AN ORGANISATION STUDY OF HEDGE EQUITIES LIMITED, COCHIN
Report Submitted in Partial Fulfillment of Requirement for the Two year Full Time Master of Business Administration Program of M.G. University, Kottayam
By AJU K RAJU REG NO: 32722
Guided by Dr. SONEY JOHN
MARIAN INTERNATIONAL INSTITUTE OF MANAGEMENT KUTTIKANAM, IDUKKI MBA (2011-2013)
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MARIAN INTERNATIONAL INSTITUTE OF MANAGEMENT KUTTIKKANAM PO, PEERMADE-685531, KERALA
CERTIFICATE This is to certify that the Organization Study Report entitled “AN ORGANISATION STUDY OF HEDGE EQUITIES LIMITED, COCHIN.” Submitted to M.G. University in partial fulfillment of the requirements for the award of the MBA degree is a record of original work done by Mr. Aju K Raju during the year 2012 under my supervision and guidance Signature of the
Director
Signature of the
Faculty Guide (Dr. SONEY JOHN)
Date ……………. Viva – Voce Examination held on ………………………………. Signature of the Internal Examiner
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DECLARATION
I, AJU K RAJU MBA student , Marian International Institute of Management, Kuttikkanam, do hereby declare that this report entitled “AN
ORGANISATION
STUDY
OF
HEDGE
EQUITIES
LIMITED,COCHIN ”, submitted in partial fulfillment for the degree of Master of Business Administration, is a record of bonafide work done by me under the guidance of Dr. SONY JOHN, Professor, MIIM, Kuttikkanam. I further declare that this report has not previously formed the basis for the award of any titles of recognition.
Kuttikkanam
AJU K RAJU
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ACKNOWLEDGEMENT The success of a project depends upon framework and cooperation of various people involved either directly or indirectly. I take this opportunity to express my gratitude to all those who helped in this project. First and foremost I thank God the almighty for his blessing for the successful
completion
of
this
work.
I
take
this
opportunity
to
acknowledge my indebtedness to all persons who have me in completing my work. I would like to convey my sincere gratitude, and thanks Mr. Alex Babu (MD) of hedge equities, for allowing me to undertake this study at hedge equities and also like to thank to Mr.Benil Dani Alexander, Sr .executive advisory help desk, hedge school of applied economics Cochin for his support and valuable suggestion. I extend my sincere thank to all staffs hedge equities ltd who helped me in this work. I also thank all other staff of Hedge school of applied economics, Kochi for their guidanance in conducting the study. It is my privileges to express my sincere thanks to Dr. Soney john associate professor of Marian international institution of management, Kuttikkanam for his support and necessary guidance throughout my endeavor. Finally I wish to thank my family and friends and express my sincere gratitude to them for their support; guidance, protection and blessing those were showered upon me throughout the endeavor.
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INDEX
SL NO
CONTENTS
PAGE NO
1
INTRODUCTION
1
2
SCOPE OF THE STUDY
2
3
OBJECTIVE OF THE STUDY
2
4
METHODOLOGY
2
5
INDUSTRY PROFILE
3
6
ORGANISATIONAL PROFILE
20
7
ORGANISATIONAL STRUCTURE
37
8
DEPARTMENTS AND THEIR FUNCTIONS 40
9
SWOT ANALYSIS
47
10
FINDINGS
48
11
SUGGESTIONS
49
12
CONCLUSIONS
50
13
BIBLIOGRAPHY
51
5
LIST OF CHARTS
SLNO
CONTENTS
PAGE NO
1
ORGANIZATIONAL STRUCTURE
38
2
UNDER THE GM
38
3
REGIONAL ORGANIZATIONAL STRUCTURE
39
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INTRODUCTION In this economic era for tightening business, nuts and bolt of any company. Industries, or enterprise, it is necessary to measure its market position in certain time interval with the ever changing theories and concepts of market for this assessment and technical analysis is needed. Although analysis dose not reveal the absolute solution of any objective, it provides the guide towards a good output. This study will give students a different experience where in they learn the practical side of the business since the real life situations are in front of them and can be related to concepts, principles, theories which were taken in classes. This would help the future managers to face the upcoming challenges in the business life. Hedge equities is one of the leading financial service company in India, specialized in offering a wide range of financial product, tailor made to suit individual need, as a first step to make their presence, Global Hedge equities is Kerala’s second largest financial institution .This study help in creating managers who are equipped with the experience of linking the theoretical input with those of practical exposure and come out with creative solutions/ideas in enhancing the business.
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SCOPE OF THE STUDY To know the working and procedural steps in the organization Useful for the academic purpose and further reference To know the functioning of the financial services industry in India
OBJECTIVES OF THE STUDY To study the organizational structure of Hedge equities (P) Ltd To study about various departments and their functions
To study about the day to day activities in the Hedge equities METHODOLOGY The data are collected from two sources namely primary and secondary sources. Primary data The primary data collected by providing questionnaires to the main department. Personal interview also conducted in the organization to collect the required data Secondary data Magazines, company web site
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INDUSTRY PROFILE A financial market is a market in which people and entities can trade financial securities, commodities, and other fungible items of value at low transaction costs and at prices that reflect supply and demand. Securities include stocks and bonds, and commodities include precious metals or agricultural goods. There are both general markets (where many commodities are traded) and specialized markets (where only one commodity is traded). Financial markets facilitate:
The raising of capital (in the capital markets)
The transfer of risk (in the derivatives markets)
Price discovery
Global transactions with integration of financial markets
The transfer of liquidity (in the money markets)
International trade (in the currency markets
Capital market Capital market consists of primary market and secondary market. In primary market newly issued stocks are exchanged and in secondary market buying and selling of already existing bonds and stocks takes place. So, the capital market can be divided into bond market and stock market. Bond market provides financing by bond issuance and bond trading. Stock market provides financing by shares or stock issuance and by share trading. As a whole, capital market facilitates rising of capital.
Money market Money market facilitates short term debt financing and capital. The money market is a subsection of the fixed income market. Money market securities are essentially IOUs issued by governments, financial institutions and large corporations. These instruments are very liquid and considered extraordinarily safe. Because they are extremely conservative, money market securities offer significantly lower returns than most other securities.
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One of the main differences between the money market and the stock market is that most money market securities trade in very high denominations. This limits access for the individual investor. Furthermore, the money market is a dealer market, which means that firms buy and sell securities in their own accounts, at their own risk. Compare this to the stock market where a broker receives commission to acts as an agent, while the investor takes the risk of holding the stock. Another characteristic of a dealer market is the lack of a central trading floor or exchange. Deals are transacted over the phone or through electronic systems.
Derivatives market Derivatives market provides instruments which help in controlling financial risk. The derivative itself is merely a contract between two or more parties. Its value is determined by fluctuations in the underlying asset. The most common underlying assets include stocks, bonds, commodities, currencies, interest rates and market indexes. Most derivatives are characterized by high leverage. The first leap towards an organized derivatives market came in 1848, when the Chicago Board of trade, the largest derivative exchange in the world, was established. Derivatives markets broadly can be classified into two categories, those that are traded on the exchange and the traded one to one or 'over the counter'. They are hence known as:
Exchange Traded Derivatives
OTC Derivatives (Over The Counter)
OTC Equity Derivatives The term "Derivative" indicates that it has no independent value, i.e. its value is entirely
"derived" from the value of the underlying asset. The underlying asset can be securities, commodities, bullion, currency, live stock or anything else. In other words, Derivative means a forward, future, option or any other hybrid contract of pre determined fixed duration, linked for the purpose of contract fulfillment to the value of a specified real or financial asset or to an index of securities.
