This project report summarizes a comparative study of brokerage plans offered by Religare Securities Ltd. and various other brokerage firms. The report includes a certificate, acknowledgments, declaration, table of contents and an abstract. It discusses Religare Enterprises Ltd., Religare Securities Ltd., their products and services. It also compares Religare Securities to competitors like ICICI Direct, Indiabulls and Sharekhan. The report details the research methodology used and plans to analyze findings and provide recommendations.
1. PROJECT REPORT
ON
A COMPARATIVE STUDY OF BROKERAGE PLANS OF
RELIGARE SECURITIES LTD. WITH VARIOUS BROKERAGE
FIRMS
BY
Rahul Mahajan
(08bs0004066)
Religare Securities Limited
Summer Internship Project
(Batch of 2010)
2. PROJECT TITLE
A COMPARATIVE STUDY OF BROKERAGE PLANS OF RELIGARE
SECURITIES LTD. WITH VARIOUS BROKERAGE FIRMS
COMPANY GUIDE FACULTY GUIDE
Mr. Abhay Sawhney Prof. Rajneesh Mehra
A.S.M. Delhi, Religare ICFAI Business School
Chandigarh
SUBMITTED BY
RAHUL MAHAJAN
(08BS0004066)
3. Certificate
This is to certify that the project report entitled “A
COMPARATIVE STUDY OF BROKERAGE PLANS OF RELIGARE SECURITIES LTD.
WITH VARIOUS BROKERAGE FIRMS” at Religare Securities
Limited is a bonafide record of work done by Rahul
Mahajan, and submitted in partial fulfillment of the
requirements of MBA program of ICFAI Business School,
Chandigarh.
Prof. Rajneesh Mehra
Faculty Guide
IBS Chandigarh
4. TO WHOMSOEVER IT MAY CONCERN
This is to certify that Mr. Rahul Mahajan, doing MBA at ICFAI
Business School, Chandigarh has done a project entitled “A
COMPARATIVE STUDY OF BROKERAGE PLANS OF RELIGARE SECURITIES LTD.
WITH VARIOUS BROKERAGE FIRMS” at Religare Securities Limited, Noida
Branch from February 23, 2009 to May 23, 2009.
From Religare Securities LTD.
Mr. Abhay Sawhney
Area Sales Manager
Delhi (N.C.R.)
Declaration
5. I hereby declare that this report on “COMPARATIVE STUDY OF BROKERAGE
PLANS OF RELIGARE SECURITIES LTD. WITH VARIOUS BROKERAGE FIRMS” has
been written and prepared by me during the academic year 2008-2009.
This project was done under the able guidance and supervision of Prof.
Rajneesh Mehra, Faculty, ICFAI Business School and Mr. Abhay Sawhney,
ASM, Religare Securities Ltd., Noida in partial fulfillment of the requirement
for the Master of Business Administration Degree course of the ICFAI
Business School.
I also declare that this project is the result of my own effort and has not
been submitted to any other institution for the award of any Degree or
Diploma.
Place: Noida
Rahul Mahajan
08bs0004066
6. Acknowledgements
Sometimes words fall short to show gratitude, the same happened with me
during this project. The immense help and support received from Religare
Securities limited overwhelmed me during the project.
My sincere gratitude to MR.ABHAY SAWHNEY (ASM, Religare Securities Ltd.)
and MR.SANDEEP BHATI (SM, Religare Securities Ltd.), for providing me with an
opportunity to work with Religare Securities limited.
I also thank PROF. RAJNEESH MEHRA, faculty guide, IBS, Chandigarh who has
sincerely supported me with the valuable insights into the completion of this
project.
I am grateful to MS. ESHA AHUJA (TL, Noida, Religare Securities Ltd.) and all
of the members of Noida branch, who have helped me in the successful
completion of this project, special mention of MR SANDEEP CHATTURVEDI.
Last but not the least; my heartfelt love for my parents, whose constant
support and blessings helped me throughout this project.
Table Of Contents
7. I. Certificate
II. To whomsoever it may concern
III.Declaration
IV.Acknowledgement
V. Abstract
Chapter 1: Introduction
1.1 Objectives of the project
1.2 Increasing internet trading
Chapter 2: Introduction to brokerage industry
2.1 Brokerage industries insight
2.2 Stock market
2.3 Stock trading
Chapter 3: Religare Enterprises Ltd.
3.1 About Religare
3.2 Pan India expansion
3.3 Financial services provided by Religare
3.4 Corporate Structure
3.5 Area of operations
3.6 Products and Services
Chapter 4: Religare Securities Ltd.
