FINAL Project of Stock Market (Ankit)

V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 1

Today India has become a “globalize country”. The process of globalization has very highly affected. Corporate world of both, India and exotic corporate world means today’s neoteric business world. This corporate world plays a decisive role in globalization. This corporate world is now becoming more and more competitive. Regarding this competition business houses need more professionalized people for their managerial work. Highly professionalized people come from business school. Business school offers training for all business aspects. So from this angle our Ganpat University has granted B.B.A. program. Theoretical knowledge is not enough. After study student has to go practical world. At that time they have difficulty in practical works. This B.B.A. program provides an opportunity for this type of practical knowledge. The rationale behind visiting the company and preparing the Project Report is to study the INVESTOR INVESTMENT BEHAVIOR IN STOCK MARKET&SUGGESTING GOOD INVESTMENT STRATEGY


It's a great pleasure and privilege in presenting this Project Report to one and all concerned. My deepest gratuity to GEOJIT FINANCIAL SERVICES LIMITED, MEHSANA to undergo research of STUDY OF INVESTOR INVESTMENT BEHAVIOR IN STOCK MARKET & SUGGESTING GOOD INVESTMENT STRATEGY The successful completion of a project requires active participation of many people from the time of inception of an idea to its implementation, many brain works together and that only provides fruitful results. I am highly indebted to PROF HARESH OZA for bestowing me his kind and gracious facilitation during the research period. Without his prudent guidance and encouragement the project would not have been possible. I would also like to express my sincere thanks to other people at GEOJIT FINANCIAL SERVICES LIMITED, MEHSANA, for their invaluable contribution and guidance in making this Project Report. I would also like to thank all the respondents who fill up the questionnaire without their response it is not possible for me to complete the research. I also like to thank all those people who have knowingly and unknowingly contributed in one way or other in making this Project a more completely one with their valuable tips and suggestion.


For preparing the project report, I have visited the Geojit Financial Services Limited for 21 days during the suggested duration from 27-10 2008 to 16-112008, to avail the necessary information. I have filled up the questionnaire with the customers of Geojit Financial Services Limited. The blend of learning and knowledge acquired during my practical studies at the company is presented in this project report.

The project report starts with the research objectives, basic information regarding the research approach, the sample size for my research is 60 and I have used simple random sampling method for my research and the sources for data collection is both primary sources and secondary sources., after this I have shown the data analysis of each question and for analysis I have used percentile method and at last I have written findings and some of the limitations which I have faced during my research work. V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 4

I hope that the information incorporated in this project report would be appreciated as I have put in may be efforts in leaving no stone unturned as I consider it to be true, fair and relevant in its content and context to the best of my knowledge and ability.

Sr. 1 2 3 4 5

Particulars Preface Acknowledgement Executive summary Introduction about the company Research Objectives

Page no. 2 3 4 6 13

6

Research Methodology

14

7 8 9

Data analysis Findings Limitations

15 30 31

10 11 12

Conclusion Bibliography Annexure

32 33 34


 INTRODUCTION ABOUT THE COMPANY

Mr. C.J. George and Mr. Ranajit Kanjilal founded Geojit as a partnership firm in the year 1987. In 1993, Mr. Ranajit Kanjilal retired from the firm and Geojit became a proprietary concern of Mr. C .J. George. In 1994, it became a Public Limited Company by the name Geojit Securities Ltd. The Kerala State Industrial Development Corporation Ltd. (KSIDC), in 1995, became a co-promoter of Geojit by acquiring 24% stake in the company, the only instance in India of a government entity participating in the equity of a stock broking company. Geojit listed at The Stock Exchange, Mumbai (BSE) in the year 2000. In 2003, the Company was renamed as Geojit Financial Services Ltd. (GFSL). The board of the company consists of professional directors; including a Kerala government nominee with 2/3rd of the board members being Independent Directors. With effect from July 2005, the company is also listed at The National Stock Exchange (NSE). Geojit is a charter member of the Financial Planning Standards Board of India and is one of the largest DP brokers in the country. CORPORATE OFFICE 5th Floor, Finance Towers, Kaloor, Kochi 682 017. Ph : 0484 2405501/2 Fax : 2405618 V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 6

email : [email protected] www.geojit.com

Management Mr. C. J. George

Managing Director

Mr. Satish Menon

Director (Operations)

