You are on page 1of 83

INTRODUCTION

Genesis
In middle of 1999, when e-commerce was just about starting in India, Sameer Gehlaut bought a
defunct securities company with a NSE membership and started offering brokerage services.
By December 1999, the company embarked on its journey to build
one of the first online platforms in India for offering internet brokerage services. In January
2000, Indiabulls Financial Services was incorporated as the flagship company.

In late 2000, Indiabulls Securities, a subsidiary of Indiabulls


Financial Services started offering online brokerage services and simultaneously opened physical
offices across India. By 2003, Indiabulls securities had established a strong pan India presence
and client base through its offices and on the internet.

In September 2004, Indiabulls Financial Services went public with an IPO at Rs.19 a share. In
late 2004, Indiabulls Financial Services started it's financing business with consumer loans. In
March 2005, Indiabulls Properties Private Ltd, a subsidiary of Indiabulls Financial Services,
participated in government auction of Jupiter Mills, a defunct 11 acre textile mill owned by NTC
in Lower Parel, Mumbai. Indiabulls Properties Private Ltd. won the mill in auction and that
purchase started Indiabulls Real Estate business. A few months later, Indiabulls Real Estate
Company Pvt. Ltd. bought Elphinstone Mill in Lower Parel, another textile mill auctioned by
NTC.

Solutions Beyond Imagination


With real estate business gaining size, Indiabulls Financial Services demerged the real estate
business under Indiabulls Real Estate and each shareholder of Indiabulls Financial Services
received additional share of Indiabulls Real Estate through the demerger. Subsequently,
Indiabulls Financial Services also demerged Indiabulls Securities and each shareholder of
Indiabulls Financial Services also received a share of Indiabulls Securities. Today, Indiabulls
Group has a net worth of over Rs. 17,792 crore and the market capitalization stands at over
Rs.48,848 crore. Indiabulls Group has a strong presence in important sectors like financial
services & real estate through independently listed companies and the group continues its
journey of building businesses with website strong cash flows.
MANAGEMENT TEAT
Sameer Gehlaut
Chairman, Indiabulls Group,

Sameer Gehlaut has been the chairman of Indiabulls Group since inception. He is also the
chairman of major Indiabulls companies: Indiabulls Housing Finance & Indiabulls Real Estate.
Under his leadership, Indiabulls Group has grown in scale and size to a business house with
strong businesses in various sectors.

Mr.Gehlaut started Indiabulls Group after working briefly with Halliburton before returning to
India. Mr.Gehlaut received a B.Tech degree in Mechanical Engineering from Indian Institute of
Technology, Delhi.
INDIABULLS HOUSING FINANCE LTD.

Indiabulls Housing Finance Ltd. (IBHFL) is the 2nd largest private housing finance company in
India, regulated by the National Housing Bank (NHB). We are an ‘AAA’ rated company. We are
a part of one of India’s leading business conglomerates – ‘The Indiabulls Group’, which was
established in 1999 with business’ spread across housing finance, real estate and wealth
management.

Millions of Indians aspire to own a place that they can call home. At IBHFL, our collective
efforts are directed towards fulfilling these aspirations and dreams of our customers. We have
serviced more than 9.20 lakh customers and have cumulatively disbursed home loans of over Rs.
1.67 lakh crore as of the last financial year. We pride ourselves in having a workforce of over
6400 employees, more than half of which is dedicated to customers and sales, serving as the
pillar on which we can meet the many needs of the segment.
Our constant endeavour is to ensure that the interest of all our key stakeholders – customers,
shareholders, investors, bankers & employees are taken care of. Imbibed in all business plans
and activities that we undertake is a strong focus on staying true to our core values and goals.
Our Core Values
- Customer First
- Transparency
- Integrity
- Professionalism
Our Goals
- To ensure utmost convenience in the home buying experience - Making housing finance more
affordable/viable by contributing towards the rganization of the housing finance sector In
keeping with the principle to continually working towards greater ‘customer convenience’, we
are equipped to tend to you over our website and mobile application with with e-Home Loans
providing completely online home loans – from application to disbursal. The entire gamut of our
services will assist you in an all-inclusive home buying experience is available for you to avail
anytime and anywhere.
Our Network
- Over 220 well-appointed and accessible branches in 110 towns and cities across India
- 2 representative offices in Dubai and London offering services to NRIs/PIOs

Combining efficiencies in products, services and processes, we are committed to providing the
best home buying experience and be your perfect home loan partner.
We Welcome You Home!

INDIABULLS REAL ESTATE

BUILDING LANDMARK EDIFICES,


Creating everlasting impressions!
Since its inception, Indiabulls Real Estate has earned a distinct reputation for building projects
that turn spaces into inspiring places. With prime focus on construction and development of
residential, commercial & SEZ projects across major Indian Metros & London, Indiabulls Real
Estate went on to expand its projects portfolio. Today it ranks third amongst the top Real Estate
companies with a total Gross Development value of INR 33,668 crores and net worth of
INR 4,819 crores as of June 30, 2016.

Indiabulls Real Estate’s strategic partnership with Farallon Capital Management LLC of USA
was instrumental in bringing the first FDI into real estate in India. Currently IBREL has 15 on-
going projects in India with total saleable area of 357.8 lakh sq.ft. It also has four new projects
that are planned to be launched shortly with total saleable area of 87.5 lakh sq.ft. planned. The
company has a fully paid for land bank of 1,010 acres and also possesses 2,588 acres of SEZ
land at Nashik, Maharashtra.

IBREL is currently developing 44.53 million sqft into premium quality, high-end commercial,
residential and retail spaces in the Metros- Mumbai, Delhi NCR & Chennai, apart from Tier I
cities. With its recent acquisition of the prime property, 22 Hanover Square in central London for
INR 1,630 crores IBREL is consolidating its presence internationally as well.
Some of the iconic landmarks of IBREL that have redefined commercial spaces in Mumbai are
One Indiabulls Centre & Indiabulls Financial Centre with over 3 million sq.ft. of sprawling
commercial space. Indiabulls Real Estate has delivered a record 3.3 million sq ft developed space
valued at $ 1 billion (within 4 years of inception). This is fastest and largest delivery in value of
terms by any Indian real estate developer in the same time period.
IBREL has been assigned credit rating of AA- for long term debt and A1+ for short term loan by
CARE and International ratings of B+/B1/B+ by S&P/Moddy’s/Fitch respectively.

INDIABULLS VENTURES
Indiabulls Ventures Limited (Formerly known as Indiabulls Securities Limited) is one of the
leading company in the segment of Capital Market and Real Estate marketing and
distribution,primarily offering the following services :-

a) Equity/ Commodity/ Currency Broking


b) Marketing and Distribution of Residential Properties
c) Developing and Leasing of Commercial Properties

Indiabulls Ventures Limited (formerly Indiabulls Securities Ltd) is a leading capital market
company. It was the first Company to be assigned the BQ1 grading by CRISIL, which is the
highest broker quality grading. It is a reflection of the financial stability, strong fundamentals and
stringent risk management controls that the Company possesses. The Company pioneered the on-
line trading platform and today it’s in house platform is one of the fastest and most efficient
trading platforms in the country. It also provide an off line distribution channel for trading, as
well as depositary services to it’s clients. The Company has a client base in excess of 7 lakhs
with a presence in 18 cities.

The Company through it’s various subsidiaries is also engaged in the business of Marketing of
Non Discretionary Wealth Management products, Commercial Leasing and Commodity &
Currency Broking.

Through its distribution arm, the Company provides a one stop destination to clients to meet their
investment needs by offering them a wide bouquet of residential projects at a Pan India Level.
Through its website ibhomesearch.in clients are provided transparent and updated information on
various projects, which facilitate their decision making.

The Company has forayed into the business of Developing, Marketing and Maintaining of
Commercial Spaces through it’s recent acquisition of India Land & Properties Ltd. One
Indiabulls Park, (OIBP) a Gold rated Green IT Park is located at Ambattur Chennai, and is a
flagship centre of excellence, offering IT/ITES office spaces. OIBP provides amenities of
international standard which nurtures each occupant with new ideas, support to enrich their
human potential and to sustain growth.

INDIABULLS FOUNDATION
The Group’s vision of building an inclusive India is what drives the team at Indiabulls
Foundation. In this endeavour, the foundation works towards empowering hundreds of
underprivileged people through its myriad of social engagement programmes and activities.

Indiabulls Foundation provides sustainable solutions that are tailored to meet the specific needs
of the underprivileged people.

Many free services are provided through Indiabulls Foundations dedicated programmes that
cover the gamut of Health, Education, Women’s and Youth Empowerment, Sustainable
Livelihood, Nutrition and Disaster Relief among others.

The Foundation seamlessly integrates technology with resources to be able to enrich and enhance
the lives of its beneficiaries. As part of its future goals, Indiabulls Foundation is geared up to
reach out to more and more people from marginalised communities and make a difference.
INDIABULLS
REAL ESTATE

BUILDING LANDMARK EDIFICES,


Creating everlasting impressions!

Since its inception, Indiabulls Real Estate has earned a distinct reputation for building projects
that turn spaces into inspiring places. With prime focus on construction and development of
residential, commercial & SEZ projects across major Indian Metros & London, Indiabulls Real
Estate went on to expand its projects portfolio. Today it ranks third amongst the top Real Estate
companies with a total Gross Development value of INR 33,668 crores and net worth of
INR 4,819 crores as of June 30, 2016.

Indiabulls Real Estate’s strategic partnership with Farallon Capital Management LLC of USA
was instrumental in bringing the first FDI into real estate in India. Currently IBREL has 15 on-
going projects in India with total saleable area of 357.8 lakh sq.ft. It also has four new projects
that are planned to be launched shortly with total saleable area of 87.5 lakh sq.ft. planned. The
company has a fully paid for land bank of 1,010 acres and also possesses 2,588 acres of SEZ
land at Nashik, Maharashtra.

