CHAPTER-1 ABOUT STOCK BROKING INDUSTRY
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1. OVERVIEW OF STOCK BROKING INDUSTRY IN INDIA The functioning of stock broking in India was started in 1875. The BSE oldest stock broking of India. History of Indian stocks trading starts with the 318 person taking membership in Stock Brokers Association and Native Share, which is known by name as Bombay Stock Exchange (BSE). In the year 1965, BSE got a permanent acknowledgment from Government of India which was most required. The National Stock Exchange arrives 2nd to the BSE in the terms of status. NSE and BSE represent themselves as the synonyms of the Indian stock market. History of stock market in India is almost same as history of BSE. An up-beat mood of marketplace was lost abruptly with the Harshad Mehta scam. This came to the public knowledge that Harshad Mehta, who is also called as big-bull and giant of Indian stock market which diverted huge fund from banks by fraudulent means. He also played with millions of shares of many companies. For preventing such frauds, Government formed SEBI, through Act in 1992. The SEBI is statutory body which regulates and controls functioning of brokers, stock exchanges, portfolio manager investment advisors, sub-brokers, etc. SEBI obliged several tough measures to protect interest of investor. Sensex crossed 5000 mark in year 1999 and 6000 mark in year 2000. Foreign institutional investor (FII) is investing in stock markets in India on very large scale. Liberal economic policies pursue by successive Government attracted many foreign institutional investors towards large scale. The impulsive behavior and action of market dedicated it tag 'volatile market.' The factors which affected market in past were the good monsoon, rise to power of Bharatiya Janatha Party's etc. The result of cricket matches between Pakistan and India also affected movements of stock broking in India. National Democratic Alliance which was led by BJP, in 2004 the public election unsuccessfully tried for riding on market sentiment to power. India, after US hosts the large number of the listed companies. The Global investors now seek India as preferred location for the investment. Stock market now also appeals to the middle class Indians. Most of the Indian working in foreign country now diverts their savings to the stocks. This new phenomenon is result of diminished interest rate from banks and opening of the online trading. SHAREKHAN LIMITED
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They can sell or buy stocks online while returning from work places. The recent incidents which led to the growing interests among all Indian middle class is initial public offer announced by ONGC, Maruti Udyog Limited, Tata Consultancy Services and many big names like such. A bullish run of stock market can associated with steady growth of of 6% in GDP, growth of Indian company to MNCs, the large potential of the growth in fields of mass media, telecommunication, education, IT sectors and tourism backed by the economic reforms ensures that the Indian stock market continue its bull run. run.
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1.1 LIST OF STOCK BROKERS IN INDIA:
COMPANY LOGO
COMPANY NAME
ZE R ODH OD H A
RKSV
I CI CI D I R E C T
SH A R E K H A N
I N D I A B UL UL L S
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5 PA I SA
MOTI M OTI L A L OSWA L
H D F C SE SE C UR UR I T I E S
AN A N G E L B R OK I N G
KOTA KOTAK K S E CURI CURI T I E S
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1.2 OVERVIEW OF STOCK BROKING INDUSTRY IN WORLD MARKET The stock market is witnessing heightened activities and is increasingly gaining importance. In the current context of globalization and the subsequent integration of the global markets this paper captures the trends, similarities and patterns in the activities and movements of the Indian Stock Market in comparison to its international counterparts. It covers New York Stock Exchange (NYSE), Hong Kong Stock exchange (HSE), Tokyo Stock exchange (TSE), Russian Stock exchange (RSE), Korean Stock exchange (KSE) from various sociopolitical-economic backgrounds. The origin of the New York Stock Exchange (NYSE) is dated back to May 17, 1792, when the Buttonwood Agreement was signed by twenty-four stock brokers outside of 68 Wall Street in New York under a buttonwood buttonwo od tree. Also called the “Big Board”, it is the largest stock exchange in the world in terms of dollar volume and second largest in terms of number of companies listed. The Tokyo stock exchange was established on May 15, 1878 and trading began on June 1, 1878. In 1943, the exchange was combined with ten other stock exchanges in major Japanese cities to form a single Japanese Stock Exchange. It is the second largest stock exchange market in terms of monetary volume and currently has 2302 listed companies. The Hong Kong stock exchange is the 8th largest stock exchange in the world in terms of Market capitalization. The Hang Sang Index (HIS), was started on November 24, 1969. The Russian stock exchange was established in 1995 by consolidating the separate regional stock exchanges into one uniformly regulated trading floor. The Korea stock exchange was created by the integration of the three existing of the Korean Spots and Futures exchanges (Korean stock exchange, Korean futures exchange & KOSDAQ) under the Korea Stock and Futures Exchange Act.3.5. In this paper, the names of the countries and the names of the indices of those countries have been used interchangeably. Thus, the names of the countries represent the indices for the purpose of analysis and they need to be interpreted that way. Again, all the analyses have been done with the closing prices.
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The following table gives the country and the exchange with the name of its indices.
COUNTRY
STOCK EXCHANGE NAME INDICES NAME
HONGKONG
Hong Kong stock Exchange
Hang seng
USA
USA stock Exchange
NYSE
KOREA
Korea stock Exchange
KRX 100
RUSSIAN
Russian stock Exchange
RTS Index
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1.2.1 LIST OF STOCK BROKERS IN WORLD MARKET:
COMPANY LOGO
COMPANY NAME
CREDO
INVESTEC
K I L L I K & C O. O.
SA XO BA BANK - D E NMAR K
REYKER
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THALES S E CURI CURI TIE S
R E D MA M A YN Y N E B E N TL TL E Y
MON M ONE E X BOOM B OOM SE C UR I TI E S
SWI SS QUOTE
OPTI ONSXPRE SS-US SS-US
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1.3 OVERVIEW OF STOCK BROKING INDUSTRY IN GUJARAT The Gujarat brokerage industry consists of companies that primarily act as agents for the buying and selling sell ing of securities (e.g. stocks, shares, and similar financial instruments) i nstruments) on a commission or transaction fee or Brokerage basis. An agent that charges a fee or commission for executing buys and sell orders submitted by an investor. The firm that acts as an agent for a customer, charge the customer the commission for its service. Roles similar to that of a stockbroker include investment advisor, financial advisor and probably many others. A stockbroker may or may not be also an investment advisor. A stockbroker is a regulated professional broker who buys and sells shares and other securities through market makers or Agency Only Firms on behalf of i nvestors. Typically, a broker who receives an order from a customer will communicate with a company employee located at a particular exchange, who will execute the order at the exchange and report details of the transaction to the broker. Customers typically keep their securities in an account with the broker. Brokers charge customers commissions for conducting transactions and fees for maintaining their accounts.
Some of the main characteristics of the brokerage industry include growth in e-broking, decline in brokerage fees and growing derivative market and many more. There are several domestic as well as local players in stock trading services which are providing various services to their customers like online trading, portfolio management system, stock broking etc. They are helping the investors to take decision about where to invest because there is lots of Investment Avenue available with investors. Some of them are as follows working at the domestic level:
Fortune fiscal ltd
Marfatia stock broking Pvt ltd
Market creators ltd
Religare securities
Sharekhan
Motilal Oswald
Angel Broking SHAREKHAN LIMITED
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1.3.1LIST OF STOCK BROKERS IN GUJARAT:
COMPANY LOGO
COMPANY NAME
F ORTUNE RTUNE F I SCAL LTD LTD
MA M A R F A TI A STOC ST OCK K B R OK I N G PVT LTD
MA M A R K E T CR E A TOR S LT D
R E L I G AR A R E SE C U UR R I TI E S
I NVE STO STOR POI POI NT
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AR A R I H A N T CA PI TA L MA M A R K E TS L TD
SB I C A PI TA L MA MAR K E T
SH A R E K H A N
MOTI M OTI L A L OSWA L
AN A N G E L B R OK I N G
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CHAPTER-2 ABOUT SHAREKHAN LIMITED
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2.1 OVERVIEW OF SHAREKHAN LIMITED Sharekhan is online stock trading company of SSKI Group, Group, provider of India-based investment banking and corporate finance service. Sharekhan ltd was founded on 1990 and their headhunter in Mumbai the owner of sharekhan ltd is BNP Paribas. Sharekhan is one of the largest stock broking houses in the country. Shri Shantilal Kantilal Ishwarlal Securities Limited (SSKI) has been among India’s leading broking houses for more than a century. 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 1.5 Corers. Launched Launched on 8th February, 2000 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, mutual funds, 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, equit y, mutual funds, 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- friendly online trading facility, coupled with a wealth of content that will help you stalk the right shares. At that time sharekhan cover across 575 cities and 153 branches in India, and they have 2300 above franchisees and across 1.4 million customers in a country.
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2.2 COMPANY PROFILE OF SHAREKHAN LIMITED:
LOGO
FOUNDED
February 1990
HEADQUATERS
Mumbai
COUNTRY OF ORIGIN
India
OWNER
BNP Paribas
INDUSTRY
Financial Service
SERVICES
Investments, Online Trading, Stock Broking
PARENT
BNP Paribas
SLOGAN
Your guide to the financial jungle
WEBSITES
www.Sharekhan.com
Bharuch Main Branch
R K Casta, Wing “A” , 1 st Floor, Office No. 104 – 104 – 105 105 Behind Super Market, Bharuch 392001
(when I have taken training) Branch Manager
Mr. shailesh bhatt
Telephone No.