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Foreign exchange market Foreign exchange market facilitates the foreign exchange trading. The foreign exchange market (forex, FX, or currency market) is a form of exchange for the global decentralized trading of international currencies. Financial centers around the world function as anchors of trading between a wide range of different types of buyers and sellers around the clock, with the exception of weekends In a typical foreign exchange transaction, a party purchases a quantity of one currency by paying a quantity of another currency. The modern foreign exchange market began forming during the 1970s after three decades of government restrictions on foreign exchange transactions (the Breton Woods system of monetary management established the rules for commercial and financial relations among the world's major industrial states after World War II), when countries gradually switched to floating exchange rates from the previous exchange rate regime, which remained fixed as per the Breton Woods system.
Insurance market Insurance market helps in relocation of various risk. Insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the insurance; the insured, or policyholder, is the person or entity buying the insurance policy. The amount to be charged for a certain amount of insurance coverage is called the premium. Risk management, the practice of appraising and controlling risk, has evolved as a discrete field of study and practice. The transaction involves the insured assuming a guaranteed and known relatively small loss in the form of payment to the insurer in exchange for the insurer's promise to compensate (indemnify) the insured in the case of a financial (personal) loss. The insured receives a contract, called the insurance policy, which details the conditions and circumstances under which the insured will be financially compensated.
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Commodity market Commodity market organizes trading of commodities. Commodity markets are markets where raw or primary products are exchanged. These raw commodities are traded on regulated commodities exchanges, in which they are bought and sold in standardized contracts. The trading of commodities consists of direct physical trading and derivatives trading. Exchange traded commodities have seen an upturn in the volume of trading since the start of the decade. This was largely a result of the growing attraction of commodities as an asset class and a proliferation of investment options which has made it easier to access this market.
Commodity trading Spot trading is any transaction where delivery either takes place immediately, or with a minimum lag between the trade and delivery due to technical constraints. Spot trading normally involves visual inspection of the commodity or a sample of the commodity, and is carried out in markets such as wholesale markets. Commodity markets, on the other hand, require the existence of agreed standards so that trades can be made without visual inspection.
Forward market A forward contract is an agreement between two parties to exchange at some fixed future date a given quantity of a commodity for a price defined today. The fixed price today is known as the forward price. Early on these forward contracts were used as a way of getting products from producer to the consumer. These typically were only for food and agricultural products
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Futures contracts Futures contract has the same general features as a forward contract but is standardized and transacted through a futures exchange. Although more complex today, early forward contracts for example, were used for rice in seventeenth century Japan. Modern forward, or futures agreements began in Chicago in the 1840s, with the appearance of the railroads. Chicago, being centrally located, emerged as the hub between Midwestern farmers and producers and the east coast consumer population centers.
Hedging Hedging, a common practice of farming cooperatives, insures against a poor harvest by purchasing futures contracts in the same commodity. If the cooperative has significantly less of its product to sell due to weather or insects, it makes up for that loss with a profit on the markets, since the overall supply of the crop is short everywhere that suffered the same conditions.
Delivery and condition guarantees In addition, delivery day, method of settlement and delivery point must all be specified. Typically, trading must end two (or more) business days prior to the delivery day, so that the routing of the shipment can be finalized via ship or rail, and payment can be settled when the contract arrives at any delivery point.
Stock exchange market A stock
exchange is
a
form
of exchange which
provides
services
for stock
brokers and traders to trade stocks, bonds, and other securities. Stock exchanges also provide facilities for issue and redemption of securities and other financial instruments, and capital events including the payment of income and dividends. Securities traded on a stock exchange include shares issued by companies, unit trusts, derivatives, pooled investment products and bonds.
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History of stock market It has been suggested by Braudal about the History of Stock Market that during the 11 th century in Cairo, the Jewish and Muslim merchants already had the notion of trade association and had setup all the methods of credit as well as payments. This claim though destroys the calls that the History of Stock Market originates with Italy. If we fall back upon the 12th century France it can be seen that the courtier change was worried about handling and regulating the debts on the bank’s behalf of the agricultural professions. As these men use to deal with debts they can also be called as originators of brokerage business in the History of Stock Market. During the end of 13th century traders of Bruges commodity accumulated inside the house of a native named Van der Beurse. During the early 14th century they came to be known as the Brugse Beurse. These people institutionalized their gatherings, which were known to be an informal meeting until then. This concept did spread at a rapid pace around the European nations and neighboring countries. In the countries like Amsterdam and Ghent its branches known as Beurzen opened. During the middle of 13th century the bankers of Venice started trading in government securities. At this very time the government of Venice outlawed airing bruits which were intentionally used to lessen the price of governmental funds. The bankers from Florence, Verona, Genova during the 14th century also started trading with government securities. It were the Dutch’s in the History of Stock Market who inaugurated the concept of joint stock exchanges which led the people to buy shares and become share holders and invest money in various businesses and get their part of profit and loss. The Dutch East India Company in the year 1602 brought out first shares on the Stock Exchange of Amsterdam and it was also the first Stock Exchange to bring out bonds and shares in the history of Stock Market. The Stock Exchange of Amsterdam is also known to be the first stock exchange in the History of Stock Market to inaugurate continuous trade during the early part of 17th century. There are Stock Markets in virtually every part of the world at this moment. Some of the important stock markets are located in United States, United Kingdom, India, China etc.