IBREL is currently developing 44.53 million sqft into premium quality, high-end commercial,
residential and retail spaces in the Metros- Mumbai, Delhi NCR & Chennai, apart from Tier I
cities. With its recent acquisition of the prime property, 22 Hanover Square in central London for
INR 1,630 crores IBREL is consolidating its presence internationally as well.

Some of the iconic landmarks of IBREL that have redefined commercial spaces in Mumbai are
One Indiabulls Centre & Indiabulls Financial Centre with over 3 million sq.ft. of sprawling
commercial space. Indiabulls Real Estate has delivered a record 3.3 million sq ft developed space
valued at $ 1 billion (within 4 years of inception). This is fastest and largest delivery in value of
terms by any Indian real estate developer in the same time period.
IBREL has been assigned credit rating of AA- for long term debt and A1+ for short term loan by
CARE and International ratings of B+/B1/B+ by S&P/Moddy’s/Fitch respectively.

Announcements 2017
27-Jul-2017 : Sale of Company’s treasury shares

25-Jul-2017 : Disclosure under Regulation 30 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015

25-Jul-2017 : Intimation of Record Date(s) for payment of interest on Secured, Redeemable,


Non-convertible Debentures (NCDs) issued by the Company, and listed on the Debt Segment of
the Stock Exchange.

25-Jul-2017 : Disclosure under Regulation 30 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015

24-Jul-2017 : Approval of Unaudited Financial Results of Indiabulls Real Estate Limited, for the
quarter ended June 30, 2017, and outcome of Board Meeting

18-Jul-2017 : Intimation regarding payment of interest on Secured, Redeemable, Non-


convertible Debentures (NCDs) issued by the Company, and listed on the Debt Segment of the
Stock Exchange.

17-Jul-2017 : Intimation of Board Meeting for consideration and approval of unaudited financial
results of Indiabulls Real Estate Limited (“the Company”) for the quarter ended June 30, 2017,
issuance of Non-Convertible Debentures and closure of Trading Window.

12-Jul-2017 : Intimation regarding payment of interest on Secured, Redeemable, Non-


convertible Debentures (NCDs) issued by the Company, and listed on the Debt Segment of the
Stock Exchange.

07-Jul-2017 : Intimation regarding payment of interest on Secured, Redeemable, Non-


convertible Debentures (NCDs) issued by the Company, and listed on the Debt Segment of the
Stock Exchange.

29-Jun-2017 : Allotment of Secured, Redeemable, Non-Convertible Debentures on a Private


Placement basis – Intimation under SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015.

29-Jun-2017 : Intimation regarding payment of interest on Secured, Redeemable, Non-


convertible Debentures (NCDs) issued by the Company, and listed on the Debt Segment of the
Stock Exchange.

27-Jun-2017 : Acquisition of entire minority stake in Indiabulls Infraestate Ltd

27-Jun-2017 : Disclosure under Regulation 30 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015

22-Jun-2017 : Sale of Company’s shares by the Trust

22-Jun-2017 : Intimation under Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015.

21-Jun-2017 : Disclosure under Regulation 30 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015

08-Jun-2017 : Allotment of Secured, Redeemable, Non-Convertible Debentures on a Private


Placement basis – Intimation under SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015.

08-Jun-2017 : Disclosure under Regulation 30 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015

06-Jun-2017 : Intimation of Record Date(s) for payment of interest on, and repayment of,
Secured, Redeemable, Non-convertible Debentures (NCDs) issued by the Company, and listed
on the Debt Segment of the Stock Exchange.

06-Jun-2017 : Intimation regarding payment of interest on Secured, Redeemable, Non-


convertible Debentures (NCDs) issued by the Company, and listed on the Debt Segment of the
Stock Exchange.

05-Jun-2017 : Intimation under Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015.

22-May-2017 : Intimation of Record Date(s) for payment of interest on Secured, Redeemable,


Non-convertible Debentures (NCDs) issued by the Company, and listed on the Debt Segment of
the Stock Exchange.

22-May-2017 : Intimation regarding payment of interest on, and repayment on maturity of,
Secured, Redeemable, Non-convertible Debentures (NCDs) issued by the Company, and listed
on the Debt Segment of the Stock Exchange.

16-May-2017 : Disclosure under Regulation 30 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015

12-May-2017 : Disclosure under Regulation 30 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015

11-May-2017 : Disclosure under Regulation 30 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015

08-May-2017 : Allotment of Equity shares pursuant to exercise of stock options under various
ESOP Schemes

04-May-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

03-May-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

03-May-2017 : Intimation of Record Date(s) for payment of interest on, and repayment of,
Secured, Redeemable, Non-convertible Debentures (NCDs) issued by the Company, and listed
on the Debt Segment of the Stock Exchange.

28-Apr-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

28-Apr-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

28-Apr-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

27-Apr-2017 : Submission of audited financial results (standalone and consolidated) of


Indiabulls Real Estate Limited for the quarter and financial year ended March 31, 2017, along
with Audit Reports and declaration.

26-Apr-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

20-Apr-2017 : Intimation of Board Meeting for consideration and approval of audited financial
results of Indiabulls Real Estate Limited (“the Company”) for the quarter and financial year
ended March 31, 2017, and closure of Trading Window.

19-Apr-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

19-Apr-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

18-Apr-2017 : Intimation regarding payment of interest on, and repayment on maturity of,
Secured, Redeemable, Non-convertible Debentures (NCDs) issued by the Company, and listed
on the Debt Segment of the Stock Exchange.

18-Apr-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

17-Apr-2017 : Outcome of the Board meeting of Indiabulls Real Estate Limited

17-Apr-2017 : Intimation regarding extinguishment of Equity Shares, bought back by Indiabulls


Real Estate Limited (the “Company”) from March 22, 2017 till April 10, 2017, and consequent
reduction in its Equity Share Capital

13-Apr-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

12-Apr-2017 : Furnishing of a copy of Post Buyback Public Advertisement, made today i.e.
April 12, 2017

10-Apr-2017 : Closure of Buyback of equity shares of Rs. 2/- each (“Equity Shares”) of
Indiabulls Real Estates Limited (“Company”).

28-Mar-2017 : Intimation regarding payment of interest on Secured, Redeemable, Non-


convertible Debentures (NCDs) issued by the Company, and listed on the Debt Segment of the
Stock Exchange.

23-Mar-2017 : Intimation regarding extinguishment of Equity Shares, bought back by Indiabulls


Real Estate Limited (the “Company”) from March 8, 2017 till March 21, 2017, and consequent
reduction in its Equity Share Capital

22-Mar-2017 : Allotment of Secured, Redeemable, Non-Convertible Debentures on a Private


Placement basis – Intimation under SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015.

20-Mar-2017 : Intimation regarding payment of interest on Secured, Redeemable, Non-


convertible Debentures (NCDs) issued by the Company, and listed on the Debt Segment of the
Stock Exchange.
17-Mar-2017 : Intimation under Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015.

14-Mar-2017 : Acquisition of a subsidiary

09-Mar-2017 : Intimation regarding extinguishment of Equity Shares, bought back by Indiabulls


Real Estate Limited (the “Company”) from February 21, 2017 till March 7, 2017, and
consequent reduction in its Equity Share Capital

06-Mar-2017 : Intimation regarding payment of interest on, and repayment on maturity of,
Secured, Redeemable, Non-convertible Debentures (NCDs) issued by the Company, and listed
on the Debt Segment of the Stock Exchange.

28-Feb-2017 : Regulatory and Development Update on Sky Suites project

20-Feb-2017 : Intimation regarding extinguishment of Equity Shares, bought back by Indiabulls


Real Estate Limited (the “Company”) from January 23, 2017 till February 20, 2017, and
consequent reduction in its Equity Share Capital

14-Feb-2017 : Intimation of Record Date(s) for payment of interest on, and repayment of,
Secured, Redeemable, Non-convertible Debentures (NCDs) issued by the Company, and listed
on the Debt Segment of the Stock Exchange.

14-Feb-2017 : Intimation of Record Date(s) for payment of interest on Secured, Redeemable,


Non-convertible Debentures (NCDs) issued by the Company, and listed on the Debt Segment of
the Stock Exchange.

31-Jan-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

27-Jan-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

25-Jan-2017 : Submission of unaudited financial results (standalone and consolidated) of


Indiabulls Real Estate Limited for the quarter and nine months ended December 31, 2016, along
with Limited Review Reports thereon.

24-Jan-2017 : Intimation regarding extinguishment of Equity Shares, bought back by Indiabulls


Real Estate Limited (the “Company”) from January 11, 2017 till January 22, 2017, and
consequent reduction in its Equity Share Capital

18-Jan-2017 : Intimation of Board Meeting for consideration and approval of the unaudited
financial results of Indiabulls Real Estate Limited (“the Company”) for the quarter and nine
months ended December 31, 2016, and closure of Trading Window.

17-Jan-2017 : Stock Exchange Intimation

13-Jan-2017 : Disclosure under Regulation 30 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015

12-Jan-2017 : Intimation regarding extinguishment of Equity Shares, bought back by Indiabulls


Real Estate Limited (the “Company”) from January 1, 2017 till January 10, 2017, and
consequent reduction in its Equity Share Capital

11-Jan-2017 : Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure


Requirements) Regulations, 2015

05-Jan-2017 : Intimation regarding extinguishment of Equity Shares, bought back by Indiabulls


Real Estate Limited (the “Company”) from December 24, 2016 till December 31, 2016, and
consequent reduction in its Equity Share Capital

02-Jan-2017 : Intimation regarding payment of interest on Secured, Redeemable, Non-


convertible Debentures (NCDs) issued by the Company, and listed on the Debt Segment of the
Stock Exchange.

Building Landmark Edifices


Indiabulls Real Estate stands for excellence and luxury in residential and commercial properties.
It was incorporated in 2006 with its focus on construction and development of residential,
commercial and SEZ projects across major Indian metros. To grow its footprint internationally,
and to give wings to its global ambitions, Indiabulls branched out to London a couple of years
ago with some of the most marquee projects in the heart of upscale central London.