02642-645733
Email.
[email protected]
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2.3 HISTORY OF SHAREKHAN LIMITED: Our evolution The evolution of our Company can be traced through the following phases: In the year 1996, our Company, started as a stock broking company by getting itself registered as a Multiple Member of the Bombay Stock Exchange, for carrying on the activities of buying, selling or dealing in securities. Thereafter, to expand the scope and breadth of operations and areas of services our Company: Company:
In March 1996, became a registered Dealer of OTC Exchange of India, for carrying on the activities of buying, selling or dealing in securities.
In May 1999, got registered as a depository participant with CDSL.
In August 2000, became a stock broking company of National Stock Exchange by getting registered as a Multiple Member of the National Stock Exchange, for carrying on the activities of buying, selling or dealing in securities.
In September 2000, got registered as a trading member of the Bombay Stock Exchange, Derivatives Segment for carrying on activities of dealing in derivati ves.
In September 2000, got registered as trading member of the National Stock Exchange, Derivatives Segment for carrying on activities of dealing in derivatives.
In September 2008, got registered as a trading member of the Bombay Stock Exchange, Currency Derivatives Segment for carrying on activities of dealing in currency derivatives.
In September 2008, got registered as a trading member of the MCX Stock Exchange Limited, Currency Derivatives Segment for carrying on activities of dealing in currency derivatives.
In September 2008, got registered as a clearing member of the MCX Stock Exchange Limited, Currency Derivatives Segment for carrying on activities of clearing and settlement of currency derivatives trades.
In November 2008, got registered as a trading member of the National Stock Exchange, Currency Derivatives Segment for carrying on activities of dealing in currency derivatives.
In November 2008, got registered as a clearing member of the National Stock Exchange, Currency Derivatives Segment for carrying on activities of clearing and settlement of currency derivatives trades.
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In March 2009, got registered as a clearing member of the National Stock Exchange, Derivatives Segment for carrying on activities of clearing and settlement of derivatives trades.
In September 2009, got registered as a trading member of the Bombay Stock Exchange, Debt Market Segment
Apart from stock broking and depository services our Company provides other financial services such as commodity broking, Non-Banking Financial Services, Wealth Management and insurance advisory services, through its subsidiaries.
In March 2009, Inventure Insurance Broking Private Limited became a subsidiary of Inventure Wealth Management Limited. IIBPL has a team of IRDA certified advisors who cater to the varied needs of customers in both life and general insurance space offered by major insurance companies in India. Further IIBPL has made an application dated November 24, 2009, to the Insurance Regulatory and Development Authority ("IRDA") for registration as a composite broker, which will enable it to distribute products and services of life insurance companies, non-life insurance companies and re-insurance businesses. Inventure Finance Private Limited In November 2007 our Company acquired IFPL pursuant to a memorandum of understanding by and between Mr. Rasik Tokershi Gala and Mr. Manilal Khimji Karani, the sellers; and Mr. Nagji K. Rita and Mr. Kanji B. Rita representing our Company. IFPL is registered with the RBI as non-banking financial institution, without accepting public deposits.
Sharekhan by PNB Paribas BNP Paribas announces that an agreement has been reached with the company’s shareholders for BNP Paribas SA to acquire 100% of Sharekhan. BNP Paribas has been present in India for over 150 years and offers solutions to its clients through its Corporate and Institutional Banking and International Financial Services activities. Sharekhan will join BNP Paribas’ Personal Investors division, which is a key player in retail brokerage and digital banking services with 1.7 million clients in Europe. Based in Mumbai, Sharekhan, the n°1 independent retail brokerage firm in India, offers broking solutions across all asset classes to more than 1.2 million private clients.
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With 7% market share in terms of number of accounts, Sharekhan is the 1st independent and 3rd retail brokerage firm in India. Internet focused since its creation in 2000, it is today one of the most well-known online brands in India and has been constantly profitable over the last twelve years. Joris Dierckx, Country Head Hea d of BNP Paribas India stated, “We are very pleased to welcome all Sharekhan staff and clients into our group. Sharekhan will serve as a platform for the Group’s strategy in India to offer a comprehensive range of products from pure brokerage to asset based investment services including mutual funds and savings products. The purchase of Sharekhan is a unique opportunity for us to build on our achievements in the Indian market and to further expand our business in India.” About BNP Paribas in India
BNP Paribas was one of the first foreign banks to establish a presence in India in 1860. Today, it is among the leading corporate banks in the country, with branches in eight major cities. BNP Paribas offers a wide range of financial services covering corporate and institutional banking, transaction banking and wealth management. In addition, BNP Paribas has subsidiaries and strategic partnerships that offer solutions from International Financial Services businesses. About BNP Paribas
BNP Paribas has a presence in 75 countries with more than 185,000 employees, including 145,000 in Europe. It ranks highly in its two core activities: Retail Banking & Services and Corporate & Institutional Banking. In Europe, the Group has four domestic markets (Belgium, France, Italy and Luxembourg) and BNP Paribas Personal Finance is the leader in consumer lending. BNP Paribas is rolling out its integrated retail banking model across Mediterranean basin countries, in Turkey, in Eastern Europe and a large network in the western part of the United States. In its Corporate & Institutional Banking and International Financial Services activities .
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2.4 MISSION: “To educate and empower the retail investor to help him/her take better investment decisions.”
2.5 VISION: “To be the best retail broking brand in the Indian equities market.”
2.6 ROLE:
Interface between the stock exchange and the investor.
Assistance to investors in precise allocation of funds.
Building awareness amongst general public about stock market.
2.7 AWARDS & ACHIEVEMENT :
2001 - Web Award winner of Chip magazines Best Financial Website Award.
2004 - Best Local Brokerage by b y Advisory Poll of Poll 2004.
2005 - Awaaz Consumer Awards Best Broking House by CNBC channel.
Sharekhan is amongst top 3 online Brokers in India
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2.8 PRODUCTS & SERVICES OF SHAREKHAN LIMITED: 2.8.1 CORE SERVICES:
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2.8.2 OTHER SERVICES:
Online BSE and NSE executions (through BOLT BOLT & NEAT terminals)
Free access to investment advice from Sharekhan’s Research team
Sharekhan Value Line (a monthly publication with reviews of recommendations, stocks to watch out for etc.)
Daily research reports and market review (High (Hi gh Noon & Eagle Eye)
Pre-market Report (Morning Cups)
Daily trading calls based on Technical Analysis
Cool trading products (Daring Derivatives and Market Strategy)
Personalized Advice
Live Market Information
Depository Services
Derivatives Trading (Futures and Options)
IPO’s & Mutual Funds Distribution
Internet-based Online Trading: Trade Tiger
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2.8.3 PRODUCTS:
Classic Account
Fast trade Account
Trade Tiger
Invest Tiger
2.8.3.1 Classic Account: The features about classic account are
It is basically used for beginners i.e. Fresher
Here the transactions can be done in BSE, NSE and F&O.
There can be a market watch.
Here we can make four templates i.e. folders.
You can add 20 scrip’s in each template.
Here you can add minimum 20 scrip and maximum 100 scrip.
Top gainers, Top losers, Top traded equities and Top traded funds are the special links available in this.
It gives maximum access.
You can keep lump sum amount in the account.
A system required is Windows XP, 2000, IE 6.0.
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2.8.3.2 Fast trade Account: The features about fast trade account are
We can make five templates.
You can monitor 125 companies.
Systems required here are Windows XP, 2000, IE 6.0 and Java.
You can also buy Mutual funds and IPO online.
You can also monitor circuits.
You can see the market depth i.e. the logic of demand and supply. It will help to decide whether to buy or not.
It can also add trigger as in it i t works as a reminder.
This online trading platform is an applet- based application that provides live streaming quotes from BSE and NSE.
Get live market prices and market statistics like best bid price, quantity, best offer price and quantity etc. for chosen stocks.
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2.8.3.3. Trade Tiger:
Trade Tiger is an application that brings you the power of a broker’s terminal, right from your desktop.
Trade on multiple exchanges {NSE, BSE, MCX, NCDEX} from a single screen.
Customize market watches by scripts or sectors and view them on a single screen.
Get access to technical tools and trade like a pro.
2.8.3.4 Invest Tiger:
This account allows you to trade through website and is suitable for retail investors.
Online trading website also comes with a Dial-n-Trade service that enables to buy and sell shares by calling dedicated toll-free number 1-800-22-7050. 1-800-22-7050.
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2.9 SWOT ANALYSIS OF SHAREKHAN LIMITED:
Online Trading Facility
Largest Chain of Retail Share Shops in India
88 years of Experience in securities market
Dedicated and responsive workforce/staff
Value added service for HNI client
Research Center
Membership of of NSE & BSE
Trading
STRENGTH
option
like
Future
&
Option
and
Commodities
Volume based differentiated product.
