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Future of Equity Trading in India: A Comparative Analysis of Sharekhan, Reliance Money and ICICI Direct.

com (Online Share Trading)

Submitted in partial fulfillment for the award of the degree of

Master of Business Administration Under the guidance of Supervisor (External)


(Mr. SACHIN KUMAR)
(Assistant manager) ( Sharekhan ltd).

Internal Guide
( Ms.Archana Singh ) (In charge Academies) (Global Inst. Of Information tech.)

Submitted by Nitin kumar


(Univ. Enrollment No. 101517027851)

Global Institute Of Information Technology 32-A, Knowledge Park-1, Greater Noida (U.P)
DECLARATION
I hereby declare that this Project Report entitled Future of Equity Trading in India: A Comparative Analysis of Sharekhan, Reliance Money and ICICI Direct.com (Online Share Trading) submitted by me to the Maha maya Technical University Noida , is a bonafide work undertaken by me and it is not submitted to any other university or Institution for the award of any degree diploma/certificate or published any time before.

Name:

Nitin kumar

Enrollment NO.:- 101517027851 Semester:3 rd

NITIN KUMAR.

CERTIFICATE
This is to certify that the project report (MBA 035) Future of Equity Trading in India: A Comparative Analysis of Sharekhan, Reliance Money
and ICICI Direct.com (Online Share Trading)

done by Mr. Nitin kumar enrollment

no. 101517027851 is an authentic work carried out by him/her under my guidance and supervision. The matter embodied in this project report has not been submitted earlier for the award of any other degree or diploma to the best of my knowledge and belief.

Date:-

____________________ Name of the Internal guide

_____________________ Signature of the internal guide

Executive Summary.
In few years Equities has emerged as a tool for ensuring ones financial well being. Equities have not only contributed to the India growth story but have also helped families tap into the success of Indian Industry. As information and awareness is rising more and more people are enjoying the benefits of investing in equities. The main reason the number of retail equities investors remains small is that nine in ten people with incomes in India do not know that equities exist. But once people are aware of equities investment opportunities, the number who decide to invest in equities increases to as many as one in five people. The trick for converting a person with no knowledge of equities to a new Equities customer is to understand which of the potential investors are more likely to buy

equities and to use the right arguments in the sales process that customers will accept as important and relevant to their decision.

This Project gave me a great learning experience and at the same time it gave me enough scope to implement my analytical ability. The analysis and advice presented in this Project Report is based on market research on the saving and investment practices of the investors and preferences of the investors for investment in Equities. This Report will help to know about the investors Preferences in Equities means Are they prefer any particular Asset Management Company (AMC), Which type of Product they prefer, Which Option (Growth or Dividend) they prefer or Which Investment Strategy they follow (Systematic Investment Plan or One time Plan).

This Project as a whole can be divided into two parts.

The project gives an insight about the Company Profile of sharekhan ltd. broker company, organization structure and product of the company and Equities and its various aspects, Objectives of the study, Research Methodology. One can have a brief knowledge about Equities and its basics through the Project.

ACKNOWLEDGEMENT
The project has been prepared as a part of an internship required during the completion of MBA from Maha Maya Technical University Noida. I was actively involved with SHAREKHAN LTD. in Noida sector18 branch for a period of 2 months, and I can across a lot of people who put in their time and effort towards acclimatizing me to the working of their organization.

I first of all would like to extend my profound sense of gratitude to Mr. NARESH GUPTA (territory manager) sharekhan ltd. For providing me the opportunity to work as a summer trainee in the esteemed organization. I am indebted to my project supervisor Mr. SACHIN KUMAR (assistant manager) sharekhan ltd. who took keen interest in my study and helped me a lot conduct this study through his erudition and eminent guidance whenever I was needed his calm demeanor and willingness to teach is, has not only been a great help in successfully completing my project but also a doorway to immeasurable learning and great experience. I would like to thank to all management of share khan ltd. for giving me an opportunity to be part of the esteem organization and enhance my knowledge by granting permission to do my summer training project under their guidance. thanking all the people with whom I have interacted during the course of my training. I shall be falling my duty if I do not express my sincere thanks to all the teachers and colleague of department for there affection encouragement cooperation and guidance. I would like express my deep sense of respect and sincere gratitude to Prof. Anurag Srivastav for providing me ample time and resource to complete the project. Also appreciate and thank Prof. Nikhlash faculty of MBA, as without his continuous guidance and enthusiasm the project would have never been materialized in the present form. I am deeply beholden to my parents for their loving and caring attitude and generous support at every step of my life. I also would like thank to my friends for their support in completion of this project.

NITIN KUMAR

Content Title Page

Page no. 0

Declaration Supervisor Certificate Internal guide Certificate Executive Summary. Acknowledgement Introduction BOMBAY STOCK EXCHANGE SENSEX AND NIFTY How the SENSEX is calculated? Concept of free-float market cap The formula for calculating the SENSEX BSE SENSEX National Stock Exchange NSE-MIDCAP INDEX HISTORY OF ONLINE TRADING E- Broking - A small beginning INTERNET TRADING IN INDIA Indian Stock Exchanges - An Umbrella Growth Share khan Company profile

1 2 3 4-5 6-7 10 11 12 13-14 15-18 19 20-21 22 23 24 25 26-28 29 30-54

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TYPES OF ACCOUNT Share khans brokerage charges TIED UP WITH THE BANKS DEMAT-ACCOUNT Meaning of Trading Account COMPETITIORS Research&Mathdology SUGGESTIONS LIMITATIONS CONCLUSION BIBLIOGRAPHY

55-60 61-62 63 64-66 67-70 71 72-83 84-85 86-87 88 89

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INTRODUCTION

AS A FINANCIAL SYSTEM

The financial system is one of the most important inventions of the modern society .The phenomena of imbalance in the distribution of capital or funds existed in every economic system. These are areas or people with surplus funds and there are those with deficit. A financial System functions are as an intermediately and facilities in the flow of funds from areas of surplus to the area of deficit. A financial system is a composition of various institutions, markets regulation and law, practices, money managers, transactions and claims and liabilities. The functions performed by financial system are as: 1) SAVING FUNCTIONS 2) LIQUIDITY FUNCTIONS. 3) PAYMENTS FUNCTIONS. 4) RISK FUNCTIONS. 5) POLICY FUNCTIONS.

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BOMBAY STOCK EXCHANGE


Greater liquidity and lesser risk of intermediary charges due to widely spread trading mechanism across India The screen-based scrip less trading ensures transparency and accuracy of prices Faster settlement and transfer process as compared to other exchanges Shorter allotment procedure (in case of a new issue) than other exchanges

SENSEX AND NIFTY


The Sensex is an "index. An index is basically an indicator. It gives you a general idea about whether most of the stocks have gone up or most of the stocks have gone down. The Sensex is an indicator of all the major companies of the BSE. If the Sensex goes up, it means that the prices of the stocks of most of the major companies on the BSE have gone up. If the Sensex goes down, this tells you that the stock price of most of the major stocks on the BSE have gone down.

The BSE is the Bombay Stock Exchange and the NSE is the National Stock Exchange. The BSE is situated at Bombay and the NSE is situated at Delhi. These are the major stock exchanges in the country. There are other stock exchanges like the Calcutta Stock Exchange etc. but they are not as popular as the BSE and the NSE.Most of the stock

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trading in the country is done though the BSE & the NSBesides Sensex and the Nifty there are many other indexes. There is an index that gives you an idea about whether the mid-cap stocks go up and down. This is called the BSE Mid-cap Index. There are many other types of indexes. There is an index for the metal stocks. There is an index for theFMCG stocks. There is an index for the automobile stocks etc.