It is the company’s mission to create high end spaces, and its endeavours epitomise this
philosophy. It has delivered iconic commercial developments of over 3.3 million sq. ft. in
Mumbai namely, One Indiabulls Centre and Indiabulls Finance Centre, apart from delivering
projects in Madurai, Ahmedabad and Thane. The company began handing over Indiabulls Sky in
2016.
Indiabulls Real Estate is one of the largest real estate company with a Gross Development Value
of Rs. 39,812 Cr., and net worth of Rs. 4,754Cr. (as of March 31st, 2017), and with 14 on-going
projects with total saleable area of 35.5 million sq. ft. under its wing.The company has planned
three new projects with total saleable area of 5.57 million sq. ft. Further it has commercial
development with a leaseable area of 3.15 Mn Sq Ft and, with a lease rental potential of Rs 576
Cr p.a. under construction. Additionally the company has a land bank of 1,010 acres and also
possesses 2,588 acres of SEZ land at Nasik, Maharashtra. Recently (In July 2014), Indiabulls
Real estate acquired the prime property, 22 Hanover Square in Central London for Rs.1630 Cr.

Ratings
IBREL has been assigned credit rating of AA- for long term debt, one of the highest in the
industry.

In the heart of Hyderabad, yet nestled amidst the serene and sylvan surroundings of Indira Park
and Hussain Sagar Lake, Indiabulls Centrum Hyderabad is a township of well-designed 2, 2 1/2,
3 and 4 bedroom apartments.

Impeccably planned in harmony with Vaastu and modern architecture, each apartment here
vibrates with positive energy and comes beautifully equipped with lifestyle comforts and
convenience.
Let nature be a part of your life. With lush green surroundings, open spaces and lakefront walks,
there’s nothing more exciting than living at a residence that has everything you need. Project
completed and handed over.
A Clubhouse with a gym
Facility for indoor games like table tennis and pool
Multi-purpose hall for social events or creative activities
Landscaped sit-outs for senior citizens
2 automatic passenger lifts in each block
24 hour generator backup for elevators and common areas
Beautiful gardens and gorgeous landscaping
24x7 professional security system
Rainwater harvesting
Home Loan
You must be at least 21 years of age for the loan to be sanctioned. The loan must terminate
before or when you turn 65 years of age. You must be employed or self-employed with a regular
source of income.
Office premise loan
You must be at least 21 years of age for the loan to be sanctioned. The loan must terminate
before or when you turn 65 years of age. You must be self-employed with a regular source of
income. The loan can be for the purchase / construction / extension of a non-residential property.
A loan for renovation or improvement will be given only at the time of acquisition of property.
Professionally qualified and self-employed individuals can apply. A minimum of 3 year’s work
experience is a must.
Loan Amount
A number of factors such as your income, age, number of dependants, qualifications, assets and
liabilities, income stability/ continuity of your employment / business etc. are taken into account
when assessing your repayment capacity.

However, there are ways by which you can enhance your eligibility: If your spouse is earning,
add him/her as a co-applicant. The additional income shall be included to enhance your loan
amount. Incidentally, if there are any co-owners they must necessarily be co-applicants. Did you
know that your fiancée’s income could also be considered for sanctioning the loan on your
combined income? The disbursement of the loan, however, is done only after you submit proof
of your marriage. Providing additional security like bonds, fixed deposits and LIC policies may
also help to enhance eligibility. While there is no need for a guarantor, having one might enhance
your credibility with us. If so, our loan officer would provide you with the necessary details.
However, the final amount to be sanctioned will depend on your repayment capacity. In the total
cost, registration charges, transfer charges and stamp duty costs are included.
Sanctioning
Documents required for applying for a home loan (for self-employed professionals and
businessmen)
General Documents
 Updated bank passbook or a Xerox of the statement of accounts for the last 6 months
 Age proof: PAN card, Voters ID, Passport and License Xerox of ration card Business
profile with details on the nature of business, list of clients, suppliers, staff strength,
geographical spread, etc.
 Xerox of education qualifications certificate and proof of business existence
 Xerox of last 3 years Income Tax returns Last 3 years profit /loss and balance sheet
Processing fees cheque
 Documents required for applying for a home loan (for employed professionals)
 Latest salary certificate / slip in original
 Age proof: PAN card, voters ID, passport, license
 Xerox of Form no.16 A (TDS Form) from employer. Certificate in original from
employer for any other allowances, which are not reflected in salary slip
 Updated bank pass book / Xerox of statement of accounts for last 6 months
 Xerox of your company’s ID or ration card
 Passport size photographs of applicant and co-applicant
 Processing fees cheque
 You may be asked to submit further legal documents if required by the bank or its
approved lawyers. Retain photocopies of all the documents being submitted by you.

Disbursement
Your loan will be disbursed after you identify and select the property that you are purchasing and
submit the requisite legal documents. Each and every single document asked for will be verified
and checked for your safety. This may take some time but we want to ensure a clear title by
completing all the legal and technical verifications so that you have full rights to your home. The
230 A Clearance of the seller and / or 37I clearance from the appropriate income tax authorities
(if applicable) is also needed. On satisfactory completion of the above, registration of the
conveyance deed and investment of your own contribution, the loan amount (as warranted by the
stage of construction) will be disbursed by Bank. The disbursement will be in favour of the
builder/seller.

List of documents for disbursement


 Loan Agreements
 Disbursement Requests
 Post-dated cheques
 Personal guarantors documents, as the case may be
MARKETING OPERATIONS
Offerings

Indiabulls offers two products: - “Get More At Indiabulls.”

1. NIB - Normal Indiabulls


2. PIB - Power Indiabulls

NIB – Normal Indiabulls: -

“A multitude of ways to access your account either through priority access to Relationship
Manager over phone OR online access to your Account & Research Tools.”

Enjoy priority telephone access that gives you direct access to your Relationship Manager.

Stay on the top of your investments with a snapshot of your Account Statements. Get access to
Portfolio statement and access to digital contract notes.

PIB – Power Indiabulls: -

“Trading just got faster”

It is advance trading software which great deals of versatility even at low band width assuring
speed and total functionality ensuring speed and total functioning of a broker’s terminal. An
active trader market execute traders and get confirmation of the some computers terminal need to
be 128 Bits Encrypted (Supported by explorer version 5 and above)

Regardless of how the market is performing or which way the economic winds are
blowing as traders, are researching, charting, crafting a strategy, buying and selling. Investors are
getting in, getting out and moving on to the next trade. Choose from a comprehensive offering of
accounts, platform and product. Customize technology and services to support the way of work.
Choose from a broad spectrum of sophisticated trading tools using a fast desktop Trading
Software. - Trading just got faster.

Features of PIB:

 Live Streaming Quotes


 Fast Order Entry
 Tic by Tic Live Charts
 Technical Analysis
 Live News and Alerts

Extensive Reports for Real-time Accounting

Indiabulls: “ A Cut Above The Rest”

Service Industry is base on differentiation of the product and service Indiabulls is different from its
competitors because of following reason –

 Internal Marketing: -
is to train and motivate employees to serve customers. The selection, training and
motivation of the employees will make a huge difference in customer satisfaction.

In Indiabulls the employees are well trained and motivated to work and they
work dedicatly. Because Indiabulls know that employee’s attitude will promote stronger
customer loyalty. Indiabulls designed a sound training programme and support and rewards
for good performance. They can use Internet, internal newsletters, daily remainders, and
employee roundtables to reinforce customer-centered attitude.

 External Marketing: -
Describe the normal work to prepare, price, distribute and promote the service to
customers. Its is mainly for customers to provide better service for this purpose Indiabulls
is providing following unique services to his customers: -
1. Relationship Managers who are dedicated to supporting customers trading and
investing needs. They always keep in touch with client and they give various tips to
client by which he can invest in good stocks.
2. Dealers everyday give confirmations of the client’s whole day trading in the
evening after signing out from the Market.

Company

Internal External

Marketing Marketing

Indiabulls

Employees Interactive Marketing Customers

 Indiabulls is providing Funding for trading to its client on nominal rates of interest i.e.
on 18% limit of funding is as follow
Delivery- for delivery trading Indiabulls providing 2 times funding

Intraday- for this type of trading Indiabulls is proving 8 times funding without
charging any interest.
 Indiabulls Equity Analysis Indiabulls provide an analysis of more than 540 companies it
include current and future planning of various companies but this service is optional for
client.
Building and maintaining customer’s ideal portfolio demands objective,
dependable information. Indiabulls Equity Analysis helps satisfy that need by rating
stocks based on carefully selected, fact-based measures. And because we're not focused
on investment banking, Indiabulls don't have the same conflicts of interest as traditional
brokerage firms. This objectivity is an important difference in our ratings.

The Indiabulls Equity Analysis model attempts to gauge investor expectations,


since stock prices tend to move in the same direction as changes in investor expectations.

 Stocks with low and potentially improving investor expectations tend to receive A or B
ratings
 Stocks with high and potentially falling investor expectations tend to receive D or E
ratings

Over the next 12 months, A-rated stocks have a return outlook of strongly outperforming
the market while E-rated stocks have a return outlook of strongly under performing the
market. Find out more about using Indiabulls Equity Analysis

 In today’s scenario when all services are going to be online or in electronic form
Indiabulls is creating awareness of online trading that client can trade from anywhere
from the World.

 Risk management team of Indiabulls taking care of client portfolio and whenever the
value of his portfolio will go decrease by 30% client always informed by his
Relationship Manager.
 Indiabulls is providing a software called “Power Indiabulls” as describe above if a client
have his own PC and Internet then he can trade from his home or office.

 In Indiabulls possibility of auction is very less because of large client base, so he can sell
shares anytime.

 Depository Services: -
“Whatever your individual goals, we can help.”

Indiabulls is a depository participant with the National Securities Depository Limited and
Central Depository Services (India) Limited for trading and settlement of dematerialised
shares. Indiabulls performs clearing services for all securities transactions through its
accounts. Company offer depository services to create a seamless transaction platform –
execute trades through Indiabulls Securities and settle these transactions through the
Indiabulls Depository Services. Indiabulls Depository Services is part of our value added
services for its clients that create multiple interfaces with the client and provide for a
solution that takes care of all client needs

 NRI Account
You can now enjoy the convenience of hassle-free and fast way of trading in the
Indian Equity Markets through Indiabulls NRI Investor Services Our unique integrated
service creates one window for all your trading, depository and banking needs. You can
buy and sell on your computer using our NRI Trading Account Services, which have
been seamlessly integrated with your Indiabulls Depository Account and with the HDFC
NRE/NRO Bank Account.

