My summer project

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My summer project

  1. 1. SUMMER TRAINING PROJECT REPORT ON “COMPARISON BETWEEN RELIGARE AND STOCK TRADING SERVICE” Submitted in partial fulfilment of the requirements for the degree of Master of Business Administration Submitted to Department Of Management Studies Submitted By SUSHANT TRIPATHI Roll No. 09/MBA/006 JSS ACADEMY OF TECHNICAL EDUCATION NOIDA – 201307 U.P.Technical University, Lucknow (2009-2011)1|Page
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  3. 3. JSS MAHAVIDYAPEETHA JSS ACADEMY OF TECHNICAL EDUCATION, NOIDA DEPARTMENT OF MANAGEMENT STUDIES CERTIFICATEThis is to certify that “Sushant Triapthi” has successfully completed the Summer Projecttitled “Comparison Between Religare & Other Stock Trading Services” from “ReligareSecurities Ltd, NOIDA Sec-18” as the partial fulfillment of the requirement for the award ofdegree of Masters of Business Administration (M.B.A.) by U.P. Technical UniversityLucknow during batch 2009-11.Dr. S.K.BanerjeeHead, Department of Management Studies,JSSATE, Noida3|Page
  4. 4. DECLARATIONIt gives me immense pleasure that I got an opportunity to work with Religare Securities Ltd.and also to undertake such a wonderful project. The professionalism and the great workenvironment has helped me in shape-up my personality and enhance my knowledge. It was aneducating and enriching experience for me.Now that I have completed my project work, thus, it is but natural to thank all those whomade this project an outstanding experience.First and foremost, I extend my sincere gratitude to my project guide Mr.Baljeet Singh (SrRM) RSL, Noida for his invaluable suggestions and the time he has devoted for successfulexecution of this project work. I thank him for giving me insights, required inputs and properdirection throughout the project.PLACE: NOIDASushant TripathiDate : mm/dd/yyyy (Research Student)4|Page
  5. 5. This project aims at understanding the workings of an organization, its external and internalprocesses, the product and services it offers to its customers. Religare Securities Limited hasprovided an in depth knowledge about how an organization functions, the challenges it facesand its earnest endeavour to overcome them in its objective of becoming the no.1 serviceprovider in its product line.I thank Mr. VIPUL GUPTA (Branch Manager) for selecting me as a management trainee inhis organization. I would especially like to thank Mr. BALIJEET SINGH (SeniorRelationship manager) for his guidance and motivation in helping me to understand theworking of the organization and the challenges ahead in the organization and the corporateworld as a whole. My regards also extends to Mr. KAPIL GUPTA (RM), for providing aninsight in the organization and their help and support and clearing my doubts and problems.5|Page
  6. 6. TABLE OF CONTENTCHAPTER-IEXECUTIVE SUMMARY 10CHAPTER-II INTRODUCTION OF PROJECT2.1 INTRODUCTION 122.2 STATEMENT OF PROBLEM 142.3 OBJECTIVE 152.4 PROBLEM DEFINETION 162.5 WHY INVESTOR CHOOSE RELIGARE 172.6 INVESTOR EXPECTATAIONS 18CHAPTER-III PROFILE OF THE ORGANIZATION3.1 INTRODUCTION 213.2 FINANCIAL SERVICE INDUSTRY 223.3 INDIAN FINANCIAL SECTOR 243.4 RECENT ADVANCEMENT IN THE INDUSTRY 263.5 RANBAXY GROUP 283.6 RELIGARE: THE COMPANY 303.7 COMPANY STRUCTURE 346|Page
  7. 7. 3.8 COMPETITORS OF RELIGARE 353.9 THE RELIGARE AGE 373.10 THE REACH OF RELIGARE 383.11 DEVISION OF RELIGARE 393.12 COMPETITIVE ADVANTAGE 48CHAPTER-IV RESEARCH DESIGN AND METHODOLOGY4.1 INDRODUCTION TO RESEARCH METHODOLOGY 504.2 OBJECTIVE OF RESEARCH 514.3 RESEARCH DESIGN 524.4 SOURCES OF DATA COLLECTION 534.5 LIMITATION OF STUDY 54CHAPTER-V DATA REPRESENTATION, ANALYSIS & INTERPRETATION5.1 DEMATERIALISATION 565.2 OPENING OF DEMAT ACCOUNT 575.3 COMPARISON TABLE OF BROKERAGE CHARGES IN INDIA 675.4 TOP 10 BROKING FIRM IN INDIA 695.5 BROKERS’ BROKERAGE RATE REMARK 727|Page
  8. 8. CHAPTER-VIRECOMMENDATION AND CONCLUSION 83CHAPTER-VIIBIBLIOGRAPHY 86CHAPTER-VIIIANNEXTURE 888|Page
  9. 9. CHAPTER - I EXECUTIVE SUMMARY9|Page
  10. 10. This project provides an insight into the financial service industry of which insurance, stocksand mutual funds form an integral part. The project focuses on the dematerialization and stocktrading services provided by Religare.The project also includes the services industry in which Religare plays an important role. Theorganization structure, history of the company, ownership patterns, divisions and branchesand different departments in the organization are also mentioned.The project provides an overall view on the financial standing of the company, productsoffered and services provided the competitors in the industry and the competitive edge ofReligare to have a distinctive position in the industry.Lastly the project involves an analysis and comparative study of the product of Religare withtwo of its competitors and recommendations to provide a horizon of improvement andgrowth.10 | P a g e
  11. 11. CHAPTER – II INTRODUCTION11 | P a g e
  12. 12. PROJECT INTRODUCTIONThe stock broking industry is a service-oriented industry where brokers act as agents forinvestors when a security is bought or sold and are compensated with a commission.Investors would not hesitate to switch to alternative brokerage houses if they do not obtainsatisfaction. Providing quality service and hence customer satisfaction should thus berecognised as a key strategy and a crucial element of long-run success and profitability forstock broking businesses.Little has been done towards understanding the expectations investors hold from theirstockbrokers. Since expectations serve as benchmark to gauge the service level of brokers,the delivery of services that exceed customer expectations is one strategy that can give firms acompetitive advantage. Therefore, it would seem beneficial for stockbrokerage firms, in adynamic economic environment like India, to provide service at a good scale of quality.In addition, stockbrokers have much to gain in understanding investors‟ expectations of them,as this would help the stockbrokers to serve their customers better and foster long-lastingrelationship with their customers. This study therefore aims to provide a platform forunderstanding whta the customer needs and what is being provided to bridge the gap betweencustomer expectation and the actual service rendered. This information would be useful forthose who would like to control and improve the performance of their service.12 | P a g e
  13. 13. The project would focus mainly on RELIGARE understanding of the requirements of thecustomer and its endeavour to provide what the customer expects and hence showing that it isthe market leader in the stock broking industry.13 | P a g e