Mr. A. Balakrishnan

Chief Technology Officer

Mr. K. Venkitesh

National Head - Distribution

Mr. Stefan Groening

Director (Planning and Control)

Mr. Jean-Christophe GOUGEON

Director (Marketing)

Mr. Binoy .V.Samuel

Chief Financial Officer

Mrs. Jaya Jacob Alexander

Chief of Human Resources

Board of directors Mr. A. P. Kurian

Non - Executive & Independent Chairman

Mr. C. J. George

Managing Director & Chief Promoter

Mr. P.H.Kurian

Non - Executive Director

Mr. Mahesh Vyas

Non - Executive & Independent Director

Mr. Rakesh Jhunjhunwala


Mr. Ramanathan Bupathy

Non - Executive & Independent Director


Mr. Punnoose George



 HISTORY & DEVELOPMENT  1986

 Membership In Cochin Stock Exchange(CSE)


 1994  Become A Public Limited Company Named Geojit Securities Limited  1995

 Kerala State Industrial Development Corporation Ltd.(KSIDS) Acquires 24% Equity Stake

 Membership In National Stock Exchange

 1996  Launch Of Portfolio Management Services With Sebi Registration

 1997  Depositary Participant Limited(NSDL)

(DP)

Under

National

Securities


Depositary

 1999

 Membership In Bombay Stock Exchange(BSE)  2000   

BSE Listing 1st Brocking Firm In India To Offer Online Trading Facality Commences Derivatives Trading With NSE

 Establishes The 1st Bank Gateway In The Country For Internet Trading

 2001  Becomes India’s First DP To Launch Depositary Transactions Through Internet 

Establishes Joint Venture In The UAE To Serve NRI Clients

 2002  1st In India To Launch An Integrated Internet Trading System For Cash & Derivatives Segments  2003  Geojit Commodities Limited, Wholly Owned Subsidiary, Launches Online Futures Trading In Agri-Commodities, Precious Metals And Energy Futures On Multiple Commodity Exchanges  Company Renamed As Geojit Financial Services Limited.  2005  NSE Listing  Geojit Credits, A Subsidiary, Registers With RBI As A Non-Banking Financial Company (NBFC)  2007 V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 11

 BNP Paribas Takes A Stake In The Equity Of Geojit , Making It The Largest Share-Holder

 Charter Member Of The Financial Planning Standards Board Of India



RESEARCH OBJECTIVES MAIN OBJECTIVE OF THE RESEARCH The objective of my research is “TO STUDY INVESTOR INVESTMENT BEHAVIOR IN STOCK MARKET & SUGGESTING GOOD INVESTMENT STRATEGY “ OTHER OBJECTIVES  To study the investment habit of the people in the stock market.  To know about the people’s preference for investment whether

investment or trading V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 14

 To understand the frequency of investment in the market  To analyze from total saving how much portion of amount people invest

in stock market  To understand how much people invest at a time  To know that for how much period people invest in stock market  To understand the expected return of people from investment  To know on what basis people invest in stock market  The preference of people for investment in a particular sector  To analyze the preferred price range of share by people

 To understand the people’s investment strategy  To find out the common mistakes made by investors  To define certain views for making money in stock market

RESEARCH METHODOLOGY  RESEARCH APPROACH To achieve this objective I have conducted a survey and then collected data and analyzed it and lastly find out the needed results

 SAMPLING METHOD I have used simple random sampling method for my research


 SOURCES OF DATA COLLECTION Data sources of are two types 1) Primary data sources 2) Secondary data sources 1) Primary data sources Primary data can be collected through the questionnaire. Which contain the different question about the investment behavior and investment strategy. Primary data sources are very helpful for research. This provides information related to the investor’s investment behavior & investment strategy. 2) Secondary data sources Secondary data can be collected through e-learning. It provides information regarding Geojit Financial Services Limited

 SAMPLE SIZE I used 60 samples for my study  STATASTICAL TOOL USED FOR DATA ANALYSIS PERCENTILE METHOD