How the SENSEX is calculated?


The Sensex has a very important function. The Sensex is supposed to be an indicator of the stocks in the BSE. It is supposed to show whether the stocks are generally going up, or generally going down.

To show this accurately, the Sensex is calculated taking into consideration stock prices of 30 different BSE listed companies. It is calculated using the free-float market capitalization method. This is a world wide accepted method as one of the best methods for calculating a stock market index.

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Note: The method used for calculating the Sensex and the 30 companies that are taken into consideration are changed from time to time. This is done to make the Sensex an accurate index and so that it represents the BSE stocks properly.

To really understand how the Sensex is calculated, we simply need to understand what the term free-float market capitalization means. But, before we understand what free-float market capitalization means, we first need to understand what market capitalization means.

Market cap or market capitalization is simply the worth of a company in terms of its shares. if we were to buy all the shares of a particular company, what is the amount you would have to pay? That amount is called the market capitalization!

To calculate the market cap of a particular company, simply multiply the current share price by the number of shares issued by the company! for example- ONGC, has a market cap of Rs.170,705.21 Cr.

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Concept of free-float market cap


Many different types of investors hold the shares of a company! The Govt. may hold some of the shares. Some of the shares may be held by the founders or directors of the company. Some of the shares may be held by the FDIs etc.

Now, only the open market shares that are free for trading by anyone, are called the free-float shares. When we are calculating the Sensex, we are interested in these free-

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floatshares!

A particular company, may have certain shares in the open market and certain shares that are not available for trading in the open market. According the BSE, any shares that DO NOT fall under the following criteria, can be considered to be open market shares: Holdings by founders/directors/ acquirers which has control element Holdings by persons/ bodies with "controlling interest" Government holding as promoter/acquirer Holdings through the FDI Route Strategic stakes by private corporate bodies/ individuals Equity held by associate/group companies (cross-holdings) Equity held by employee welfare trusts Locked-in shares and shares which would not be sold in the open market in normal course. A company has to submit a complete report about who has how many of the companys shares to the BSE. On the basis of this, the BSE will decide the free-float factor of the company. The free-float factor is a very valuable number! If you multiply the "free-float

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factor" with the market cap of that company, you will get the free-float market cap which is the value of the shares of the company in the open market! A simple way to understand the free-float market cap would be, the total cost of buying all the shares in the open market!

So, having understood what the free float market cap is, now what? How do you find out the value of the Sensex at a particular point? Well, its pretty simple.

First: Find out the free-float market cap of all the 30 companies that make up the
Sensex!

Second: Add all the free-float market caps of all the 30 companies! Third: Make all this relative to the Sensex base. The value you get is the Sensex value!

In third step, you will need to understand ratios and proportions from 5th standard mathematics. Think of it this way: Suppose, for a free-float market cap of Rs.100,000 Cr... the Sensex value is 4000 Then, for a free-float market cap of Rs.150,000 Cr... the Sensex value will be..

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So, the Sensex value will be 6000 if the free-float market cap comes to Rs.150,000 Cr!

Please Note: Every time one of the 30 companies has a stock split or a "bonus" etc. appropriate changes are made in the market cap calculations.

Let s take an example.... Suppose the Index consists of only 2 stocks: Stock A and Stock B. Suppose company A has 1,000 shares in total, of which 200 are held by the promoters, so that only 800 shares are available for trading to the general public. These 800 shares are the so-called 'free-floating' shares.

Similarly, company B has 2,000 shares in total, of which 1,000 are held by the promoters and the rest 1,000 are free-floating. Now suppose the current market price of stock A is Rs 120. Thus, the 'total' market

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capitalization of company A is Rs 120,000 (1,000 x 120), but its free-float market capitalization is Rs 96,000 (800 x 120).

Similarly, suppose the current market price of stock B is Rs 200. The total market capitalization of company B will thus be Rs 400,000 (2,000 x 200), but its free-float market cap is only Rs 200,000 (1,000 x 200).

So as of today the market capitalization of the index (i.e. stocks A and B) is Rs 520,000 (Rs 120,000 + Rs 400,000); while the free-float market capitalization of the index is Rs 296,000. (Rs 96,000 + Rs 200,000).

The year 1978-79 is considered the base year of the index with a value set to 100. What this means is that suppose at that time the market capitalization of the stocks that comprised the index then was, say, 60,000 (remember at that time there may have been some other stocks in the index, not A and B, but that does not matter), then we assume that an index market cap of 60,000 is equal to an index-value of 100.

The formula for calculating the SENSEX = (Sum of free flow market cap of 30 biggest
stocks of BSE)*Index Value in 1978-79/Market Cap Value in 1978-79.

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Note: The base value (index value) of the Sensex is 100 on April 1, 1979, and the base year of BSE-SENSEX is 178-79.

Apply the formula.

The sensex is = 296,000 x 100/60,000 = 493.33

This is how the Sensex is calculated. Now, there is only one question left to be answered, which 30 companies, why those 30 companies, why no other companies?

The 30 companies that make up the Sensex are selected and reviewed from time to time by an index committee. This index committee is made up of academicians, equities managers, finance journalists, independent governing board members and other participants in the financial markets.

BSE SENSEX

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BSE Sensex or Bombay Stock Exchange Sensitivity Index is a value-weighted index composed of 30 stocks that started January 1, 1986. The Sensex is regarded as the pulse of the domestic stock markets in India. It consists of the 30 largest and most actively traded stocks, representative of various sectors, on the Bombay Stock Exchange. These companies account for around fifty per cent of the market capitalization of the BSE. The base value of the sensex is 100 on April 1, 1979, and the base year of BSE-SENSEX is 1978-79. At regular intervals, the Bombay Stock Exchange (BSE) authorities review and modify its composition to be sure it reflects current market conditions. The index is calculated based on a free-float capitalization method; a variation of the market cap method. Instead of using a company's outstanding shares it uses its float, or shares that are readily available for trading. The free-float method, therefore, does not include restricted stocks, such as those held by promoters, government and strategic investors The exchange, while providing an efficient and transparent market for trading securities, upholds the interests of the investors and ensures redressed of their grievances, whether against the companies or its own member brokers. It also strives to educate and enlighten the investors by making available necessary informative inputs and conducting investor education programmes. A governing board comprising of 9 elected directors, 2 SEBI nominees, 7 public representatives and an executive director is the apex body, which decides the policies and regulates the affairs of the exchange.

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The Executive director as the chief executive officer is responsible for the day today administration of the exchange. The average daily turnover of the exchange during the year 2000-01(April-March) was Rs 3984.19 crores and average number of daily trades 5.69Lakhs.

However the average daily turn over of the exchange during the year 2001-02 has declined to Rs. 1244.10 crores and number of average daily trades during the period to 5.17Lakhs.

The average daily turn over of the exchange during the year 2002-03 has declined and number of average daily trades during the period is also decreased. The Ban on all deferral products like BLESS AND ALBM in the Indian capital markets by SEBI with effect from July 2,2001, abolition of account period settlements, introduction of compulsory rolling settlements in all scripts traded on the exchanges with effect from Dec 31,2001, etc., have adversely impacted the liquidity and consequently there is a considerable decline in the daily turn over at the exchange. The average daily turn over of the exchange present scenario is 110363(laces) and number of average daily trades 1057(laces).