We provide full access to the following services to help you trade seamlessly:

 Indiabulls NRI Trading Account - Provides access to comprehensive trading tools for
independent NRI investors
 Indiabulls Depository Services - Integrated services for seamless delivery
 HDFC Bank Account - NRE/NRO Accounts with built in tax management solutions and
facility to source all regulatory approvals
 Indiabulls Equity Analysis - Premium Research on 540+ companies updated daily

How can Indiabulls manage its service: -

Word of mouth Personal


communication needs Past Experience

Expected
Service

GAP 5

Perceived
CUSTOMER
Service
CUSTO
MER
MARKETER

Service Delivery GAP 4 External


GAP 1 (including pre
Communication
and post
contacts) to customer

GAP 3

Translation
perception into
service quality
specification

GAP 2

Management
1. Gap between customer expectation and management perception: Management does not
always correctly perceive what customer want. For intense in Inidabulls a customer is
expecting that he can buy share after deposited require check but he has to wait for 3 days
and same happen with demand draft.

2. Gap between management perception and service quality: Management might correctly
perceive customer’s want but not set a performance standard. Like a form of an account
should passed away from the all stages of processing but it mostly takes time of 10 days.

3. Gap between service quality specification and service quality: Personnel might be poorly
trained, or incapable or unwilling to meet the standard or they may be held to conflicting
standards, such as taking time to listen to customer and serving them fast. That is happen
in indiabulls.

4. Gap between service delivery and external communication: customers’ expectations are
affected by statement made by company representative and ads.

5. Gap between perceived service and expected service: This gap occurs when the customer
misperceives the service quality. A client may be perceived wrongly like in infrastructure
of Inidabulls but this will solved in new office of Indiabulls.
Promotion: -

Indiabulls is turning to marketing public relations to directly support corporate and product
promotion and image making. Because public is any group that has an actual or potential interest
in or impact on a company’s ability to achieve its objective. Indiabulls has its team relationship
manager that monitors the attitudes of organization’s publics and distributes information and
communications to built goodwill. They are performing following five functions:

1. Press Relations: - They present news about the organization in the most positive light.
2. Product Publicity: - All Relationship managers are sponsoring efforts to publicize
product offerings by Indiabulls i.e. NIB and PIB.
3. Corporate Communication: - They promoting understanding of the organization through
internal and external communications.
4. Counseling: - All RMs advise management about public issues and company positions
and image during good and crises.

Indiabulls is promoting its product by advertising by following medium:

 Electronic media: - By advertise its product via Television


 Print media: - By various Pam plates, brochures, etc.
 Canopy: - Indiabulls is now promoting its product by canopies. By Canopies
company can know the potential area of the cities and segment of population to
whom it should target. We also had canopies in Jodhpur city in following areas
 Basani Mandi
 Mandor Mandi
 Mehta Market
 Pal Road
 Basani Industrial Area
 Kazri
 Lic Office
 Hosing Board Office
 Paota

From above campaign we had good result we have come to know that public is interested to
know about Indiabulls and shares trading.

Infrastructure: - Indiabulls also try to demonstrate its service quality through Physical Evidence
and presentation. Because if we talk about online security trading then we have to say that
physical evidence will important for the company in Indiabulls office all client come everyday
and they trade but with the time passing Indiabulls is growing and number of client increasing
day by day so space of office is not sufficient for both staff members and clients also. To
overcome this problem Indiabulls will shift in new office with and of July.

Summary: -

What a customer expect from the company:

1. Wide range of services under one roof


2. 24 hours support and ease to access
3. Personalized attention

What company offers to its customers:

1. Extensive product range.


2. Enhance customer experience.
3. Personalize service through Relationship Managers.
4. Under stand local market dynamics.
5. Expanding geographical and online presence.
6. Provide a wide array of services such as brokerage, depositary services, mutual fund and
equity distribution, commodities trading and consumer
loans.

7. Offer innovative products such as Power Indiabulls and Indiabulls Signature Client
Account.

8. Improve customer education through in-house equity research.

9. Improve customer interface and customer experience through technology.

10. Continually invest in upgrading of systems.

1. Improve speed and quality of services.


12. Enhance data mining to improve risk management processes.

MARKETING MIX OF INDIABULLS

Being a service industry Indiabulls will have 7P’s rather than 4, they are:

PRODUCTS

Fig: 21

a) Power India bulls (PIB)


PIB is the advanced online trading platform from Indiabulls Securities Limited. PIB provides the
best in the class internet trading features and delivers a seamless and rich online trading
experience for its users. PIB comes with a whole host of online features for the internet trading
users ranging from real-time stock prices, to live trading reports, charting, News Room. PIB
provides an integrated online trading platform for the internet trading community to invest in
equity, F&O, Online IPOs and base their decision on sound fundamental research and technical
analysis. It also provides various kinds of trading reports, each developed to cater to internet
trading users’ distinct needs.
b) Indiabulls Signature account
Indiabulls Signature account caters to remain on top of your investments. It provides you the
platform to trade in Equity and Derivatives. With an unmatched service and nationwide
presence, the Indiabulls Signature account comes bundled with a variety of exclusive features.

c) Depository Services
Indiabulls is a depository participant with the National Securities Depository Limited and Central
Depository Services (India) Limited for trading and settlement of dematerialized shares.
Indiabulls performs clearing services for all securities transactions through its accounts. We offer
depository services to create a seamless transaction platform – execute trades through Indiabulls
Securities and settle these transactions through the Indiabulls Depository Services. Indiabulls
Depository Services is part of our value added services for our clients that create multiple
interfaces with the client and provide for a solution that takes care of all your needs.

d) Currency Derivatives
Indiabulls offers trading in the Currency Derivatives Segment in NSE. Currency Derivatives are
similar in nature to Stock Futures & Option contracts. Currency Derivatives Contracts (USD-
INR, EUR-INR, GBP-INR and JPY-INR) at exchange rate as the underlying are available for
trading with a monthly expiry. At any given time, Currency Derivatives Contracts are available
for trading for the next 12 months expiry for futures whereas 3 months expiry and 1 quarterly
expiry for options.

The Mark-to-Market for Currency Derivatives is settled on a daily basis in a manner similar to
Equity Futures & Options. The market for Currency Derivatives is open from 9 A.M to 5 P.M
(Monday to Friday).

PRICE

Indiabulls has various models at different price ranges targeted at a particular market segment. It
caters to both the service and enterprise segment of customers.
Indiabulls charges Rs. 1350 for opening a demat account (900 account opening charges + 450
DP charges + 750 for software (optional)). It charges brokerage of: 0.3% to 0.2% (delivery) and
0.2% (intraday). The brokerage ranges from 1paise to 20paise or 3paise to 30paise.

Indiabulls provides home loans @ 10.75 (fluctuating) to salaried people and 12% (fluctuating) to
non-salaried professionals.

The price of real estate fluctuates from location to location, and according to the size of the flat,
residential or commercial plots.

PLACE

Indiabulls has its offices at all major cities, namely Delhi, Mumbai, Bangalore, Ahmadabad,
Chennai, Kolkata, Hyderabad, Nasik and many other Indian cities.
PROMOTION

Indiabulls does its promotion through news papers, magazines, through websites and television
ads.

Fig: 23

PEOPLE

This includes the employees of the organization. The employees of Indiabulls have expertise in
the field and are well versed in all the tricks of the trade. The employees are given importance in
the organization because a satisfied employee creates a satisfied customer. They provide
excellent and time to time services.

PROCESS

A hierarchical process is followed for execution of all services. First the sales lead is generated
by the employees and sales calling is done on that database. The employees then approach
interested customers, negotiation of sales is done, and the customers are explained the norms and
sale is closed. Continuous services and assistance is provided to existing customers, they are
made aware of new beneficial offers from time to time.

PHYSICAL EVIDENCE

Different branches of Indiabulls have a very professional and formal atmosphere. The work
environment is very good. This may be one of the reasons why the employees like to spend time
in office and generate high productivity.

SWOT ANALYSIS OF INDIABULLS

This is a strategic planning method to evaluate the Strength, Weaknesses (limitations),


Opportunities and Threats involved in a project or business venture. It involves specifying the
objectives of the business venture or project and identifying internal and external factors that are
favorable or unfavorable to achieve it. This technique is credited to Albert Humphrey of Stanford
University.
• Online trading platform.
• Diverse branches and networks provide a great
oppourtunity to cater tapped and untapped
market as well.

Strength • Provides competitive brokerage and DP charges.


• Equity analysis reports to support its clients.
• Both online and offline trading facility.
• Real time online transfer of funds and exposure
facility with HDFC, Citybank, ICICI, etc

• It should have its own mutual


funds asit provides advises on
mutual funds.
• Position to answer the
questions of the clients in their
Weaknesses fields.
• It does not provide indices on
major world markets, ADR
prices of Indian scripts.
• Lacks banking arm
• Financial services like mutual funds and
insurance.
• It is registered with Luxemberg Stock
Exchange so can target other stock
exchanges also.
• ATM facility should be provided for
Oppourtunities easy withdrawals.
• Tie-ups with third party companies for
selling products.
• High client base will help for cross sales
of its products.

• Companies like Sharekhan, ICICI


Direct, Kotak Securities, and private
brokers are major threats.
• Banks with demat facilities are
jockeying for position.
Threats • Local brokers capable of charging
lower brokerage.
• Changes in SEBI guidelines and other
tax implications.
• Government regulations
BCG MATRIX OF INDIABULLS

Companies that are large enough to be organized as strategic business units face the challenge of
allocating resources among these units. In the early 1970’s Boston Consultancy Group developed
a model to manage the portfolio of these business units (or major product lines). The BCG
growth share matrix displays different business units on a graph of market growth rate vs. market
share relative to competitors.