 AREA OF STUDY THE CUSTOMERS OF GEOJIT FINANCIAL SERVICES LIMITED, MEHASANA

DATA ANALYSIS 1. From how many years you are in the stock market? 0-2 year

2-4 year

4-6 year

more than 6 year


No. of years 0-2 year 2-4 year 4-6 year more than 6 year

No. of persons 21 24 9 6

As shown above 35 % persons of my study have experience of about 2 years, about 40 % persons of my study have experience about 2 to 4 years, 15 % persons of my study have experience about 4 to 6 years, about 10 % persons of my study have experience of more than 6 years in stock market.

2. How much investment have you made in the market? (Approximate) 0-2 lakh

2-4 lakh

4-6 lakh

more than 6 lakh


Investment 0-2 lack 2-4 lack 4-6 lack more than 6 lack


As per my research about 50 % persons would like to invest up to 2 lack while 30 % persons would like to invest 2 to 4 lack and about 15 % persons would like to invest 4 to 6 lack while only 5 % persons would like to invest more than 6 lack. So company should focus on those customers who would like to invest more in stock market.

3. Who brings you in stock market? Friends & Relative

News paper


Advertise Source Friends & Relative News paper Advertise Mega public issue

Mega public issue No. of persons 42 12 0 6

As per above chart about 70 % persons would like to invest in stock market as per opinion of their friends and relatives while 20 % persons would like to invest as per newspaper and magazines and persons do not like to invest through advertising and about 10 % persons would like to invest as per mega public issue. So it can be conclude that most of the people invest as per opinion of their friends and relatives.


4. What you prefer more? Investment Preference Investment Trading Both

Trading

Both No. of persons 36 18 6

As per my research 60 % persons prefer investment while 30 % persons prefer trading and only 10 % persons prefer both investment & trading. So we can conclude that majority of the people prefer to invest rather than trading in the stock market.


5 How much investment experience do you have? Very little knowledge & experience Some investment knowledge & understanding Very huge experience & good knowledge of investment Experience Very little knowledge & experience

No. of persons 6

Some investment knowledge & understanding

42

Very huge experience &good knowledge of investment

12

As per above chart 10% persons have Very little knowledge & experience while about 70 % persons have Some investment knowledge & understanding and about 20% persons have V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 21

Very huge experience &good knowledge of investment. From above information it is clear that the majority of people who invest in stock market have average knowledge of investment.

6. How frequently do you invest in the market? Weekly

Monthly

Quarterly

Half yearly

Frequency of investment Weekly Monthly Quarterly Half yearly


As per my research about 40 % persons would like to invest weekly in stock market while 30% persons would like to invest monthly in stock market and about 13.33% persons would like to invest quarterly in stock market while about 16.67% persons would like to invest half yearly in stock market. V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 22

7. From total saving how much portion of amount you invest in stock market? 10-20%

20-40%

60-80%

80-100%

Investment in stock market 10-20% 20-40% 40-60% 60-80% 80-100%

40-60%

No. of persons 10 24 18 4 4


As per above chart about 16.66% persons invest 10 to 20% of their saving while about 40% persons invest 20 to 40% of their saving and about 30% persons invest 40 to 60% of their saving and about 6.67% persons invest 60 to 80% of their saving while about 6.67% persons invest 80 to 100% of their saving.

8 How much do you invest at a time? (In1000Rs.) Up to 5

5-10

10-15

15-20

20-25

More than 25

Investment at a time (In1000Rs.) Up to 5 5-10 10-15 15-20 20-25 More than 25

No. of persons 20 20 10 2 2 6


As per my research about 33.34% persons invest up to 5000 Rs. At a time and about 33.345 persons invest 5000 to 10000 Rs. At a time while about 16.66% persons invest 10000 to 15000 Rs. At a time and about 3.33% persons invest 15000 to 20000 Rs. At a time while another 3.33% persons would like to invest 20000 to 25000 Rs. At a time and about 10% persons invest more than 25000 Rs. At a time.