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Major stock exchanges in various countries over the world are as follows: o American Stock Exchange
o Kuwait Stock Exchange
o Australian Stock Exchange
o London Stock Exchange
o Colombo Stock Exchange
o Nigerian Stock Exchange
o Chicago Stock Exchange
o New York Stock Exchange
o Dhaka Stock Exchange
o Philippines Stock Exchange
o Hong Kong Stock Exchange
o Singapore Stock Exchange
o Jakarta Stock Exchange
o Bombay stock Exchange
o Jamaica Stock Exchange
o The National Stock Exchange of India o Toronto Stock Exchange
Indian Stock Exchanges – An Umbrella Growth “Stock Exchange means anybody of individuals whether incorporated or not, consolidated for the purpose of assisting, regulating and controlling the business of buying, selling and dealing in securities. It is a market where stocks, shares and other securities are bought and sold and also to provide avenue for disposal of securities when the owners feel like. It is an essential component of the economy and indispensable for the proper functioning of corporate enterprises. In general, the financial market is divided into two parts, Money Market and Capital Market. Securities market is an important, organized capital market where transaction of capital is facilitated by means of direct financing using securities as a commodity. Securities market can be divided into primary market and secondary market. The working of stock exchanges in India started in 1875. BSE is the oldest stock market in India. The history of Indian stock trading starts with 318 persons taking membership in Native Share and Stock Brokers Association, which we now know by the name Bombay Stock Exchange or BSE in short. In 1965, BSE got permanent recognition from the Government of
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India. National Stock Exchange comes second to BSE in terms of popularity. BSE and NSE represent themselves as synonyms of Indian Stock Market. The history of Indian Stock Market is almost the same as the history of BSE. The 30 stock sensitive index or Sensex was first compiled in 1986. The Sensex is compiled based on the performance of the stocks of 30 financially sound benchmark companies. In 1990 the BSE crossed the 1000 mark for the first time. It crossed 2000, 3000 and 4000 figures in 1992. The up-boat mood of the market was suddenly lost with Harshad Mehta scam. It came to public knowledge that Mr. Mehta, also known as the big bull of Indian stock market diverted huge funds from banks through fraudulent means. He played with 270 million shares of about 90 companies. Millions of small scale investors became victims to the fraud as the Sensex fell flat shedding 570 points. To prevent such fraud the Government formed The Securities and Exchange Board of India, through an act in 1992. SEBI is the statutory body that controls and regulates the functioning of stock exchanges, brokers, sub-brokers, portfolio managers, investment advisors etc. SEBI oblige several rigid measures to protect the interest of investors. Now with the inception of online trading and daily settlements the chances for a fraud is nil, says top officials of SEBI. Sensex crossed the 5000 mark in 1999 and the 6000 mark in 2000. The 7000 mark was crossed in June and the 8000 mark in September 8 in 2005. Many Foreign Institutional Investors (FII) are investing in Indian stock markets on a very large scale. The liberal economic policies pursued by successive Governments attracted Foreign Institutional Investors to a large scale. Experts now believe that the Sensex can soar past 20000 marks very soon. The unpredictable behavior of the market gave it a tag – ‘a volatile market’. The factors that affected the market in the past were good monsoon, Bharatiya Janatha Party’s rise to power etc. The result of a cricket match between India and Pakistan also affected the movements in Indian stock markets. The National Democratic Alliance led by BJP, during 2004 public elections unsuccessfully tried to ride on the market sentiments to power. NDA was voted out of power and the Sensex recorded the biggest fall in a day amidst fears that the CongressCommunist coalition would stall economic reforms. Later Prime Minister Man Mohan Singh’s
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assurance of reforms with a human face cast off the fears and market reacted sharply to touch the mark of 8500. India, after United States hosts the largest number of listed companies. Global investors now ardently seek India as their preferred location for investment. Once viewed with scepticism, stock market now appeals to middle class Indians also. Many Indian working in foreign countries now divert their savings to stocks. This recent phenomenon is the result of opening up of online trading and diminished interest rates from banks. The stock brokers based in India are opening offices in different countries mainly to cater the needs of Non Resident Indians. The time factor also works for the NRIs. They can buy or sell stocks online after returning from their work places. The bullish run of the stock market can be associated with a steady growth of around 6% in GDP, the growth of Indian companies to MNCs, large potential of growth in the fields of telecommunication, mass media, education, tourism and IT sectors backed by economic reforms ensure that Indian stock market continues its bull run.
Primary Market The primary market is that part of the capital market that deals with the issue of new securities. Companies, governments or public sector institutions can obtain funding through the sale of a new stock or bond issue. This is typically done through a syndicate of securities dealers. The process of selling new issue to investors is called underwriting. In the case of a new stock issue, this sale is an Initial Public offering (IPO). Dealers earn a commission that is built into the price of the security offering, though it can be found in the prospectus. Primary market creates long term instruments through which corporate entities borrow from capital market. Features of primary market:
This is the market for new long term equity capital. This primary market is the market where the securities are sold for the first time. Therefore it is also called the new issue market (NIM)
In a primary issue, the securities are issued by the company directly to investors.
The company receives the money and issue new security certificates to investors.
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Primary issue is used by companies for the purpose of setting up new business or for expanding or modernizing the existing business.
The primary market performs the crucial function of facilitating capital formation in the economy.
The new issue market does not include certain other sources of new long term external finance, such as loan from financial institutions. Borrowers in the new issue market may be raising capital for converting private capital into public capital; this is known as “gong public”.
The financial assets sold can only be redeemed by the original holder.
Methods of issuing securities in the primary market are:
Initial public offering
Right issue ( for existing companies)
Preferential Issue
Secondary Market The secondary market is an ongoing market, which is equipped and organized with a place, facilities and other resources required for trading securities after their initial offering. It refers to a specific place where securities transaction among many and unspecified persons is carried out through intermediation of the securities firms, i.e. a licensed broker, the exchanges, a specified traditional organization in accordance with the rules and regulations established by the exchanges. With regard to the history of stock exchanges, they say it was under a tree when it was started back in the year 1875. Bombay Stock Exchange (BSE) was the major exchanges in India till 1994. National Stock Exchange (NSE) started operations in 1994. NSE was floated by major banks and financial institutions. It same as a result of Harshad Mehta scam of 1992. Contrary to popular belief the scam was more of a banking scam than a stock market scam. The old methods of trading in BSE were people assembling on what was called a ring in the BSE building. They had a unique language to communicate apart from all the shouting. Investors
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were not allowed access and the system was opaque and misused by brokers. The shares were in physical form and prone to duplication and fraud. NSE was the first stock exchange to introduce screen based trading. BSE was forced to follow suit. The present day trading platform is transparent and gives investors prices on a real time basis. With the introduction of depository and mandatory dematerialization of shares chances of fraud reduced further. The trading screen gives top 3 buy and sell quotes on every scrip. A typical trading day starts at 10 and ends at 3:30 during week days. BSE has 30 stocks which makes the Sensex. NSE has 50 stocks in its index called Nifty. FIIs, banks, financial institutions and mutual funds are biggest players in the market. Then there are the retail investors and speculators. The last ones are the ones who follow the market from morning till evening. Market can be very addictive like blogging through stakes are higher in the former.
Origin of Indian Stock Market The origin of stock market in India goes back to the eighteenth century when long term negotiable securities were first issued. However for all practical purposes, the real beginning occurred in the middle of nineteenth century after the enactment of the Companies Act in 1850, which introduced the features of limited liability and generated investor interest in corporate securities. An important early event in the development of stock markets in India was the formation of the Native Share and Stock Brokers Association at Bombay in 1875, the precursor of the present day Bombay Stock Exchange. This was followed by the formation of associations/exchanges in Ahmedabad (1894), Calcutta (1908) and Madras (1937). In addition, a large number of ephemeral exchanges merged mainly in buoyant periods to recede into oblivion during depressing times subsequently. Stock exchanges are intricacy inter-woven in the fabric of a nation’s economic life. Without a stock exchange, the saving of the community – the sinews of economic progress and productive efficiency would remain underutilized. The task of mobilization and allocation of savings could be attempted in the old days by a much less specialized institution than the stock exchanges. But as business and industry expanded and the economy assumed more complex nature, the need for permanent finance arose. Entrepreneurs needed money for long term
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whereas investors demanded liquidity – the facility to convert their investment into cash at any given time. The answer was a ready market for investments and this was how the stock exchanges came into being. Stock exchange means anybody of individuals, whether incorporated or not, constituted for the purpose of regulating or controlling the business of buying, selling or dealing in securities. These securities include: a. Shares, scrip, stocks, bonds, debentures stock or other marketable securities of a like nature in or of any incorporated company or other body corporate; b. Government securities; and c. Rights or interest in securities The Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) are the two primary exchanges in India. In addition there are 22 Regional Stock Exchanges. However the BSE and NSE have established themselves as the two leading exchanges and account for about 80 percent of the equity volume traded in India. The NSE and BSE are equal in size in terms of daily traded volume. The average daily turnover at the exchanges has increased form Rs. 851 crore in 1997-98 and further to Rs. 2273 crore in 1990-2000 (April – August 1999). NSE has around 1500 shares listed with a total market capitalization of around Rs. 9, 21,500 crore. The BSE has over 6000 stock listed and has a market capitalization of around Rs. 9, 68,000 crore. Most key stocks are traded on both the stock exchanges and hence the investor could buy them on either exchange. Both exchanges have a different settlement cycle, which allows investors to shift their positions on the bourses. The primary index of BSE is BSE Sensex comprising 30 stocks. NSE has the S&P NSE 50 index (Nifty) which consists of fifty stocks. The BSE Sensex is the older and more widely followed index. Both these indices are calculated on the basis of market capitalization and contain the heavily traded shares from key sectors. The markets are closed on Saturdays and Sundays. Both the exchanges have switched over from the open outcry trading system to a fully automated computerized mode of trading known as BOLT (BSE Online Trading) and NEAT ( National Exchange Automated Trading) system.