  14. 14. STATEMENT OF PROBLEMTo provide RELIGARE with meaningful recommendation (if any) to initiate a change in theirproducts (Demat and trading) after questioning prospective investors regarding the fulfilmentof their expectation.14 | P a g e
  15. 15. OBJECTIVETo understand and analyse the expectations of customers of RELIGARE in today marketscenario and RELIGARE‟s efforts to provide the best services at the most competitive pricesand provide recommendations of any deviation from that purpose. Stating the objective of the study. Mapping out a questionnaire to understand the expectations of customers. Identifying problems being faced by customers Analysing RELIGARE‟s product in meeting these expectations. Finding deviations if any.15 | P a g e
  16. 16. PROBLEM DEFINITION Understanding expectation of investors. Analysing the problems being faced by investors. Understanding RELIGARE‟s product to meet these problems. Mapping a questionnaire to analyse investors‟ satisfaction of RELIGARE product. Contemplating the information. Providing meaningful analysis of the problem.16 | P a g e
  17. 17. Why investors choose Religare?? It is a Ranbaxy promoter group company. Diverse portfolio and a lot of products under one roof. Has one of the best brokerage plans. Attractive brand. Relationship managers attached to customers. Equity research team (one of the best in the market). Controlled and low cost service structure. Large volume processing structure. Expertise in coordinating multi-location responses.17 | P a g e
  18. 18. INVESTORS EXPECTATIONS Providing basic knowledge to investors so as to help them in understanding the stock marketand making proper decisions in stocks Providing an averagely priced product so as to appeal to the investors and have a penetrationeffect in the market. Timely input (tips, entry and exist) to be provided to prospective clients so that they canmaximize their wealth by making smart decisions. Updated info about client accounts on amounts outstanding, payment, withdrawals,shortages etc if any. Ancillary services like providing payout facilities, direct transfers, timely payments andreceipts, confirmations about order receiptance and delivery of stocks, cheques,dematerialised shares etc.18 | P a g e
  19. 19. Infrastructure facilities like proper sitting arrangements, water and other refreshments, cleanfacility and a clean working environment. Cordial relation with clients should be maintained so as to promote goodwill and business ofthe broker. Proper availability of RM‟s to attend to clients requests so as to minimize delays in orderreacceptance and minimizing customer dissatisfaction.19 | P a g e
  20. 20. CHAPTER – III PROFILE OF THE ORGANIZATION20 | P a g e
  21. 21. INTRODUCTIONThe stock broking industry is a service-oriented industry where brokers act as agents forinvestors when a security is bought or sold and are compensated with a commission.Investors would not hesitate to switch to alternative brokerage houses if they do not obtainsatisfaction. Providing quality service and hence customer satisfaction should thus berecognised as a key strategy and a crucial element of long-run success and profitability forstock broking businesses.Little has been done towards understanding the expectations investors hold from theirstockbrokers. Since expectations serve as benchmark to gauge the service level of brokers,the delivery of services that exceed customer expectations is one strategy that can give firms acompetitive advantage. Therefore, it would seem beneficial for stockbrokerage firms, in adynamic economic environment like India, to provide service at a good scale of quality.In addition, stockbrokers have much to gain in understanding investors‟ expectations of them,as this would help the stockbrokers to serve their customers better and foster long-lastingrelationship with their customers. This study therefore aims to provide a platform forunderstanding whta the customer needs and what is being provided to bridge the gap betweencustomer expectation and the actual service rendered. This information would be useful forthose who would like to control and improve the performance of their service.The project would focus mainly on RELIGARE understanding of the requirements of thecustomer and its endeavour to provide what the customer expects and hence showing that it isthe market leader in the stock broking industry.21 | P a g e
  22. 22. Financial Services IndustryThe financial services industry broadly known as the money market has been in existencesince the late 1990s.The finance industry encompasses a broad range of organizations thatdeal with the management of money. Among these are:- Banks Credit financers Insurance companies Consumer finance companies Stock brokers Investment funds Government sponsored enterprisesOther financial services Intermediation or advisory services - These services involve stock brokers (private clientservices) and discount brokers. Stock brokers assist investors in buying or selling shares.Primarily internet-based companies are often referred to as discount brokerage. Full serviceand private client firms primarily assist execute trades and execute trades for clients withlarge amounts of capital to invest, such as large companies, wealthy individuals, andinvestment management funds.22 | P a g e
  23. 23. Venture capital - Venture capital is a type of private equity capital typically provided byprofessional, outside investors to new, high-potential-growth companies in the interest oftaking the company to an IPO or trade sale of the business. Conglomerates - A financial services conglomerate is a financial services firm that is activein more than one sector of the financial services market e.g. life insurance, general insurance,health insurance, asset management. A key rationale for the existence of such businesses isthe existence of diversification benefits that are present when different types of businesses areaggregated i.e. bad things dont always happen at the same time.23 | P a g e
  24. 24. THE INDIAN FINANCIAL SECTORThe Indian financial services industry has experienced significant growth in the last fewyears. There has been a considerable broadening and deepening of the Indian financialmarkets due to various financial market reforms undertaken by the Indian regulators, theintroduction of innovative financial instruments in the recent years and the management andbrokerage have been liberalized to allow private sector involvement, which has contributed tothe development and modernization of the financial services sector. This is particularlyevident in the non-banking financial services sector, such as brokerage, resident mortgage andinsurance services. Where new products and expanding delivery channels have helped thesesectors to achieve high growth rates recently. Financial services accounted for approximately14%of the total GDP.Derivatives Trading, Demutualization and Depositories Actto assist market participants in managing risks better than through hedging and arbitrage, theSecurities Contracts(Regulation) Act,1956 was amended to lift the ban on options in securitiesand was further amended to include derivatives so that the entire regulatory could apply toderivative trading also. Derivative trading commenced in June 2000 in NSE and BSE.The government proposed in March 2001 to corporatize the stock exchanges and therebysegregate ownership, management and trading membership. A tax incentive to facilitatecorporatization and demutualization process. The NSE has adopted a demutualisedgovernance structure where ownership, management and trading are separates to help reduceconflicts of interest.24 | P a g e