4.1 Company overview
4.2 Products offered
4.3 Equity trading
4.4 Types of accounts
4.5 Client coverage
4.6 Online trading
8. 4.7 Incomes
4.8 SWOT analysis
Chapter 5: The Competitors
5.1 ICICI Direct
5.2 Indiabulls
5.3 Sharekhan
Chapter 6: Research Methodology
6.1 Descriptive research design
6.2 Sampling Design
6.3 Sample Size and Area
6.4 Details of the survey conducted
6.5 Data Collection Method
Chapter 7: Analysis and Interpretation
Chapter 8: Recommendations
Chapter 9: Annexure
Chapter 10: References
LIST OF IILUSTRATIONS
1. Increasing Internet trading Graph 1
2. Percentage of sub brokers present in each region Graph 2
9. 3. Percentage of branches in each region
Graph 3
4. Institutional structure of the Indian stock market Table 1
5. Pan India presence expanding Graph 4
6. Geographical distribution Chart 1
7. Corporate structure of Religare Fig 1
8. Religare area of operations Table 2
9. Increased client coverage (Equity client) Graph 5
10. Increased client coverage (Priority client group) Graph 6
11. Increased online trading client Graph 7
12. Increased portfolio management client Graph 8
13. Increased income from total brokerage Graph 9
14. Increased income from priority service client Graph 10
Abstract
This project has been a great learning experience for me and at the same time it
gave me enough scope to implement my analytical ability. The project in religare
is to figure out the potential brokerage plans, which can undertake the various
products and services offered by the religare.
10. With the advent of the internet, investors can now enter orders directly online, or
even trade with other investors via ECN's (electronic communication networks).
So, most of the brokerage houses have started providing the facility of online
trading to the customers. Today even the banks with the view of expansion and
large number of customers has started providing the online trading terminal to the
customers.
As the competition from big players of online trading like Share khan, Kotak
Mahindra, ICICI Direct etc is rising religare intends to built up a loyal customer
base , the project is a step towards the same. In this era of competition it’s
becoming difficult for the organizations to acquire and retain the customers.
Hence, for religare it is of utmost importance to have satisfied existing customers
as well as to attract the other customers.
With the help of this project Religare Securities Ltd could tap the Customers
potential in investment and which would provide them various opportunities of
increasing the customer base.
“Customer Relationship and Branch Operations” believes that “They would
not remember what you did but they will always remember
what you said”.
11. CHAPTER ONE
INTRODUCTION
Globalization has proved to be a boon for the Indian economy. After globalization
there has been a tremendous growth in the Indian economy.
Every sector of the economy has shown an outstanding performance after
globalization.
12. The project was under taken as to study the Indian online
trading. Earlier Trading was confined in limited boundaries
but now the scenario has been totally different after the entrance of online trading.
There is a cut throat competition between the broking houses. Now the brokers are
more concerned about their customers to improve their performance. The sector is
undergoing fundamental changes that have diluted its traditional role of protecting
small deposits against capital and income risk and facilitating the conversion of
Savings into investment.
Also there have been a drastic increase in the volume of share traded on stock
exchange and with that the online trading has shown Bull Run.
Increasing Internet trading volume
Online trading is the service offered on the internet for purchase and sales of
shares. In the real world you place orders on your stock broker either verbally or in
a written form. In online trading you will access a stock broker’s website through
your internet enabled PC and place orders through the brokers internet based
trading engine. These orders are routed to the stock exchange without manual
intervention and executed their own in the matter of a few seconds. From the past
two years the volume of the internet trading has increased largely.
14. CHAPTER TWO
Introduction to brokerage industry
Post major reforms initiative in early 2000s brokerage industry in India is
experiencing rapid growth and diversity. At present apart of brokerage business
industry is also offering wide range of financial services. These developments have
resulted in huge spurt in business and also growing market share of the large sized
brokerage houses has led to surge in enterprise value. In the year 2007 IPOs of
large firms (Motilal Oswal, Religare, and Edelweiss) received huge response
(Indian catalog, 2001). At the same time global and private equity firms have taken
15. stake in brokerage firms. In India there are about 45
equity brokerage houses that are at present listed in the
stock exchanges.
Industry Insight
Majority of the broking firms entered the business post 1990. A majority of
members have memberships in more than one stock exchange and across
equities, equity derivatives and commodities futures in domestic and
International stock exchange.
