Summer Training Project Report on
COMPARATIVE ANALYSIS OF INVESTMENT OPTIONS AVAILABLE IN THE MARKET AND CUSTOMER BUYING PREFERENCE Project Report submitted by:
PRAKHAR SRIVASTAVA 2011MB34
PROJECT CONCLUDED AT:
HAZRAT GANJ BRANCH, LUCKNOW Submitted in partial fulfillment for the Award of degree of Master of Business Administration
SUBMITTED BY: -
SUBMITTED TO:-
PRAKHAR SRIVASTAVA 2011MB34 MBA 3RD SEM
DR. PEEUSH RANJAN AGRAWAL (HEAD OF DEPARTMENT)
Academic Year 2012-2013
OBJECTIVES OF THE PROJECT •
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To understand all about different investment avenues available in India. To find out how the investors get information about the various financial instrument To find out how the investor wants to invest i.e. i .e. on his own or through a broker. To find out the saving habits of the different customers and the amount they invest in various financial instruments i nstruments.. In which type of financial instrument they like to invest. How long they prefer to keep their money invested. What is the return that they expect from the investment? i nvestment? What are the various factors that they consider before investing? To find out the risk profile of the investor. To give a recommendation to the investors that where they should invest. To give a suggestion to the company where its funds lack in the market & how it should be rectified. After all as a management trainee I will try to get some valuable knowledge from my seniors in the organization as well as from my faculty guide which will help me in the future. To evaluate the consumer attitude towards saving and decision making regarding investments.
LIMITATIONS OF THE STUDY •
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Total number of financial instrument in the market is so large that it needs a lot of resources to analyze them all. There are various companies providing these financial instruments to the public. Handling and analyzing such a varied and diversified data needs a lot of time and resources. As the project is based on secondary data, possibility of unauthorized information cannot be avoided. Reluctance of the people to provide complete information about them can affect the validity of responses. Due to time and cost constraint study will be conducted in only selected area of Lucknow. The lack of knowledge in customers about the financial instruments can be a major limitation. The information can be biased due to use of questionnaires.
INTRODUCTION TO THE
INDUSTRY
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The Stock Exchange, Mumbai, popularly known as "BSE" was established in 1875 as "The Native Share and Stock Brokers Association". It is the oldest one in Asia, even older than the Tokyo Stock Exchange, which was established in 1878 It is the first Stock Exchange in the Country to have obtained permanent recognition in 1956 from the Govt. of India under the Securities Contracts (Regulation) Act, 1956.
NSE (NATIONAL STOCK EXCHANGE) •
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NSE was incorporated in 1992 and was given recognition as a stock exchange in April 1993. It started operations in June 1994, with trading on the Wholesale Debt Market Segment. It has been playing a leading role as a change agent in transforming the Indian Capital Markets to its present form. The Indian Capital Markets are a far cry from what they used to be a decade ago in terms of market practices, infrastructure, technology, risk management, clearing and settlement and investor service.
INTRODUCTION TO
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KARVY, KARVY, is a premier integrated financial services provider, and ranked among the top five in the country in all its business segments, services over 16 million individual investors in various capacities, and provides investor services to over 300 corporate, comprising the who is who of Corporate India. The birth of Karvy was on a modest scale in 1981. It began with the vision and enterprise of a small group of practicing Chartered Accountants who founded the flagship company. KARVY with the help of highly qualified manpower, cuttingedge technology, comprehensive infrastructure and total customer-focus has secured for the position of an emerging financial services giant enjoying the confidence and support of an enviable clientele across diverse fields in the financial world.