National Stock Exchange

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NIFTY
The Nifty is an indicator of all the major companies of the NSE. Just like the Sensex represents the top stocks of the BSE, the Nifty represents the top stocks of the NSE. Nifty means National Index for Fifty Stocks. The NSE-50 comprises 50 companies that represent 20 broad Industry groups with an aggregate market capitalization of around Rs. 1,70,000 crs. All companies included in the Index have a market capitalization in excess of Rs 500 crs each and should have traded for 85% of trading days at an impact cost of less than 1.5%. The base period for the index is the close of prices on Nov 3, 1995, which makes one year of completion of operation of NSEs capital market segment. The base value of the Index has been set at 1000.

NSE-MIDCAP INDEX:

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The NSE madcap Index or the Junior Nifty comprises 50 stocks that represents 21 aboard Industry groups and will provide proper representation of the madcap segment of the Indian capital Market. All stocks in the index should have market capitalization of greater than Rs.200 crores and should have traded 85% of the trading days at an impact cost of less2.5%. The base period for the index is Nov 4, 1996, which signifies two years for completion of operations of the capital market segment of the operations. The base value of the Index has been set at 1000. Average daily turn over of the present scenario 258212 (Laces) and number of averages daily trades 2160(Laces).

HISTORY OF ONLINE TRADING

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Online stock trading is very old concept for big institutions who trade through private networks owned by Reuter's "Instinet" and a system called Posit" since

1969. But it becomes internet based for lay men only in late 90s. Funny, that actually idea was first time used by a company making Beer called

"WIT beer" to help its shareholders trade its shares. Thats how "WIT Capital" was born which is considered pioneer of this concept. It was made mainstream and household name by a offshoot of Charles Schwab & Co called was made mainstream and household name by a offshoot of Charles Schwab & Co called eSchwab which is used by millions of people in USA. Lot of NRI's I know play in US stock market even when they come to India for holidays via website of eSchwabe. There are other serious players like E*TRADE, DATEK online etc. All this

companies ask you to start account with US $5000 and you can buy and sell stock using these funds. They also issue you a check book which you can use to make payments from this account. Or use their ATM card to withdraw cash from your stock trading account. Today practically every big name brokerage firm offers online stock trading as it reduces their costs. Earlier they had army of brokers on phone with clients executing trade, which is done by computers accepting orders from clients directly. This firm now offers human access to high net worth accounts, and now to rest at charge per trade.

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E- Broking - A small beginning:


You have some money to dabble with. Trading shares on BSE/NSE has always been your dream. When will you ever find the time? And besides, the hassle of finding a broker is not easy. Realizing there is untapped market of investors who want to be able to execute their own trades when it suits them, brokers have taken their trading rooms to the Internet. Known as online brokers, they allow you to buy and sell shares via Internet. There are 2 types of online trading service: discount brokers and full service online

broker. Discount online brokers allow you to trade via Internet at reduced rates. Some provide quality research, other dont. Full service online brokerage is linked to existing brokerages. These brokers allow their clients to place online orders with the option of talking/ chatting to brokers if advice is needed. Brokerage rates ICICIDirect.com, IndiaBulls.com, Sharekhan.com, here are higher. 5Paisa.com, HDFCsec.com,

Geojit securities.com,

Tatatdw.com, Kotakstreet.com are some of the online broking sites in India. With Net trading in securities and rapid consolidation between multiple stock exchanges, the international securities marketplace is fast becoming a "global village" through the creation of a universal virtual equity market. Compared to the Western countries, online trading is still in its infancy in India. With trading turnover at around Rs. 10 crores per day from online trading compared to a combined

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gross turnover of around Rs. 9000-10,000 crores handled by the BSE and NSE together, online trading has a long way to go.

INTERNET TRADING IN INDIA:


In the past, investors had no option but to contact their broker to get real time access to market data. The Net brings data to the investor on line and net broking enables him to trade on a click. Now information has become easily accessible to both retail as well as big investors. The development of broking in India can be categorized in 3 phases: 1. Stock brokers offering on their sites features such as live portfolio manager, live quotes, market research and news to attract more investors. 2. Brokers offering on line broking and relationship management by providing and offering analysis and information to investors during broking and non-broking hours based on their profile and needs, that is, customized services. 3. Brokers (now e-brokers) will offer value management or services such as initial public offerings on line, asset allocation, portfolio management, financial planning, tax planning, insurance services and enable the investors to take better and well-considered decisions. In the US, 82 per cent of the deals are done on line. The European on line broking market is expected to be of $8 billions and is likely to raise fivefold by 2002. In India, presently Internet trading can take place through the order routing system, which will route client orders to exchanges trading systems for execution of trades on stock exchanges (NSE and BSE). This will

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also require interface with banks to facilitate instant cash debit or credit and the depository system for debit or credit of securities.

OBJECTIVES OF INTERNET TRADING


Increase transparency in the markets. Enhance market quality through improved liquidity, by increasing quote continuity and market depth. Reduce settlement risks due to open trades, by elimination of mismatches. Provide management information system (MIS). Introduce flexibility in system, to handle growing volumes easily and to support nationwide expansion of market activity. Besides, through Internet trading three fundamental objectives of securities regulation can be easily achieved, these are: Investor protection, creation of a fair and efficient market and, reduction of the systematic risks. Other leading cities in stock market operations:

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Ahmadabad gained

importance next to Bombay with

respect

to cotton

textile industry.

After 1880, many mills originated from Ahmadabad and rapidly forged ahead. As new mills were floated, the need for a Stock Exchange at Ahmadabad was realized and in 1894 the brokers formed "The Ahmadabad Share and Stock Brokers' Association. What the cotton textile industry was to Bombay and Ahmadabad, the jute industry was to Calcutta. Also tea and coal industries were the other major industrial groups in Calcutta. After the Share Mania in 186165, in the 1870's there was a sharp boom in jute shares, which was followed by a boom in tea shares in the 1880's and 1890's; and a coal boom between 1904 and 1908. On June 1908, some leading brokers formed "The Calcutta Stock Exchange Association". In the beginning of the twentieth century, the industrial revolution was on the way in India with the Swadeshi Movement; and with the inauguration of the Tata Iron and Steel Company Limited in 1907, an important stage in industrial advancement under Indian enterprise was reached. Indian cotton and jute textiles, steel, sugar, paper and flour mills and all companies generally enjoyed phenomenal prosperity, due to the First World War. In 1920, the then demure city of Madras had the maiden thrill of a stock exchange functioning in its midst, under the name and style of "The Madras Stock Exchange" with 100 members. However, when boom faded, the number of members stood reduced from 100 to 3, by 1923, and so it went out of existence. In 1935, the stock market activity improved, especially in South India where there was a rapid increase in the number of textile mills and

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many plantation companies were floated. In 1937, a stock exchange was once again organized in Madras - Madras Stock Exchange Association (Pvt) Limited. (In 1957 the name was changed to Madras Stock Exchange Limited). Lahore Stock Exchange was formed in 1934 and it had a brief life. It was merged with the Punjab Stock Exchange Limited, which was incorporated in 1936.

Indian Stock Exchanges - An Umbrella Growth:


The Second World War broke out in 1939. It gave a sharp boom, which was followed by a

slump. But, in 1943, the situation changed radically, when India was fully mobilized as a supply base. On account of the restrictive controls on cotton, bullion, seeds and other

commodities, those dealing in them found in the stock market as the only outlet for their activities. They were anxious to join the trade and numerous others swelled their number. Many new associations were constituted for the purpose and Stock Exchanges in all parts of the country were floated.