BCG MATRIX OF INDIABULLS


 Question Marks

Indiabulls Retail and Indiabulls Securities

Indiabulls Retail (Now known as „Store One‟) can be classified as question mark as it is new to
the market and need to compete with established retailers like Future Group and K Raheja Group
to gain market share. Indiabulls Securities also comes in this category due to pertinent
competitors like Sharekhan, Karvy Stock Broking and others. Though broking industry is
expanding by 12-15% annually, Indiabulls Securities is not able to cope with this high pace.

 Stars

Indiabulls Real Estate and Indiabulls Financial Services

Indiabulls Real Estate can be considered to be in the Star category. It is considered star as it has a
high market growth rate and enjoys a high market share as well. Real Estate sector in India is
growing at 34% annually (www.sethassociates.com/Real_estate_sector_in_india.php) while
growth of Indiabulls Real Estate has surged to 97%. Its profit rose to Rs. 201.32 Crores in 2010-
2011 from 6.75 Crores in the preceding year. (www.indiabulls.com/ibgroup/media.htm).
Financial services sector in India grew at 8 % last year but had a steady growth rate of 15% for
the last few years. For FY 2011, net profits of Indiabulls Financial more than doubled to Rs. 743
Crores.

 Cash Cows

None of the companies of Indiabulls comes in this category.

 Dogs

None of the companies of Indiabulls comes in this category

PORTER’s 5 FACTOR MODEL OF INDIABULLS

Named after Michel E. Porter, this model identifies and analyses 5 competitive forces that shape
every industry and determines industry’s weaknesses and strength. They are:

 Competition in the industry


Indiabulls faces competition from various firms like:
Potential of new entrants

The market for Non Banking Financial Companies or rather broking houses are flourishing.
This new trend poses for new threats also; this may be either the entry of local players who
can provide lower rates or a very big player who can enter into a price war. Threat of new
entry is high when:

 Capital requirements to start the business are less


 Few economies of scale are in place
 Customers can easily switch (low switching cost)
 Your key technology is not hard to acquire or isn’t protected well
 Your product is not differentiated

Power of suppliers

Indiabulls Group has very high profile corporate suppliers, who for obvious reasons have
great bargaining power and offers from competitors also. The operations largely depend on
these supplies.

Some of suppliers of Indiabulls Group (PIB) are:


Bargaining Power of supplier means how strong is the position of a seller. Suppliers are more
powerful when:

 Suppliers are concentrated and well organized


 Few substitutes available to suppliers
 Their product is most effective or unique
 Switching cost, from one suppliers to another, is high
 You are not an important customer to Supplier

Power of customers

Customer is the king of the market. They have a lot of options while planning to purchase
products. Products offered by Indiabulls are unsought in nature and are industry dependent. The
threats which lies here are:

 Too many goods chasing too few consumers.


 Buyer purchases in bulk quantities and are mostly corporate clients.
 Product is not much differentiated.
 Buyer’s cost of switching to a competitors’ product is low.
 Shopping cost is low.
 Credible Threat of integration.

Threat of substitutes

Indiabulls poses great threat of substitutes like people of low risk appetite would like to invest in
bank rather than in share market, real estate, commodities, etc. Its products can very well be
substituted by substitutes offered by competitors.
INDIABULLS IN NEWS
RECENT CORPORATE SOCIAL RESPONSIBILITY

BY INDIABULLS

THE NOA PROGRAM

Indiabulls CSR Initiative - Drug Access Program for cancer patients in partnership with
Novartis

As a part of its deep commitment to social causes, Indiabulls has taken up this noble project
named ‘Novartis Oncology Access’, in partnership with Novartis (drug manufacturing company)
and Max Foundation (NGO). Indiabulls as financial partner is helping them access actual income
of the patient and their families, and based on the accessed income; recommend the drug
donation slabs as per approved guidelines.

Novartis are the developers & makers of Glivec- a medication for the treatment of Ph+ chronic
myeloid leukemia (CML) in chronic phase, accelerated phase and blast crisis for both pediatric
and adult patients. This drug is also indicated for adult patients with specific conditions.

NOA program:

The NOA program is a drug access program for to help patients who have been prescribed
Glivec and Tasigna but cannot afford to pay for the entire treatment cost. This program is run by
Novartis along with its partner Physicians- enrolls patient under this program after diagnosis,
The MAX Foundation- independent NGO – Assist patient throughout the program in
completing formalities & procurement of medicines, Indiabulls Financial Services -
independent body for financial evaluation of patient, collection & safekeeping the submitted
documents with confidentiality and outlets – Independent pharmacist, dispenses drugs to patients
& manage drug inventory.

Indiabulls Financial Services:

As a NOA partner Indiabulls are performing task of the local credit evaluation agency which
works as an independent and unbiased body for the financial analysis and assessment of the
patient and family members’ earning capacity to afford medical expenses on critical disease. The
analysis bases on income levels assessment by way of financial evaluation, field verification,
living standard, personal discussion with patient/ care taker & guidelines as per standard
operating procedure (SOP) which is prepared by Novartis based on the WHO guidelines for drug
donation programs using Business for Social Responsibility’s (BSR) cost of living index, a well-
established international guide often used as eligibility criteria for determining access to drug
assistance programs. Based on the family composite Income a suitable donation decision is
given.

ACCORDING TO 12th ANNUAL REPORT OF MARCH 2011-12 DIRECTOR’S


REPORT IN ECONOMIC TIMES

- Indiabulls Foundation plans to set up a hospital for the poor, for treatment of life threatening
diseases. The foundation also aims to work at a district level on transformation projects
specifically in the areas of education and healthcare infrastructure.

- The Company will actively support Indiabulls Foundation. In FY


2010-11, the Company has contributed Rs. 8.8 Cr to Indiabulls Foundation.

- Other CSR Initiatives: the Company has partnered with Novartis to launch a "Drug Access
Programme" for Cancer Patients. Indiabulls lends its expertise by assessing the financial status of
the patients to approve access to Free Drugs under the programme.

CUSTOMER RELATIONSHIP

With a great team of highly motivated staff, Indiabulls maintains a great customer. Customer
retention being of great importance in such market where margin is usually low and profit
mainly comes due to scale of operations.

The dedicated workforce is always at the service of the customer at the very first call. There are
always schemes, discounts and exemptions to existing customers.

Also if there is any new product or scheme old customer is always called before sales call is
made to the new ones. There is guidance at each step.

Not only customer retention important but clients new to the market are also given great
importance. Relationship managers are always there to take care of all such affairs. Continuous
follow ups call are made time to time to remind customers for any kind of dates or investments is
to be made.

MARKET DYNAMICS

The pricing signals that are created as a result of changing supply and demand level in a given
market. Market dynamics describe the dynamic, or changing, price signals that result from the
continual changes in both supply and demand of any particular product or group of products.
Market dynamics is a fundamental concept in supply, demand and pricing economic models.

There is great shift in the Indian consumption pattern that is being observed like:

 69% of the population is less than 35 years of age and has spurred consumption demand.
 54% of the population is in the working group.
 High savings and investment rate (over 35% of GDP).
 India’s manufacturing growth is amongst the fastest in the world. India’s manufacturing
base is the fourth largest globally.
 The growth potential of the services sector in India is enormous at $200 billion offering
employment to 40 million people. The confidence of a robust growth in the services
sector is the highest in India among the 4 BRIC countries including Brazil, Russia, China
and India service sector. Among 60% of firms there expect a rise in activity while
The above factors along with many other factors are some of those market dynamics which
greatly affect this market.

FACTORS AFFECTING INVESTMENT DECISIONS

There are a numerous reasons that affect investment decisions here are some of them:

 Risk Tolerance
Risk refers to the volatility of portfolio’s value. The amount of risk the investor is willing to take
on is an extremely important factor. While some people do become more risk averse as they get
older; a conservative investor remains risk averse over his life-cycle. An aggressive investor
generally dares to take risk throughout his life. If an investor is risk averse and he takes too much
risk, he usually panic when confronted with unexpected losses and abandon their investment
plans mid-stream and suffers huge losses.

 Return Needs
This refers to whether the investor needs to emphasize growth or income. Younger investors who
are accumulating savings will want returns that tend to emphasize growth and higher total
returns, which primarily are provided by equity shares. Retirees who depend on their investment
portfolio for part of their annual income will want consistent annual payouts, such as those from
bonds and dividend-paying stocks. Of course, many individuals may want a blending of the two
Þ some current income, but also some growth.

 Investment Time Horizon


The time horizon starts when the investment portfolio is implemented and ends when the
investor will need to take the money out. The length of time you will be investing is important
because it can directly affect your ability to reduce risk. Longer time horizons allow you to take
on greater risks with a greater total return potential because some of that risk can be reduced by
investing across different market environments. If the time horizon is short, the investor
has greater liquidity needs some attractive opportunities of earning higher return has to be
sacrificed and the result is reduced in return.

 Tax Exposure
Investors in higher tax brackets prefer such investments where the return is tax exempt, others
will have no such preference.

 Management Outlook
lf the management is progressive and has an aggressively marketing and growth outlook, it will
encourage innovation and favor capital proposals which ensure better productivity on quality or
both. In some industries where the product being manufactured is a simple standardized one,
innovation is difficult and management would be extremely cost conscious. In contrast, in
industries such as chemicals and electronics, a firm cannot survive, if it follows a policy of
'make-do' with its existing equipment. The management has to be progressive and innovation
must be encouraged in such cases.

 Competitor’s Strategy
Competitors' strategy regarding capital investment exerts significant influence on the investment
decision of a company. If competitors continue to install more equipment and succeed in turning
out better products, the existence of the company not following suit would be seriously
threatened. This reaction to a rival's policy regarding capital investment often forces decision on
a company'.
 Opportunity created by technological change
Technological changes create new equipment which may represent a major change in process, so
that there emerges the need for re-evaluation of existing capital equipment in a company. Some
changes may justify new investments. Sometimes the old equipment which has to be replaced by
new equipment as a result of technical innovation may be downgraded to some other
applications, A proper evaluation of this aspect is necessary, but is often not given due
consideration. In this connection, we may note that the cost of new equipment is a major factor
in investment decisions.