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It facilitates more efficient processing, automatic order matching, faster execution of trades and transparency; the scrip’s traded on BSE have been classified into ‘A’, ‘B1’, ‘B2’, ‘C’, ‘F’ and ‘Z’ groups. The ‘A’ share represents those, which are in the carried forward system (Badla). The ‘F’ group represents the debt market (fixed income securities) segment. The ‘Z’ group scrips are the blacklisted companies. The ‘C’ group covers the odd lot securities in ‘A’, ‘B1’ & ‘B2’ groups and rights renunciations. The key regulator governing Stock Exchanges, Brokers, Depository participants, Mutual Funds, FIIs and other participants in Indian secondary and primary market is the Securities and Exchange Board of India (SEBI) Ltd.
Brief History of Stock Exchanges The world’s foremost marketplace, New York Stock Exchange (NYSE), started its trading under a tree ( now known as 68 Wall Street) over 200 years ago. Similarly, India’s premier stock exchange Bombay stock Exchange (BSE) can also trace back its origin to as far as 125 years when it started as a voluntary non-profit making association. News on the stock market appears in different media every day. We hear about it every time it reaches a new high or new low, and we also hear about it daily in statements like ‘The BSE sensitive Index rose 5% today’. Obviously, stocks and stock markets are important. Stocks of public limited companies are bought and sold at a stock exchange. But what really are stock exchanges? Known also as the stock market or bourse, a stock exchange is an organized market place for securities (like stock, bonds, options) featured by the centralization of supply and demand for the transaction of orders by member brokers, for institutional and individual investors. The exchange makes buying and selling easy. For example, we do not have to really go to an exchange, say, BSE – we can contact a broker, who does business with the BSE, and he or she will buy or sell his stock on our behalf.
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Trading Pattern of the Indian Stock Market Trading in Indian Stock Exchange is limited is limited to listed securities of public limited companies. They are basically developed into two categories namely, specified securities (forward list) and non specified securities (cash list). Equity shares of dividend paying, growth oriented companies with a paid up capital of at least Rs. 50 million and market capitalization of at least Rs. 100 million and having more than 20,000 shares are normally put in the specified group and balance in non-specified group. Two types of transactions can be carried out on the Indian Stock Exchanges Spot delivery Transaction For delivery and payment within the time or on the date stipulated when entering into the contract which shall not be more than 14 days following the date of the contract. Forward Transaction Delivery and payment can be extended further by a period of 14 days each so that the overall period does not exceed 90 days from the contract. The latter is permitted only in the case of specified shares.
Stock Exchanges in India National Stock Exchange (NSE) National Stock Exchange (NSE) of India commenced its operation in the Indian Capital Market on 3rd November 1994 in Mumbai. The recommendations of Pherwani committee led to the beginning of NSE. Players in NSE Trading members Participants
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The recognized members of NSE are called trading members who trade on behalf of themselves and their clients. Participants include trading member and large players like bank who take direct settlement responsibility.
Promoters of NSE IDBI, ICICI, LIC, GIC, SBI, Canara Bank, Corporation Bank, Indian Bank, Orient Bank of Commerce, Union Bank of India, Punjab National Bank, Infrastructure leasing and financial services and SBI.
Trading system of NSE The software used in the NSE trading system is known as National Exchange for Advanced Trading. The trade takes place through computers. The trading member’s computer is connected with the central computers at the NSE through leased lines and VSAT. The price at which the buyer and the seller are willing to transact will appear on the screen. When the price match the transaction will be completed and a confirmation slip will be printed at the office of the trading member.
OTC Exchange of India (OTCEI) The OTC e of India (OTCEI) has been setup to provide a cost effective and convenient plat forms for raising finance from the capital market. OTCEI was promoted by a consortium of financial institutions sated its operations in 1992. It is a ring less, electronic, nation wider stock exchange committed to providing entrepreneurs with a smooth economical vehicle for going public and investors with a fair, sable and efficient market. Thus the OTCEI brings investors and promoters closer together.
Bombay Stock exchange (BSE) The stock exchange, Mumbai is popularly known as ‘BSE’. It is oldest one in 1875 as “The Native Share and sock Brokers Associations of People (AOP) and is engaged in the process of converting itself into demutualised and corporate entity. It has evolved over the years into its present status as the premier Stock Exchange in the country to have obtained.
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Permanent recognition in 1956 from the Govt. of India under the securities contracts (Regulation) Act, 1956.
Market Size and Characteristics: The Indian retail brokerage is showing phenomenal growth. The total trading volume of brokerage companies has increased fromUS$1239.1 billion in 2004 to US$1492.1 billion in 2005, and is expected to reach US$6535.7 billion by 2015. Some of the main characteristics of the brokerage industry include growth in e-broking; growing derivatives market, decline in brokerage fees etc. Today, as per NSDL statistics, we have only 2.4million investors with demat account in the country. Considering various investor combinations that are holding accounts, we can presume the country has roughly 5-7.5 lakh active investors now. This figure is unbelievably small compared to the potential number of investors, which is anything between 200 million and 250 million. When we take into consideration the way transaction risk and cost in the Indian capital market is coming down, there will be a massive surge in the number of investors and also in volumes. The only way to manage this kind of potential growth is to adopt state-of-the-art trading techniques. The growth of the Internet-based trading as a mass trading technique in the country is unstoppable, going by the indicators available and the signals for the future. When it ultimately gathers momentum, the biggest beneficiary will be the investor, who will be able to trade with greater speed and transparency, and at lower costs.
Major players in Indian share broking industry are follows ICIC Securities Ltd. Kotak Securities Ltd Indiabulls Financial Services Limited India Infoline IL&FS investmart Limited
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SSKLI Ltd. Motilal Oswal securities Fortis Securities Karya securities Geojit BNP Paribas HDFC Securities Hedge equities JRG Securities India Infoline
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ORGANIZATIONAL PROFILE
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HEDGE EQUITIES (P ) LTD Hedge equities is one of the leading financial services company in India ,established in 2008 and officially inaugurated in may 2008.they are specialized in offering a wide range of financial products, tailor made to suit individual need. As a first step hedge equities made their presence global the company had initiated their operations in middle –east to cater to the vast Nonresident Indian (NRI) population in that region. Ever since their inception, they have spanned their presence all over India through their meticulous research, high brand awareness, intellectual management and extensive industry knowledge .hedge equities believe in creating a new breed of investors who take judicious decisions through them. Team Hedge is a balanced mix of more than 15 years of experience cutting across various industries with a strong background in financial markets.