On the back of growing equity culture broking activity is spreading in Tier II
and Tier III cities in India.
Deepening financial system and economic growth has provided growth and
expansion opportunities to broking firms. Access to public equity markets
and growing international investor’s interest has enabled them to raise
resources.
Although there are more than 9000 brokers registered with SEBI 80% of the
turnover in NSE and BSE is accounted by about 100 brokers.
One of the oldest trading industries that have been around even before the
establishment of BSE is the Indian Broking Industry. Post liberalization there have
been number of changes, despite this the stock broking industry was at its pace and
retained its sustainable growth.
To study the trend in the stock broking industry, if we take the database of over
394 broking firms. All the data for the study was collected through responses
received directly from the broking firms. The insights have been arrived at through
16. an analysis on various parameters, pertinent to the equity
broking industry, such as region, terminal, market,
branches, sub brokers, products and growth areas.
Some key characteristics of the sample 394 firms are:
On the basis of geographical concentration, the West region has the
maximum representation of 52%. Around 24% firms are located in the
North, 13% in the South and 10% in the East
3% firms started broking operations before 1950, 65% between 1950-
1995 and 32% post 1995
On the basis of terminals, 40% are located at Mumbai, 12% in Delhi, 8%
in Ahmedabad, 7% in Kolkata, 4% in Chennai and 29% are from other
cities
In the cash market, around 34% firms trade at NSE, 14% at BSE and
52% trade at both exchanges. In the derivative segment, 48% trade at
NSE, 7% at BSE and 45% at both, whereas in the debt market, 31% trade
at NSE, 26% at BSE and 43% at both exchanges
Majority of branches are located in the North, i.e. around 40%. West has
31%, 24% are located in South and 5% in East
In terms of sub-brokers, around 55% are located in the South, 29% in
West, 11% in North and 4% in East
In terms of various areas of growth, 84% firms have expressed interest in
expanding their institutional clients, 66% firms intend to increase FII
clients and 43% are interested in setting up JV in India and abroad
In terms of IT penetration, 62% firms have provided their website and
around 94% firms have email facility
17. (Graph 2)
Branches & Sub-Brokers
The maximum concentration of branches is in the North, with as many as 40%
of all branches located there, followed by the Western region, with 31% branches.
Around 24% branches are located in the South and East constitutes for 5% of the
total branches of the total sample.
In case of sub-brokers, almost 55% of them are based in the South. West and
North follow, with 30% and 11% sub-brokers respectively, whereas East has
around 4% of total sub-brokers.
18. (Graph 3)
Where one firm looses out to other
Lack of well established branches put smaller brokers at a disadvantage
when compared to larger Brick and Mortar players who have presence in
every corner of the country.
Bulk of client base is made up of retail investors. Institutional and other
high value high volume investors prefer to trade with so called blue chip
brokers. Retail investors are “easy come easy go” accompanied with
inconsistent trading habits. In Bull Run they gain confidence to invest but in
correction phase they lose confidence easily.
19. High competition among Stock brokers has put
significant pressure on the prices. Market consolidation
and merger are expected to keep the broking industry viable in the long run.
Demanding customers asks for 24/7/365 access to information and
transaction capability. Providing it with minimum overheads is very
challenging especially for newer firms who are yet to realize margin of
scale.
Foreign banks for a slice of equity business pie
In the recent period, global and domestic private equity firms have taken stake in
brokerage firms such as Anand Rathi (Citigroup), Edelweiss (Lehman Brothers),
Geojit (BNP Paribas), SMC (Millennium India), Motilal Oswal (New Vernon),
Network Broking (Amas Bank of Hindujas) and India Infoline (Orient Global) etc.
Stock Exchange - Business Trends
INDIAN STOCK MARKETS AND EXCHANGES
There are 23 recognized stock exchanges in India, including the Over the Counter
Exchange of India (OTCEI) for small and new companies and the National Stock
Exchange (NSE) which was set up as a model exchange to provide nation-wide
services to investors.
BOMBAY STOCK EXCHANGE (BSE)
Bombay stock exchange is the oldest stock exchange of India For the premier
Stock Exchange that pioneered the stock broking activity in India, 128 years of
experience seems to be a proud milestone. A lot has changed since 1875 when 318
persons became members of what today is called "The Stock Exchange, Mumbai"
by paying a princely amount of Re1.