Less informative website
Does not have slab rate brokerage which is provided by competitors
WEAKNESS
OPPORTUNITY
THREATS
Problems due to network crash
Unawareness Among Investors
Collaboration with international financial institution
To capture the market lost to its Competitors.
To focus on developing a superior and powerful portal
To spread awareness of its Brand Name.
Follow government laws
Competitors develops
Prolonged depression and high volatility in the market
New Entrants.
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CHAPTER-3 DEPARTMENTAL STUDY
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ORGANISATION CHART Branch Head
Sales
Direct Sales Executive
Equity
Back Office
Advisors
Dept.
Relationship
Customer care / Accounting
Managers
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MARKETING DEPARTMENT
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3.1.1 ACTIVITIES: The main aim or marketing activities at Sharekhan is that the customer should get enough guidance to join the company and how he can get the best service than any other stockbroker. There is an officer for handling the marketing activities followed by two executives and it is not limited to them but the other people are also having some responsibilities to increase the no. of clients and retain them by providing them the services services needed needed by them. them. There are many services those are designed such that the specific target segments of the customers are covered and the products are positioned in the minds of customers as the best one in bharuch. The services are as given below: Sharekhan is India’s leading national network of stock-broking stock-broking outlets. It is having the largest retail distribution chain in India. Sharekhan is not only a share-broking firm, but it avails of various services and other financial products to its clients. 1) Offline Trading facility 2) Online BSE and NSE executions (through BOLT, i.e. BSE Online Trading and NEAT, i.e. National Exchange Exchange Automated Automated Trading) Trading) 3) Free access to investment advice from Sharekhan’s Research team. 4) Depository services: Demat and Remat transactions (Sharekhan is registered with NSDL, i.e. National Securities Securities Depository Depository Ltd., as a Depository Depository Participant) Participant) 5) Derivatives trading, i.e. Futures and Options (through NEAT F&O) 6) Internet based online trading. 7) Other investment products: Mutual Funds, RBI Bonds, Insurance, etc.
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3.1.2 Online BSE and NSE Trading: Sharekhan is a registered Stock Broker with the Bombay Stock Exchange and National Stock Exchange to trade on behalf of clients. The screen-based trading is done on BOLT-BSE Online Trading and NEAT – National Exchange Automated Trading, terminals. There are two types of transactions executed on these terminals viz. intra-day and delivery based transactions. Intraday transactions are those, in which the squaring up of deal is done on the same day, while in delivery based transaction the squaring squaring up of deal is done on the same day, while in delivery based transaction transaction the squaring up is not done on the same day, but the stock is to be traded on the basis of rolling settlement i.e. T+2. The Brokerage of Intraday transaction is 0.10% single side, while brokerage on delivery based transactions is 0.50% on both side, i.e. while purchasing as well as selling.
3.1.3Free Access to Investment Advice through R&D: The Research and Development at Sharekhan is done at its Head office Mumbai. From there it forwards the relevant data and tips on particular shares and scripts at the relevant time. The R&D department Head Mr. Hemang Jani forwards all the details regarding all stocks and scripts to all the branches through through internet. At the end of each each trading day there is a Teleconfere Teleconference, nce, through which the R&D department Head Mr. Hemang Jani talks with each Branch heads and discusses about each day’s closing position and shows their predictions about next day’s opening opening position. The quarries regarding stock positions and other4relevant matter of the branch heads of each branch is being solved through teleconference teleconference
3.1.5 Derivatives Trading: Sharekhan is a Trading Member registered with the Stock Exchange, according to the norms and Guidelines given by the SEBI. Two types of users access the NEAT F&O trading system. The Trading Members and the Clearing Members. The Trading Members (TM) has access to functions such as, order matching, order and trade management. The Clearing Member (CM) uses the trader workstation for the purpose of monitoring the trading member(s) for whom he clears the trades. Additionally, he can enter and set limits to position, which a trading member can take. Sharekhan provides the service service of derivatives derivatives trading on NEAT NEAT F&O to its clients.
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3.1.5 Commodities Trading: Sharekhan is providing the facility to trade with the commodities through MCX (Multi-Commodity Exchange) and NCDEX (National Commodities & Derivatives Exchange). The commodities market in India is an emerging market, which will become the largest market in the world within the next 5 years, as the trends in the commodities market shows its performance. The company also provides research reports on daily, weekly and monthly basis for the investors in the commodities. commodities. It is j ust like the futures and is having a fixed lot of goods with the margin for each commodity and the trading is based on the theory t heory of futures and therefore, it is also called Vayda Market. In short Sharekhan also provides brokering in commodities commodities and the brokerage charges are 0.10% on total trade value and if carry forwarded an additional 0.02% charge on total trade.
3.1.6 Online IPO: Online IPO (Initial Public Offering) is a new service started by Sharekhan for providing the application form of any company’s issues of just like the TCS issue can be subscribed by filling an online form to reduce the paper work and the fund transfer facility is also provided to the clients for transferring the funds online. It is given on its web-site for helping the clients who are not able to collect the forms manually and the speed of filling and reducing the risk of misplacing of forms, not reaching in time, etc.
3.1.7 MARKETING MIX: The marketing mix of Sharekhan is an excellent example we have seen in the industry because no other brokering organization has such products to target the investors of different minds, incomes and aims. There is an objective of satisfying the customer as to make him delighted with affordable prices and convenient services. The fourth P of the marketing mix is the best at Sharekhan in India because the total no. of share shops are widespread all over to have the maximum contacts and awareness about Sharekhan, and we can say that it has achieved that because it is having the maximum turnover than any other broker in India. The Classic, Speed Trade and Speed Trade Plus are the trading products, which are are one of the bests in the market. market. The marketing is done based on leads generated through the web contact, tele-contact and personal contact with the customer and is a planned procedure to find out new customers. The marketing management is carried out in an excellent way at Sharekhan.
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3.1.7.1 PRODUCT : Service is an act or performance that one party offers to another for sell and it is not a physical product that you can touch t ouch but it is that one can feel. It is not likely to result into the ownership of anything. A service can be a fully service or a mixture of service and physical product. The trading products of Sharekhan are such a mixture of services like DP service (managing the Demat account), providing reports for investment advice etc. and thus we can define its service mix as a hybrid product mix of different physical products with accompanying services. Therefore, the two types of accounts offered by Sharekhan i.e., Offline and Online are the two main product lines in the product mix of the company. The offline a/c with Sharekhan Sharekhan is defined as the account having which you can trade anywhere in the share shop of Sharekhan and the online a/c is that you can trade on your PC through the software provided by Sharekhan and it also offers teletrading in both the cases but the major difference is of the service and prices for opening an account. The product mix is as shown below:
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Sharekhan
Offline A/c.
Trade tiger A/c.
Classic A/c.
The product mix is showing the products offered by Sharekhan to it s customers and it is one type t ype of a tree structure diagram that shows the products of a company. The products are actually services and are at the completion of the second stage of Product-LifeCycle, i.e., Growth and are entering into maturity stage. So there should be some changes in the marketing strategies of the company.
3.1.7.2 Price: Prices for the trading products are as given below:
Classic
Rs.750 (onetime)
Trade Tiger
Rs.2000/quarter
Facility
for
viewing
the
market
online
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3.1.7.3 PROMOTION: Promotional activities at Sharekhan are done by web, e-mails and personal contact. Sharekhan is also organizing seminars and presentations and promotes its services to the clients. It is spending Rs.20000 per month for promotional promotional activities. As explained earlier, Sharekhan Sharekhan is having the largest distribution chain of re tail outlets of share shops. And it can be seen also because there are 180 share shops in 90 cities, which gives the maximum awareness to Sharekhan. The distribution of Sharekhan is also proved by its turnover and awareness among the investors in the stock market. The marketing strategies followed by Sharekhan at this point are as given below: The excellent marketing mix i.e., the Product-Price-Place-Promotion and for services additional 3Ps viz. People, Process and Physical evidence, are managed according to the needs of the customers and try the best to deliver the maximum value to the customers customers for what they pay a price. The HR and Operations are one of the best at Sharekhan to help the customers for getting the needs fulfilled with a family culture and atmosphere of harmony, peace and brotherhood and it is focusing on the specific segments like HNI, Delivery-based and Intra-day traders.
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HUMAN RESOURCE DEPARTMENT
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Human resource is the crucial resource that a company can use to grow with the work of the employees. HRM activities at Sharekhan start form induction to the specific job training and are done by H/O at Mumbai. H/O takes a written test and selection interview for filling up vacancies in branches but the recruitment is done by the branch itself and the selection is performed by H/O from the screened applicants.
Any new recruit is firstly inducted to the company and sent to T & D department that is covered under HRD and T & D programmes makes employees aware about all the activities/jobs within the department he/she is to be recruited. Suppose if, I would be recruited for finance department then the finance related employees are known to me with their work profiles, that is, what they reall y do?
Then the specific job training is provided at H/O and the person has to keep in touch with the concerned department at H/O on internet because he/she has to solve many conflicts arising in the investor’s mind and to have an up-to-date up -to-date information regarding the procedures and any new facilities or policies to resolve the problems of the clients. It is a must for each employee because the employee is the people by whom the company gets its customers and retains them.