Mission To create an ethical and sustainable financial services platform for our customers and partner them to build business, to provide employees with meaningful work, self-development and progression, and to achieve a consistent and competitive growth in profit and earnings for our shareholders and staff.
Vision Hedge equities have been a household name among the masses owing our success to timely Professional financial assistance to our clients. This aptly articulates our vision of ‘Evolving into a financial supermarket which will be a one stop shop for all financial solutions’.
Social Corporate Responsibility Being a responsible corporate citizen, Hedge equities has initiated a non-profit movement, “Hedge Yuva”, which focuses on educating the masses about Stock Market. The movement has also formulated various scholarship programs for young and dynamic youth.
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Promise
To our Customers: We exist to serve and meet your needs. Our focus is to create an ethical and sustainable financial services platform that places your unique needs over and above everything else.
To our Employees: We will provide our employees with a meaningful and rewarding
career with emphasis on self development and career progression. To our Shareholders: We will spare no efforts to achieve a consistent and competitive
growth in earnings and profitability.
Hedge Advantage At Hedge Equities, the needs of Customers stand before everything else. SEBI Registered Portfolio Manager with a dedicated Wealth Management Services desk
that aims to provide objective guidance tailored to meet each customer’s individual needs. Strong Research Team backed with best of breed data mining and analysis. Industry leading technology solutions that make portfolio administration simpler and cost
effective. A Global Outlook blended with a Local Flavor and backed with a growing network of
over 120 service outlets.450 qualified employees, and over 200 support associates. The Trust and Goodwill of over 20,000 satisfied customers. Member of BSE, NSE, MCX, MCXSX,NMC, and Depository Participant in CDSL Rated as the top brand by the investor community of Asianet channel Growing overseas presence with operations in Middle East and an expanding presence in
the European region and North America.
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About Hedge Equities Hedge equities is one of the leading Financial services company in India, specialized in offering a wide range of financial products, tailor made to suit individual needs. As a first step to make their presence Global, Hedge equities have initiated operations in Middle East to cater to the vast Non Resident Indian (NRI) population in that region. Ever since their inception, they have spanned their presence all over India through their Meticulous Research, High Brand awareness, Intellectual Management and Extensive Industry knowledge. Hedge believe in creating a new breed of investors who take judicious decisions through them. Team Hedge is a balanced mix of more than 15 years experience cutting across various industries with a strong background in the financial markets. The board comprises of six power houses in their respective fields- FedEx Securities, Baby Marine Exports, Thakker Developers, Smart financial, SM Hedge (CFO, Videocon Industries) and Padmashree Mohan Lal.
Fedex securities Managed by a team of ex-bankers, Fedex is a SEBI registered category 1 merchant banker. The company concentrates on non-fund based activities like structuring, tie up of project financing, financial restructuring investment banking, corporate and advisory services. The core management team consists of bankers with rich experience of decades and exposure to volatile situations in commercial and investment banking. With offices at Nariman point and Vile Parle east, Mumbai, state of the art infrastructure and qualified manpower to conduct the business, Fedex securities envisages a phenomenal growth in this sector for its clients.
Baby Marine Exports Baby Marine Group, started its operation in 1977 from Kozhikode and through innovations and hard work has grown into three unit and related industries spanning both the west and east coast of Indian. Baby Marine Exports, B.M Products and Baby Marine(Eastern ) Exports are efficiently aided by preprocessing units, ice factories and a fleet of insulated and refrigerated trucks for sea food transportation. Due to constant upgrading of machinery, state-of-the-art infrastructural facilities, better links with raw materials suppliers, and an established network of purchasers have
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obviously made Baby Marine Group a leading exporter of processed marine products to various international markets.
Smart financial Smart financial entered the financial market only in 1992 but over this brief span has covered a niche for itself by becoming the leading financial provider. The company offer guidance to investors as equities, commodities, mutual fund’s portfolio management services and insurance. It offers complete range of financial solutions that encompasses every sphere of life
Thakker group Starting off as a land developer and builder in 1962, Thakker groups diversified into commercial production of agricultural and horticultural products, housing real estate marketing plantation etc. They have provided shelter to more than 40000 families by offering residential plots and premises .Thakker developers is the flagship company of the group. It was established as private limited in 1987 and later went on to become the only public limited company in North Maharashtra engaged in housing ,commercial construction and land development. The company is also a Class1 contractor registered with the Public Work Department, Govt. of Maharashtra.
SM Hedge Mr. S.M Hedge, a chartered accountant by profession is the Chief Finance Officer of the Indian Multinational Videocon International and has been at the helm of affairs for the last 20 year.
Padmashree Bharat Mohanlal Mohanlal, the south Indian movie superstar has become a legend, a brand and cultural ambassador owing to various factors. Versatility and natural flair for donning complex characters have won him numerous accolades not to speak of some unforgettable films contributed by him. A multifaceted personality, he has some business ventures also which include Vismaya MaxFilm Post Production Studio, College for Dubbing Artists at the Kinfra film and Video Park Thiruvananthapuram. He is the also the director of Uni Royal Marine Exports; a Kozhikode based major Seafood Export Company. Intellectual and knowledge arbitrage is the mantra of modern day business. The same holds true for the financial markets. With the breadth and depth of knowledge of modern day business that the Board of Hedge brings to the table, you can be rest assured that some of the best minds in the business are taking care of your investments.