  25. 25. The settlement system on stock exchanges gave rise to settlement risk due to lapse of timebefore trades were settled. A significant proportion of transactions ended up as bad deliveriesdue to non-compliance with paperwork. To obviate this problem, the Depositories Act 1996was passed. All actively traded scripts are now held, traded and settled in uncertificated form.25 | P a g e
  26. 26. Recent advancements in the industry With market sentiment turning positive due to the formation of a stable newly electedgovernment, the ripple effect is likely to felt across all the financial services in India. Financial services and real estate sector rose by 9.5 per cent in the first quarter of 2009-10. Slashing interest rates, lowering factory levies and more than doubling the limit on foreigninvestment in corporate bonds has led to rapid growth in the financial sector. April-May 2009 saw increased inflow in to equity with investors steadily turning positive onequity with net investment of mutual funds in debt almost getting tripled. India‟s market capitalization (m-cap) has touched US$ 1.04 trillion making it the ninthlargest in the world. The Indian stock market has currently responded to the optimism of reforms by the newstable government and its continuity in policies.26 | P a g e
  27. 27. Falling commodity price will ease input cost of the industries. Government policies to boostthe economy. Inflation at record lows with lower crude price. As interest rate in developed economy isrecord low, India could attract investment. Reducing interest rates provide fuel to the recession economy making the financial systemmore secure.27 | P a g e
  28. 28. RANBAXY GROUP RELIGARE SECURITIES LIMITEDCompany history:-Religare Securities limited…… Incorporated in 1984, promoted by Ranbaxy group, Religare Enterprises (REL) is theholding company of 11 business subsidiaries. Each of its subsidiaries is engaged in a wide spectrum of financial products and servicestargeted at retail, high-net worth individuals, corporate and institutional clients. The services offered by the group include : Share broking, Financing loans against shares, IPO financing, Distribution of mutual funds, Insurance broking, Commodity broking, Wealth management advisory business, Private equity, Merchant banking and Trading in arts and artifacts among others.28 | P a g e
  29. 29. More than 90% of revenue drivers for the company are its retail equity broking armReligare Securities and Religare Finvest, which finances loans against shares.29 | P a g e
  30. 30. RELIGARE:THE COMPANY Religare Enterprises Limited (REL), is one of the leading integrated financial servicesgroups of India. The company offers a diverse bouquet of services ranging from equities, commodities,insurance broking to wealth management, portfolio management services, personal financialservices, investment banking and institutional broking services. The services are broadly clubbed across three key business verticals- Retail, Wealthmanagement and the Institutional spectrum. Religare Enterprises Limited is the holding company for all its businesses, structured andbeing operated through various subsidiaries.30 | P a g e
  31. 31. NAME OF THE ORGANIZATION: RELIGARE SECURITIES LTD. Registered Office Address:- NOIDA: 101, Ocean Plaza, Sector-18 NOIDA - India. Phone: +91-120-4679623 Fax: +91-120- Corporate Office Address: - Noida: A-3, 4, 5, Sector-125 Uttar Pradesh - 201 301, India. Phone: +91-0120-339-100031 | P a g e
  32. 32. For us, each leaf of the clover has a special meaning. It is a symbol of hope,trust, care, good fortune. For the world, it is the symbol of Religare. The first leaf of the clover represents Hope. The aspirations to succeed. The dream of becoming. Of new possibilities. It is the beginning of every step and the foundation on which a person reaches for the stars. The second leaf of the clover represents Trust. The ability to place one‟s own faith in another. To have a relationship as partners in a team. To accomplish a given goal with the balance that brings satisfaction to all, not in the binding, but in the bond that is built. The third leaf of the clover represents Care. The secret ingredient that is the cement in every relationship. The truth of feeling that underlines sincerity and the triumph of diligence in every aspect. From it springs true warmth of service and the ability to adapt to evolving environments with consideration to all. The fourth and final leaf of the clover represents Good Fortune. Signifying that rare ability to meld opportunity and planning with circumstance to generate those often looked for remunerative moments of success.32 | P a g e
  33. 33. Hope, Trust. Care. Good Fortune. All elements perfectly combine in the emblematic and rare, four-leaf clover to visually symbolize the values that bind together and form the core of the Religare vision.33 | P a g e
  34. 34. COMPANY STRUCTURE:Our organization is led by individual who are professional and leaders in every sense of the world.Experts in their respective domain, esteem members of its Board of Directors are: Name Designation  Mr. Malvinder Mohan Singh Non Executive Chairman  Mr. Sunil Godhwani CEO & Managing Director  Mr. Shivinder Mohan Singh Non Executive Director  Mr. Harpal Singh Non Executive Director  Mr. Deepak Ramchand Sabnani Independent Director  Mr. Padam Bahl Independent Director  Mr. J. W. Balani Independent Director  Ms. Sunita Naidoo Independent Director34 | P a g e
  35. 35. COMPETITORS OF RELIGARE  ICICI DIRECT  INDIA INFOLOINE SECURITY PVT. LTD.  HDFC SECURITIES  INDIA BULLS  KOTAK SECURITIES  RELIANCE MONEY35 | P a g e
  36. 36.  SHARE KHAN SECURITIES  MOTILAL OSWAL  ANAND RATHI SECURITIES  HEM SECURITIES  ANGEL BROKING36 | P a g e