9. For how much period you made investment? 8-10 Days

1-3 Month

3-6 Month

6-12 Month

More than 1year Period for investment 8-10 Days 1-3 Month 3-6 Month 6-12 Month More than 1year

No. of persons 4 24 6 18 8


Above chart shows that about 6.67% persons invest for 8 to 10 days while about 40% persons invest for 1 month to 3 month and about 10% persons invest for 3 month to 6 month while 30% persons invest for 6 month to 12 month and about 13.33% persons invest for more than one year.

10How much return you expect on your investment decision? 8-12%

12-16%

16-20%

More than 20%

Expected return

No. of persons 8-12% 12-16%

18 11


16-20% More than 20%

16 15

As per my research 30% persons expect 8 to 12% return while 18.33% persons expect 12 to 16% return and about 26.67% expect 16 to 20% return while 25% persons expect more than 2

11. On what basis you take your investment decision? Broker’s advise

Market situation

Tips, paid service

News paper, Magazine


Company’s news, Result Base Broker’s advise Market situation Tips, paid service News paper, Magazine Company’s news, Result Own study

Own study No.of persons 12 12 6 8 6 16

Broker’s advise 20% 26.67%

20%

Market situation 20% Tips, paid service 10% 20%

10%

News paper, Magazine 13.33% Company’s news, Result 10% Own study 26.67%

13.33%

10%

Above chart shown the various factors and its impact on investment and how investor consider such factors while investing. The chart suggest that people much like to invest according to their own study of stock market.

12. At current level which sector do you prefer more for investment? V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 28

Banking & Construction

Energy & Power

Reality (real estate)

Engineering

Metal

Information technology

Capital Goods

Financial Services

FMCG

Telecom

Sector Banking & Construction Energy & Power Reality (real estate)

No. of persons 8 12 5

Engineering Metal Information technology Capital Goods Financial Services FMCG Telecom

4 4 7 5 6 6 3

Telecom 5% Banking & Construction 13%

FMCG 10% Financial Services 10%

Energy & Power 20%

Capital Goods 8% Information technology 12%

Metal 7%

Reality (real estate) 8% Engineering 7%


13. From below mentioned share price range which range do you prefer for Buying share? Below Rs.50

Rs.50-100

Rs100-500

More than Rs.500

Price range Below Rs.50 Rs.50-100 Rs100-500 More than Rs.500


Above chart shows the price range preferred by various persons. From the above chart it can be conclude that majority of people prefer the price of share from 50 to 100.


14. What is your Investment strategy?

 Don’t invest more than 40% of your income  Intention (market) environment based selection of sector and in that sector invest in powerful companies  Installment type investment like SIP  Invest at every decline  Invest for long term  Invest in Blue Chip Company with good management.  More investment, more money  Invest in company which give good return to shareholder & have good performance.  Invest in short term profit making companies.  Take delivery and wait up to sufficient return 15. In your opinion what are the mistakes made by common investors?

       

Buy when price of share is high Don’t buy when price of share is low Purchase according to other’s views & tips Not buying in correction Buying speculative shares Buy at every upside and sell at every decline Invest money without understanding risk factor of sector and company Investors do not have patience. 16. What are your views for making money in stock market?

 Long term investment in powerful companies in recession time  Buy in correction  Avoid penny and speculative shares V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 31

Buy at every decline and sell at every upside Give more time to your investment Invest your money systematically Study the companies, make your own policies for investment and do not fall victim of fear and greed  To make money, take chances  Buy shares when people sell and sell shares when people buy    

17. Give your opinion reasons for this major correction?

          

World recession Forth coming political elections Excessive rise of equities market in recent time Global financial crisis American subprime issue Lowest consumers and industrial demand Historical recession in world market Stock loss their trust in public Change in normal investor’s thinking regarding stock Inflation Foreign investor


 People who invest in stock market have experience of stock market average 2 to 4 years.  Most of the people do not want to invest in stock market more than 2 lack.  Many people take decision to invest in stock market as per opinion of their friends and relatives.  People prefer to invest in stock market rather than trading  People who invest in stock market have some investment knowledge & understanding regarding stock market.  Most of the people make investment in stock market weekly or monthly.  People would like to invest about 40% of their saving in stock market.  People like to invest up to 10,000 rs. At a time  Most of the people would like to invest for 1 to 3 months in stock market.  Most of the people expect 15 % return of their investment.  Most of the people invest on the basis of their own study, broker’s advice & market situation. V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 33