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The Uttar Pradesh Stock Exchange Limited

(1940), Nagpur Stock Exchange Limited

(1940) and Hyderabad Stock Exchange Limited (1944) were incorporated. In Delhi two stock exchanges - Delhi Stock and Share Brokers' Association Limited and the Delhi Stocks and Shares Exchange Limited - were floated and later in June 1947, amalgamated into the Delhi Stock Exchange Association Limited.

Company profile

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SHAREKHAN- ONE OF THE FASTEST GROWING FINANCIAL SERVICES COMPANY IN INDIA

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INTRODUCTION
Sharekhan is one of the top retail brokerage houses in India with a strong online trading platform. The company provides equity based products (research, equities, derivatives, depository, margin funding, etc.). It has one of the largest networks in the country with 704

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share shops in 280 cities and Indias premier online trading portal www.sharekhan.com. With their research expertise, customer commitment and superior technology, they provide investors with end-to-end solutions in investments. They provide trade execution services through multiple channels - an Internet platform, telephone and retail outlets. It is the retail broking arm of the Mumbai-based SSKI [SHANTILAL SHEWANTILAL KANTILAL ISWARNATH LIMITED] Group. Sharekhan is online stock trading company of SSKI Group, provider of India-based investment banking and corporate finance service. Sharekhan is one of the largest stock broking houses in the country. Shri Shantilal Kantilal Ishwarlal Securities Limited (SSKI) has been among Indias leading broking houses for more than a century. It has a client base of 1.5 Corers. Launched on 8th February, 2000 as an online trading portal, Sharekhan offers its clients trade execution facilities for cash as well as derivatives, on BSE and NSE, depository services, equities, initial public offerings (IPOs), and commodities trading facilities on MCX and NCDEX. Besides high quality investment advice from an experienced research team Sharekhan provides market related news, stock quotes fundamental and statistical information across equity, equities, IPOs and much more. Sharekhan is also about focus. Sharekhan does not claim expertise in too many things. Sharekhan s expertise lies in stocks and that's what he talks about with authority. To sum up, Sharekhan brings to you a user-

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friendly online trading facility, coupled with a wealth of content that will help you stalk the right shares.

History of ShareKhan
Sharekhan is online stock trading company of SSKI Group, provider of India-based investment banking and corporate finance service. Sharekhan is one of the largest stock broking houses in the country. Shri Shantilal Kantilal Ishwarlal Securities Limited (SSKI) has been among Indias leading broking houses for more than a century.

SSKI which is established in 1930 is the parent company of Sharekhan ltd. With a legacy of more than 80 years in the stock markets, the SSKI group ventured into institutional broking and corporate finance over a decade ago. Presently SSKI is one of the leading players in institutional broking and corporate finance activities. Sharekhan offers its customers a wide range of equity related services including trade execution on BSE, NSE, and Derivatives. Depository services, online trading, Investment advice, Commodities, etc. Sharekhan Ltd is India's leading online retail broking house with its presence through 1288'Share Shops' in 398 cities. It has a client base of 1.5 Corers.

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Sharekhan Ltd. is a brokerage firm which is established on 8 th February 2000 and now it is having all the rights of SSKI. The Company's online trading and investment site - www.Sharekhan.com - was also launched on Feb 8, 2000. This site gives access to superior content and transaction facility to retail customers across the country. Known for its jargon-free, investor friendly language and high quality research, the content-rich and research oriented portal has stood out among its contemporaries because of its steadfast dedication to offering customers best-of-breed technology and superior market information. Launched on 8th February, 2000 as an online trading portal, Sharekhan offers its clients trade execution facilities for cash as well as derivatives, on BSE and NSE, depository services, equities, initial public offerings (IPOs), and commodities trading facilities on MCX and NCDEX. On April 17, 2002 Sharekhan launched Speed Trade, a net-based executable application that emulates the broker terminals along with host of other information relevant to the Day Traders. This was for the first time that a net based trading station of this caliber was offered to the traders. In the last six months Speed Trade has become a de facto standard for the Day Trading community over the net. The company was awarded the 2005 Most Preferred Stock Broking Brand by Awwaz Consumer Vote. It is first brokerage Company to go online.

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Share khans ground network includes over 331 centers in 137 cities in India which provide a host of trading related services. Share khans management team is one of the strongest in the sector and has positioned Sharekhan to take advantage of the growing consumer demand for financial services products in India through investments in research, pan-Indian branch network and an outstanding technology platform. Further, Share khans lineage and relationship with SSKI Group provide it a unique position to understand and leverage the growth of the financial services sector. We look forward to providing strategic counsel to Share khans management as they continue their expansion for the benefit of all shareholders."

Sharekhan has always believed in investing in technology to build its business. The company has used some of the best-known names in the IT industry, like Sun Microsystems, Oracle, Microsoft, Cambridge Technologies, Nexgenix, Vignette, Verisign Financial

Technologies India Ltd, Spider Software Pvt Ltd. To build its trading engine and content. The Morakhiya family holds a majority stake in the company. HSBC, Intel & Carlyle are the other investors. With a legacy of more than 80 years in the stock markets, the SSKI group ventured into institutional broking and corporate finance 18 years ago. Presently SSKI is one of the leading players in institutional broking and corporate finance activities. SSKI holds a sizeable portion of the market in each of these segments. SSKIs institutional broking arm

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accounts for 7% of the market for Foreign Institutional portfolio investment and 5% of all Domestic Institutional portfolio investment in the country. It has 60 institutional clients spread over India, Far East, UK and US. Foreign Institutional Investors generate about 65% of the organizations revenue, with a daily turnover of over US$ 2 million. The Corporate Finance section has a list of very prestigious clients and has many firsts to its credit, in terms of the size of deal, sector tapped etc. The group has placed over US$ 1 billion in private equity deals. Some of the clients include BPL Cellular Holding, Gujarat Hutchison, Planetasia, and Shoppers Stop. Share khan has one of the best states of art web portal providing fundamental and statistical information across equity, equities and IPOs. One can surf across 5,500 companies for in-depth information, details about more than 1,500 equities schemes and IPO data. One can also access other market related details such as board meetings, result announcements, FII transactions, buying/selling by equities and much more. SSKI Corporate Finance Private Limited (SSKI) is a leading India-based investment bank with strong research-driven focus. Their team members are widely respected for their commitment to transactions and their specialized knowledge in their areas of strength. The team has completed over US$5 billion worth of deals in the last 5 years - making it among the most significant players raising equity in the Indian market. SSKI, a veteran equities solutions company has over 8 decades of experience in the Indian stock markets. Pipavav, Essar,

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"Sharekhan has always believed in collaborating with like-minded Corporate into forming strategic associations for mutual benefit relationships" says Jaideep Arora, Director - Sharekhan Limited. Sharekhan is also about focus. Sharekhan does not claim expertise in too many things. Share khans expertise lies in stocks and that's what he talks about with authority. So when he says that investing in stocks should not be confused with trading in stocks or a portfolio-based strategy is better than betting on a single horse, it is something that is spoken with years of focused learning and experience in the stock markets. And these beliefs are reflected in everything Sharekhan does for us! Sharekhan is a part of the SSKI group, an Indian financial services power house, with strong presence in Retail equities Institutional equities Investment banking. "Sharekhan has always believed in collaborating with like-minded Corporate into forming strategic associations for mutual benefit relationships" says Jaideep Arora, Director - Sharekhan Limited. Sharekhan is also about focus. Sharekhan does not claim expertise in too many things. Share khans expertise lies in stocks and that's what he talks about with authority. So when he says that investing in stocks should not be confused with trading in stocks or a portfolio-based strategy is better than betting on a single horse, it is something that is spoken with years of focused learning and experience in the stock markets. And these beliefs are reflected in everything Sharekhan does for us! Sharekhan is a part of the SSKI group, an Indian financial services power house, with strong presence in Retail equities Institutional equities Investment banking.