  37. 37. The Religare Edge:  Position is not squared off without margin calls.  Cash transfer facility against sale & purchase of shares.  Judgmental call tips given even in the processing time.  Facility to place after market orders.  Efficient and prompt customer service.  Efficient research and analytical team.  SMS alert and email notification.  Short margin calls in the morning.  Transfer funds with most banks.  We offer discount on brokerage.  Attractive margin funding facility.  Flat prescribed NSDL charges.  ECS of dividend in margin.  Excellent market tips.  No inactivity fee.  IPO investments.  4 times exposure on delivery and intraday.  We offer mapping with other demat absolutely free of cost.  No minimum balance maintenance on R-ally.  Brokerage is negotiable.  Company offers demat 3 in 1 online banking with HDFC Bank, ICICI Bank, PNB and AXIS Bank.37 | P a g e
  38. 38. REACH OF RELIGARE Religare Enterprises Ltd is a Ranbaxy promoter group company 6 Regional offices 25 Zonal Offices Presence through more than 1200 locations-Pan India Present across more than 375 Cities & Towns Total group employees 6,500 plus Client Interfaces through the Retail, Wealth and Institutional spectrums Among the largest Retail brokerage branch network, going beyond Tier-I and Tier-II cities inIndia Overseas presence with a representative office in London, with aggressive plans ofstraddling other parts of the globe in this financial year38 | P a g e
  39. 39. DIVISION OF RELIGAREReligare Securities Limited (RSL) Registered with SEBI as an approved stockbroker with membership of NSE and BSE Registered for portfolio management Registered as Depository Participant Registered as merchant bankerReligare Finvest Limited(RFL) Registered with RBI as a non-banking finance company and presently engaged in providingcredit, distribution of mutual funds and IPO financing. Registered with SEBI as a Depository Participant of Central Depository Services Limited.Religare Commodities Limited Registered with Forwarding Market Commission as a commodity broker. Member of National Commodities and derivative Exchange Limited, Multi CommodityExchange Of India Limited and National Multi Commodity Exchange Of India Limited.39 | P a g e
  40. 40. Religare Insurance Broking Services Limited Registered with Insurance Regulatory Development Authority as a composite broker whichenables us to distribute products and services of life insurance companies, non life insurancecompanies and re-insurance businesses.Religare Venture Capital Private Limited RVCL was recently incorporated to commence the business of private equity and investmentmanager business and is yet to commence business.Religare Wealth Management Services Ltd RWMSL is newly incorporated company in which the wealth management advisory businessis conducted with a joint venture with Macquarie providing wealth management services tohigh net worth clients in India.Religare Finance Ltd RFINL was recently incorporated to start the business of personal loans and other consumerlending businesses.40 | P a g e
  41. 41. Religare Capital Market Ltd RCML was recently incorporated to do the merchant banking business which is presentlyunder RSL, with the view to segregate the merchant banking operations from brokingbusiness.41 | P a g e
  42. 42. EQUITY BROKING Over 200,000 Retail Equity clients, with growth rates of over 200% Market share as on 31st March, 07, was 2.70% Pan India footprint, one of the largest in the category International presence Strong equity research credentials Team of 10 research analysts Over 90 man years of research experience for equity retail42 | P a g e
  43. 43. COMMODITY TRADING Started operations in 2004 Member of MCX, NCDEX and NMCE Presence through more than 460 locations all over India, in addition to over 40 Mandi(Rural) locations, one of the largest in the category 20,000 plus clients, with growth rates of over 400% As of 31st March 2007, market share, ranged between 3% - 4% Over 40% growth in turnover YOY Strong, credible research and analytics with a dedicated team of 12 professionals43 | P a g e
  44. 44. ONLINE INVESTMENT Official Launch of E-trading in August 2006 Aggressive growth over the last few months Market share as of 31st March, 07 was around 4.76%* Recently launched a revamped, unique 360 degree customer centric online trading portalwww.religareonline.com Launch of “Trade Rewards” unique reward points system, a first in the category Host of other revolutionary features- 0% brokerage, Interest on cash margin etc.44 | P a g e
  45. 45. PERSONAL CREDITPersonal Loans - Key Facts Official Launch of Personal Loans in August 2006 Total number clients as on 31st March 2007, were more than 840Loans against Shares - Key Facts Current Book Size Rs 650 cr. Presence through all Religare locations in India. Total number of clients as of 31st March 2007 was over 1600.45 | P a g e
  46. 46. PERSONAL FINANCIAL SERVICES This group caters to the financial needs of individuals by advising them on various financialplans Financial planning for retail investment is not widespread in India PFS was started to target the rapidly expanding middle net worth individuals (MNI‟s) inIndia Rapid rollout of offerings, such as mutual funds, life and general insurance, fixed income,small savings instruments, capital bonds and equity IPOs Expert group of Religare‟s PFS advisors provide high quality customized solutions Dedicated Team of more than 200 advisors.46 | P a g e
  47. 47. PROVIDING FINACIAL SOLUTIONS TO EVERYONE COMPETITORSRELIGARE SECURITIES LTD operates in a tough and competitive environment, beingfaced by strategic problems like client turnover, stock market fluctuations, external forces canaffect the working of the organization if it doesn‟t not change with the changing environment.Religare currently faces competition from various other brokers namely:- Kotak securities ltd. ICICI securities. Share khan securities Edelweiss securities Motilal Oswal Angel BrokingWith every commercial bank providing depository services ,Religare makes a nitch for itselfby having a competitive advantage in the following area:- Personalized services Variable brokerage(Price differentiation) Lowest charges for its quality products Conglomerate-Providing various services under one roof.47 | P a g e
  48. 48. COMPETITIVE ADVANTAGE Flexi brokerage and exposure. Call centre support provided for trading, back office and IT support. Fully automated processes. Feature rich software. Interest on cash margin deposited with Religare. Target group- Mass market. USP Interest on cash margin deposited. Better quality product at competitive brokerage.48 | P a g e
  49. 49. CHAPTER-IV RESEARCH DESIGN AND METHODOLOGY49 | P a g e
  50. 50. INTRODUCTION TO RESEARCH METHODOLOGY:Research Methodology comprises defining and redefining the problem, formulating hypothesis orsuggesting solution, collecting, organizing and evaluating the data, making deduction and reaching toconclusions.Research Methodology is a way to solve research in study and solving research problems along withlogic behind them. Thus while talking about research methodologies we are not only talking ofresearch methods but also consider the logic behind the methods.During my project, I collected data through various sources of primary & secondary data.50 | P a g e