HRP (Human Resource Planning), HRIS (Human Resource Information System), Recruitment & Selection, Career planning and development, Assessment & development of employees for Performance appraisal, etc. activities of managing the HR at Sharekhan is maintained in a way to meet the requirements.
The corporate culture at Sharekhan is maintained in such a way that the people are helpful to each other and eager to get the work done as soon as possible with a cooperative thinking. An additional Rs.10000 is provided for each outlet of Sharekhan to motivate its employees by performance appraisal and also the heads of each departments and branches has to go through a 3606 performance appraisal for maintaining the consistency in growth of the company.
In the end we can say that the human resource of Sharekhan is a best managed and used for the continuous growth and development of the company for its future plans to be achieved time-to-time.
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FINANCE DEPARTMENT
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Like blood is the most important factor in our body, Finance is the blood of any business. Finance is needed for all the activities like l ike production or services as well as their distribution. The finance department directly influences all the functions of the other departments. Also finance has to give equal importance to all departments. Finance is that administrative area or set of administrative function in an organization may have the means to carry out its objective as satisfactorily as possible. Sharekhan has special accounts department for separate calculation of pay-in and pay-out of funds according to the client’s Profit/Loss. client’s Profit/Loss. Finance management is done at Sharekhan is done by managing the stocks in the Demat accounts and funds in the margin & trading accounts FINANCE
DP
Accounts
Finance is the lifeblood of an organization to continue its activities and the finance management at Sharekhan can be divided into two major parts viz. DP (Depository Participation) and Accounts management, which are shown in the figure given above.
DP means providing the facility to the clients for managing the stock bought/sold by them. DP covers two major terminologies viz. settlements and the auctions which is a part of managing Demat account. Settlements as defined by b y SEBI are T+2, currently and it means that the demat account of the clients are prone to be sufficient for selling a script with no debit at all, i.e., the account must have the sold amount of stock to fulfill the settlement after 2 days from trade-day. Generally, the timings are 9:30 and 3:00 as a deadline for the client and he must provide the stock for giving a delivery to the buyer. The chart show the total transaction between two clients:
C
DP(Sharekhan)
E
DP
C
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The chart shows the process that the request for selling and buying passes through the DPs of the respective clients and finally the exchanges like SKSE (Saurashtra Kutch Stock Exchange) becomes the controlling intermediary for the delivery of stocks and this process is done in two days. Nowadays, as banks are becoming fast for E-Fund Transfer (EFT) and Phone-banking is getting more popularity, SEBI is thinking to make the financial market of India to have a maximum speed of transactions just like the other nations in the world and proposing for T+1 settlement scheme but the system is not enough competent for that thing. But soon or later we will have such a settlement system in India, as said sai d by Mr. J. N. Bajpai, chairman of SEBI.
The client, if not capable of providing the delivery of say, 1000 shares of SAIL then the Auctions are initiated by the exchanges and the client has to pay for the price prevailing in the t he market with 4-5% penalty. The penalty can go on maximum to 20% more than the market price of the sold stock. Generally, it is known as a buying auction and a same kind of auction is for selling the stock for which the buyer was proved unable to pay the price is carried out by exchange, known as the selling auction. And a debit or credit note is provided in the respective case of auction to the clients, i.e., for buying auction debit note is given on the T+4 basis and in case of selling auction the credit note is given on T+5 basis. There are two types of auctions called as Internal auctions & Market auctions, the internal auctions are defines as the auctions carried out between the other shops of Sharekhan and market auctions are those as explained earlier, the auction carried out in the market.
This is all about settlements but now switch to funds management or accounts management at Sharekhan. The collection of funds from the clients who had a debit balance or made a loss are made on the next day of trading and the payments to the profiting traders are made after af ter two days of trading because the cheques are received re ceived from H/O and then pay-out is done and Pay-in is as explained that amounts to be taken from the clients. In this way, accounts are managed but in case if the client is unable to pay, the deposit from the margin a/c is cut down to the payments pa yments and in case if a client is having a credit balance in F&O trading though he had a debit balance in cash-NSE & BSE trading, request is sent to H/O for totaling the three balances. The main aim for accounts management is that the clients must have a credit or no debit on the next day.
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The DP services provided by Sharekhan are falling under the regulation of NSDL (National Securities Depository Limited) and CDSL (Central Depository Services Limited), organizations governed by SEBI to regulate the depository services in the interest of the investors. So, the financial market in India is governed by Ministry of finance under which two major bodies viz. SEBI & RBI are covered and under RBI the banks and other financial institutions are covered while SEBI covers the exchanges, NSDL & CDSL and the whole DP service providers with the brokers to the investors.
In this way we have gained a meaningful knowledge about India’s financial market and its structure from this training at Sharekhan. In this way, the finance function is carried out at Sharekhan by following the guidelines given by SEBI. And the company is a private limited one with its own policies for disclosing its financial statements.
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OPERATION DEPARTMENT
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3.4.1.1 Inputs There are many inputs to the production & operations viz., land & buildings, machinery & equipments, furniture & fixtures, employees, technology, capital (invested by promoters & deposited by the customers) and the most important input, i.e., management functions carried out at national, regional and branch level in Sharekhan.
3.4.1.2 Conversion Process The main aim of it is to make profit with customer satisfaction. The conversion of inputs works as the Sharekhan earn brokerage from the customers. The profits are generated from getting a higher return on the invested amount of money than the amount payable to the customers. The process is facilitated by a centralized computer system in which the data is stored and recovered for the whole INDIA and it is having the CPU at the H/O in Mumbai, Sharekhan is regulating the brokerage rates all over India by keep watch on each transaction done from the branch office. The data of a customer will be stored in the central computer and all facilities such as bills, credit/debit reports etc. are provided by that computer to all customers on-line on the internet. The conversion process is also facilitated by some adjustments to the inputs and then the random fluctuations are also handled in the process and lastly the monitoring of the process is done and a feedback is given to do the adjustments for the process as indicated in the figure given.
3.4.1.3 Outputs Outputs are those services generated by Sharekhan with the help of the inputs and using the conversion process. These services services are as listed in the figure above.
Sharekhan Consumer Retail Services
Channels
brokering
Financial
Complain
advisory
resolvance
Services Corporate
Capital
Nationwide
Broker
markets
data transfer
electronic Depository
Others
participant
advisor
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3.4.1.4 Operations Strategy at Sharekhan:
Operations strategies are implemented in Sharekhan as shown in the chart given above and the main points of consideration are Efficiency, Dependability, Quality and Flexibility.
The points demand a facility mission that is made up of process, capacity, facilities, vertical integration, and infrastructure facilities provided to get the desired outputs as per the plan.
The main aim of the operations strategy at Sharekhan is that the efficiency of the organization and high level of it is desired outputs with low costs, i.e., productivity with effectiveness. Quality should be high and consistent in delivering services; Flexibility is related with fast introduction of new services and providing a wide range to select an option to the customer. This is facilitated by the process of operations, capacity/ability of the organization, competitive advantages, vertical integration and the infrastructure created by the firm.
Sharekhan plans the strategies to get a working plan from it and the planning is done from top-to-bottom level, i.e., national level, regional level, divisional level and the branch level planning is carried out by the managers.
In this way, the Operations are managed with the best efforts in a direction that is to facilitate future plans by achieving success in time and create milestones in the industry by driving the company with excellence.
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CHAPTER-4 LITERATURE REVIEW
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tr ading & DEMAT account in India 4.1 Olekar & Talwar (2013) in their paper “Online trading – Some – Some issues” observed that the banks normally levy a lower service charges compared to other depository participants. He also found that when the numbers of users are more online, the speed of transactions is affected. Investors Perception 4.2 A study by N. Kathirvel A. Mekala (2010) titled “Women Investors Perception towards Online Trading in Tamilnadu with Special Reference to Coimbatore District” shows that a good financial system provides the intermediation between savers and investors and promotes faster economic development. An investment share requires a careful evaluation of factors related to the economy, industry and the company. This analysis is called fundamental analysis. An investor is surrounded by many factors in her consideration of making investments. She is interested in liquidity of her assets. She is also interested by the fact that there is an increasing number of women working in the organization. 1. To identify the demographic profile of women investors. 2. To identify the factors influencing the women investors while making investment. 3. To suggest suitable measure to protect the interest of women investors. In this study the researcher used Descriptive research, which is concerned with describing the characteristics of a particular individual or of a group.
4.3 Manoj Kumar Dashl (2010) in his paper titled, Factors Influencing Investment Decision of Generations in India: An Econometric Study‟ has stated that the modern investor is a mature and adequately groomed person. In spite of the phenomenal growth in the security s ecurity market and quality Initial Public Offerings (IPOs) in the market, the individual investors prefer investments according to their risk ris k preference. For e.g. Risk averse people choose life insurance policies, fixed deposits with banks and post office, PPF and NSC. Occasions of blind investments are scarce, as a majority of investors are found to be using some source and reference groups for taking decisions. The purpose of this study was to determine whether the variables such as demographic characteristics (age, gender) and investment patterns could be used individually or in combination to both differentiate among levels of men and women investment decisions and risk tolerance and develop some guidelines to the investment managers to design their investment schemes by considering these views of individuals.