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REASONS TO CHOOSE SHAREKHAN LIMITED

1. Experience
SSKI has more than eight decades of trust and credibility in the Indian stock market. In the Asia Money broker's poll held recently, SSKI won the 'India's best broking house for 2004' award. Ever since it launched Sharekhan as its retail broking division in February 2000, it has been providing institutional-level research and broking services to individual investors.

2. Technology
With their online trading account one can buy and sell shares in an instant from any PC with an internet connection. Customers get access to the powerful online trading tools that will help them to take complete control over their investment in shares.

3. Accessibility
Sharekhan provides services for investors. These services are accessible through many centers across the country (Over 650 locations in 150 cities), over the Internet (through the website www.sharekhan.com) as well as over the Voice Tool.

4 .Knowledge

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In a business where the right information at the right time can translate into direct profits, investors get access to a wide range of information on the content-rich portal, www.sharekhan.com. Investors will also get a useful set of knowledge-based tools that will empower them to take informed decisions.

5.

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Convenience One can call Sharekhans Dial-N-Trade number to get investment advice and execute his/her transactions. They have a dedicated call-center to provide this service via a Toll Free Number 1800-22-7500 & 39707500 from anywhere in India. Customer Service Its customer service team assist their customer for any help that they need relating to transactions, billing, dmat and other queries. Their customer service can be contacted via a toll- free number, email or live chat on www.sharekhan.com. Investment Advice

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Sharekhan has dedicated research teams of more than 30 people for fundamental and technical research. Their analysts constantly track the pulse of the market and provide timely investment advice to customer in the form of daily research emails, online chat, printed reports etc PRODUCT & SERVICES A Sharekhan outlet offers the following services: Online BSE and NSE executions (through BOLT & NEAT terminals) Free access to investment advice from Sharekhans Research Convenience
One can call Share khans Dial-N-Trade number to get investment advice and execute his/her transactions. They have a dedicated call-center to provide this service via a Toll Free Number 1800-22-7500 & 39707500 from anywhere in India.

6. Customer Service

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Its customer service team assists their customer for any help that they need relating to transactions, billing, demat and other queries. Their customer service can be contacted via a tollfree number, email or live chat on www.sharekhan.com.

7. Investment Advice
Sharekhan has dedicated research teams of more than 30 people for fundamental and technical research. Their analysts constantly track the pulse of the market and provide timely investment advice to customer in the form of daily research emails, online chat, printed reports etc.

PROFILE OF THE COMPANY


Name of the company Year of Establishment Headquarter : : Sharekhan ltd. 1922 ShareKhan SSKI A-206 Phoenix House, Phoenix Mills Compound lower parel

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Mumbai Maharashtra , INDIA- 400013

Nature of Business

Service Provider

Services . Number of Employees

Depository Services, Online Services and Technical Research : Over 3500

Website Slogan :

www.sharekhan.com Your Guide to financial jungle.

SHAREKHAN LIMITEDS MANAGEMENT TEAM TOP MANAGEMENT


Mr.TarunShah Chief Executive Officer Sharekhan

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Mr. Shankar Vailaya heads the operations, finance and legal functions Mr. Jaideep Arora Director(Products & Technology) of the Sharekhan 4. Pathik Gandotra 5. Rishi Kohli 6. Nikhil Vora : Head of Research : Vice President of Equity Derivatives : Vice President of Research

WORK STRUCTURE OF SHAREKHAN

Sharekhan has always believed in investing in technology to build its business. The company has used some of the best-known names in the IT industry, like SunMicro systems, Oracle, Microsoft, Cambridge Technologies, Nexgenix, Vignette, Verisign Financial Technologies India Ltd, Spider Software Pvt Ltd. to build its trading engine and content. The City Venture holds a majority stake in the company. HSBC, Intel & Carlyle are the other investors.

On April 17, 2002 Sharekhan launched Speed Trade and Trade Tiger, are net-based executable application that emulates the broker terminals along with host of other information relevant to the Day Traders. This was for the first time that a net-based trading station of this caliber was

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offered to the traders. In the last six months Speed Trade has become a de facto standard for the Day Trading community over the net. Share khans ground network includes over 1288+ Share shops in 325+ cities in India. The firms online trading and investment site - www.sharekhan.com - was launched on Feb 8, 2000. The site gives access to superior content and transaction facility to retail customers across the country. Known for its jargon-free, investor friendly language and high quality research, the site has a registered base of over 3 Lacs customers.

The number of trading members currently stands at over 8 Lacs. While online trading currently accounts for just over 5 per cent of the daily trading in stocks in India, Sharekhan alone accounts for 27 per cent of the volumes traded online.

The Corporate Finance section has a list of very prestigious clients and has many first to its credit, in terms of the size of deal, sector tapped etc. The group has placed over US$ 5 billion in private equity deals. Some of the clients include BPL Cellular Holding, Gujarat Pipavav, Essar, Hutchison, Planetasia, and Shoppers Stop.

Finally, Sharekhan shifted hands and City venture get holds on it.

ACHIEVEMENTS OF SHAREKHAN

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A rated among the top 20 wired companies along with Reliance, HUJl, Infosys, etc Business Today, January 2004 edition.

by

Awarded Top Domestic Brokerage House four times by Euro money and Asia money.

Pioneers of online trading in India amongst the top 3 online trading websites from India.

Most preferred financial destination amongst online broking customers. Winners of Best Financial Website award. Indias most preferred brokers within 5 years. Awaaz customers Award 2005.

Future Plans

2,00,000 plus retail customers being serviced through centralized call centers/ web solutions. Branches / Semi branches servicing affluent / aggressive traders through high skill financial advisor.

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250 independent investment managers/ franchisee servicing 50,000 highly clients. New initiative Portfolio management Services and commodities trading.

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Vision:
To be the best retail brokering brand in the retail business of stock marketing.

Mission:
To educated and empower the individual investor to make better investment better decision through the quality advise and superior services.

Sharekhan is infect:
1. Among the top three branded retail service provider. 2. No.1 player in the on line trading business. 3. Largest network of branded broking outlet in the country service more then 700000 client. Get anything you need at a sharekhan outlet.

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All you have to do is walk into any of our 640 share shops across 280 cities in India to get a host of trading related serviced our friendly customer service staff will also help you with any account related queries you may.

Sharekhan outlets offer the following services .


1. Online BSE and NSE execution (through blot and neat terminal). 2. Free access to the investment advise from share khans research team. 3. Sharekhan value line ( a monthly population with review of recommendation, stock to watch out for etc.) 4. Daily research reports and market review (High Noon & Eagle Eye) 5. Pre-market Report (Morning Cuppa) 6. 7. 8. 9. Daily trading calls based on Technical Analysis Cool trading products (Daring Derivatives and Market Strategy) Personalized Advice Live Market Information

10. Depository Services: Demat & Remat Transactions 11. Derivatives Trading (Futures and Options)

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12. Commodities Trading 13. IPOs & Equities Distribution 14. Internet-based Online Trading: Speed Trade

FINANCIAL CAPABILITY
Taking in to consideration all its assets and liabilities company is valued at around Rs. 750-850 cores.