 Market Forecast
Both short and long run market forecasts are influential factors in capital investment decisions.
In order to participate in long-run forecast for market potential critical decisions on capital
investment have to be taken.

 Fiscal Incentives
Tax concessions either on new investment incomes or investment allowance allowed on new
investment decisions, the method for allowing depreciation deduction allowance also influence
new investment decisions.

 Cash Flow Budgets


The analysis of cash-flow budget which shows the flow of funds into and out of the company
may affect capital investment decision in two ways. 'First, the analysis may indicate that a
company may acquire necessary cash to purchase the equipment not immediately but after say,
one year, or it may show that the purchase of capital assets now may generate the demand for
major capital additions after two years and such expenditure might clash with anticipated other
expenditures which cannot be postponed. Secondly, the cash flow budget shows the timing of
cash flows for alternative investments and thus helps management in selecting the desired
investment project.

 Non-economic Factors
New equipment may make the workshop a pleasant place and permit more socializing on the job.
The effect would be reduced absenteeism and increased productivity. It may be difficult to
evaluate the benefits in monetary terms and as such we call this as non-economic factor. Let us
take one more example. Suppose the installation of a new machine ensures greater safety in
operation. It is difficult to measure the resulting monetary saving through avoidance of an
unknown number of injuries. Even then, these factors give tangible results and do influence
investment decisions.
FINANCIAL OPERATIONS
HR OPERATIONS

Organizations are run and steered by people. It is through people that goals are set and
objectives realized. The performance of an organization is, thus, dependent upon the sum total of
the performance of its members. According to Peter Drucker, an organization is like a tune. It is
not constituted by individual sounds but by their synthesis. The success of an organization,
therefore, depends on its ability to accurately measure the performance of its members and use it
objectively to optimize them as vital resources.

The performance of an employee is his resultant behavior on task which can be observed
and evaluated. It refers to the contribution made by an individual in the accomplishment of
organizational objectives. Performance can be measured by combining quantity, quality, time
and cost. People do not learn unless they are given feedback on the results of their actions. For
learning to take place, feedback should be provided regularly and it should register both
successes and failures. It should also follow soon after the relevant action or actions.
Performance appraisal system provides management an opportunity to recall as well as give
feedback to people. This feedback is pertaining the performance of the worker. This helps them
to correct their mistakes and acquire new skills.

Performance appraisal (PA) refers to all those procedures that are used to evaluate the
personality, the performance and the potential of its group members. Evaluation is different from
judgment. The former is concerned with performance and the latter is concerned with the
individual. While evaluation deals with achievement of goals, a judgment has an undercurrent of
personal attack and is likely to evoke resistance. Performance appraisal could be informal or
formal. Informal performance appraisal is a continuous process of feeding back information to
the subordinates about how well they are doing their work in the organization. The informal
appraisal is conducted on a day-today basis. For example, the manager spontaneously mentions
that a particular piece of work was well performed or poorly performed. It is due to the close
connection between the behavior and the feedback on it, the informal appraisal quickly
encourages desirable performance and discourages undesirable performance before it becomes
permanently ingrained. Therefore, informal appraisal should not be perceived merely as a casual
occurrence but as an important activity and an integral part of the organization’s culture.

The formal performance appraisal occurs usually annually on formal basis and involves
appraise and appraiser in finding answers to the following questions:

1. What performance level has to be achieved during the period?

2. Has it been achieved?

3. What has been the shortfall and constraints?

4. What are we going to do now?

5. How will we know that we have done it?

6. What kind of feedback can be expected?

7. What assistance can be expected to improve performance?

8. What rewards and opportunities are likely to follow from the performance appraisal?

When the employees have this type of information, they are aware of the following

specifications:-

1. What the organization expects from them?

2. What assistance is available?

3. What can they expect when the required level of performance is achieved?
This increases employee acceptance of the appraisal process and results in the trust that
the employee has in the organization. An environment that affords an opportunity for further
growth while minimizing stressful situations certainly enhances appraisal acceptance.
Establishing this type of environment goes far beyond the performance appraisal process. Every
aspect of managing people and their work relates to the improvement of their quality of work
life. Performance appraisal is an integral part of a trusting, healthy and happy work environment
that goes a long way in promoting the same.

Performance appraisal has been used for the following three purposes:

• Remedial

• Maintenance

• Development

A performance appraisal needs to cover all these three purposes with the same focus. If
any purpose predominates, the system becomes out of balance. For instance, if remedial purpose
is foremost, then the performance appraisal may become a disciplinary tool, a form of a charge
sheet and a tool of power instead of instrument of evaluation. Sometimes maintenance becomes
the main objective for an organization. In this case, the process may become short, skimped and
per functionary ritual. If there is too much emphasis on development, then the focus falls on the
future assignment rather than on the current job.

OBJECTIVES OF PERFORMANCE APPRAISAL

Performance appraisal serves the following management objectives:


1. Providing basis for promotion/transfer/termination—
Identifying those subordinates who deserve promotion or require lateral shift
(transfer) or termination and can be used for career planning.

2. Enhancing employees’ effectiveness—


Helping employees in identifying their strengths and weaknesses. Also,
informing them about the performance expected from them. This helps them to
understand their role well and increases their efficiency at work. The feedback reinforces
good performance and discourages poor performance. This also involves identifying
employee’s training and development needs. Identifying training and development needs
of employees is necessary to prepare them for meeting challenges in their current and
future employment.

3. Aiding in designing training and development programs—


Identifying skills that need to be developed. This helps in tailor-making training
and development programs.

4. Removing work alienation—


Counseling employees corrects misconceptions which might result in work
alienation. Performance appraisal also helps employees in internalizing the norms and
values of the organization.

5. Removing discontent—
Identifying and removing factors responsible for worker’s discontent motivates
them for performing better at work. Performance appraisal helps in creating a positive
and healthy work environment in the organization.
6. Developing interpersonal relationship—
Relations between the superiors and subordinates can be improved through
realization that there exists a mutual dependence. This mutual dependence leads to better
performance and success. By facilitating employees to do introspection, self-evaluation
and goal setting, their behavior can be modified. Better interpersonal relationships lead to
team building.

7. Aiding wage administration—


Performance appraisal can help in development of scientific basis for reward
allocation, wage fixation, raises, incentives etc.

8. Exercising control—
Performance appraisal also provides a means for exercising control.

9. Improving communication—
Performance appraisal serves as a mechanism for communication between
superiors and subordinates.

DEVELOPING A PERFORMANCE APPRAISAL SYSTEM

A formal performance appraisal system can provide a framework within which appraisers
and appraise can operate. A performance appraisal system can be developed through a program
comprising the following stages:-

1. Determine overall approach to performance appraisal. The decisions on the overall

approach to introduce performance appraisal should cover the following:-


(a) What are the objectives of introducing performance appraisal?

(b) What benefits are anticipated from introducing performance appraisal?

(c) What are the main features of the approach to performance appraisal?

2. Where and how should PA be introduced?

Performance appraisal is best introduced on an organization-wide basis starting at


the top. The most common and best method is to set up a project team or working group for this
purpose.

3. Decide who is to be covered?

At one time, most schemes were restricted to managers. However, performance appraisal is now
being extended to all the members of professional, administrative, technical and support staff.
The decision regarding who is to be covered should be made at the outset itself.

4. Decide on whether the same approach should be adopted at each level. In most cases, the
essence of the approach is the same for all levels. The performance measures vary for different
levels.

5. Set up project team. Project teams consist of managers and other employees. The

human resources department or outside consultants are valuable means of getting

involvement and ownership.


6. Define role of human resource department. The role of human resource department developing
and implementing performance appraisal system is to convince top management. They need to
clarify to them that its introduction can make a significant

impact on the organizational performance.

7. Decide whether to use outside consultants. External consultants can be used for

seeking advice and introducing performance appraisal to run training programs. They

carry on evaluation studies including the conduct of attitude surveys. But as they are

costly, care should be taken in selecting consultants who have the required level of

experience and expertise.

8. Define performance management processes and documentation. The project team

needs to pay attention to each point against a background of an understanding of the

objectives to be attained and the culture and structure of the organization. Particular attention
needs to be given to the development of rating plans and document design. When designing
performance appraisal forms, the aim should be to keep them as simple and brief as possible
while allowing ample “white space” for comments. It is desirable to issue an overall description
of performance appraisal system to all concerned which sets out its objectives and methods of
operation. It also clarifies the benefits that need to be achieved for the organization and its
employees.

9. Pilot test. The whole PA system cannot be pilot tested because the cycle lasts generally for 12
months. Performance appraisal includes drawing up performance agreements, objective setting,
document completion etc. These can pilot tested. Based
on the experience gained, the system may be fine-tuned.

10. Plan implementation program. The implementation program should cover the

following:

• Date of introducing performance appraisal in the whole or different parts of the

organization

• Procedure for evaluating the process

• Briefing or training program


INTRODUCING AND OPERATION PERFORMANCE APPRAISAL

SYSTEM

The introduction of performance appraisal should be planned during the development


stage. The main steps are to train everyone on performance appraisal, and once in operation, to
monitor and evaluate how the system is performing in practice.

TRAINING

The importance of thorough training for both appraisers and appraise, in the skills

required to carry out performance appraisal effectively, cannot be overemphasized. Both parties
in the performance appraisal process need guidance and training in the preparation of the
following:
• Performance agreements and plans

• Conducting performance reviews

• Completing review forms

There is also a need to develop skills required to conduct appraisal discussions, including
interpersonal skills. Training can be provided by formal courses or workshops. It is probably best
to develop a series of training modules, as it might be difficult to get people to go through all the
training required at one time. It is believed that people are unable to absorb information at one
go. The modules could consist of the following:

• Introduction to performance appraisal system

• Defining key tasks and setting objectives

• Working with attributes and competence

• Preparing performance and development plans

• Conducting appraisal discussions

• Rating

• Providing feedback

• Coaching and counseling

MONITORING AND EVALUATING PERFORMANCE APPRAISAL

It is not only important to monitor the introduction of performance appraisal very


carefully, but it is equally vital to continue to monitor and evaluate it regularly. This helps in
correcting any drawbacks. The ultimate test, of course, is analyzing organizational performance
to establish the extent to which improvements can be attributed to performance appraisal. It may
be difficult to establish a direct connection. However, more detailed assessment with managers
and staff on the impact of the process may reveal specific areas in which there have been
improvements.