MILESTONES
ACHIEVEMENTS •
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Among the top 5 stock brokers in India (4% of NSE volumes) India's No. 1 Registrar & Securities Transfer Transfer Agents Among the top 3 Depository Participants Largest Network of Branches & Business Associates ISO 9002 certified operations by DNV Among top 10 Investment bankers Largest Distributor of Financial Products Adjudged as one of the top 50 IT uses in India by MIS Asia Fully Fledged IT driven operations
MAJOR AREAS OF OPERATIONS •
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Karvy Consultants Limited Karvy Stock Broking Limited Karvy Investors Services Limited Karvy Computershare Pvt. Limited Karvy Global Services Limited Karvy Comtrade Limited Karvy Insurance Broking Private Limited
INTRODUCTION TO THE TOPIC
TYPES OF INVESTMENT OPTIONS AVAILABLE IN THE MARKET •
Mutual Funds
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Bond/IPO’s
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Insurance Fixed Deposits Govt. Securities Real Estate Commodities
RESEARCH
METHODOLOGY
RESEARCH OBJECTIVE
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To analyze the COMPARATIVE ANALYSIS OF
INVESTMENT OPTIONS AVAILABLE IN THE MARKET IN ACCORDANCE WITH THE CUSTOMER BUYING PREFERENCE and their potential market among the people of Lucknow City.
SAMPLING DESIGN •
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Sampling Area Sample Population Sample Size
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Lucknow city above 15,000 100
METHODS •
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The method used in the research (survey) is of probability type as we are unaware about the results. It can be either of the side. It is area of Lucknow city under which we have to conduct the research. The research is based on Convenience Method s. and the take the sample from to various stock broking company.
RESEARCH DESIGN •
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Research Data Source Research Method Research Technique Type of Questionnaire Type of Questions
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No of Questions
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Descriptive & Objective Primary data Survey Method Questionnaire Structured Closed & Open ended Questions 15
DATA
ANALYSIS
Ques 1. Do you know kn ow about the following Financial Instrument? e t a R e s n o p s e R
100 80 60 40 20 0
92
76
76 54
54
62
56
Series1
Series1
Mutual Funds 92
Bonds/IPO' Insurance s 76 76
Fixed Deposits 54
Govt. Commoditi Real Estate Securities es 54 62 56
Ques 2. How do you get information regarding these Financial Instruments? e t a R e s n o p s e R
60 40 20 0 Advertisement
Company Sales force
Advertisement Series1
52
Series1 Friends / Relatives
Company Sales force 44
Magazines /Newspaper
Friends / Relatives 36
Magazines /Newspaper 50
Ques 3. Ratings of Investment options as per the customer's preference e c n e r e f e r p f o e l a c S
3 2 1 0
Mutual Funds Series1 3
Series1
Bonds 2
Govt. Insurance Securities 2 3
FD 2
Real Estate 1
IPO 2
Commodi ties 1
Ques 4. Do you invest in Financial Instruments?
100 e t a R e s n o p s e R
80 60 40 20 0 Series1 Yes No
Series1
Yes 87
No 13
Ques 5. Where do you invest your savings? e t a R e s n o p s e R
80 60 40 20 0 Series1
Fixed Deposits Series1 74
Equity 26
Mutual Funds 36
Post Office 40
Commodi Derivativ Insurance Others ties es 46 48 16 26
Ques 6. What are the factors which you consider while investing in any Financial Instrument? e t a R e s n o p s e R
80 60 40 20 0
Return (capital Tax saving appreciation) Series1 70 52
Series1
Liquidity
Regular income flow
Safety
Risk
28
16
44
26
e t a R e s n o p s e R
Ques 7. On what basis you will invest inve st in any particular Financial Instrument? 50 40 30 20 10 0
Series1
Series1
Past Performance
Portfolio
38
50
Fundamental/T Fund Ma Manager echnical Analysis 10 40
Market Sentiment 44
Ques 8. How will you invest your money in any Financial Instrument? 60 e t 50 a R 40 e s n 30 o p 20 s e R 10 0 Series1
Yourself Sub broker / Agents Through banks
Series1
Yourself 56
Sub broker / Agents 60
Through banks 30
Ques 9. How long you prefer to keep your money in any Financial Instrument? 60
e t a R e s n o p s e R
40 20 0 Less than 6 months
6 months to 1 year
Series1 1 year to 3 year
Less than 6 months 6 months to 1 year Series1 12 46
More than 3 years
1 year to 3 year 32
More than 3 years 10
Ques 10. If you select a broker or agent then which broker company would you select? 60 50 40 30 20 10 0
e t a R e s n o p s e R
Series1
Share Khan Series1
20
Kotak HDFC ICICI Motilal Indiabull Angel Just Karvy Securitie Marwadi Religare Securitie Direct Oswal s Broking Trade s s 60 20 14 50 20 20 28 14 8 10
Others 0
Ques 11. What influences you to invest your amount? 100 80 60 40 20 0
e t a R e s n o p s e R
Series1
Independently Broker/Agent Series1 10 84
News Papers 34
Internet 2
Tax Consultant 14
Ques 12. Which of these would you like to be trading in? 70 60 e t a 50 R e 40 s n o 30 p s e 20 R 10 0 Series1
Equity Derivatives Commodities
Series1
Equity 62
Derivatives 68
Commodities 10
Ques 13. Which are the constraints that you might consider while investing? e t a R e s n o p s e R
80 60 40 20 0 Risk Taking ability
Series1
Risk Taking ability 30
Fund Facility
Return on Investment
Series1 Time Duration
Company Investment position
Fund Facility
Return on Investment
Time Duration
62
30
18
Company Investment position 10
Ques 14. How much return you expect from any Financial Instrument?