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Management Alex. K. Babu, Managing Director Alex Babu is the Founder and Managing Director of Hedge Equities. He has over 9 years of experience in equity research and fund management with considerable experience across all market capitalizations. He is a specialist in mid-cap and infra stock selection. Ever since joining the Hedge Family, he has been designing, developing and implementing the strategic plan for the company in the most cost effective and time efficient manner. He was also instrumental in establishing and assembling a strong research team with equal emphasis on macroeconomic, industrial, and company level research. Prior to joining Hedge Equities, Alex was at the helm of Baby Marine Exports, a leading Seafood exports firm handling all aspects of finance and marketing. Alex Babu is a graduate in Engineering from Cochin University of Science and Technology. N. Bhuvanendran, Chief Executive Officer Professionalism augmented by profound vision” is a perfect phrase to describe Bhuvanendran. His rich experience spanning 20 years with the leading names in the Indian financial services industry, is often camouflaged by his youthful appearance, till Mr.Bhuvanendran opens up his favorite subject-Money matters. Bhuvanendran is a talented and introspective writer whose creativity has been capitalized by various financial journals. He is also in the limelight for a market related show which aims at quenching the financial queries of professionals and investors in a leading Malayalam television channel. He is one of the few investments professional who have experience across both listed and unlisted equity space. He is an epitome of the fact that honesty, transparency and moral integrity are not at variance with Business acumen. Bobby J Arakunnel, Chief Operating Officer Mr. Bobby has been responsible for the entire operations of Hedge Equities ever since its inception. He has proved his versatility by showcasing excellent Man-Management and Marketing Activities and is well versed in all aspects of Indian Financial Markets. In the last 12
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years, he has worked with all the major players in the financial service sector of the country which has added oodles to his workmanship. Mr. Mohanlal – Director This Honorary Lieutenant Colonel's brand image and brimming popularity has helped Hedge Equities to create awareness amongst small investors in retail segment to invest in stocks. Versatility and a natural flair for donning complex characters have won him numerous accolades not to speak of some unforgettable films contributed by him. A Multifaceted personality, whose inspiring attitude, has helped him to take up Business world with a storm. Dr.Samuel George He is a doctor and an entrepreneur and runs the successful and well reputed "City Clinic" in Abudhabi since the 1970's. Having completed his Bachelors in Medicine from the Calcultta Medical College, Dr. George commenced his career in government service and then subsequently moved to Abu Dhabi in the 1970s. Today, their clinic offers specialized services in General Medicine and Pediatrics. Dr.George also nurtures a dream and a vision to make quality healthcare affordable and accessible to all and to this end, he is pursuing the development of a multi-specialty hospital at Changanassery in Kerala to serve the growing health care needs of the state. Mr. Pradeep Kumar C, Director Director A leading Textile exporter of Kerala whose 20 years of experience in this field has made him a veteran we all look up to. His vision, augmented by his hard work and commitment has helped him to be a strong player in the field of Exporting. Starting from a root level, he has travelled the hard way to reach this phenomenal position in Garment Industry which has supplemented him to expand his domain to foreign locations as well.
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SERVICES PROVIDED BY THE HEDGE EQUITIES
1. Equity Trading Equity gives you the opportunity to have a partnership with all the leading Business tycoons around the globe. Total capital contribution for a company comprises of investments through equity share holdings by small and big investors. The investors who have a stake in a company are referred to as shareholders. Power of Equity shareholders lies in the optimum selection of the Industry, have a strong belief in the Company's fundamentals and also having a confidence in the profit making capability of the company. Equity Market, at present, is a rewarding field for the investors and investing in Indian stocks are profitable for not only the long and medium-term investors, but also the position traders, short-term swing traders and also very short term intra-day traders. Fundamentally, stock market is an avenue for business people to meet shareholders. Other than bank loans, they now have another option to finance their businesses. They did it by offering their company's equities in exchange of shareholders cash. The company is never required to repay the capital, but the new shareholders have a right to future profits distributed by the company. For shareholders, they have alternatives to where they should put their money into. In the same time, they get the opportunity to participate in capital intensive businesses at an affordable price. Equity is an investment area which you can capitalize on with proper assistance regardless of the market circumstances. Hedge Equities opens the door to this highly lucrative investment opportunity that could provide a feasible solution to all your financial queries.
2. Commodities Trading Commodity "futures" are contracts to buy or sell certain goods at set prices at a predetermined time in the future. Futures trading plays a key role in the marketing of a number of important agricultural and nonagricultural commodities as it provides the industrial and farming communities with a transparent price discovery platform, which also enables them to hedge their price risk and price volatility. The growth of Indian commodities futures trading towards an efficient, transparent and well-organized market has thrown open a window of
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benefits and opportunities to Indian producers and traders. Besides the primary benefits of its twin economic functions of price discovery and price risk management, commodity futures trading has also played an instrumental role in integrating various fragmented components of the commodity ecosystem, thus developing the overall infrastructure of agricultural commodities marketing in the country. At present, 24 commodity futures exchanges are operational in India, which include 21regional bourses and the three national-level players, with another three proposed exchanges on the cards. With the state-of the-art technology-powered secure and efficient operational infrastructure, these national exchanges are creating a near-perfect market situation with a much wider participation from the ecosystem stakeholders in a large number of domestic and global commodities during local and international timings. While the trade in non-agricultural commodities, especially bullion and crude, has increased in the past two financial years, the same in agricultural commodities has declined. The share of agricultural commodities almost halved during 2008-09, due to the continued ban on several commodities. The clients can trade in commodity futures like gold, silver, crude oil, rubber etc. And take advantage of the extended trading hours (10 am to 11pm) in commodities trading.
3. Currency Trading Investments in Currency Derivatives can help you to diversify your portfolio from traditional asset classes. Currency derivatives can be described as contracts between the sellers and buyers, whose values are to be derived from the underlying assets, the currency amounts. These are basically risk management tools in force and money markets used for hedging risks and act as insurance against unforeseen and unpredictable currency and interest rate movements. Any individual or corporate expecting to receive or pay certain amounts in foreign currencies at future date can use these products to opt for a fixed rate - at which the currencies can be exchanged now itself. Currency derivative serve the purpose of financial risk management encompassing various market risks. An upfront premium is payable for buying a derivative. Currency Futures will bring in more transparency and efficiency in price discovery, eliminate Counterparty credit risk, provide access to all types of market participants, offer standardized products and provide transparent trading platform.
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4. Mutual Funds A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. The money thus collected is invested by the fund manager in different types of securities depending upon the objective of the scheme. These could range from shares to debentures to money market instruments. The income earned through these investments and the capital appreciations realized by the scheme are shared by its unit holder. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed portfolio at a relatively low cost. Mutual fund is also called unit trust or open ended trust a company that invests the funds of its clients in diversified securities and in turn represent those holdings. They make continuous offering of new shares at NAV (Net Asset Value) determined daily by the market values of the securities they hold. In Hedge Equities the clients can select from a wide range of Mutual Funds and Bonds available in the markets today.
5. Online trading Hedge Equities has a large network of branches with online terminals of NSE and BSE in the Capital market and derivative segments. The clients are assured of prompt order execution through dedicated phones and expert dealers at our offices.
6. Internet trading Hedge Equities offers Internet trading through this site. You can trade through the Internet from the comforts of your office or home, anywhere in the world. The dedicated IT systems ensure service up time and speed, making Internet broking through Hedge Equities hassle-free. Using the easiest facility provided by NSDL, the clients can transfer the shares sold by them online without delivery instruction slips. Additionally, digitally signed contract notes can be sent to clients through E-mail.
7. Depository services Hedge Equities is a member of the National Securities Depository Limited (NSDL), offer depository services with minimum Annual Maintenance Charges and transaction charges. Account holders can view their holding position through the Internet. They also offer the
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‘easiest’ facility provided by NSDL (electronic access to securities information and execution of secured transaction) through which clients can give delivery instructions via the Internet.
8. Derivative trading Hedge offer trading in the futures and options segment of the National Stock Exchange (NSE).Through the present derivative trading an investor can take a short-term view on the market for up to a three months perspective by paying a small margin on the futures segment and a small premium in the options segment. In the case of options, if the trade goes in the opposite direction the maximum loss will be limited to the premium paid.
9. Knowledge Centre Knowledge Centre activities are intended to provide systematic and structured services mainly to new investors and also to young aspirant aiming for a career in financial markets. The centre has three functional areas: the Publication Division, the Training Centre, and Wealth Management Advisory Service which provides complete investment solutions to investors through knowledge based personalized service.