  51. 51. OBJECTIVES OF RESEARCH :To understand and analyse the expectations of customers of RELIGARE in today marketscenario and RELIGARE‟s efforts to provide the best services at the most competitive pricesand provide recommendations of any deviation from that purpose. Stating the objective of the study. Mapping out a questionnaire to understand the expectations of customers. Identifying problems being faced by customers Analysing RELIGARE‟s product in meeting these expectations. Finding deviations if any. Providing recommendations and steps to be taken to counters these problems.51 | P a g e
  52. 52. RESEARCH DESIGN: A research design is the master plan or model for the conduct of formal investigation and survey. It is a specification of methods and procedures for acquiring the information needs for solving the problem. It decides the source of information and methods for gathering the data. A questionnaire and other forms are tested to use the collection of data. A sampling design is to be selected. Good research design ensures that the information obtained is relevant to the research question and that it was collected by objectives. Since research design is simply the framework of plan for a study, it is used as a guide in collecting and analyzing the data. It is a blueprint that is followed in completing the research study. My approach to research is descriptive as well as Explorative. The major objective of the descriptive research is to describe something – usually market features or functions. Exploratory research is concerned with the identifying the new insights of investment psychology. Why investor don‟t want to invest in share market.52 | P a g e
  53. 53. SOURCES OF DATA COLLECTION: In this research, I have used two types of data.  Primary Data.  Secondary Data.Sources of Primary Data includes:-  Telephonic Interview  Personal Interview during cold calling  Company prospectus & literature  QuestionnaireSources of Secondary Data includes:-  Books related to Financial Management  Internet  Newspaper  Company Database  References given by Relationship Manager53 | P a g e
  54. 54. LIMITATIONS OF STUDY:  The study was conducted in NOIDA only, which restricted the scope of the study.  The data provided by the investor and the agents can‟t be assumed as 100% correct.  Sample size was just 890 which might give different picture than the reality.  Sampling was judgment based & simple random so chance of occurrence of error is more.54 | P a g e
  55. 55. CHAPTER - V DATA REPRESENTATION, ANALYSIS & INTERPRETATION55 | P a g e
  56. 56. DEMATERIALISATIONDematerialization is the process of converting physical shares (share certificates) into an electronicform. Shares once converted into dematerialised form are held in a Demat account. An investor intending to dematerialise its securities needs to have an account with a DP. Theclient has to deface and surrender the certificates registered in its name to the DP. After intimatingNSDL electronically, the DP sends the securities to the concerned Issuer. NSDL in turn informs theIssuer electronically, using NSDL Depository system, about the request for dematerialisation. If theIssuer finds the certificates in order, it registers NSDL as the holder of the securities (the investor willbe the beneficial owner) and communicates to NSDL the confirmation of request electronically. Onreceiving such confirmation, NSDL credits the securities in the depository account of the Investor withthe DP.56 | P a g e
  57. 57. OPENING A DEMAT ACCOUNTGetting started Choose a DP Fill up an account opening form provided by DP, and sign an agreement with DP in a standard format prescribed by the depository. DP provides the investor with a copy of the agreement and schedule of charges for his future reference. DP opens the account and provides the investor with a unique account number, also known as Beneficiary Owner Identification Number (BO ID).Documents to be attached  Passport size photographs  Proof of residence (POR) - Any one of Photo Ration Card with DOB / Photo Driving License with DOB / Passport copy / Electricity bill / Telephone bill  Proof of identity (POI) - Any one of Passport copy / Photo Driving License with DOB / Voters ID Card / PAN Card / Photo Ration Card with DOB  PAN card57 | P a g e
  58. 58. THINGS INVESTORS SHOULD KNOW ABOUT ACCOUNT OPENING ANDDEMATERIALISATIONIt is mandatory for an investor to provide his bank account details at the time of opening a demataccount. This is done to safeguard investors own interests. There are two major reasons for this: The interest and dividend warrants cant be en-cashed by any unauthorized person, as the bank account number is mentioned on it. It is convenient and time saving, as dividends and interests given by the companies can be directly credited to the investors bank account (through ECS facility, wherever available).CHANGE IN BANK ACCOUNT DETAILS It is possible for an investor to make changes to the details of his bank account. The investor must inform any change in his bank account details to his DP. This enables him to receive the cash corporate benefits (such as dividends, interests) directly into his account in time and discourages any unauthorized use by any second party.CHANGE IN THE ADDRESS OF INVESTOR AS PROVIDED TO THE DPAny change in your address should be immediately informed to DP. This enables DP to makenecessary changes in the records and informing the concerned companies about the same.58 | P a g e
  59. 59. OPENING MULTIPLE ACCOUNTSAn investor is allowed to open more than one account with existing DP or with different DPs.MINIMUM BALANCE OF SECURITIES REQUIRED IN DEMAT ACCOUNTThere is no stipulated minimum balance of securities to be kept in a demat account.MAXIMUM NUMBER OF HOLDERS IN A DEMAT ACCOUNTA maximum of three persons are allowed to open a joint demat account in theirnames.ACCOUNT OPENING AND OWNERSHIP PATTERN OF SECURITIESOne must make sure to open a demat account in the same ownership pattern in which the physicalsecurities are held. For example: If you have two share certificates, one in your individual name (sayX) and the other held jointly with some other individual (say XY), then in such a case you will haveto open two different accounts in respective ownership patterns (one in your name i.e. X and the otheraccount in the name of XY).HOLDING A JOINT ACCOUNT ON "EITHER OR SURVIVOR" BASIS LIKE A BANKACCOUNTNo investor can open a demat account on "E or S" basis like a bank account.59 | P a g e
