Every modern economy is based on a sound financial system a

financial system. a set off institutional arrangements through

which financial surpluses are mobilized from the unit
generating surplus income and transferring them to the others
in need of them. The activities which include production,
distribution, exchange and holding of financial assets
instruments of different kinds by financial institutions, banks
and other intermediaries, of other market. Among these
organizations, are banks, credit card companies, insurance
companies, consumer finance companies, stock brokerages,
investment funds and some government sponsored
enterprises?

The financial markets have two major components; they are

money market and capital market.

Money market

The money market refers to the market where borrowers and

lenders exchange short-term funds to solve their liquidity
needs.

Capital market

The capital market is a market for financial investments that

are direct or indirect claims to capital.

Securities market

It refers to the markets for those financial instruments claims

obligations that are commonly and readily transferable by sale.
It has two inter dependent and inseparable segments the new
issues (primary) market and the stock (secondary) market. the
secondary market enables those who hold securities to adjust
their holdings in response to changes on their assessment of
risk and return. The primary markets provide the channel of
sale of new securities.

Stock market

A stock market, or equity market, is a private or public. Market

for the trading of company stock and derivatives at an agreed
price, these are securities listed on a stock exchange as well as
those only traded privately. The size of the world stock market
is estimated at about $36.6 trillion us at the beginning of
october2008

FOREX MARKET

The foreign exchange market (currency, forex , or FX) market is

where currency trading takes place .it is where banks and other
official institutions facilitate the buying and selling of foreign
currencies . The FX market is one of the largest and most liquid
financial markets in the world, and includes trading between
large banks, central banks, currency speculators , corporations,
governments, and other institutions.

INDIA INFOLINE

India info line is one stop financial services shop, most

respected for quality if its advice, personalized service and
cutting edge technology. Listed in Bombay and national stock
exchange with a net worth of INR 200 corer and a market cap
of over INR 1970 corer. The company has a network of 976
business locations (branches and sub brokers) spread across
365 cities and towns. It has more than 8000000 customers .it is
registered with NSDL as well as CDSL as a depository
participant, providing a one stop solution for clients trading in
the equities market first company in India to foray into the
online distribution of mutual funds.

About IIFL

Company profile
Date of 1995
Establishment
Revenue 156.75 ( USD in Millions )
Corporate 75 Nirlon Complex, Off
Address Western Express
Highway,Goregaon (E)
Mumbai-400063, Maharashtra
www.indiainfoline.com

Management Chairperson - Nirmal Jain

Details MD - R Venkataraman
Directors - A K Purwar,
Chandran Ratnaswami,
Falguni Sanghvi, Kranti Sinha,
Nilesh Vikamsey, Nirmal Jain,
R Venkataraman, Sat Pal
Khattar, Sunil Kaul, Sunil Lotke

Business Finance - Stock Broking

Operation
Background India Info line (IIFL) is engaged
in business of equities broking,
wealth advisory services and
portfolio management
services. The company was
incorporated in October 1995
as Probity Research &
Services and later in April 2000
the name was changed to India
Infoline.com. Then in March
 2001 the company again
changed its name to India Info
line.

Financials Total Income - Rs.

7998.667211 Million ( year
ending Mar 2011)
Net Profit - Rs. 1223.618546
Million ( year ending Mar 2011)

Company Sunil Lotke

Secretary
Bankers
Auditors Sharp & Tannan Associates

India Info line (IIL) is engaged in business of equities broking,

wealth advisory services and portfolio management services.
The company was incorporated in October 1995 as Probity
Research & Services and later in April 2000 the name was
changed to India Infoline.com. Then in March 2001 the
company again changed its name to India Info line.

The company is part of India Info line Group. It has

pan- India presence through its distribution network of 607
branches, 151 franchisees located in 346 cities. The company
also has presence in Dubai, New York and Singapore.

IIL operates portals such as www.indiainfoline.com and

www.5paisa.com
The IIFL (India Info line) group, comprising the holding company,
India Info line Ltd (NSE: INDIAINFO, BSE: 532636) and its
subsidiaries, is one of India’s premier providers of financial services.
 IIFL offers advice and execution platform for the entire range of
financial services covering products ranging from Equities and
derivatives, Commodities, Wealth management, Asset management,
Insurance, Fixed deposits, Loans, Investment Banking, Gold bonds
and other small savings instruments.

We have a presence in:

Equities our core offering, gives us a leading market share in both

retail and institutional segments. Over a million retail customers rely
on our research, as do leading FIIs and MFs that invest billions.