10. Equity Research Hedge Equities constantly strive to deliver insightful research to enable pro-active investment decisions. The research department is broadly divided into two divisionsFundamental Analysis Group (FAG) and Technical Analysis Group (TAG). The fundamental analysts are continuously scanning the entire economy for discovering what they call the hidden gems in stock market terminology and present it to the clients for profitable investments. Timing the market has always been the most difficult task for all analysts and their Technical Analysis Group has emerged to predict the market movements well in advance using complex Analytical methods including Eliot Wave Theory. They are equipped with cutting edge technologies for technical charting which assist the technical analysts to predict both upside and downside movements efficiently for the benefit of clients.
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11. Portfolio Management Service Hedge Equities is a SEBI-approved portfolio manager offering discretionary and nondiscretionary schemes to its clients. Hedge Equities portfolio management team keeps track of the markets on a daily basis and is exposed to a lot of information and analytic tools which an investor would not normally have access to. Other technicalities pertaining to shares like dividends, rights ,bonus ,buy-back, mergers and acquisitions are also taken care of by them.
12.Hedge school of Applied economics Hedge school of applied economics is a distinguishing school instituted on the sturdy premises of quality , with a singular objective of creating credentialed professionals for the financial markets. The focus is on grooming students to have a cutting edge in hare trading banking, insurance or wealth management by implementing innovative solution .it is also considered as an ideal branch of hedge equities.
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Branches of Hedge Equities Hedge equities has 130 branches in India and 1 branch in Dubai, UAE 106 branches in Kerala 6 branches in Karnataka 7 branches in Maharashtra 1 branch in Tamilnadu Hedge Equities Registered Office is in Nariman Point, Mumbai and corporate office is in Kaloor, Kochi and their regional offices are in Bangalore, Shimoga, and Hyderabad. There are 117 employees in their Head Office., 8-10 employees in their Regional Offices and 4-5 employees in each branch.
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Main Competitors
GEOJIT BNP PARIBAS JRG SECURITIES RELIGARE MUTHOOT SECURITIES SHAREWEALTH MOTILAL OSWAL ANANDRATHI Geojit BNP Paribas Geojit BNP Paribas today is a leading retail financial services company in India with a growing presence in the Middle East. The company rides on its rich experience in the capital market to offer its clients a wide portfolio of savings and investment solutions. The gamut of value-added products and services offered ranges from equities and derivatives to Mutual Funds, Life and General Insurance and third party Fixed Deposits. The needs of over 576,000 clients are met via multichannel services - a countrywide network of over 540 offices, phone service, dedicated Customer Care centre and the Internet. Geojit BNP Paribas has membership in, and is listed on, the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). In 2007, global banking major BNP Paribas joined the company’s other major shareholders Mr.C.J.George, KSIDC (Kerala State Industrial Development Corporation) and Mr.Rakesh Jhunjhunwala – when it took a stake to become the single largest shareholder. At the forefront of the many fruitful associations between Geojit BNP Paribas and BNP Paribas is their joint venture, namely, BNP Paribas Securities India Private Limited. This JV was created exclusively for domestic and foreign institutional clients. An industry first was achieved when Geojit BNP Paribas became the first broker in India to offer full Direct Market Access (DMA) on NSE to the JV’s institutional clients. JRG Securities JRG Securities Ltd. is one of India’s leading financial services providers with strong presence in South India. It was incorporated in 1994 and over the years it acquired a name of
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trust through Equity and Commodity Broking businesses. In 2007, Baring India Private Equity Fund II Ltd., a leading private equity firm of international repute acquired a majority stake in the Company. With the investment of BIPEF came fresh inflow of talent and a focused team committed to taking this company to greater heights. Since then JRG has undergone several transformations - expanding into new geographies, adopting state-of-the-art technology, strengthening credit and risk management systems, creating new products and strengthening client relationships through service focus. The company is committed to fully compliant with all regulatory compliances with the exchanges, SEBI, IRDA, FMC and RBI. JRG is listed on the Bombay Stock Exchange and has a diverse set of public shareholders. Religare Religare is an emerging markets financial services group with a presence across Asia, Africa, Middle East, Europe, and the Americas. In India, Religare’s largest market, the group offers a wide array of products and services including broking, insurance, asset management, lending solutions, investment banking and wealth management. With 10,000-plus employees across multiple geographies, Religare serves over a million clients, including corporate and institutions, high net worth families and individuals, and retail investors. Muthoot Securities The Muthoot Group has emerged as one of the India's largest financial group of its kind with business interests in 17 diverse fields, a network of over 2000 branches nationwide and serving 750 million customers across the country. The Muthoot Group with its pan-Indian presence and varied bouquet of products serves over 50000 customers every day. Following the tradition, this multi-farious organization with more than 16000 employees representing almost every culture and state in the country, shall continue to provide supreme quality of service and earn the trust of millions of people with its constant innovation and dynamism in the times to come. With trust built over 123 years of unblemished services to the community and with values driving its business process, the group is now on a critical diversification journey.
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Share Wealth Share wealth Securities Ltd is the first corporate member of National Stock Exchange of India Ltd, Bombay Stock Exchange Ltd and MCX Stock Exchange Ltd(MCX-SX) from THRISSUR, the Cultural Capital of Kerala. Sharewealth is also a Depository Participant with CDSL (Central Depository Services (India) Ltd).Sharewealth Securities Ltd has two group companies, Sharewealth Commodities Pvt Ltd (Member: MCX, NCDEX, NMCE ,ICEX and NSEL) and Sharewealth Financial Services Ltd (AMFI Registered Mutual Fund Distributor). Sharewealth has a group (Overseas Joint Venture) company at Abu Dhabi; Sharewealth Financial Consultancy LLC.Registered and Corporate offices of Sharewealth Group of companies are at Thrissur. Motilal Oswal Motilal Oswal Securities Ltd. (MOSL) was founded in 1987 as a small sub-broking unit, with just two people running the show. Focus on customer-first-attitude, ethical and transparent business practices,
respect
for
professionalism,
research-based
value
investing and
implementation of cutting-edge technology has enabled us to blossom into an over 1600 member team. Today they are a well diversified financial services firm offering a range of financial products and services such as Wealth Management, Broking and Distribution, Commodity Broking, Portfolio Management Services, Institutional Equities, Private Equity, Investment Banking Services and Principal Strategies. Anandrathi Anand Rathi is a leading full service investment bank founded in 1994 offering a wide range of financial services and wealth management solutions to institutions, corporations, high–net worth individuals and families. The firm has rapidly expanded its footprint to over 350 locations across India with international presence in Hong Kong, Dubai and London. Founded by Mr. Anand Rathi.
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Angel Brocking Angel Booking’s tryst with excellence in customer relations began in 1987. Today, Angel has emerged as one of the most respected Stock-Broking and Wealth Management Companies in India. With its unique retail-focused stock trading business model, Angel is committed to providing ‘Real Value for Money’ to all its clients. The Angel Group is a member of the Bombay Stock Exchange (BSE), National Stock Exchange (NSE) and the two leading Commodity Exchanges in the country: NCDEX and MCX. Angel is also registered as a Depository Participant with CDSL. They mainly deals with Equity trading, Commodity Trading, Portfolio management services, Mutual Funds, Life Insurance, IPO’s, Depository Services, Investment Advisory services .