HIERARCHY IN SHAREKHAN
There are 13 main hierarchical levels in Sharekhan: 1) Trainees 2) Super trainees 3) Sales executives/dealer 4) Senior sales executives 5) Assistant sales manager/HNI Sales Asst. Manager/Relationship Manager/Equity advisor. 6) Territory manger 7) Area sales manager 8) regional sales manager(Branch manager)

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9) Country head 10) Assistant vice president manager 11) Vice president 12) Directors 13) CEO

SWOT ANALYSIS OF SHAREKHAN STRENGTHS


It is a pioneer in online trading with a turnover of Rs.400crores and more than 800 peoples working in the organization.

SSKI the parent company of Share Khan has more than eight decades of trust and credibility in the Indian stock market. In the Asian Money Brokers poll SSKI won the Indias best broking house for 2004 award.

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Share Khan provides multi-channel access to all its customers through a strong online presence with www.sharekhan.com, 250 share shops based Dial-n-Trade facility. in 130 cities and a call-center

Share Khan has dedicated research teams for fundamental and technical research. Which constantly track the pulse of the market and provide timely investment advice free of cost to its clients which has a strike rate of 70-80%.

Employees are highly empowered. And strong communication network.

Management philosophy and commitment to maximize shareholders return and upgraded product design and development facilities to develop new products and aid diversification.

Ongoing activities to support up gradation of operational performance and

rise in

productivity and Team of talented and committed professionals available to improve companys performance weakness.

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Good co-operation between employees.

Number 1 registrar and transfer agent and dealer of investment products in India

WEAKNESS
Localized presence due to insufficient investments for country wide expansion. Lack of awareness among customers because of non-aggressive promotional strategies (print media, newspapers, etc). High brokerage charges but now they have overcome this by a new prepaid scheme in which brokerage is reduced to half. Focuses more on HNIs than retail investors which results in meager market-share as compared to close competitors. High employee turnover

OPPORTUNITIES
With the booming capital market raise its clients base. it can successfully launch new services and

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It can easily tap the retail investors with small saving through o promotional channels like print media, electronic media, etc.

As interest on fixed deposits with post office and banks are all time low, more and more small investors are entering into stock market.

Abolition of long term capital gain tax on shares and reduction in short term capital gain is making stock market as hot destination for investment among small investors.

Increasing usage of internet through broadband connectivity may boost a whole new breed of investors for trading in securities.

Growth rate of equities industry is 40 to 50% during last year and it expected that this rate will be maintained in future also.

Marketing at rural and semi-urban areas.

THREATS
Aggressive promotional strategies by close competitors may hamper Share Khans acceptance by new clients. Lack of sufficient branch-offices for speedy delivery of services. Other players are providing margin funds to investors on easy terms where as there is no such facility in share khan.

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More and more players are venturing into this domain which can further reduce the earnings of Share Khan.

Increasing number of Competitors. Constant pressure to be cost competitive to meet customers expectations. Relentless pressure to maintain profitability due to rising input/raw material prices.

Share khan provides 4 in 1 Account:


1) DEMAT A/C. 2) Trading a/c for cash calculations.

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3) Bank a/c for fund Transfer. 4) Dial n trade: for query related Trading.

SHAREKHANS BASIC PRODUCTS:


1) Demat cum Trading. 2) Commodities. 3) Port-Folio Management System (PMS). 4) Mutual Funds. 5) Derivatives. Out of these, we had to Sell Demat A/c s .

FEATURES OF TRADING WITH SHAREKHAN:

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1) Provide online Terminal to client. 2) Executive time is less. 3) Provide Relationship Manager fallibility to Client. 4) Dealer ( above Rs. 2,5000 /-) 5) Online funds Transfer facility. 6) Software based/ website based trading. (Error frees trading). 7) Provides Timely advices (tips) and Research Reports on E-mail Id of clients. 8) Real time Port-Folio Tracking. 9) Information and price alert. 10) Instant credit and money transfer facility across country. 11) Free from paperwork. 12) Equity Fund facility available (above Rs. 2 laces). 13) ** EXPOSURE facility (10 times, 4T x 5T SCHEMES).

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Sharekhan Demat Account Services:


SharekhanTransacting and investing simplified. Get ready to change the way you transact and invest in financial products and services. Whether you wish to transact in equity, equity & commodity derivatives, IPOs offshore investments or prefer to invest in equities, life & general insurance products or avail money transfer and money changing services, you can do it all through Angel. Simply open an Angel account and enjoy the convenience of handling all your key financial transactions through this one window.

Benefits of having a Sharekhan account: Its cost effective


You pay comparatively lower transaction fees. As an Introductory offer, we invite you to pay a flat fee of just Rs. 750/- and transact through Sharekhan

Its offers single


Through Share khans associates, you can transact in equity, equity and

commodities derivatives, offshore investments equities, IPOs life insurance, general insurance, money transfer, money changing and credit cards, among others.

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Its convenient
You can access Share khans services through The internet Transaction kiosks The phone (calls & transact) Our all India network of associates on an assisted trade. Its Safe your account is safeguarded with a unique security number that changes every 32

seconds. This number works as a dynamics password to keep your account extra safe. It provide you value- added services at www.sharekhan.com , you get Reliable research, including views of external experts with an enviable track record. Live news updates from Reuters and Dow Jones CEOs / expert views on the economy and financial markets Tools that help you plan your investments, tax, retirement, etc. in the persona finance section Risk Analyzer for analysis of your risk profile Asset allocators to build an appropriate investment portfolio Innovative use of technology for facilitating.

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TYPES OF ACCOUNT
Sharekhan offers three types of trading account for its clients:

Classic Account.

Fast trade account.

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Trade Tiger Account

CLASSIC ACCOUNT:
This is a User Friendly Product which allows the client to trade through website www.sharekhan.com and is suitable for the retail investor who is risk-averse and hence prefers to invest in stocks or who does not trade too frequently. This account allow investors to buy and sell stocks online along with the following features like multiple watch lists, Integrated

Banking, Demat and digital contracts, Real-time portfolio tracking with price alerts and Instant credit & transfer.

This account comes with the following features:


Online trading account for investing in Equity and Derivatives via www.sharekhan.com

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Live Terminal and Single terminal for NSE Cash, NSE F&O & BSE. Integration of On-line trading, Saving Bank and Demat Account. Instant cash transfer facility against purchase & sale of shares. Competitive transaction charges. Instant order and trade confirmation by E-mail. Streaming Quotes (Cash & Derivatives). Personalized market watch. Single screen interface for Cash and derivatives and more. Provision to enter price trigger and view the same online in market watch.

Fast trade account:


This online trading platform is an applet based application that provide lives streaming quotes from bse and nse .get live market prices and market statistics like the best bid prices ,quantity ,best offer price and quantity etc. for chosen stocks customize the screen with your own choice of securities.

This account comes with the following features:


Streaming quotes. Personalized market watch.

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Single screen interface for cash, derivatives and more. Provision to enter price trigger and view the same online in market watch New fast trade will support all browsers in the market. New fast trade is independent of existing website and can work even if content website is down. New fast trade is platform independent will support by all operating system.

Silent feature
Faster Download of Flash plug-in ( Most people have it by default) No requirement of Microsoft / Sun JVM Excellent UI Compression and Security Working on all browser Applet works only with I.E ( Applet doesnt work on I.E. 7 and above) Dynamic Feed & Order Placement on the Browser Market / Exchange News

TRADE TIGER ACCOUNT:

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This is an internet-based software application, application, which enables one to buy and sell in an instant. It is ideal for active traders and jobbers who transact frequently during days session to capitalize on intra-day price movement.