4.4 Mittal and Vyas (2008) have observed that investors have certain cognitive and emotional weakness which come in the way of their investment decisions. Over the past few years, behavioral finance researchers have scientifically shown that investors do not always act rationally. They have behavioral biases that lead to systematic errors in the way they SHAREKHAN LIMITED
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process information for investment decision. Many researchers have tried to classify the investors on the basis of their relative risk taking capacity and the type of investment they make.
4.5 Online Stock Trading in India: An Empirical Investigation”, by Nidhi Walia and Ravinder Kumar, Indian Journal of Marketing, 2007. As financial system is becoming more complex it has become need of the hour where investors should comprehend the data and understand recent intricacies of online trading. In the past investors have no other option to get market information except to contact their local broker? But Internet trading in stock market is becoming medium of exchange whereby investor can order stock exchange on simple mouse click sitting at his place. Keeping in view current market requirement an attempt has been made in this research paper to analyze current status of online trading in Indian scenario. Facts highlighted in this study clearly reveal that although online trading is picking up its speed to tap investors yet it is expected to adopt creative strategies to lure customers from physical trading to net trading.
4.6 V.K. Shobhana and J.Jayalakshmi (2006) in their study titled “Investor awareness and Preferences in online trading- a Study” have examined the level of investor awareness regarding investment options and investment risks. The analysis revealed that investment in real estate/property is preferred by majority of the respondents. The second most preferred investment is bank deposits. Awareness about investment options and risks are high among old aged, highly educated and those who are professional by occupation.
4.7 Krishnamurthy Suresh (2004) in an analysis of popular perceptions has said that retail investors swarmed back to the stock markets in the year 2003-04. The investments of households in shares and debentures rose by a paltry 8.6 per cent of Rs. 5,847 crore in 200304. Households had deposited Rs.1,69,000 crore in bank deposits while investments in small savings rose 19 percent. The data suggest that in 2003-04 the household investor had turned extremely conservative. 4.8 Brad M. Barber and Terrance Odean (2002) analyzed 1,607 investors who switched
from phone based to online trading during the 1990s. Those who switched to online trading perform well prior to going online, beating the market by more than 2% annually. After going online, they trade more actively, more speculatively, and less profitably than before — lagging lagging the market by more than 3% annually. SHAREKHAN LIMITED
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4.9 Online Trading and the National Association of Securities Dealers’ Suitability Rule: Are Online Investors Adequately Protected?” – By – By Renee Barnett, 2001. This paper presents that online trading has enabled increased access to the securities market. Encouraging investment in securities can be good for both individual investors and the economy as a whole. Yet to preserve the benefits created by online trading, investor protection is imperative. One aspect of this protection is the clarification of suitability obligations online. The difficulty in determining what constitutes a recommendation online makes investor protection difficult. This difficulty is further furth er complicated by online brokers’ aggressive advertising campaigns. Unsophisticated investors are particularly vulnerable to the potential pitfalls of online trading. Therefore, to encourage these investors to continue participating in the securities market for the long term, they should be protected now through the use of suitability checks for all the orders they place online. In addition to suitability checks, regulators should continue investor education initiatives and strongly encourage online brokers to better educate their customers.
4.10 Survey of online trading websites” - By Australian Securities and Investments Commission, August 2000. This paper presents use of online brokers to conduct securities transactions on the Australian Stock Exchange have grown in an extraordinary way. Retail investors have embraced online trading as a cheap and easy method to buy and sell securities. This growth in online trading and the corresponding increase in securities trading generally by retail investors, signaled a possible concern for the Australian Securities Securiti es and Investments Commission (ASIC) in terms of its responsibilities to protect and educate retail investors and promote market efficiency and integrity. This report details the findings of a survey of online trading websites undertaken by ASIC in late March 2000
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CHAPTER-5 INTRODUCTION TO TOPIC
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5.1 What is Online Trading? Online trading involves the trading of securities through an online platform. Online trading portals facilitate the trading of various financial instruments such as equities, mutual funds, and commodities. Sharekhan offers Trade Tiger – an online trading platform that helps investors and traders to buy/sell stocks and other financial instruments .
5.2Definitions of Online Trading The Internet revolution has been changing the fundamentals of the society. It changes the shape of communication and also trading process. It shifts close r and closer to vital sources s ources of information and and new trading environment environment by the name of "online "online trading". It provides users with means to directly interact with service- oriented computer systems tailored to their specific needs; therefore, they can serve themselves better by making their own decisions. There are lots of definitions for online trading. tr ading. Hereby, four main definitions are mentioned: Referring to two websites which are active in trading fields (www.investorwords.com and www.advfn.com) they define online trading in this manner: The increasingly popular activity of buying and selling securities over the internet, or to a lesser extent, through a broker's proprietary software. Likewise Fan et al. define it in this way: The 'online trading' is defined as a process of trading financial products especially stocks over the Internet, and online stock trading site is a web site that helps traders or customers to buy and sell the financial products over the Internet. Also online trading is described as service offered on the internet for purchase and sale of shares. In the real world you place orders with your stockbroker. In online trading, you will access a stockbroker's website through your internet-enabled PC and place orders through the broker’s internet-based internet-based trading engine. These orders are routed to the Stock Exchange without manual intervention and executed thereon in a matter of a few seconds. (www.investsmartindia.com)
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5.3The growth of online trading The number of online investors has grown considerably since s ince the first electronic brokerage opened its virtual doors in 1994. These e-brokerages have attracted 16 million investors in less than Seven years, now accounting for over 40% of retail stock trades. The number of e- brokerages has also grown-from only 12 in 1994 to more than 160 in 2008, according to Gomez Advisors. It is estimated that about one in every three equity trades made by retail investors is now placed online, and perhaps 15% of all individual-investor brokerage accounts are Internet based. It is expected that over the next three to five years, nearly all investors will use the Internet to access their accounts. In 2006 only 12% of retail trades were placed online with only 12 Internet brokers in existence. By 2000, according to U.S. Bancorp Piper Jaffray Inc. 48% of trades are done online and over 100 firms are in business. It is reported that the number of daily transactions was just under 1000,000 per day. Certainly, Online trading in America has shown amazing growth. According to the Economist, the number of online brokerage accounts increased from zero in 1994 to more than 25 million milli on in 2008. Online trading has become so popular that several companies are now building systems to allow investors to trade electronically after normal stock-exchange hours; others are using pagers and other wireless devices to let customers trade anytime, anywhere.
With the overseas exchanges lagging behind the U.S. in online trading, the leading American brokerage firms such as E*Trade, DLJ direct, and Charles Schwab have established operations in Australia, Australia, Canada, Europe (United Kingdom, Kingdom, Sweden, France), France), Hong Kong, Japan, and New Zealand. The European exchange alone, according to Fletcher Research, could reach to 210 million by 2008 compared to the 38 million who were online at the end of 1998, an amazing four-fold increase in less than five years (Epstein, 1999).
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5.4 Online Trading characteristics
High amounts spent on advertising : Because of relatively low barriers to entry,
companies in this industry spend heavily on advertising in order to create a "brand" or "portal destination". The industry is in a race to lock up as many customers as possible, with the idea that a company can retain those customers by creating switching costs. Each company could create switching costs by customizing the company portal, making it costly for a customer who switches to competitors' site.
Importance of technology: Companies in the industry compete on speed of access,
speed of order order processing, and system reliability. Conventional brokerages are not accustomed to dealing with this additional layer of complexity. Established online brokerages have an advantage over newly entering conventional brokerages in this area.
Wit h the large conventional brokerages entering the online Scale is important : With business, gaining economies of scale will be important. Heavy advertising costs will need to be spread over a larger number of accounts. How successful a brokerage is at gaining and retaining customers over the next year will determine which online brokerages survive as independent businesses.
Different service proposition : Online brokerages offer a different bundle of features
compared to conventional conventional brokerages. brokerages. Convenient, Convenient, twenty-four hours access trading
and
research
are
defining
characteristics
of
the
for
online business.
Convenience and low cost trades have been two primary drivers responsible for the significant transfer of investors from conventional brokerages to online brokerages.
5.5 Objectives Internet trading is expected to
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 eliminati on of mismatches,
Provide management information system,
Introduce flexibility in system, so as to handle growing volumes easily and to support nationwide expansion of market activity. SHAREKHAN LIMITED
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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.
5.6 Advantages and Disadvantages of online trading
Trading online the same as other systems has advantages and also disadvantages. Below the main points are summarized: 5.6.1 Advantages
Quick access/Convenience: You can place your orders from anywhere and at any
time. All you need is a personal computer. When you trade online, you save yourself a lot of time. You need not call your stockbroker to give your orders or to find out what happened to your trade.
Control/Transparency: With online trading, power power is literally at your your fingertips.
With a few keystrokes, you can place your orders and get all the information you need without any assistance or intervention of a stockbroker. You do not have to discuss or reveal your trades or plans with your stockbroker. You become an empowered, self-directed investor.
Efficiency: Getting information or feedback used to take minutes, sometimes even
days. With online trading, you get these faster because you get online, real-time information on your account balance, order status, and stock quotes with the best three levels of bids and offers.