 Most of the people prefer to invest in energy & power sector and banking & construction sector.  Most of the people prefer price of share about 50 to 100 rs.  Invest in company which give good return to shareholder & have good performance.  Take delivery and wait up to sufficient return  Intention (market) environment based selection of sector and in that sector invest in powerful companies  Long term investment in powerful companies in recession time  Study the companies, make your own policies for investment and do not fall victim of fear and greed

 Some of the respondent does not give proper answers of questions.  Respondent refuse to give answers of questions.  Mostly in my research I have to face language barrier, people do not

understand English language well, so I have to explain them in Gujarati.  It is difficult to complete the research well in 21 days.  Some respondent tries to avoid feeling questionnaire.


It is a good experience for me to conduct research about

study of investor

investment behavior in stock market & suggesting good investment strategy. It will prove very helpful to me in my future career. While conducting this research I can understand the strategies of the people who invest in stock market, their preference for investment, their experience of


stock market, frequency of investment, expected return, on which basis they invest & their views to about to make money in stock market.

 WEBSITE www.geojit.com

 ANNEXURE Questionnaire V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 36

Dear Sir/ Madam, I am student of B.B.A programme in V.M.Patel Collage Of Management Studies, Kherva. I m conducting a survey on study of investor investment behavior in stock market & suggesting good investment strategy in Mehsana city. Please help me in this by answering the following simple questions. I will treat any information you give me in strictest confident and will use only for academic purpose. 1. From how many years you are in the stock market? V.M.PATEL COLLEGE OF MANAGEMENT STUDIES 37

0-2 year 4.6 year

2-4 year more than 6 year

2. How much investment have you made in the market? (Approximate) 0-2 lakh

2-4 lakh

4-6 lakh

more than 6 lakh

3. Who brings you in stock market? Friends & Relative

News paper

Advertise

Mega public issue

4. What you prefer more? Investment

Trading

Both

5. How much investment experience do you have? Very little knowledge & experience Some investment knowledge & understanding Very huge experience & good knowledge of investment 6. How frequently do you invest in the market? Weekly

Monthly

Quarterly

Half yearly

7. From total saving how much portion of amount you invest in stock market? 10-20%

20-40%

60-80%

80-100%

40-60%

8. How much do you invest at a time? (In1000Rs.)


Up to 5

5-10

10-15

15-20

20-25

More than 25

9. For how much period you made investment? 8-10 Days

1-3 Month

3-6 Month

6-12 Month

More than 1year 10. How much return you expect on your investment decision? 8-12%

12-16%

16-20%

More than 20%

11. On what basis you take your investment decision? Broker’s advise Market situation Tips, paid service News paper, Magazine Company’s news, Result Own study 12. At current level which sector do you prefer more for investment? Banking & Construction

Energy & Power

Reality (real estate)

Engineering

Metal

Information technology


Capital Goods

Financial Services

FMCG

Telecom

13. From below mentioned share price range which range do you prefer for Buying share? Below Rs.50

Rs.50-100

Rs100-500

More than Rs.500

14. What is your Investment strategy? ----------------------------------------------------------------------------------------------15. In your opinion what are the mistakes made by common investors? ----------------------------------------------------------------------------------------------16. What are your views for making money in stock market? ----------------------------------------------------------------------------------------------17. Give your opinion reasons for this major correction? ----------------------------------------------------------------------------------------------- --------------------------------------- PERSONAL INFORMATION------------------------------------NAME: --------------------------------------------------------------------ADDRESS: ------------------------------------------------------------AGE: ------------ YEARS PROFESSION: A) BUSINESS B) SERVICE C) PROFESSION ANNUAL INCOME: A) LESS THAN 50,000 C) 1, 00,001 TO 3, 00,000 E) MORE THAN 5, 00,000

B) 50,000 TO 1,00,000 D) 3, 00,001 TO 5, 00,000


D) OTHER

FINAL Project of Stock Market (Ankit)

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