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ORGANIZATION STRUCTURE
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ORGANIZATION STRUCTURE
CORE MANAGEMENT
CEO
MD HEDGE SCHOOL
STATE HEAD SALES ONLINE
MARKETING BUSINESS
COO
RMS
KNOWLEGE &
EQUITY &
WEALTH MGHT
COMMODITY
TRANING
PMS
DEVELOMENT
OPERATIONS
IT
OVERSEAS OPERATION RESEARCH
ACCOUNTS FRANCHISE OPERATIONS
GM
UNDER THE GM
GM ADMIN
HR
DP
COMPLAINCE
KYC
MANGER
MANAGER
MANAGER
MANAGER
MANAGER
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REGIONAL ORGANISATIONAL STRUCTURE
REGIONAL MANAGER
BRANCH MANAGER
SUPPORT STAFFS
DEALER
EQUITY ADVISOR
COMMODITY
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RELATIONSHIP MANAGER
DEPARTMENTS OF HEDGE EQUITES
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DEPARTMENTS OF HEDGE EQUITES Client Relation Department Finance Department Marketing Department Business associate development Brand promotion
Investment promotion Systems Department Human Resources Department Training Wages and Salary
Performance Appraisal Trading Department Online Trading
Internet Trading Delivery And Depository Department Power of attorney
Depository function
Dematerialization
Pledging
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Equity Research Department Fundamental analysis
Technical analysis
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Client Relation Department The client relation department assists the client or customer top open an account in HEDGE EQUITIES (p) Ltd securities. This department is also known as the front office. A client has to open two types of accounts to trade and own securities in the NSE and BSE.
Finance Department Thus a department, to organize financial activities may be created under the direct control of the board of directors. Finance manager will decide the major financial policy methods. Lower levels can delegate the other routine activities.
Marketing Department The major functions of marketing department are: a. Business associate development: The Company takes up the marketing activities of the various branches. It ensures an efficient marketing arena at its various branches. The company encourages better relations in its branches and promotes for the development of various marketing strategies. b. Brand promotion: An important function of marketing department is to promote the name of the company. HEDGE EQUITIES (P) LTD does it through the different promotional activities. The name of HEDGE EQUITIES (P) LTD as a stock broking firm is made known to the outside world. c. Investment promotion: The main clients of HEDGE EQUITIES (P) LTD were its investors. Hence the marketing department tries to capture as many investors as possible to encourage them to invest. d. Delivery promotion: Intraday trading is not always profitable and might involve a lot of risk hence HEDGE EQUITIES (P) LTD promotes for delivery were the shares are kept to be sold for a later date analyzing the profitability factors.
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Systems Department The systems department is playing a vital role in the day operations of the company. It is through the systems department that the clients can avail the facilities of Internet trading. Optic fibre cables and high bandwidth connections from the HEDGE EQUITIES (P) LTD office to the ISP, a dedicated server and back-up ISDN connections were maintained directly by the systems department. For the purpose of trading they have made use of two software namely ODIN (Open Dealers Integrated Network)
Human Resources Department Human resource is often considered as the back bone of an organization even in this age of advanced automation and mechanization. Since virtual organizations are not very much popular in our part of the world, it is very important to any organization to have a HR department. The presence of an excellent HR department increases the efficiency of an organization considerably. Human resource management is defined as asset of practices, policies and programmes designed to maximize both personal and organizational goals. a. Training and induction The selected employees will undergo three days continuous induction. During this period, he will undergo training with all the department of HEDGE EQUITIES (P) LTD Securities (India) Pvt. Ltd. There will also be classroom induction also within 3 months. b. Wages and Salary Administration The wages and salaries of the employees were fixed and granted by the HR department with consent of the finance department. c. Performance Appraisal It was human resources department which gives the promotion to all employees, making transfers and taking disciplinary actions if needed.
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d. Grievance Handling The grievance of employees were received only through proper channels i.e., through the particular department heads. The HR department will make solutions to the complaints as per the rules and regulations of the company.
Trading Department The department deals with the trading related activities of the company. The trading refers to the buying and selling of shares. This department is the most important part of the organization. There are two types of trading. They are a. Online Trading: These are the trading terminal of the organization. The each computer of the department is termed as the trading terminal. The each terminal is assigned with NCFM certified dealers, who is in charge of each portal will do the trade according to the client request. The terminal is managed by either NEAT (National Exchange for Automated Trading) software or ODIN (Open Dealers Integrated Network) software. The client can also place his through written request or through the telephone, in this the order will be place d by the dealer. b. Internet Trading: The internet trading is a facility provides by the company in order to trade the securities from his convenient place like his office, home etc. the order will be placed by the client itself, and he can make changes before the trade is done for changing the price, cancellation of the order.
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Delivery And Depository Department Delivery refers to the share that bought on particular day are not sold on that day itself and holding of the share for an appreciation in the value of the security and to trade it on a future date. Deliver Instruction Slip: it is a slip the client should fill and gave to the dealer regarding the purchase of the share. There are two procedures to move the share namely a. Power of attorney This is which the client signs at the time of opening a trading account and depository participant account. If the client has given the power of attorney, HEDGE EQUITIES (P) LTD will have the power to transact the clients stock without pay –in slips. b. Easiest It is secured internet enabled service which means Electronic Access to Securities information and Execution of Secured Transaction. This is facility wherein the clients can give delivery instructions via internet. Easiest is a facility provided by CDSL. The activities related with the depository department a) Depository function b) Dematerialization c) Pledging
Equity Research Department The function of the department is to study the details regarding the share or securities and to make prediction regarding the future performance of the company. The following types of approaches done through this department: a. Fundamental analysis b. Technical analysis
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SWOT ANALYSIS STRENGTH New technology implemented for influencing customers Brokerage charges are less compared to competitors Research reports are updated and provided to the client regularly 1:4 exposures is provided to the customers Hedge maintains a good product service image Complaints are rectified immediately
Hedge stands second in Kerala after geojit BNP Paribas WEAKNESS Lack of internal communication
OPPORTUNITY Good customer base Growing IPO issues Positive outlook of people towards financial product Attraction of new investors
THREATS Entering of banks into stock brokering industry High competition Unethical market practices
Government policies
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FINDINGS Management is giving adequate recognition for achievements The company provides sufficient training in a separate institute called “ hedge school of applied economics’ Majority of the employees agree that working environment is comfortable and sufficient resources are available There is a good relation between the management and employees The company has high attrition rate Welfare facilities are adequate for the employees Separate departments for looking into customer queries are established in the organization Customer satisfaction is the main objective of the organization
SUGGESTIONS Improve internal communication Implement strategies to control attrition rate Increase promotional activities to compete in the market
Give awareness about ethical market practices
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CONCLUSION The objective of the programme was to gain practical knowledge on the overall functioning of the Organization and its various departments .during the study ,a lot of practical knowledge have been gained about the financial service industry .this study proved to be helpful in gaining idea about the various activities undergone in a real life business situation .also it helped me to gain more information about the present condition prevailing in the financial service industry and their strategies that will prove beneficial for me in future ventures This report give an insight about the company and its various functions ,the objective of the company and how the company tries to achieve these objectives .it was a great experience to do my organizational study in an organization like Hedge equities (P) ltd.
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BIBLIOGRAPHY
Websites www.hedgeequities.com www.nseindia.com www.bseindia.com www.investopedia.com
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