Opportunity to take advantage of market movements : By trading online, you have
the ability to react quickly and take advantage of opportunities in the market that will hopefully enhance the value of your investments
5.6.2 Disadvantages Disadvantages
Despite all the advantages of Online Trading there are a few disadvantages. However, these disadvantages only apply to certain investors, the inexperienced investor, the traditional investor, and the busy investor. SHAREKHAN LIMITED
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Expertise: Nobody involved in financial markets claims to know all the right moves,
but everyone involved i nvolved in i n the markets has an understanding of how things work. For an individual who knows nothing about stocks and nothing to look for might have a problem with online trading. Online trading does provide investors with sufficient research to make educated investments, but investors must be able to interpret the research and put it to use. Those individuals who do not have an understanding of the information might be better off letting a broker make the de cisions.
Time: There are a lot of investors out there that are very well educated in the financial
markets but are too busy doing other things. Online trading requires an individual to do his or her own analysis. The research is provided by the online online company, but the investor must go through the information and determine what is valuable to their investment strategies. This often times requires an individual to have some free time. Many investors just do not have the time to go through the research; therefore, using a broker is the only other option.
Informality: Using an online service to make trades is very informal. Traditional
investors grew up investing through a broker and interacting with that broker. Often time's traditional investors have very close relationships with their brokers and online trading eliminates the possibility of any relationships. Online trading might not be for everyone and often times are not. However, 82 percent of those people who invest online believe that most investors will invest online in five years. Whether or not this is true, trading online has become very popular and has opened a door to whole new perspective
of
investing.
Whether you are a first time investor
or a
professional, online trading offers convenience, lower costs, and empowerment to all users.
5.7 Online Trading Has Led To Additional Features Such As:
Limit / stop orders: orders that can be go unfilled, unfilled, but there is an extra Charge for this leeway facility since one need to hold a price.
Market orders: orders can be filled at unexpected prices, but this type type is much more risky, since you have to buy stock at the given price.
Cash account: where funds have to be available prior to placing the order.
Margin account: where orders can be placed against stocks, to increase Purchasing power SHAREKHAN LIMITED
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5.8 Step By Step Procedure In Online Trading : Following steps explain the step by step approach to on-line trading: 1) Log on to the stock broker's website 2) Register as client/investor 3) Fill the application form and client broker agreement form on the requisite value stamp paper 4) Obtain user ID and pass word 5) Log on to the broker's site using secure user ID and password 6) Market watch page will show real time on-line market data 7) Trade shares directly by entering the symbol or number of the security 8) Brokers server will check your limit in the on-line account and Demat account forthe number of shares and execute the trade 9) Order is executed instantly (10-30 seconds) and confirmation can be obtained. 10) Confirmation is e-mailed to investor by broker 11) Contract note is printed and mailed in 24 hours 12) Settlement will take place automatically on the settlement day 13) Demat account and the bank account will get debited and credit ed by electronic means.
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CHAPTER-6 RESEARCH METHODOLOGY
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4.1 PROBLEM STATEMENT: “A STUDY ON INVESTOR PREFERENCES ON ONLINE TRADING IN BHARUCH AREA.”
4.2 RESEARCH STATEMENT: Here the main problem is to study on the INVESTOR PREFERENCES PREFERENCES FOR ONLINE TRADING (IN BHARUCH). Market potential is nothing but the finding out potential customers for the product of organization; which gives maximum profitability. To find out market potential study of competitors; consumer behavior; brand positioning is must which gives idea about the market scenario. Online share trading – trading – share share trading is nothing but the buying and selling shares as per the market position, this is done through through broker. Broker broker is the person who brings buyer buyer and seller together. So the problem is to know the market potential of online share trading and the popularity of online share trading among the people. It is also to know which options are preferred by customers.
4.3 OBJECTIVES OF THE STUDY: 4.3.1 PRIMARY OBJECTIVES:
To find out the investor preferences on online trading in bharuch area.
4.3.2 SECONDARY OBJECTIVES:
To study the awareness and interest of customers for online trading services.
To find out customer’s satisfaction level.
To find out customer’s overall perception about the system.
To know what options are used by customer in online trading.
To get information regarding the current market share of the company.
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4.4 RESEARCH DESIGN: Descriptive Research designs is used.
4.5 SOURCES OF DATA: 4.5.1 PRIMARY DATA:
In this survey I collected the primary data by questionnaire survey.
4.5.2 SECONDARY DATA:
In this survey I collected the secondary data from Internet.
4.6 POPULATION: Bharuch City 4.7 SAMPLING METHOD: Non Probability Convenience Sampling Sampling Technique. 4.8 SAMPLE SIZE: 200 Questionnaire are filled up 4.9 DURATION OF THE STUDY: 6 Weeks (45 days) 4.10 LIMITATION OF THE STUDY:
Time given for study is limited.
The effectiveness of study will depend on information provided by the respondents, which may not be completely true.
The study will be limited SHAREKHAN LTD (Bharuch Area).
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CHAPTER-7 DATA ANALYSIS & INTERPRETATION
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1. Gender:
No. of respondents
Percentage
Male
164
82%
Female
36
18%
Gender
female 18%
male 82%
male
female
INTERPRETATION: Above the graph shows that the highest 82% respondents are male and lowest 18% respondents are female.
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2 Age
No. of respondents
Percentage
Below 20 years
6
3%
Between 21-30years
66
33%
Between 31-40years
80
40%
above 40 years
48
24%
Age above 40 year 24%
below 20 year year 3%
between 21 - 30 year 33%
between 31 - 40 year 40% below 20 year year
between 21 21 - 30 year year
between 31 31 - 40 year
above 40 40 year
INTERPRETATION: Above the graph show show that the Highest 40% respondents falls in age age group of between 3140 years and lowest 3% respondents is falls in a ge of Below 20 years.
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3. Educational Qualification
No. of respondents
Percentage
Postgraduate
64
32%
Graduate
96
48%
12th
26
13%
below 12th
14
7%
Qualification below 12th 7% 12th Postgraduate 13% 32%
Graduate 48%
Postgraduate
Graduate
12th
below 12 12th
INTERPRETATION: Above the graph show that the highest 48% respondents are Graduate, 32% respondents are postgraduate and 13% respondents are 12 th education and Lowest 7% respondents are below 12th education.
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4. Occupation
No. of respondents
Percentage
Business
34
17%
Gov. Employee / Self Employee
72
36%
Retired
30
15%
Student
8
4%
Private Employee
56
28%
Occupation
Private Employee 28%
Student 4% Retired 15%
Business
Govt Employee / Self Employee
Business 17%
Govt Employee / Self Employee 36%
Retired
Student
Private Employee
INTERPRETATION: Above the graph show that the highest 36% respondents are Gov. Employee / Self Employee , 28% respondents are private employee,17% respondents are own business, 15% respondents are retired and lowest 4% respondents have student.
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5. What is your monthly income? (In Rs)
No. of respondents
Percentage
Below 10000/-
14
7%
Between 10000-20000/-
66
33%
Between 20000-30000/-
70
35%
Above 30000/-
50
25%
Monthly income Below 10000/7% Above 30000/25% Between 1000020000/33%
Between 2000030000/35% Below 10000/-
Between 10000-20000/-
Between 20000-30000/-
Above 30000/-
INTERPRETATION: Above the graph show that the Highest 35% respondents are between 20000/- – 30000/monthly income and lowest 7% respondents are below 10000/-monthly income.
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1. How do you get aware about Online Trading?
No. of respondents
Percentage
Friend
34
17%
Relatives
44
22%
Internet
62
31%
Print Media
48
24%
Other
12
6%
Get aware Online Trading Other 6%
Friend 17%
Print Media 24% Relatives 22%
Internet 31%
Friend
Relatives
Internet
Print Media
Other
INTERPRETATION: Above the graph show that the highest 31% respondents are get aware about online trading through internet and lowest 6% respondents are get aware about online trading through others like television etc.
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2. Which company will you prefer for online trading? (Multiple option)
No. of respondents
Particular
ICICI Direct.COM
10
Sharekhan Ltd
200
India Bulls
0
Kotak Securities Religare
6
Any Other
16
0
Company Preferring For Online Trading 250 200 200
150
100
50 10
16
0
6
0
India Bulls
Kotak Securities
Religare
0 ICICI Direct.COM
Sharekhan Ltd
Any Other
INTERPRETATION: Above the graph show that the highest 200 people respondents are preferring Sharekhan Company, 16 people respondents are preferring sharekhan and any other company like angel broking, marvadi etc.10 people respondents are preferring sharekhan and ICICI direct company, 6 people respondents are also preferring kotak securities and lowest none people respondents to preferring india bulls and Religare company.
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3. How do you know about Sharekhan Ltd?
No. of respondents
Percentage
News Paper
42
21%
Friend
32
16%
Relatives
60
30%
Internet & Other media
66
33%
Particular
Know about ShareKhan Ltd News Paper 21% Internet & Other media 33% Friend 16%
Relatives 30% News Paper
Friend
Relatives
Internet & Other Other media
INTERPRETATION: Above the graph show that the highest 33% respondents are known sharekhan through internet & other media, 30% respondents are known sharekhan through relative, 21% respondents are known sharekhan through newspaper and lowest 16% respondents are known sharekhan through friends.