This account comes with the following features:


A single platform for multiple exchange BSE & NSE (Cash & F&O), MCX, NCDEX, Equities, IPOs Multiple Market Watch available on a Single Screen Multiple Charts with Tick by Tick Intraday and End of Day Charting powered with various Studies Graph Studies include Average, Band-Bollinger, Know Sure Thing, MACD etc Apply studies such as Vertical, Horizontal, Trend, Retracement & Free lines User can save his own defined screen as well as graph template that is, saving the layout for future use. User-defined alert settings on an input Stock Price trigger Tools available to guage market such as Tick Query, Ticker, Market Summary, Action Watch, Option Premium Calculator, Span Calculator

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Shortcut key for FAST access to order placements & reports Online fund transfer activated with 12 Banks,

DIAL-N-TRADE
Along with enabling access for trade online, the CLASSIC and SPEEDTRADE ACCOUNT also gives Dial-n-trade services. With this service, one can dial Share khans dedicated phone lines 1800-22-7500, 3970-7500. Beside this, Relationship Managers are always available on Office Phone and Mobile to resolve customer queries. All you have to do is dial any one of our two dedicated numbers (1-800-22-7050 or 30307600), enter your TPIN number (which is provided at the time of opening your account) and on authentication you'll be directed to a telebroker who will buy and sell shares for you

Features of Dial-n-Trade:

TWO dedicated numbers for placing your orders with your cellphone or landline. Toll free number: 1-800-22-7050. For people with difficulty in accessing the toll-free number, we also have a Reliance number (Your Local STD Code) 30307600 which is charged at as a local call.

Simple and Secure Interactive Voice Response based system for authentication

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No waiting time. Enter your TPIN to be transferred to our telebrokers You also get the trusted, professional advice of our telebrokers After hours order placement facility between 8.30 am and 9.00 am Reliable service, wherever you are

Share Mobile
Sharekhan had introduced Share Mobile, mobile based software where one can watch Stock Prices, Intra Day Charts, Research & Advice and Trading Calls live on the Mobile.

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Share khans brokerage charges

NORMAL PLAN MARGIN MONEY (Rs.)


5,000 10,000 20,000 25,000 50,000 1,00,000 5,00,000

INTRA DAY CHARGES (%)


0.10 0.10 0.05 0.04 0.03

DELIVERY CHARGES (%)


0.50 0.50 0.25 0.20 0.15

In margin money of Rs. 5,000 , there is an account opening charge of Rs.250. Charges of intraday & delivery are negotiable , depending upon the amount of margin money. Trade tiger software is free on the margin money above Rs.2,00,000.

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PREPAID PLAN PREPAID AMOUNT (Rs.)


750 2,000 6,000 18,000

INTRA DAY CHARGES (%)


0.050 0.035 0.025 0.020

DELIVERY CHARGES (%)


0.50 0.40 0.25 0.20

In 750 plan, Rs.750 is expired after six months. In other plan, amount is expired after twelve months. Trade tiger software is free in 6,000 and above plan. Charges of intraday & delivery are negotiable as per the investment amount.

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TIED UP WITH THE BANKS:


HDFC BANK CITI BANK UNION BANK OF INDIA ORIENTAL BANK OF COMMERCE AXIS BANK IDBI INDUSLAND BANK BANK OF INDIA ICICI BANK YES BANK FEDRAL BANK

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DEMAT-ACCOUNT
Demat account is mandatory for trading and investing of shares. Demat refers to dematerialized account. Demat Account is a safe secure and convenient way where you can buy and sell the shares without any paper work and all the things will be taken care by the DP (Depository Participants).If you have Demat account you need not to show any kind of physical certificate that you have these shares. They held automatically in your account. DP will also provide you monthly statement of your transaction just like a bank statement. For individual Indian citizens to trade in listed stocks or debentures the Securities Exchange Board of India( SEBI) requires the investors to maintain a Demat account .In a Demat account shares and securities are held in electronic form instead of taking actual possession of certificates. The investor while registering with an investment broker (or sub broker) opens a Demat account. The Demat account number, which is quoted for all transactions to enable electronic settlements of trades to take place.

Objective of Demat system:

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India has adopted a system in which book entry is done electronically .it is the system where on paper is involved. Physical form is extinguished and shares or securities are held in electronics mode. Before the introduction of the depository system by the Depository Act, 1996. The process of sale, purchase and transfer of shares was a huge problem and the safety perspective was zero.

Is a Demat account a must?


Now a day, practically all trades have to be settled in dematerialized form. Although the market regulator, the Securities and Exchange Board of India (SEBI), has allowed trades of up to 500 shares to be settled in physical form, nobody wants physical shares any more. So a Demat account is a must for trading and investing.

Why Demat?
The Demat account reduces brokerage charges, makes pledging/hypothecation of shares easier, enables quick ownership of securities on settlement resulting in increased liquidity,

avoids confusion in the ownership title of securities, and provides easy receipt of public issue allotments. It also helps you avoid bad deliveries caused by signature mismatch, postal delays and loss of certificates in transit. Further, it eliminates risks associated with forgery, counterfeiting

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and loss due to fire, theft or mutilation. Demat account holders can also avoid stamp duty (as against 0.5 per cent payable on physical shares), avoid filling up of transfer deeds, and obtain quick receipt of such benefits as stock splits and bonuses.

DEMAT Benefits
A safe and convenient way to hold securities. Immediate transfer of securities. No stamp duty on transfer of securities (0.5 % on physical shares). Elimination of risks associated with physical certificates such as bad delivery, fake securities, delays, theft etc. Reduction in paper work. Reduction in transaction cost. No odd lot problem, even one share can be sold.

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Meaning of Trading Account


1. An account similar to a traditional bank account, holding cash and securities, and is administered by an investment dealer.

2. An account held at a financial institution and administered by an investment dealer that the account holder uses to employ a trading strategy rather than a buy-and-hold investment strategy.

TYPES OF TRADING

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At the end of this section, you will be familiar with terms like Cash market, Margin trading, Futures & Options and Commodity trading.

Cash Segment
Cash market trading is meant for the people who wish to buy shares with an intention of taking delivery of shares. They need to allocate full amount towards the purchase of the shares at the time of placing order. That means the trading account must have sufficient funds to take care of the total cost of the purchase of the shares, brokerage and other charges. The shares get delivered to the investor's DP account after the settlement process. The investor may the sell the shares on the next trading day, provided the shares are not trade to trade segment (T2T). In such cases, the shares can be sold only after the receipt of the same.

Margin trading
in margin trading, the broker allows the investor to buy shares worth up to 4 times the available balance in his trading account. But, not all the shares can be traded in the margin segment. The investor has to square off the trades within the same day. That means, if an investor buys 500 shares of Xyz Company at a total cost of Rs.50, 00000, he has to sell it before the stipulated time on the same day. If the market moves against the investor's position then he has to take delivery of the shares. If the shares have to be taken for delivery, brokerage will be charged more and the

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investor should settle the balance amount as per the agreement with the broker. If investor has done a short sell, he has to buy the shares. Short sell can not be carried forward to the next day. If it is not squared off, then he will be forced to pay penalty charges. Margin trading is also referred as Day trading or Intra day trading by some people. Stop loss trigger may be used to minimize the loss if the market moves contrary to the expectation of the investor. Assuming that after buying the share prices goes down, the investor can minimize the loss by putting the stop loss trigger price and a limit price. When the stock price hits the stop loss trigger price, the system starts selling the shares, it is sold till the limit price of the sell order. In general the limit price is set 5% lower than the stop loss price for selling.