  60. 60. ALLOWING SOMEBODY ELSE TO OPERATE YOUR DEMAT ACCOUNTIt is possible for an account holder (Beneficiary Owner) to authorize some other person to operate thedemat account on his behalf by executing a power of attorney. After submitting the power of attorneyto the DP, that person can operate the account on behalf of the beneficiary owner (BO)..ADDITION/DELETION OF THE NAMES OF THE ACCOUNT HOLDERS AFTEROPENING THE ACCOUNTIt is not possible to make changes in the names of the account holders of a BO account. A new accounthas to be opened in a desired holding/ownership patternCLOSING A DEMAT ACCOUNT AND TRANSFER OF SECURITIES TO ANOTHERACCOUNT WITH SAME OR DIFFERENT DPAn investor, if he wants, can also close his demat account with one DP and transfer all the securities toanother account with existing or a different DP. As per a SEBI circular issued on November 09, 2005,there are no charges for account closure or transfer of securities by an investor from one DP toanother.FREEZING/LOCKING A DEMAT ACCOUNTThe account holder can freeze his demat account for a desired time period. A frozen account preventssecurities to be transferred out of (Debit) and transferred into (Credit) the account.60 | P a g e
  61. 61. DEMATERIALISED SHARES DO NOT HAVE ANY DISTINCTIVE NUMBERDematerialised securities are fungible assets. Therefore they are interchangeable and identical.REMATERIALISATIONThe process of getting the securities in an electronic form, converted back into the physical form isknown as Dematerialization. An investor can rematerialize his shares by filling in a Remat RequestForm (RRF).61 | P a g e
  62. 62. BENEFITS OF DEMAT ACCOUNT Safe and convenient way of holding securities (equity and debt instruments both). Transactions involving physical securities are costlier than those involving dematerialised securities (just like the transactions through a bank teller are costlier than ATM transactions). Therefore, charges applicable to an investor are lesser for each transaction. Securities can be transferred at an instruction immediately. Increased liquidity, as securities can be sold at any time during the trading hours (between 9:55 AM to 3:30 PM on all working days), and payment can be received in a very short period of time. No stamp duty charges. Risks like forgery, thefts, bad delivery, delays in transfer etc, associated with physical certificates, are eliminated. Pledging of securities in a short period of time. Reduced paper work and transaction cost.62 | P a g e
  63. 63.  Odd-lot shares can also be traded (can be even 1 share). Nomination facility available. Any change in address or bank account details can be electronically intimated to all companies in which investor holds any securities, without having to inform each of them separately. Securities are transferred by the DP itself, so no need to correspond with the companies. Shares arising out of bonus, split, consolidation, merger etc. are automatically credited into the Demat account of the investor. Shares allotted in public issues are directly credited into Demat account of the applicants in quick time.63 | P a g e
  64. 64. BANK ACCOUNT VS DEMAT ACCOUNT S. Basis Of Bank Account Demat AccountNo. Differentiation 1. Form of Funds Securities Holdings/Deposi ts 2. Used for Safekeeping of money Safekeeping of shares 3. Facilitates Transfer of money Transfer of shares (without actually (without actually handling shares) handling money) 4. Where to open A bank of choice A DP of choice (can be a bank) 5. Requirement of Not Mandatory Mandatory (effective from April 01, PAN Number 2006) 6. Interest accrual Interest income is subject No interest accruals on securities held on holdings to the applicable rate of in Demat account interest 7. Minimum AQB* maintenance is No such requirement balance specified for certain bank requirement accounts 8. Either or Available Not available Survivor facility*AQB - Average Quarterly Balance64 | P a g e
  65. 65. SIMILARITES BETWEEN BANKS A/c AND DEMAT A/cS. No. BASIS OF SIMILARITY PARTICULARS1. Security and Both are very safe and convenient means of holding Convenience deposits/securities2. Number of accounts No legal barrier on the number of bank or Demat accounts that can be opened3. Transfer of deposits Funds/securities are transferred only at the instruction of (funds or securities) the account holder4. Physical transfer of Physical transfer of money/securities is not involved money/securities5. Nomination Facility Available 65 | P a g e
  66. 66. Comparison Table of Brokerage Charges in IndiaHere you will find a table comparing intraday brokerage charges and delivery brokerage chargescharged by different online brokers in India: Sharekhan, ICICIdirect, Motilal Oswal, Religare,SBICAP Securities, Angel Broking, 5paisa, Indiabulls, UTI Securities, HDFC Securities,Indiainfoline, Reliance Money. I constantly try to update this table and try to keep it up to date, so ifyou have any more information, please leave a comment. It is also important that you read the remarksbelow the table to get a complete picture. Brokerage for Brokerage for Intraday Online Broker MMC* Delivery trading SBICAP Securities 0.50% 0.10% NIL brokerage charges Sharekhan 0.03% - 0.50% 0.03% - 0.10% NIL brokerage charges Motilal Oswal 0.30% - 0.50% 0.03% - 0.15% brokerage charges 5 paisa 0.25% - 0.85% 0.07% brokerage charges Angel Broking 0.50% 0.02% - 0.03% brokerage charges66 | P a g e
  67. 67. ICICI direct 0.75% 0.15% brokerage charges Indiabulls 0.25% - 0.50% 0.05% - 0.10% brokerage charges HDFC Securities 0.50% 0.15% brokerage charges UTI Securities 0.80% 0.15% brokerage charges Religare 0.20% - 0.30% 0.02% - 0.03% brokerage charges Reliance Money 0.01% 0.01% card system brokerage charges Geogit 0.30% 0.03% brokerage charges Indiainfoline 0.50% 0.10% - brokerage chargesMMC=Minimum monthly commitment.67 | P a g e