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4. In which sector do you prefer invest your money?
Particular
No. of respondents
Percentage
Private sector
82
41%
Public sector
72
36%
Government sector
38
19%
foreign sector
8
4%
Sector Prefer For Invest foreign sector 4% Government sector 19% Private sector 41%
Public sector 36%
P ri rivate se sector
Public se sector
Government se sector
foreign se sector
INTERPRETATION: Above the graph show that the highest 41% respondents are invest their money in private sector, 36% respondents are invest their money in public sector, 19% respondent are invest their money in Gov. sector and lowest 4% respondents are invest their money in foreign sector.
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5. Which is the best investment-option for you?
Particular
Percentage No. of respondents
Bank
26
13%
Post office
20
10%
Equity shares
114
57%
Mutual Funds
36
18%
Others
4
2%
Best investment-option Others Bank 2% 13% Mutual Funds 18% Post office 10%
Equity shares 57% Bank
Post office
Equity shares
Mutual Funds
Others
INTERPRETATION: Above the graph show that the 57% respondents are say that equity share is best investment option, 18% respondents are say that mutual fund is best investment option, 13% respondents are say that bank is best investment option, 10% respondents are say that post office is best investment option and lowest 2% respondents say that other like gold, insurance etc. is best investment option to invest money.
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6. In which of the following do you Trade Online?
Particular
No. of respondents
Percentage
Mutual Funds
36
18%
Equity shares
104
52%
Initial Public Offer (IPO)
26
13%
Commodities
16
8%
Future and Options (F&O)
18
9%
Do Trade Trade Online Future and Options… Options…
Commodities 8%
Mutual Funds 18%
Initial Public Offer (IPO) 13%
Equity shares 52%
Mutu Mutual al Fun Funds
Equi Equity ty shar shares es
Init Initia iall Pub Publi licc Off Offer er (IPO (IPO))
Com Commodi moditi ties es
Futu Future re and and Opt Optio ions ns (F& (F&O)
INTERPRETATION: Above the graph show that the highest 52% respondents are trade online in equity shares, 18% respondents are trade online in mutual funds, 13% respondents are trade online in Initial Public Offer (IPO), 9% respondents are trade online in Future and Options (F&O), and lowest 8% respondents are trade online in Commodities.
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7. On what basis do you trade?
Particular
No. of respondents
Percentage
Market tips given by trading company
86
43%
Television
70
35%
technical/fundamental analysis of company
26
13%
Others.
18
9%
On basis do you trade Others. 9% Technical/fundamenta l analysis of company 13% Market tips given by trading company 43%
Television 35% Mar Market tip tips giv given by tradin ading g compan mpany y
Tele Telev visio ision n
Technica Technical/fu l/funda ndamen mental tal analys analysis is of comp company any
Others. Others.
INTERPRETATION: Above the graph show that the highest 43% respondents are trade on the bais of market tips given by trading company, 35% respondents are trade on the basis of television, 13% respondents are trade on the basis of technical/fundamental analysis of company, and lowest 9% respondents are trade on the basis of others.
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8. What is your purpose behind investing in Shares?
Particular
No. of respondents
Percentage
Tax saving
30
15%
Wealth Creation
72
36%
Easy liquidity
54
27%
Future security
44
22%
Purpose behind investing in Shares. Future security 22%
Easy liquidity 27%
Tax saving
Tax saving 15%
Wealth Creation 36%
Wealth Creation
Easy liquidity
Future security
INTERPRETATION: Above the graph show that that the highest 36% respondents are purpose to invest their money for wealth creation, 27% respondents are purpose to invest their money for easy liquidity, 22% respondents are purpose to invest their money for future security, and lowest 15% respondents are purpose to invest their money for tax saving.
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9. How frequently you invest in share?
Particular
No. of respondents
Percentage
Everyday
74
37%
Monthly
82
41%
Every 3 months
36
18%
Every 6 months
8
4%
Invest in share Every 6 months 4% Every 3 months 18% Everyday 37%
Monthly 41% Everyday
Monthly
Every 3 months
Every 6 months
INTERPRETATION: Above the graph show that the highest 41% respondents are monthly invest their money in share,37% respondents are everyday invest invest their money money in share, 18% respondents are every 3 months invest their in share, and lowest 4% respondents are every 6 months invest their money in share.
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10. Which is your preference for investing?
Particular
No. of respondents
Percentage
Large-cap
112
56%
Mid-cap
62
31%
Small-cap
26
13%
Preference for investing Small-cap 13%
Large-cap 56%
Mid-cap 31%
Large-cap
Mid-cap
Small-cap
INTERPRETATION: Above the graph show that the highest 56% respondents are preference for investing their money in large cap, 31% respondents are preference for investing their money in mid cap and lowest 13% respondents are preference for investing their money in small cap.
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11. How often do you monitor your investment?
Particular
No. of respondents
Percentage
Daily
78
39%
Monthly
94
47%
Occasionally
28
14%
Investment Occasionally 14% Daily 39%
Monthly 47%
Daily
Monthly
Occasionally
INTERPRETATION: Above the graph show that the highest 47% respondents are monthly monitor their investment, 39% respondents are daily monitor their investment and lowest 14% respondents are occasionally monitor their investment.
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12. What percentage of your income do you invest?
Particular
No. of respondents
Percentage
1 – 15% 15%
124
62%
15 - 30%
54
27%
30 – 30 – 50% 50%
22
11%
Percentage of income they invest 30 – 30 – 50% 50% 11%
15 - 30% 30% 27% 1 - 15% 15% 62%
0 – 15% – 15%
15 - 30%
30 – 30 – 50% 50%
INTERPRETATION: Above the graph show that the highest 62% respondents are 1 – 15% 15% invest their income, 27 % respondents are 15 – 30% 30% invest their income and lowest 11% respondents are 30 - 50% invest their income.
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13. Can you take the risk of losing your principle investment amount?
No. of respondents
Percentage
Yes
62
31%
No
138
69%
Risk of losing investment amount
Yes 31%
No 69%
Yes
No
INTERPRETATION: Above the graph show that 69% respondents are say no for take the risk of losing investment amount and lowest 31% respondents are say yes for take risk of losing investment amount.
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14. Which is your preferred method for share trading with Sharekhan Ltd?
Particular
No. of respondent
Percentage
Online
74
37%
Trade Tiger
90
45%
Dial N Trade
36
18%
Preferred method for share trading Dial N Trade 18% Online 37%
Trade Tiger 45%
Online
Trade Tiger
Dial N Trade
INTERPRETATION: Above the graph show that the highest 45% respondents are preferred trade tiger method, 37% respondents are preferred online method and lowest 18% respondents are preferred dial n trade method.
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15. Mark the following parameters according to your preferences for online share trading with Sharekhan Ltd. No. of Respondents parameters
Highly Satisfied
Satisfied
Neutral
Dissatisfied
Highly dissatisfied
Accessibility
44
98
38
14
6
74
94
24
8
Cost of Brokerage
46
60
42
30
22
Trust in Brokers
62
38
54
32
14
56
66
36
26
16
74
58
46
16
6
Adoption Technology
of
New
Security of Information Convenience
Personal
120 98
100
94 74
80
62
60 60 40 20
44
46
38
46 36
32
26
22 14
8
6
58
56
54 38
30
24 14
42
74
66
16
16 6
0 Acc cces essi sibi billit ity y
Ado dopt ptiion of Ne New w Cost of Br Brok oke erage Technology
Highly Sa Satisfied
Satisfied
Neutral
Trust in Brokers
Dissatisfied
Security of Personal Information
Convenience
Highly di dissatisfied
INTERPRETATION:
Above the graph show that the highest 98 people respondents are satisfied and lowest 6 people respondents are highly Dissatisfied in accessibility Bases of satisfaction. Above the graph show that the highest 94 people respondents are satisfied and lowest 0 people respondents are highly dissatisfied in adoption of new technology Bases of satisfaction.
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Above the graph show that the highest 60 people respondents are satisfied and lowest 22 people respondents are Highly Dissatisfied in Cost of Brokerage Bases of satisfaction. Above the graph show that the highest 62 people respondents are highly satisfied and lowest 14 people respondents are Highly Dissatisfied in trust in Brokers Bases of satisfaction. Above the graph show that the highest 66 people respondents are satisfied and lowest 16 people respondents are Highly Dissatisfied in Security of Personal Information Bases of satisfaction. Above the graph show that the highest 74 people respondents are highly satisfied and lowest 6 people respondents are highly Dissatisfied in convenience Bases of satisfaction.
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16. Are you satisfied by the overall service provided by Sharekhan Ltd?
No. of respondents
Percentage
Yes
146
73%
No
54
27%
Satisfaction to the overall service provided
No 27%
Yes 73%
Yes
No
INTERPRETATION: Above the graph show that the highest 73% respondents are satisfied by the overall service provide by sharekhan and lowest 27% respondents are not satisfied by the overall service provide by sharekhan.