DISTINCTION BETWEEN PERFORMANCE AND POTENTIAL

Performance appraisal is designed to look backward in order to look forward. The best
prediction of potential, using performance appraisal as the basis, is made when the next job is
quite similar to the previous one. But, in many cases the next job may be quite different and thus
the past performance does not prove adequate as predictor of future performance. It is important
for us to clearly understand the differences between current performance and promotion potential
of subordinates. As mentioned earlier, performance is the resultant behavior of the subordinate
on the task which can be observed or evaluated. Potential, on the other hand, refers to the ability
of the employees to fit into future role. Many managers default in assuming that a person with
abilities to perform well in one job will automatically perform well in a more responsible
position. It is for this reason that people are often promoted to positions in which they cannot
perform adequately. This has been amply summarized in Peter’s principle. The principle
indicates that in any organization, everyone rises to his/her level of competence. We should
remember that by promoting an employee with no promotion potential, we might lose a good
worker and get a bad executive.

Most performance appraisal forms have a column for potential for promotion in which a
score is required to be filled up. Though this is supported by words, only the numerical score is
recorded for manpower planning purposes. A statement such as, ready for promotion in 10
months/years, is seen by an appraisee as a promise. There are many methods available for
identifying potential. These include assessment centers, psychological tests, assignments, peer
and self-assessment and action learning programs. Ideally, potential assessment should involve
the use of more than one technique. This is likely to result in more reliable judgment.

PROCESS OF PERFORMANCE APPRAISAL

Performance appraisal comprises the following steps:

• Select performance factors based on the job description. These are duly evaluated

and help in setting standards for achievement

• Set the performance review period

• Measure actual performance

• Compare performance with set standards and rate it with a suitable scale

• Communicate the rating to the appraisee

• Use the performance appraisal for the desired purpose

PERFORMANCE CRITERIA
In order to be effective, the criteria for performance appraisal should be genuinely related
to success or failure in the job and should be amenable to objective judgment. It should also be
easy for the appraisers to administer and appear just and relevant to the employees. They need to
strike a fair balance between sensitivity to the needs of the present job and applicability to the
organization. The earlier concept of merit rating has yielded place to performance appraisal. In
the merit rating system, merit was based upon personality traits such as leadership, ability to get
along with others, decisiveness, creativity, industry, judgment, initiative and drive. It is difficult
to apply this system reliably since it demands too much on the quality of personal relationships
rather than worker’s performance. Personality measurement is somewhat dangerous because we
usually like to quantify. The focus earlier was on “what” he is. In performance appraisal, the
focus is shifted to “how” he performs in work-oriented activities such as job knowledge,
accuracy, clarity, analytical mind and ability to carry on operations to their logical ends.
Performance appraisal is based on competence, contribution and commitment. It is not based on
chance, chemistry and convenience. Merit rating was generally used for blue-collared jobs.
Performance appraisal, on the other hand, is more comprehensive and can be used for all of the
following categories:

• Workers

• Supervisors

• Managers

Management by objective (MBO) is an example of performance based appraisal

approach that involves setting objectives and comparing performance against the

objectives. Objectives give greater freedom to both management and the employees in

deciding how performance is to be measured. They also have greater motivational effect since
the standards are discussed and agreed upon both by the management and the employees.
BENEFITS OF PERFORMANCE APPRAISAL

Performance appraisal is a formal exercise carried out for all executives and staff

members with respect to their contributions made toward the growth of the organization. The
aim is to measure the overall performance of an employee over a period of time. This is usually
one year. The procedure is carried out by the immediate supervisor who inurn provides a
feedback to the employees and helps in better management. Performance appraisal does not
merely measure the performance of the people but has many other benefits. The benefits of a
successful appraisal system can be summed up as follows:
1. Benefits for the appraisee are as follows:

• Better understanding of his/her role in the organization. Provides answers to

questions such as what is expected and what needs to be done to meet those

expectations

• Clear understanding of his/her strengths and weaknesses so as to develop into

a better performer in future

• Increased motivation, job satisfaction and self-esteem

• Opportunity to discuss work problems and how to overcome them

• Opportunity to discuss aspirations and any guidance, support or training

needed to fulfill these aspirations

• Improved working relationships with the superiors

2. Benefits for the management are as follows:

• Identification of performers and non-performers and their development toward

better performance

• Opportunity to prepare employees for assuming higher responsibilities

• Opportunity to improve communication between the employees and the

management
• Identification of training and development needs

• Generation of ideas for improvement

• Better identification of potential and formulation of career plans

3. Benefits for the organization are as follows:

• Improved performance throughout the organization

• Creation of a culture of continuous improvement and success

• Conveyance of message that people are valued

The above benefits can be realized only if performance appraisal is considered as a


process of management. It should not become a scheme devised by the personnel

department for managers to use in accordance with the directives of that department and generate
completed forms which are stored away in employee’s dossiers and then

forgotten. Performance appraisal is a process for establishing sound understanding about what is
to be achieved and an approach to manage and develop people. This helps in increasing the
probability of achieving the short-term goals and long-term goals.

Performance appraisal helps management to collect data on human resources and use it for
enhancing responsiveness of the organization. Since it is people who perform appraisal and since
people have emotions, there will always be some subjectivity. Though criterion could be
stipulated, personal likings and biases are likely to influence the evaluation. Every assessor has a
price-expectation of a particular type of behavior.
An appraisee, who meets it, gets higher assessment. Being subjective in nature, there are
certain pitfalls which need to be guarded against. The issue of performance appraisal is very
sensitive to the appraisee because it affects his/her present position (status, and self esteem) and
career growth. Performance appraisal system should not only be fair, equitable and transparent,
but it should be perceived to be so. This can happen only if the system has in-built transparency.
Some of the common pitfalls encountered in performance appraisal are mentioned below:-

1. Shifting standards—

Performance appraisal should be based on uniform and fair standards. In absence of this,
the employees can get confused and the organization might not be able to decide as to who is
suitable for promotion. Let us consider a hypothetical situation. In a given year, quality can be
the criteria for performance evaluation. The boss can change that in a current year and decides to
judge the employees on the basis of quantity of work.

2. Different rater’s patterns—

Managers differ in rating style. Some rate harshly whereas others are quite lenient. This
can be reduced by precise definition on the appraisal form. For instance, dependability may be
defined as the confidence you have in the employee to carry out instructions and the extent to
which you can rely on his/her ability, punctuality and attendance. Subjectivity can also be
moderated through a multi-layer appraisal system. In this system, the immediate superior
initiates the report which is reviewed by next the higher authority.

3. Central tendency—
Many appraisal forms require the appraiser to justify outstanding or poor assessments.
Many of such raters may prefer an easier path of rating most people as average.

4. First impression—

Some raters may form an overall impression based on some specific qualities or features
of the ratee in the first meeting itself and carry it forward. Making assessment on too short a time
span and inadequate knowledge can sometimes prove incorrect.

5. Latest behavior—

At times, the appraisal is influenced by the most recent behavior, ignoring the most
commonly engendered behavior during the entire period. Thus, a usually sober person may be
treated as arrogant because he expressed his/her opinion.

6. Halo effect—

Some raters have a tendency to rate high/low on all performance measures based on one
of their characteristics. For example, an employee who is just an average work performer but is
very good in cricket and plays Ranji trophy may be given high overall rating. One who does not
shave regularly may be assessed as lazy at workplace also. Rating employees on each of the
performance measures can reduce this.
7. Horn effect—

Highly critical bosses have a tendency to compare performance of their subordinates with
what they did. This is not correct because the performance also depends upon the situation. For
example, a salesman now operates in a buyer’s market as against the seller’s market of
yesteryears.

8. Stereotyping (Rater’s Bias)—

Some raters have a standard mental picture about a person because of that person’s sex,
color, caste, religion, age, style of-clothing, political view etc. Stereotyping results in an
oversimplified view. Such assessments are based on false assumptions/feelings, rather than facts.
Discretion should not become discrimination.

9. Spill over effect--

This is allowing past performance to influence present evaluation. In some organizations,


when an employee reports on transfer, his earlier reports are also transferred along. This biases
the mind of the new boss.

There are other pitfalls such as taking too short appraisal interviews and failing to support
opinions with evidence, inadequate briefing of the appraisee and pre-judging
performance. In some organizations, such as PSUs, there is a system called CCR (Character
Confidential Rol1). East India Co started this system. Since it is confidential,

it can be manipulated. The corporate world soon realized its disadvantages and introduced self-
appraisal systems.

CONSTRAINTS

An interaction with over 100 managers of various backgrounds in BHEL highlighted the
following common constraints in implementing performance feedback, as perceived by them:-

• A work culture not so conducive to proper giving and receiving of feedback

• Lack of appreciation about the philosophy and benefits of performance feedback

• Lack of willingness of superiors/top management in adopting this practice

• Fears and apprehensions about the use of performance feedback outcomes

• Confidentiality in the existing performance appraisal system

• Interference by the trade unions in case of workers

• Lack of proper system or procedure

• Lack of accountability
• Lack of clarity on role, goal, job demands etc

• No direct linkages of performance feedback system with rewards or punishment

• Lack of proper skill in performance analysis and giving feedback

• Constraint of time availability

• Personal bias and subjectivity

• Non-uniformity in the criteria of performance analysis

• Lack of trust and openness in people and conservativeness

• Heterogeneous interest

• Low motivation

• Target achievement oriented system

• Non-recognition of the effort in subordinate development

DIFFERENT TYPES OF WORK FORCE APPRAISAL SYSTEMS

Depending upon who is doing appraisal, methods of performance appraisal could be


classified into five categories:

 Rating by superiors—

In this system, supervisors appraise the performance of subordinates without involving the
latter. This method is most commonly used in government organizations. However, it suffers
from the prejudiced approach and the ability of the superiors. The validity of the system can be
improved by basing it on performance. The various methods which are used under this system
are as follows:

• Ranking method

• Paired comparison method

• Graphic rating scales method

• Forced choice list method

• Critical incidence method

• Forced distribution method

 Feedback on appraisal information—

In this system, the appraisee is informed about his/her strong and weak points. The
person is given an opportunity to defend himself/herself in terms of constraints or weaknesses.
This system leads to greater satisfaction and higher work performance due to participative
approach. Meyer suggests that the goal of the appraisal should be to improve the future
performance of subordinates and, therefore, suggested that performance appraisal should be
made a continuous process rather than a yearly feature.