Private Wealth Management services cater to over 2500 families

who have trusted us with close to Rs 25,000 corers ($ 5bn) of assets
for advice.

Investment Banking services are for corporate looking to raise

capital. Our forte is Equity Capital Markets, where we have executed
several marquee transactions.

Credit & Finance focuses on secured mortgages and consumer

loans. Our high quality loan book of over Rs. 6,200 corers ($ 1.2bn) is
backed by strong capital adequacy of approximately 20%.

IIFL Mutual Fund made an impressive beginning in FY12, with

lowest charge Nifty ETF. Other products include Fixed Maturity
Plans.

Life Insurance, Pension and other Financial Products, on open

architecture complete our product suite to help customers build a
balanced portfolio.

IIFL has received membership of the Colombo Stock Exchange

becoming the first foreign broker to enter Sri Lanka. IIFL owns and
manages the website,www.indiainfoline.com, which is one of India’s
leading online destinations for personal finance, stock markets,
economy and business. IIFL has been awarded the ‘Best Broker,
India’ by Finance Asia and the ‘Most improved brokerage,
India’ in the Asia Money polls. India Info line was also adjudged
as ‘Fastest Growing Equity Broking House - Large firms’ by Dun
& Bradstreet. A forerunner in the field of equity research, IIFL’s
research is acknowledged by none other than Forbes as ‘Best of the
Web’ and ‘…a must read for investors in Asia’.

Our research is available not just over the Internet but also on
international wire services like Bloomberg, Thomson First Call and
Internet Securities besides others where it is amongst one of the most
read Indian brokers.

IIFL is a listed company with a consolidated group net worth of about

Rs 1,800 corers. The income and net profit during FY2010-11 were
Rs. 14.7bn and Rs. 2.1bn respectively.

The Group has a consistent and uninterrupted track record of profits

and dividends since its listing in 2005. The company is listed on both
Exchanges and also trades in the derivatives segment.

IIFL’s Crisil and ICRA Rating for short term is top rated as CRISIL
A1+ and ICRA (A1+) respectively. For long term, IIFL has been
rated ICRA (AA-) by ICRA and CRISIL AA-/Stable by CRISIL
indicating high degree of safety for timely servicing of financial
obligations.

IIFL is near you physically: we are present in every nook and cranny
of the country, with over 3,000 business locations across 500 cities in
India. You can reach us in a variety of ways, online, over the phone
 and through our branches. All our offices are connected with the
corporate office in Mumbai with cutting edge networking
technology. The group caters to a customer base of about a million
customers.

Our physical presence in key global markets includes subsidiaries in

Colombo, Dubai, New York, Mauritius, London, Singapore and
Hong Kong.
Milestones
1995
-Incorporated as an equity research and consulting firm with a
client
Base that included leading FIIs, banks, consulting firms and
Corporate.

Oct, 1956
With Registration No. 11 93797. We commenced our operations
as an
Independent provider of information, analysis and research
covering
Indian businesses, financial markets and economy, to
institutional
Customers. We became a public limited company on April 28,
2000 and the name of the Company was changed to Probity
Research and Services Limited. The name of the Company was
changed to India Infoline.com

1999
-Restructured the business model to embrace the internet;
launched
Archives.indiainfoline.com mobilised capital from reputed
private
Equity investors.
2000
-Commenced the distribution of personal financial products;
launched
Online equity trading; entered life insurance distribution as a
Corporate agent. Acknowledged by Forbes as ‘Best of the Web’
and
‘...must read for investors’.

2004
-Acquired commodities broking license; launched Portfolio
Management Service.

2005
- Listed on the Indian stock markets

- India Info line fixes a price band between Rs 70 and Rs 80 for its
Forthcoming public issue. The company is coming out with
public issue Of 1.18 corer shares with a face value of Rs 10
through the book
Building route. The issue is slated to open on April 21 and close
on
April 27. Enam Financial Consultants Private Ltd would be the
sole
Book running lead manager to the issue while In time Spectrum
Registry Ltd is the registrar to the issue.
-India Info line public issue gets 6.6 times oversubscription
-IIFL appoints R Mohan as VP

-India Info line Ltd has informed that the Company has entered
into a
Advertising agreement with Times Group where in the Company
and other Group companies would spend about Rupees Thirty
Corers over the next 5 years in print as well as non print media of
The Times Group.
-India Info line to buy 75-pc stake in Money tree

2006
-India Info line launches exclusive SMS Value Added Service
-India Info line enters into strategic agreement with Saraswat
Bank
-India Info line to launch stock trading on cell phones
-Indiainfoline to roll out MCX, NCDEX, DGCX software
-Acquired membership of DGCX; launched investment banking
services

2007
-Launched a proprietary trading platform; inducted an
institutional
Equities team; formed a Singapore subsidiary; raised over USD
300mn In the group; launched consumer finance business under
the
‘Money line’ brand.