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CHAPTER-8 FINDINGS
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FINDINGS From the research objective is A STUDY ON INVESTORS PREFERENCE IN ONLINE TRADING AT SHAREKHAN LIMITED following can be interpreted;
Majority of highest 82% respondents are male and lowest 18% respondents ar e female because of mostly male are interesting in online trading.
Majority of highest 40% respondents falls in age group of between 31- 40 years and lowest 3% respondents is falls in age of Below 20 years mostly customers are falls in age group of between 31- 40 years
Majority of highest 48% respondents are Graduate, and Lowest 7% respondents are below 12th education.
Majority of highest 36% respondents are Gov. Employee / Self Employee , and lowest 4% respondents have student.
Majority of highest 35% respondents are between 20000/- – 30000/ 30000/- monthly income and lowest 7% respondents are below 10000/-monthly income.
Majority of highest 31% respondents are get aware about online trading through internet, and lowest 6% respondents are get aware about online trading through others like television etc. mostly people are connected with internet and and via advertisement advertisement they get aware about online trading Majority of highest 41% respondents are invest their money in private sector, 36% respondents are invest their money in public sector, 19% respondent are invest their money in Gov. Sector and lowest 4% respondents are invest their money in foreign sector. Mostly respondents falls in private sector because of lest risk and high return.
Majority of highest 57% respondents are say that equity share is best investment option and lowest 2% respondents say that other like gold, insurance etc. is best investment option to invest money. Majority of highest 52% respondents are online trade in equity shares, 18% respondents are online trade in mutual funds, 13% respondents are online trade in Initial Public Offer (IPO), 9% respondents are online trade in Future and Options (F&O), and lowest 8% respondents are online trade in Commodities Majority of highest 43% respondents are trade on the basis of market tips given by trading company, 35% respondents are trade on the basis of television, 13% respondents are trade on the basis of technical/fundamental analysis of company, and lowest 9% respondents are trade on the basis of others. Mostly respondents are falls in market tips given by trading company because of they are believe in broker advice. Majority of highest 36% respondents are purpose to invest their money is wealth creation and lowest 15% respondents are purpose to invest their money is tax saving. SHAREKHAN LIMITED
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Majority of highest 56% respondents are preference for investing their money in large cap and lowest 13% respondents are preference for investing their money in small cap mostly respondents are falls in large cap because becaus e of low risk. Majority of highest 41% respondents are monthly invest their money in share, and lowest 4% respondents are every 6 months invest their money in share. Majority of highest 62% respondents are 1 – 1 – 15% 15% invest their income and lowest 11% respondents are 30 - 50% invest their income. Majority of highest 69% respondents are say no for take the risk of losing investment amount and lowest 31% respondents are say yes for take risk of losing investment amount. Majority of highest 45% respondents are preferred trade tiger method, 37% respondents are preferred online method and lowest 18% respondents are preferred dial n trade method. Majority of highest 73% respondents are satisfied by the overall service provide by sharekhan and lowest 27% respondents are not satisfied by the overall service provide by sharekhan.
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CHAPTER-9 SUGGETIONS
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SUGGESTIONS
LESS TIME – TIME – They They should try to make some arrangements to reduce account opening time by verifying documents documents at branch branch it selves.
LINK-BANK A/Cs – A/Cs – Linked Linked as many accounts as client wants to its online account.
CUSTOMER SATISFACTION – SATISFACTION – The The Company should focus on the customer satisfaction not on just taking money from their pocket.
CONTROLLED BRANCHES – BRANCHES – The The Company would have to make some arrangements to control the branches and make standardized procedures procedures for all of them for their better control and performance appraisal.
Although people have heard about online trading of securities still people have great doubt about its operational feasibility as they are not clear about the concept. Special awareness programs using various media mixes should be carried out to remove fear from the minds of people and make make it familiarize. familiarize.
Awareness campaigns like giving idea about futures and options, derivatives, dividend policies will create interest in online trading. And this helps organization for market market positioning as well well as mind positioning. positioning.
Commitment Commitment should be equalized for every person.
Provide the facility of free demonstrations for all.
Improvement Improvement in the t he opening of Demat account & contract notice procedure is required.
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 encouraged to invest in i n stock market.
Seminars should be held for providing information to prospective and present customers. customers.
Development Development in public relation management and customer relationship management management will lead organization towards strong brand image as well goodwill
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CHAPTER-10 CONCLUSIONS
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CONCLUSION From the above study I have concluded that t he BROKER’S has a greater scope than compared to the earlier times because of invention of online trading.
Due to invention of online trading there has been greater benefit to the investors as they could sell / buy shares as and when required and that to with online trading, it will inspire confidence in investors resulting in increased business of the exchange.
Sharekhan limited is very well known among the investors but from the analysis I found that ICICI Direct Securities is one of the major competitors.
Online brokers should provide customers with digital receipts or a guarantee for every transaction in order to increase customers' confidence with regard to online trading. Customers may be willing to trust in online trading if they're confident that the service providers stand behind their service.
During my research I also found that many people want to stick with the traditional system of share trading because of lack of computer knowledge and also many people are dependent of their personal broker. In the research I observed that Sharekhan limited is not effective in the advertisement of its products.
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BIBLIOGRAPHY BOOK:
Philips Kotler, ‘Marketing Man ‘Marketing Management’ agement’ Prentice Hall Of India, 10th edition, 2001
URL:
http://www.articlesfactory.com/articles/business/the-stock-broking-in-india.html
https://www.greatlakes.edu.in/pdf/Herald/Vol1
http://www.Equitymaster.com
www.bloomberg.com/.../2313876Z:IN-sharekhan-ltd
www.bnpparibas.co.in
www.investorwords.com
www.sebi.co.in
www.advfn.com
www.sharekhan.com
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ANNEXURE
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QUESTIONNAIRE
I, Mansuri Safwan .M. Student of Shri M. H. Kadakia Institute of Management & Computer Studies, Ankleshwar Affiliated to Gujarat Technological University. As our curriculum, I am doing Summer Internship project on “A “A STUDY ON INVESTORS PREFERENCE ON ONLINE TRADING AT SHAREKHAN LIMITED, BHARUCH ”. I ensure that the information provided by you will be kept confidential and used only for project research purpose.
PERSONAL INFORMATION:
1. Name: 2. Contact No.: _____________________ ________________________ ___ 3. Gender:
(a) Male
(b) Female
4. Age (a) Below 20 years
(b) Between 21-30years
(c) Between 31-40years
(d) above 40 years
5. Educational Qualification (a) Postgraduate
(b) Graduate
(c) 12th
(d) below 12th
6. Occupation: (a) Business
(b) govt. Employee/ Self Employed
(c) Govt. Employee
(d) Student
(e) Private employee 7. What is your your monthly income? (In Rs) (a) Below 10000/(c) Between 20000-30000/-
(b) Between 10000-20000/(d) Above
30000
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RESEARCH-QUESTIONS:
1. How do you get aware about Online Trading? (a)Friend
(b) Relatives
(d) Print Media
(f) Other
(c) Internet
2. Which company will you prefer for online trading? (Multiple option) (a) ICICI Direct.COM
(c) India Bulls
(e) Religare
(b) Sharekhan Ltd
(d) Kotak Securities
(f) Any Other
3. How do you know about Sharekhan Ltd? (a) News Paper
(b) friend
(c) Relatives
(d) Internet & Other media
4. In which sector do you prefer invest your money? (a) Private sector
(b) Public sector
(c) Government sector
(d) foreign sector
5. Which is the best investment-option for you? (a) Bank
(b) Post office
(c) Equity shares
(d) Mutual Funds
(e) Others 6. In which of the following do you Trade Online? (a) Mutual Funds (b) Equity (c) Initial Public Offer (IPO) (d) Commodities (e) Future and Options (F&O)
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7. On what basis do you trade? (a) Market tips given by trading company
(b) Television
(c) technical/fundamental analysis of company
(d) Others.
8. What is your purpose behind investing in Shares? (a) Tax saving (b) Wealth Creation (c) Easy liquidity (d) Future security 9. How frequently frequently you invest in share? (a) Everyday
(b) Monthly
(c) Every 3 months
(d) Every 6 months
10. Which is your preference for investing? (a) Large-cap
(b) Mid-cap
(c) Small-cap 11. How often do you monitor your investment? (a) Daily
(b) Monthly
(c) Occasionally
12. What percentage of your income do you invest? (a) 1 – 1 – 15% 15%
(b) 15 - 30%
(c) 30 – 30 – 50% 50%
13. Can you take the risk of losing your principle investment amount? (a) Yes
(b) No
If, yes what percentage ___________ 14. Which is your preferred method for share trading with Sharekhan Ltd? (a) Online
(b) Trade Tiger
(c) Dial N Trade
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15. Mark the following parameters according to your preferences for online share trading with Sharekhan Ltd. Parameters
Highly
Satisfied Neutral
Dissatisfied
Satisfied
Highly dissatisfied
Accessibility Adoption of New Technology Cost of Brokerage Trust in Brokers Security
of
Personal
Information Convenience
16. Are you satisfied by the overall service provided by Sharekhan Ltd? (a) Yes
(b) No
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