 Field review technique—


In this technique, the appraiser goes to the field (e.g. shop floor) and obtains the
information about work performance of the employee by way of questioning the said
individual, the peer group and the superiors. The information received about how he is
performing helps the appraiser in defining the profile of the employee. Rating by self and the
peer group-- In this method, the employee appraisal is done independently at the following
three levels:

• The employee

• The peer group

• The superior

HRD department analyzes these appraisal reports and draws a profile based on common
aspects. 360o performance appraisal-- This is a new concept in performance appraisal, where the
feedback is collected from all around the employee, the superior, the subordinates, the peer
group and the customers. The evaluation is very comprehensive in terms of the employee’s
skills, abilities, styles and job-related competencies. This system has the following advantages:

• Higher validity and reliability of the evaluation

• Self-evaluation by the employees gets compared with the perception of others

• Helps in maximizing employee potential in the face of challenges

PERFORMANCE REVIEW SEQUENCE


The following is offered as a rough guide to the sequence of events which a manager may
wish to initiate in order to ensure that nothing of importance in the performance appraisal
process has been overlooked:-

(a) Agree a time and date for the review well in advance and set aside at least an hour.

(b) Arrange for the location to be private and free from interruptions.

(c) Bring all relevant results and information concerning the appraisee’s performance in

his area of responsibility.

(d) Ask the appraisee for the following:-

• To review his/her performance in the work situation point by point

• About any problems which might have affected his/her performance

• About the implications of any problems or events and their effect on the

individual, the team and the work

• What needs to be done by either of them to help improve his/her future

Performance

(e) Decide on the key result areas.

(f) Manager and appraisee should jointly set standards of performance and the course

of action for the next review period.

(g) Close with a firm date for the next interim review.
NEW TRENDS IN PERFORMANCE APPRAISAL SYSTEM

The performance appraisal systems existing in companies in India have brought forth
many problems at all levels in the organizational structure. The findings of a survey

conducted by Business Today, in collaboration with a few organizations, revealed the

following:

• Performance appraisal systems do not appear to be connected to rewards

• Middle managers feel that they are underpaid

• Factory workers are unhappy about their pay scales, increments, flat bonuses and

unrealistic allowances.

In the emerging business environment, companies are learning a new rule for
benchmarking employee performance and deciding on the rewards. Customer satisfaction,
organizational prosperity and achieving the corporate goals should be the ultimate arbiter to
circumvent the above-mentioned problems. The appraisal and reward

systems, designed with the above framework, attract the best people, retain them and motivate
them to give their best. Translating the corporate objectives into specific, quantifiable goals for
every employee forms the corner stone of performance appraisal systems leading to feedback on
how close to or how far from those goals the employee is at the end of appraisal period. The
nature of goals emphasized by the performance appraisal systems should not only be numbers-
driven, sales or budget-oriented but also the methods used to achieve those numbers. This shuns
the employees from putting company’s values, credibility and reputation at stake. Therefore,
performance appraisal systems should focus on behavior oriented dimensions. Performance
appraisal systems should also focus on teamwork which is increasingly gaining importance. In an
age of increased automation, employee productivity in general and managerial productivity in
particular has to be assessed and rewarded.

The potential of managers for taking on higher responsibilities, which is reflected not just
in their track record but also in their personality traits and non-function-related abilities, have to
be appraised using methods like assessment centers. And for all these, companies have to adopt
techniques like 3600 evaluations. This prevents an employee to be assessed exclusively by
his/her superiors. Linking the form of reward to business objectives helps in yielding results.
This includes achieving entrepreneurial action from the employees. Goal-linked incentive pay
and stock options, which link compensation to profits, are good examples of this orientation.
However, mature companies focusing and managing their earnings per share and protecting
market share have to seek out managerial talent. They reward it with flexible and tax-friendly
compensation packages with benefits designed to improve the quality of life. Companies that are
delivering find the promotion route closed due to restricted number

of vertical jumps possible within the flattened hierarchy. They are required to dismantle

the promotion mindset in their employees, equate growth with lateral movement and move
toward a designation-less structure. In this case, companies have to listen to their

employees before finalizing the form of rewards. It is only then that the process of linking pay
packets to performance actually payoff. Some of the emerging techniques of performance
appraisal adopted by companies like Phillips, Reckitt and Coleman, Godrej and Boyce, Glaxo,
Cadbury India, and Mastek are enlisted below:

1. Narrative essay- A candid statement from a ratee.

2. Simple ranking- Order of rating from best to worst.

3. Alternation ranking- Alternating from top to bottom of list.


4. Paired comparison- Comparing rates to one another.

5. Forced distribution- One-to-one comparison.

6. Behavioral checklist- A descriptive rating.

7. Critical incident- Evaluation based on key incidents.

8. Graphic rating scale- Standardized, quantitative rating.

9. BARS- Rating in behavioral terms.

10. MBO- Measuring performance against results.

11. Work planning review- Emphasizes process over outcomes.

12. Immediate superiors- Feedback from immediate boss.

13. Self-appraisal- Evaluation by ratee.

14. Peer-group appraisal- Evaluation by team members.

15. Upward appraisal- Evaluation by subordinates.

16. 360-degree appraisal- Evaluation by boss peers and subordinates.

17. Assessment centers- Assessment based on response to a battery of tests.

360O APPRAISAL SYSTEM OR FEEDBACK

This is defined as the systemic collection and feedback of performance data for an
individual or a group. It is derived from a number of stakeholders in their performance. It is done
in a systematic way via questionnaires or interviews. This formalizes judgment coming from
people and through natural interactions employees have with one another. There is both a
collection and a feedback process. Data is gathered and fed back to the individual participant in a
clear way designed to promote understanding, acceptance and ultimately changed behavior.
Stakeholders are people who are both affected by your performance and deal with you closely
enough to be able to answer specific questions about the way you interact with them. This
feedback system assesses managers in terms of the competence they possess or more specifically
through the detailed behavior that constitutes them. So far, 360o feedback has concentrated on
people who are at the more senior levels in an organization. This includes directors, managers,
senior executives in companies and partners or principals in the profession. However, as
organizations are beginning to appreciate the power and value of such measurement, other
jobholders find that their behavior also comes under the microscope. Engineers, pilots, sales
people, HR professionals, customer service staff etc., have all participated in this assessment and
feedback process. Certain specific benefits of the 360o feedback system are as follows:

• Self development and individual counseling

• Part of organized training and development

• Team building

• Performance management

• Strategic or organizational development

• Validation of training and other initiatives

• Remuneration

The 360o feedback system can be used in any organization for the above purposes. It is
believed that the impact of this feedback on an organization is very beneficial. The technique
presents feedback in a powerful way and can have impact on the quantity or quality of
performance data, communications, staff motivation and the roles of those involved. However,
this system is not a quick process.
The 3600 feedback has become popular recently because of a change in the expectation
that organizations have from their employees. This is through the increasing emphasis on
performance measurement, change in major management concepts and more receptive attitudes.

NEW APPRAISAL SYSTEMS

The changing needs of the organization and the existing lacunae in the performance
appraisal systems have forced the organization to design their own appraisal system. This system
fulfills the organizational as well as individual needs. In this regard, various new concepts of
appraisal system have come into vogue. They are briefly discussed as follows:

1. Focus on achievement system—

The goal of this system is to continuously improve the performance of employees and the
organization in general. Here, each individual has primary responsibilities for his/her
performance. Therefore, the stress is primarily on development rather than evaluation. This
system is employee driven. The key role of a manager is to support employees to maximize their
potential and achievement. Hence, this system emphasizes upon the success of the company
which is enhanced through clear link between corporate strategies and individual goals. The
outcome of this achievement system leads to visible changes in the organizational functioning
and moving toward a more optimistic climate.

2. Team appraisals—
This concept focuses upon appraising the performance of the team rather than an
individual team member. The assessment of every team member is made accordingly. Digital
Corporation USA is currently using this system. The main features of this system are as follows:

• It involves team members in decisions affecting the team

• Individuals are involved in day-to-day activities

It includes self-appraisal, appraisal by peers and review of performance in a group by


review committee. This prevents extensively documented job description and job requirement
reports. In the organizational setting, most people are interested in evaluating others by
appraising performance. They are hardly prepared themselves to be evaluated. Hence, it is a real
challenge for HR professionals to make the appraisal system more pragmatic to ensure that
people trust in the system. So long as a human being evaluates another, there is some subjectivity
in the assessment. Thus, it is essential to balance the subjectivity and objectivity in the appraisal
system to make it people oriented, workable and productive. Moreover, the purpose of the
system should be more developmental rather than punitive in natures

Investor Relations
Investor / Analyst / Queries / Media

Indiabulls House,
Indiabulls Finance Centre,
Tower- 1, 14th Floor, Senapati Bapat Marg,
Elphinstone Road, Mumbai – 400013

Phone: +91 22 6189 1481


Fax: +91 22 61891421
Email: investor.relations@indiabulls.com
Compliance Officer

Indiabulls Finance Centre,


Tower 1, 11th Floor,
Elphinstone Mills Compound,
Elphinstone Road (W)
Mumbai – 400013

Phone: +91 22 61899800


Email: helpdesk@indiabulls.com