Futures and Options


Future represents a contract between a buyer and seller on a specific quantity of financial instrument like currency, stock market index or stocks, or even a commodity, at a specified price with a defined delivery or settlement period. Futures are traded in lots of underlying assets like stocks. Buying a contract is known as long position and selling a contract is called as short position. Future contracts have two types of settlements, one is a physical delivery and the other one is settling in cash. Physical delivery part may be exercised in a commodity future contract. Last Thursday of the month is the due date for delivery or settlement of all F&O contracts.

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However there is no need to wait till the last day of the settlement of the future contract. The contract can be squared off even before the expiry date. In F&O segment, both the buyer and seller face equal risks. So, we can say that the risk factor is symmetrical. The operators or investors of Future & Options segment can be classified as Hedgers - who have positions in long and short in F&O segments, so that any market fluctuation will not affect them. Speculators - Risk savvy people, who speculate and take their positions in F&O and the leave the rest to the market. The speculators get in to highest degree of exposure to risks. Same time speculators make big profits, if the market condition is in favor to them. Third category is known as Arbitrageurs operate in various markets simultaneously to protect their interests, they may take a short position in F&O and long position in cash segment. Futures & Options trading is also known as derivative trading. The major difference between equity trading and derivative trading is, in case of futures, the short positions can be carried forward until the expiry of the contract, where as in cash segment, the short positions have to be squared off on the same day, failing which the investor has to pay the penalty charges. F & O segment is actively traded by the Foreign Institutional Investors and the turnover is 4 times higher than cash segment.

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COMPETITIORS

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DATA ANALYSIS AND INTERPRETATION Q1. In which of these Financial Instruments do you invest into?
Financial Instrument Mutual Fund Bond Online trading Derivative Percentage of respondent 75% 16% 7% 2%

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Interpretation
This shows that although the mutual funds market is on the rise yet, the most favored investment continues to be in the Share Market. So, with a more transparent system, investment in the Stock Market can definitely be increased.

Q2. Are you aware of online Share trading? Aware of online share trading
Yes No

Percentage of respondent
72% 28%

Interpretation

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With the increase in cyber education, the awareness towards online share trading has increased by leaps and bounds. This awareness is expected to increase further with the increase in Internet education.

Q3. Heard about Sharekhan ltd.? Awareness of Sharekhan ltd.


Yes No

Percentage of respondent
70% 30%

Interpretation
The pie chart showz that the brand image should be leveraged by the company to increase its market share over its competitor

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Q4. Do you know about the facilities provided by sharekhan ltd. Responses
Yes No

Percentage of respondent
55% 45%

Interpretation
Although there is sufficiently high brand equity among the target audience yet, it is to be noted that the customers are not aware of the facilities provided by the company meaning thereby, that, the company should concentrate more towards promotional tools and increase its focus on product awareness rather than brand awareness.

Q.5 Which company provide a less BROKARAGE rate ?

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Company Name
Sharekhan ltd HDFC ICICI

Percentage of respondent
44 22 34

Interpretation
44% have respondent of Sharekhan ltd., 22% have respondent of HDFC, 34% have respondent of ICICI.

Q. 6 Which company provide you a large number of product and services? Company Name
Sharekhan ltd.

Percentage of respondent
44%

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HDFC ICICI

22% 36%

Interpretation
44% have respondent of Sharekhan ltd., 22% have respondent of HDFC, 34% have respondent of ICICI.

Q7 are u satisfied with the current level of brokerage


Ans. Yes. No. 62% 38%

Interpretation

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The pie chart accentuates the fact that strategic marketing has gone beyond meeting targets and generating profit volume it shows that all the competitor is striving hard not only to woo he customer but also to Make them brand loyal by generating customer satisfaction.

Q8.How many of u do trading


DAILY WEEKLY MONTHLY YEARLY 32% 27% 23% 18%

Interpretation:
In spite of the huge returns that the share market promises, we see that there is still a dearth of active traders and investors. This is because of the non transparent structure of the Indian share market and the skepticism of the target audience that is generated by the volatility of the stock market. It requires efficient bureaucratic intervention on the part of the Government.

Q.9. According to your perspective which investment gives you maximum return?

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(1) Share market (2) Mutual funds (3) Purchasing insurance policy

20% 35% 45%

Interpretation
As of today people believe in secured investment with no risk & high return. So insurance policy are the best option for them as they give good return after a period of time

.Share market has also come up in a big way though the risk factor is a bit too high despite good return.

Q.10 USER OF DEMAT ACCOUNT


SHAREKHAN HDFC 41% 28%

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ICICI

31%

Interpretation
As compare to other companies dealing in stock sharekhan has 41% of user account while hdfc has 28% and icici has 31%

SUGGESTIONS 1. MORE BRANCHES


Need to open more branches to be a topper in market Because it has allow distribution network

.2. LESS TIME


They should try to make some arrangements to reduce account opening time by verifying documents at branch it selves.

3. LINK-BANK A/Cs
Linked as many accounts as client wants to its online account.

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4. NEW BANKS IN THE KITTY


Need to tie up with major banks like SBI, Allahabad Bank, Bank of Baroda etc.

5.CUSTOMER SATISFACTION
The company should focus on the customer satisfaction not on just taking money from their pocket.

7.CONTROLLED BRANCHES
The company would have to make some arrangements to control the branches and make standardized procedures for all of them for their better control and performance appraisal. Commitment should be equalized for every person. Provide the facility of free demonstrations for all. Improvement in the opening of De-mat & contract notice procedure is required.

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There should be a limited number of clients under the relationship manger. So that he can handle new as well as old customer properly. Some promotional activities are required for the awareness of the customer. People at young age should be encouraged to invest in stock market. Seminars should be held for providing information to prospective and present Coustmer.

LIMITATIONS
Lack of awareness of capital market: Since the area is not known before it takes lot of time in convincing people to start investing in shares primarily in IPOs.

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Some people are comfortable with traditional system: As people are doing

trading

from

there respective brokers, they are quite comfortable to trade via physical form of paper. Lack of Techno Savvy people and poor internet penetration: Since most of the people are quite experienced and also they are not Internet penetration is poor in India. Some respondents are unwilling to talk: Some respondents either do not have time or willing does not respond, as they are quite annoyed with the phone call. Inaccurate Leads: Sometimes leads are provided which had error in it, which varies from only 5-digit phone number to wrong phone number Misleading concepts: Some people think that as all the shares are in electronic form and they dont physical proof. Sometimes this leads to a great misconception of the entire process. The time constraint was one of the major problems. The study is limited to the different schemes available under the Demat account selected. The lack of information sources for the analysis part. Geographical locations. have any techno savvy. Also

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CONCLUSION

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On the basis of the study it is found that Sharekhan Ltd is better services provider than other stockbrokers because of their timely

the

research and personalized advice on what

stocks to buy and sell. Sharekhan Ltd. provides the facility of Trade tiger as well as relationship manager facility for encouragement and protects the interest of the investors. It also provides the information through the internet and mobile alerts that what IPOs are coming in the market and it also provides its research on the future prospect of the IPO. Study also concludes that people are not much aware of commodity market and while its going to be biggest market in India. The company should also organize seminars and similar activities to enhance the knowledge of prospective and existing customers, so that they feel more comfortable while investing in the stock market.

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BIBLIOGRAPHY
1. www.Google.com 2. www.bseindia.com 3. www.nseindia.com 4. www.moneycontrol.com 5. www.sharekhan.com 6. www.icicidirect.com 7. www.5paisa.com

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