2008
-Launched wealth management services under the ‘IIFL Wealth’
brand; set up India Info line Private Equity fund; received the
Insurance Broking license from IRDA; received the venture
capital license; Received in principle approval to sponsor a
mutual fund; received Best broker- India’ award from Finance
Asia; ‘Most Improved
Brokerage- India’ award from Asia money.
- India Info line Ltd has informed that the Board of Directors of
the
Company have vide circular resolution passed on March 10, 2008
Approved the appointment of Mr. A K Purwar, ex-Chairman of
the State
Bank of India, as an independent director on the Board of the
Company.
- India Info line Ltd has informed that pursuant to the
resignation
Of Mr. Nimish Mehta, Company Secretary and Compliance
Officer of the
Company. Ms. Falguni Sanghvi has been appointed as the
Company
Secretary with effect from October 07, 2008.
- The Company has splits its face value from Rs10/- to Rs2/-.
2009
-Received registration for a housing finance company from the
National Housing Bank; received ‘Fastest growing Equity
Broking House
- Large firms’ in India by Dun & Bradstreet

2010

-received in principal approval for membership of the

Singapore stock exchange received membership of the
Colombo stock exchange

2011

- launched IIFL mutual fund

Pillars of the
organization

Mr. Nirmal Jain

Chairman & managing darector.

India Infoline Ltd.

Mr. Nirmal Jain is the founder and Chairman of

India Info line Ltd. He is a PGDM (Post Graduate Diploma in
Management) from IIM (Indian Institute of Management)
Ahmadabad, a Chartered Accountant and a rank-holder Cost
Accountant. His professional track record is equally
outstanding. He started his career in 1989 with Hindustan Lever
Limited, the Indian arm of Unilever. During his stint with
Hindustan Lever, he handled a variety of responsibilities,
including export and trading in agro-commodities. He
contributed immensely towards the rapid and profitable
growth of Hindustan Lever’s commodity export business, which
was then the nation’s as well as the Company’s top priority. He
founded Probity Research and Services Pvt. Ltd. (later
re-christened India Info line) in 1995; perhaps the first
independent equity research Company in India. His work set
new standards for equity research in India. Mr. Jain was one of
the first entrepreneurs in India to seize the internet
opportunity, with the launch of www.indiainfoline.com in 1999.
Under his leadership, India Infoline not only steered through
the dotcom bust and one of the worst stock market
downtrends but also grew from strength to strength

Mr. R. Venkataraman

Executive director

India Infoline Ltd. Mr. R Venkataraman,

Co-Promoter and Managing Director of India Info line Ltd, is a
B.Tech (electronics and electrical communications engineering,
IIT Kharagpur) and an MBA (IIM Bangalore). He joined the India
Info line Board in July 1999. He previously held senior
managerial positions in ICICI Limited, including ICICI Securities
Limited, their investment banking joint venture with J P Morgan
of US, BZW and Taib Capital Corporation Limited. He was also
the Assistant Vice President with G E Capital Services India
Limited in their private equity division, possessing a varied
experience of more than 19 years in the financial services
sector

The board of director

Mr. Nilesh Vikamsey

Independent Director,

India Infoline Ltd Mr. Nilesh Vikamsey – Board

Member since February 2005 - is a practicing Chartered
Accountant for 25 years and Senior Partner at M/s Khimji
Kunverji & Co., Chartered Accountants, a member firm of HLB
International, a world-wide organisation of professional
accounting firms and business advisers, ranked amongst the
top 12 accounting groups in the world. Mr. Vikamsey headed
the audit department till 1990 and thereafter also handled
financial services, consultancy, investigations, mergers and
acquisitions, valuations and due diligence, among others. He is
elected member of the Central Council of Institute of Chartered
Accountant of India (ICAI), the Apex decision making body of
the second largest accounting body in the world, 2010–2013.