  68. 68. Brokerage is usually negotiable: Several of you trying to choose an online broker and open an onlinetrading account must have been frustrated trying to search for the exact brokerage charges charged byvarious online brokers. But the fact is the brokerage charged by the same broker varies and in severalcases is negotiable. For example if you go and tell a brokerage house that you are going to deposit 2lakh rupees and try to convince them you are going to trade heavily, they might consider reducingyour brokerage. That is why in the above table you will find only a range for the brokerage charges insome cases. But that should be enough to get an idea.Effective brokerage with taxes is more: In addition to the above brokerage charges you will have topay STT (Securities Transaction Tax) at the rate or 0.02% of the total transaction amount. You willalso be charged 12.5% Service Tax on the brokerage amount (and not on the transaction amount). Forexample, if your brokerage is 0.50% for delivery and you do a delivery transaction of Rs.100/- thenthe total brokerage you pay is0.50 (brokerage) + 0.02 (stt) + 0.063 (service tax) = 0.58 .Thus your effective brokerage (including all taxes) will be 0.58%. Similarly for brokerage on intradaytransactions.One may also like to compare brokerages charged by the online brokers mentioned above for tradingin futures and options. I have traded options on SBICAP securities and have been charged Rs.100/-flat brokerage fee for every options trade. I will probably find out and also add a comparison table forbrokerage charges for trading derivatives (futures and options) later, if i see enough people googlesearching for the same. For futures, some online brokers charge different brokerage for different legsof the trade, i.e. different for buy and sell trade.Except SBICAP Securities, I do not have any other trading account. So my information is gatheredfrom indirect sources. In case there are any inacurracies please let me know by posting a comment.68 | P a g e
  69. 69. TOP TEN BROKING FIRM IN INDIAMany times new investor or trader gets confusion for open a D Mat and trading Account inBroking house. Many of Broking House promises to you for better service but clients getproblem due to trading session in theirs Broker house firm.Here we are giving list of India‟s top 10 Broking House on base of survey of investor andtrader of many cities. In their views following Broking Houses gives best and reliable services1. ICICI direct.com2. India Infoline3. Kotak Securities Ltd.4. Share Khan5. Indiabulls6. Motilal Oswal7. Bajaj Capital8. SMC9. Angel Broking10. Reliance Money69 | P a g e
  70. 70. Contact the brokers in your nouns and find the below details:1. Account Opening charges2. Annual Maintenance Charges3. Buy and Sell commissions4. Any additional Commissions5. Online Trading Facility at past its sell-by date times6. Customer Service Clarity7. Availability of information (free research reports or timely information on company movesand actions)8. Number of banks approved to association account to the trading a/cVisit the maximum brokers and own a database of this. You required to call them to ask thesequestions to get answer. By calling them you will return with idea in the order of the customerservice clarity too...Once you have collected the background, analyze and compare that. You will get exact detailssomething like to who are the best and with whom you want to start on an account.This will not one and only help you to identify the show of multiple brokers but in any timeyou can compare your present trading accounts acting out with any other brokerage companybecause you hold that data too beside you..70 | P a g e
  71. 71. Posts Tagged „Brokerage Structure of Religare‟An Overview on the Brokerage Charges for Online Stock Trading in IndiaSeptember 22nd, 2009 adminOn the Financial Awareness Portal, I have posted two articles on the subject of brokeragecharges comparison. You may like to refer these articles “An Overview on the BrokerageStructure of Reliance Money” and “Comparison of Brokerage Charges in India”In continuation with the above two articles, this is the third article in which I have tried toprovide the details of brokerage structure of five brokerage houses in India. Please check outthe following tables to get an idea about the brokerage structure of different brokers in India71 | P a g e
  72. 72. Broker Brokerage Rate RemarksDelivery Trades Intra-DayHDFC Securities0.5% Fixed brokerage rates regardless of the turnoverBrokerage charged on both legs0.05%Fixed brokerage rates regardless of the turnoverBrokerage charged on both legsMinimum brokerage of Rs.25 per trade subject to the SEBI limit of 2.5% of total traded valueOccasionally introduces brokerage rebate schemes but turnover slabs are very high for beingeligible for the rebate and as such the schemes are generally not beneficial to ordinaryinvestors72 | P a g e
  73. 73. ICICI Direct0.25% to 0.75%Variable brokerage in seven slabs of turnover in the steps of 0.05 eachCharged on both the legs0.25% to 0.75%Variable brokerage in seven slabs of turnoverCharged only on the first leg and hence effective rate of 0.375%Margin trades @0.05%For most of the retail investors, higher rates will be applicable, as the turnover for lower ratesmay not be achieved by them73 | P a g e
  74. 74. Kotak Securities0.18%, 0.23%, 0.27%, 0.36%, 0.45%, 0.55%, 0.59%Variable brokerage in seven slabs of turnoverCharged on both the legs0.03%, 0.04%, 0.05%, 0.06%Variable brokerage in four slabs of turnoverCharged on both the legsFor most of the retail investors, higher rates will be applicable, as the turnover for lower ratesmay not be achieved by them74 | P a g e
  75. 75. Religare0.30% to 0.50%Variable brokerage in three slabs of turnover in the steps of 0.1 eachCharged on both the legs0.03% to 0.05%Variable brokerage in three slabs of turnover in the steps of 0.01 eachCharged on both the legsThe details are applicable for Classic Account in which the traders do not have to pay anysubscription charges or fixed feesIn other accounts such as Classic Plus Account, Freedom Account, Trump Account, thetraders have to pay certain minimum fixed fees every month, six months or year. Traders willbe reimbursed brokerage maximum up to the subscription amount or will be provided certainfree turnover depending upon the type of account75 | P a g e
  76. 76. Asit C Mehta Investmentz.com0.55% Fixed brokerage rates regardless of the turnoverBrokerage charged on both legsFor advanced brokerage plans, lower rates are available for higher turnovers0.05% Fixed brokerage rates regardless of the turnoverBrokerage charged on both legsFor advanced brokerage plans, lower rates are available for higher turnoversMinimum brokerage of 3 paisa per shareVarious advance brokerage plans in which the traders will be reimbursed brokerage maximumup to the amount of advance brokerage paid by them76 | P a g e
  77. 77. Name of the Broker Brokerage Rate RemarksFutures OptionsHDFC Securities0.05% 0.025% in case of intra-day square offFixed brokerage rates regardless of the turnoverBrokerage charged on both legs1% of the premium amount or Rs.100 per lot, whichever is higherFixed brokerage rates regardless of the turnoverBrokerage charged on both legsMinimum brokerage of Rs.25 per trade subject to the SEBI limit of 2.5% of total traded valueOccasionally introduces brokerage rebate schemes but turnover slabs are very high for beingeligible for the rebate and as such the schemes are generally not beneficial to ordinaryinvestors77 | P a g e