60
e t a R e s n o p s e R
40 20 0 10% to 20%
20% to 30%
Series1 30% to 50% More than 50%
Series1
10% to 20% 10
20% to 30% 22
30% to 50% 50
More than 50% 18
Ques 15. Will you invest your money for saving the Tax in any Financial Instrument?
80
e t a R e s n o p s e R
60 40 20 0
Series1 Yes No
Series1
Yes 80
No 20
FINDINGS •
This is probably the most important question of the questionnaire; the result of this question is that most of the people think of (RISK TAKING ABILITY) because it is the most crucial constraint. Next comes is the facilities given to them under the funds and also the ROI (return on investment). There are other factors also like time duration of their investment and Company reputation in the market.
RECOMMENDATIONS •
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Mutual Funds can also be offered as they have high risk profile. Company should take initiative to get demat account of these customers. The age group of 41-50 years, investors are from the 15,00020,000 Rs disposable income group. Investor in this group are invested in Insurance sector, the primary focus of these investors are retirement and time horizon is likely to be 6-9 years. This is also good potential group for the retirement plan in ULIPs. Fixed deposits can be a good option for them. In the survey there were lot of people who were in the age group of above 60. For this group of people the company can target Fixed deposits which gives continues return like monthly interests so that they can keep on getting returns.
SUGGESTIONS •
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Return on Investment is must but the risk also should be minimizing at the same time. No one loves to lose his hard earned money therefore it should be invested in safer place. Services are must for them and therefore the company must also concentrate on this aspect. Good advisory services, secrecy of the data given to the company as well as every people must treated as they all are equal i.e. no biasness. Charges of the services provided to them should be reasonable and viable.
CONCLUSIONS •
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Karvy has enough number of branches all over India and therefore it is a great advantage for the company and the company also planning to expand its network. Karvy also provides the facility of trading in almost all the exchanges and therefore whatever the customer demands the company has in its package. The company also has a very good research team at its Head Office and this is meant for the better working as well as for the customer of Karvy only. The company also has the advantage of the existing customers where their level of faith and their view about the company to the outside world will be a helping hand for the company to expand its business.
REFERENCES •
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(n.d.). Business Today . (n.d.). The Economic Times. (n.d.). The Mint. (n.d.). Karvy Finapolis. Aswathapa, K. (n.d.). 3rd edition "Human Resource and Personnel Management". New Delhi: Tata McGraw-Hill Publishing Company Ltd. Cooper. (n.d.). 8th Edition "Business Research Methods". New Delhi: Tata McGraw-Hill Publishing Company Ltd. Kotler, P. (n.d.). The Millenium Edition "Marketing Management". New Delhi: Prentice Hall of India Pvt. Ltd.
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www.karvy/about.asp . (n.d.). www.bseindia/about.asp (n.d.).
www.nseindia.com (n.d.). www.mcx.com (n.d.). www.ncdex.com (n.d.). www.karvy.com (n.d.). www.icicidirect.com (n.d.). www.mutualfundsindia.com (n.d.). www.nseindia.com (n.d.). www.bseindia.com (n.d.). www.scribd.com (n.d.). www.mcx.com (n.d.). www.equitymaster.com (n.d.).
THANK YOU!