He is on the ICAI study group member for the introduction of

the Accounting Standard — 30 on financial instruments —
recognition and management. Convener of the Study group
Formed by ASB of ICAI to formulate comments on various
Exposure Drafts, Discussion Papers and other matters
pertaining to IFRS originating from IASB, Representative of the
Institute of Chartered Accountants of India on the Committee
for Improvement in Transparency, Accountability and
Governance(ITAG) of South Asian Federation of Accountants
(SAFA), Member of Executive Committee & IFRS
Implementation Committee of WIRC of Institute of Chartered
Accountant of India (ICAI), Accounting and Auditing Committee
of Bombay Chartered Accountant Society (BCAS) and also on its
Core Group, member of Review, Reforms & Rationalisation
Committee, IPR Commit Chamber of Commerce and Industry
(BCCI), Member of Legal Affairs Committee of Bombay
Chamber of Commerce and Industry(BCCI), Corporate
Members Committee of The Chamber of Tax Consultants (CTC),
Regular Contributor to WIRC Annual Referencer on “Bank
Branch Audit”, Study/ Sub Group formed by ICAI for
Considering Developments on Fair Value Accounting (AS 30)
post Sub Prime crisis, Sub Group formed by ICAI for
approaching the Government and Regulatory Authorities for
Convergence with IFRS.ee of Bombay

He is also a Vice Chairman of Financial Reporting Review Board

Accounting Standard Board and Member of Accounting
Standard Board and various other Standing and Non Standing
Committees. Mr. Vikamsey is also a Director of Miloni
Consultants Private Limited, HLB Offices and Services Private
Limited, Trunil Properties Private Limited, BarKat Properties
Private Limited and India Info line Investment Services Limited.

Mr. Kranti Sinha

Independent Director,

India Infoline Ltd. Mr. Kranti Sinha — Board

member since January 2005 — completed his masters from the
Agra University and started his career as a Class I Officer with
Life Insurance Corporation of India. He served as the Director
and Chief Executive of LIC Housing Finance Limited from August
1998 to December 2002 and concurrently as the Managing
Director of LICHFL Care Homes (a wholly-owned subsidiary of
LIC Housing Finance Limited). He retired from the permanent
cadre of the Executive Director of LIC; served as the Deputy
President of the Governing Council of Insurance Institute of
India and as a member of the Governing Council of National
Insurance Academy, Pune apart from various other such
bodies. Mr. Sinha is also on the Board of Directors of Hindustan
Motors Limited and Cinemax (India) Limited.

Mr. Arun. K. Purwar

Independent Director,

India Infoline Ltd. Mr. Purwar is currently the

Chairman of India Venture Advisors Pvt. Ltd., investment
manager to India Venture Trust – Fund I, the healthcare and life
sciences focussed private equity fund sponsored by the Piramal
Group. He has also taken over as the Chairman of IL & FS
Renewable Energy Limited in March 2008 and India Info line
Investment Services Ltd in November 2009. He is working as
Independent Director in leading companies in Telecom, Steel,
Textiles, Power, and Auto components, Renewable Energy,
Engineering Consultancy, Financial Services and Healthcare
Services. He is an Advisor to Mizuho Securities in Japan and is
also a member of Advisory Board for Institute of Indian
Economic Studies (IIES), Waseda University, and Tokyo, Japan.
Mr. Purwar was the Chairman of State Bank of India, the largest
bank in the country from November ‘02 to May ’06 and held
several important and critical positions like Managing Director
of State Bank of Patiala, Chief Executive Officer of the Tokyo
branch covering almost the entire range of commercial banking
operations in his illustrious career at the bank from 1968 to
2006. Mr. Purwar also worked as Chairman of Indian Bank
Association during 2005 – 2006. Mr. Purwar has received the
“CEO of the year” Award from the Institute for Technology &
Management (2004); “Outstanding Achiever of the year” Award
from Indian Banks’ Association (2004); “Finance Man of the
Year” Award by the Bombay Management Association in 2006.