  78. 78. ICICI Direct0.03% to 0.05%Variable brokerage in four slabs in the steps of 0.005 eachCharged on both the legsIn case of intra-day square off, second leg is charged at Rs.15 per lotRs.65 to Rs.95 per lotVariable brokerage in five slabs of premium turnover in the steps of Rs.5 eachCharged on both the legsIn case of intra-day square off, second leg is charged at Rs.15 per lotFor most of the retail investors, higher rates will be applicable, as the applicable turnover forlower rates may not be achieved by them78 | P a g e
  79. 79. Kotak Securities0.023%, 0.027%, 0.036%, 0.045%, 0.07% for intra-day square off0.032%, 0.046%, 0.046%, 0.073%, 0.09% for carry forward positionsVariable brokerage in five slabs of turnoverCharged on both the legs1.15%, 1.35%, 1.8%, 2.25%, 2.5% for intra-day square off1.6%, 2.3%,2.3%, 2.5%, 2.5% for carry forward positionsVariable brokerage in five slabs of premium turnoverMinimum per lot Rs.70, Rs.80 and Rs.100 for intra-day square offMinimum Rs. 100 per lot in case of carry forwardCharged on both the legsFor most of the retail investors, higher rates will be applicable, as the applicable turnover forlower rates may not be achieved by themDepending upon the turnover, the accounts are given different names such as „GatewayAccount‟, „Privilege Account‟ etc79 | P a g e
  80. 80. Religare0.03% to 0.05%Variable brokerage in three slabs of turnover in the steps of 0.01 eachCharged on both the legs1% of the premium amountor Rs.75 per lot, whichever is higherThe details are applicable for Classic Account in which the traders do not have to pay anysubscription charges or fixed feesIn other accounts such as Classic Plus Account, Freedom Account, Trump Account, thetraders have to pay certain minimum fixed fees every month, six months or year. Traders willbe reimbursed brokerage maximum up to the subscription amount or will be provided certainfree turnover depending upon the type of account80 | P a g e
  81. 81. Asit C MehtaInvestmentz.com 0.05%Fixed brokerage rates regardless of the turnoverBrokerage charged on both legsFor advanced brokerage plans, lower rates are available for higher turnoversRs.100 per lotFor advanced brokerage plans, lower rates are available for higher turnoversMinimum brokerage of 3 paisa per shareVarious advance brokerage plans in which the traders will be reimbursed brokerage maximumup to the amount of advance brokerage paid by them81 | P a g e
  82. 82. CHAPTER-VI RECOMMENDATIONS AND CONCLUSION82 | P a g e
  83. 83. RECOMMENDATIONS AND CONCLUSIONThough Religare is the best trading broker in the region, its services still require some changes so as tobring customer satisfaction levels up. As already known Religare‟s working is adversely affected bythe trends in the market and in these times providing the customer with all the requirements is a verydifficult task, but still every personnel at Religare tries to provide the utmost level of satisfaction to itsclients.The changes that would help Religare to grow and sustain in my view are as follows:- The price of the product of Religare is the least in the market but to induce prospective customers itneeds to tell the investors that even if other brokers have their prices less than Religare ,the otherbrokers either charge higher brokerage or do not provide pool facility and therefore Religare‟s producthas been priced after examining various other pricing options in the interest of the investors. Religare should provide basic information on its product and the services offered by it. It shouldmake every attempt to make the consumer aware of the various facilities it provides so that thecustomer can avail them. For example lot of respondents lacked information about the interest ratebeing charged on margin lending , information regarding T+2 and T+5 and how to access CRN portalsand tips on stocks should be provided to customers who are using their own Odin facility etc. The refreshment issue can be resolved by: By providing refreshments at a later time, in the middle of the trading period.83 | P a g e
  84. 84. The water and other facilities can be moved inside the trading room so that the client doesn‟t have towait for someone to bring it to him and get it himself. An alternative source of refreshment supply be sought so as to meet the budget of the enterprise. Misuse and mismanagement should be checked. Customer complaints regarding Odin diet, confirmation calling, and transactional report for incometax purposes should be provided to the customer as per requirement. Furthermore the transactionalreport should be bifurcated between long term and short term capital gain for the ease of the clients. The Odin diet software is the most advanced and user friendly software that Religare provides for itsclients. The customer should be made aware of the many function that the Odin can provide to it‟s theclients. An RM assessment is required after every month so as to assess their performance and ask themabout the steps they have taken to retain their original customers and to induce the dormant customersto invest and also to assess if the client is satisfied with the working of their respective RMs. The enterprise should try to bring in the notion of „customer orientation‟ i.e give the customer whatthey require, only then can it grow and reach the highest level of customer satisfaction.84 | P a g e
  85. 85. Religare is the best service provider for depository and its stock trading services and has over all beenthe industry leader and carved out a name for itself in the stock broking industry and with itsendeavour to retain that position certain changes in its daily working would add to its competitiveadvantage.85 | P a g e
  86. 86. CHAPTER-VII BIBLIOGRAPHY86 | P a g e
  87. 87. BIBLIOGRAPHYBOOKS & JOURNALS:  RESEARCH METHODOLOGY METOHDS & TECHNIQUES Author: - C.R.Kothari  MARKETING RESEARCH Author: - David. J. Luck Ronald S. RubinWEBSITES:  http://www.religaresecurities.com  http://www.nseindia.com  http://www.bseindia.com  http://www.google.com  http://www.finsights.com  http://www.asklaila.com  http://www.moneycontrol.com  http://www.adityabirlamoney.com  http://www.economictimes.com87 | P a g e
  88. 88. CHAPTER – VIII ANNEXURE88 | P a g e
  89. 89. APPENDIXQUESTIONNARE1. Name :2. Mob No : email:3. Company :4. IncomeA) Below 2 lakh B) 2lakh to 5 lakhC) 5lakh to 10 lakh D) More than 10 lakh5. Do you invest in share market ?89 | P a g e
  90. 90. A) Yes B) No[A] If “yes”1. How much you invest?2. Which is your broking firm?3. In which market you invest more frequently?A) Equity market B) Commodity marketC) Mutual funds D) GoldE) Other : ........................4. Are you satisfied with the service?A) Yes B) NoComment :[B] If “no”90 | P a g e
  91. 91. 1.Do you have “Demat Account”?A) Yes B) No2. Any specific reason for not investing in stock marketComment :-3. Would you like to invest in share market?1. Have you heard about “Religare”?91 | P a g e

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