Sunil Kaul

Independent Director,

India Infoline Ltd. Mr. Sunil Kaul earned his post

graduate degree in management from the Indian Institute of
Management, Bangalore and a bachelor’s degree in technology
from the Indian Institute of Technology, Bombay. Sunil Kaul is a
Managing Director for Carlyle’s Asia Buyout fund focused on
investments in the financial services sector across Asia. He is
based in Singapore. Since joining Carlyle, Mr. Kaul has worked
on several notable portfolio investments of Carlyle including
HDFC Ltd, India’s leading financial services group, TC Bank, a
leading mid-sized bank in Taiwan and Caribbean Investment
Holdings, one of the largest provider of offshore company
incorporation and trust services in Asia and India Info line
Limited Mr. Kaul serves as a director on the board of TC Bank
and a member of its Risk and Executive Committees. He is also
a member of the Asia Pacific Infrastructure Partnership. Prior to
joining Carlyle, Mr. Kaul served as the president of Citibank
Japan, covering the banks corporate and retail banking
operations. He concurrently served as the chairman of City’s
credit card and consumer finance companies in Japan. He was
also a member of City’s Global Management Committee and
Global Consumer Planning Group. Mr. Kaul has over 20 years’
experience in corporate and consumer banking of which more
than 10 have been in Asia. He has lived and worked in India, the
United States, Japan, Netherlands and Singapore. In his earlier
roles, Mr. Kaul served as the Head of Retail Banking for City in
Asia Pacific. He has also held senior positions in Business
Development for City’s Global Transaction Services based in
New York, Transaction Services Head for City Japan and Global
Cash Business Management Head for ABN Amro, based out of
Holland.
 Chapter
2

History of GOLD loan

Gold is a brilliant yellow precious metal that is resistant to air

and water corrosion. It is a very soft and pure metal. Gold is the
most malleable and ductile metal found on earth. That’s why it
is expensive and it is alloyed with other metals, usually copper
and silver to make it less expensive and harder, a karat is the
unit that measures the purity of gold jewellery or else it is
hallmarked with a three digit number that indicates the parts
per thousand of gold. Some countries hallmark gold with a
three digit number that indicates the parts per thousand of
gold. The alloyed gold comes in many colours and may not be
bright yellow all the time. It has long been a values commodity,
particularly in India where it is considered auspicious, and had
been in use for centuries in the form of jewellery, coins,
bullions, electronics, and dentistry, also for other medical
purposes. Though gold is a highly liquid asset, it wasn’t until
recently that consumers leveraged it effectively to meet their
liquidity needs.

Lenders provide loans by securing gold assets as collateral.

Compared with the rest of the world in India the gold loan
market is big business. Until a decade back, most of the lending
was in the unorganized sector through pawnbrokers and
money lenders. However this scenario changed with the
entrance of organized sector players such as banks and non
banking finance companies (NBFCs) which now command more
than 25% of the market. The organized gold loan market has
grown at 40% CAGR form 2002 to 2010. NBFCs have been a
major driving force behind this growth given their extensive
network. Faster turnaround time, higher loan to value ratios
and the ability to serve non-bankable customers. Of late, banks
have improved their gold loan product features and
services.Coupled with comparatively lower interest rates
charges, bank stand to gain market share at the expanses of
NBFCs in the near future.

The eligibility criteria required to apply for gold lone in India

includes three factors. Firs-tly, the person has to be above 18
years of age. Secondly, the person applying or a gold loan in
india should have a ID & address proof and last but not the
least the applicant should be working on a regular salary basis ,
means there should be a constant flow of income.

BACKGROUND: GOLD AND THE INDIAN SOCIETY

Gold has traditionally been among the most liquid asset and is
an accepted universal currency. it has traditionally been
consumed by individuals in the form of jewellery, especially in
India were it is considered auspicious. Gold is presumed to be a
safe haven in times of economic uncertainty, a fact exemplified
by a 30% increases the value of gold over the past year India is
one of the largest market of gold accounting for approximately
10% of the total world gold stock as of 2010. Rural India
accounts for 65% of this gold stock. Though gold price have
increased 19% CAGR from 2002 to 2010, gold stock in India has
grown at 22% CAGR During the same period to 18000 tons
(Rs.32000 billion). The demand for gold has followed a regional
trend with southern India accounting for 40% of annual
demand, followed by the west (25%), north (20-25%) and east
(10-15%).

Looking for Gold Loan Market

Major Players

The Key Players in the Indian gold loan market include the
unorganized sector, banks _ public/private/cooperatives
and NBFCs. While the unorganised sector, comprising local
pawnbroker and money leader has traditionally dominated the
gold loan market for money decades and still commands nearly
75% of the market the organized sector led by NBFCs is
catching up fast. The organized sector has grown at a rapid
paces of 40% CAGR form the 2002 to 2010 and is expected to
grow by 33% to41% CAGR in 2011

And in doing so these companies are challenges the dominance

of the large unorganised sector within the organized sector,
NBFCs have grown at a repaid rate from 18.4% in FY to 32.2% in
FY10. (Source: cognizant 20-20 insight jan.2012)