20. Since then, the country's capital markets have passed through
both good and bad periods. The journey in the 20th century
has not been an easy one. Till the decade of eighties, there was no scale to measure
the ups and downs in the Indian stock market. The Stock Exchange, Mumbai
(BSE) in 1986 came out with a stock index that subsequently became the
barometer of the Indian stock market.
SENSEX
SENSEX is not only scientifically designed but also based on globally accepted
construction and review methodology. First compiled in 1986, SENSEX is a basket
of 30 constituent stocks representing a sample of large, liquid and representative
companies. The base year of SENSEX is 1978-79 and the base value is 100. The
index is widely reported in both domestic and international markets through print
as well as electronic media.
The index is calculated on the “Free-float Market Capitalization” methodology.
The "Free-float Market Capitalization" methodology of index construction is
regarded as an industry best practice globally. All major index providers like
NIKKEI, NASDAQ and DOW JONES use the free float methodology.
The growth of equity markets in India has been phenomenal in the decade gone by.
Right from early nineties the stock market witnessed heightened activity in terms
of various bull and bear runs. The SENSEX captured all these events in the most
judicial manner. One can identify the booms and busts of the Indian stock market
through SENSEX.
NATIONAL STOCK EXCHANGE (NSE)
21. The National Stock Exchange of India Limited has genesis
in the report of the High Powered Study Group on
Establishment of New Stock Exchanges, which recommended promotion of a
National Stock Exchange by financial institutions (FI’s) to provide access to
investors from all across the country on an equal footing. Based on the
recommendations, NSE was promoted by leading Financial Institutions at the
behest of the Government of India and was incorporated in November 1992 as a
tax-paying company unlike other stock exchanges in the country.
On its recognition as a stock exchange under the Securities Contracts (Regulation)
Act, 1956 The Capital Market (Equities) segment commenced operations in
November 1994 and operations in Derivatives segment commenced in June 2000.
When India’s National Stock Exchange (NSE) was started in 1994, few believed it
would survive. How could a stock exchange run by a team of untested
professionals headed by a former development banker succeed against existing
stock exchanges run by third generation, savvy stockbrokers?
Critics even went to the extent of warning that NSE’s sophisticated systems would
be a misfit in an Indian capital market dominated by physical deliveries, arbitrary
speculative trade, and lengthy trade settlements.
Today, with number of trades touching 2.5 million a day and turnover touching
turnover touching Rs 100 billion in value terms, NSE towers over all the other
stock exchanges in the country.
In a ten-year period (NSE completed a decade on June 30, 2004) the National
Stock Exchange has tilted the market system in favour of investors and away from
a significant bias in favour of intermediaries. For a mass of investors across the
22. country, the NSE is now the focal point for trading in
stocks, and futures and options.
The Stock Exchange, (NSE) came out with a stock index that subsequently became
another barometer of the Indian stock market known as NIFTY.
Nifty been the focal point of investors, as it provides trading the shares as well as
index in futures and options. Before Nifty came into existence trading of index
concept was not present it was introduced by Nifty and is present in it only, till
date.
CASH MARKET AND DERIVATIVES
National stock exchange gives the investors different option where an investor can
deal the equities into different market situations like cash market and derivatives.
Cash market is simply the equity market where investors have to pay the security
amount which is done in BSE also but in NSE investors has the choice of dealing
in derivatives. Derivatives are the future market where investors have the option of
dealing in the price list of futures for which there a separate index is present known
as NIFTY FUTURE.
In Derivatives there are two choices available for an investor FUTURES AND
OPTIONS
FUTURE – In future market shares are deal in lots these lots could be of different
numbers like 100, 200, 500 etc. Investors while taking over these lots and coming
under the contract takes the position of the shares by paying the 1/3rd amount of
the total holdings. (could be understood by a formula).
Holdings of investors = (shares lot * price of the lot) / 3.
23. This formula explains that as investor is interested in
taking 2 lots of reliance of 100 shares of Rs. 900 , the investor has to
pay:-
(2*100*900) / 3 = 60000/
Which shows the investor is taking the position of Rs. 180000/- in just Rs. 60000/-
in future market which the area of attraction of this particular market. These
holdings are taken for 1 month, 2 months and three months according to the
investor’s preference. The beauty of this contract is that the remaining 2/3rd money
of the holdings is paid by the broking house the investors dealing with. Investor
coming into this contract should know that by the time of contract he is in like of 1
or 2 months investor should clear its position before the last Thursday of the expiry
month.
OPTIONS – Option is a contract where the investor has two options to deal with
CALL and PUT. The concept of call and put is opposite to each other call is the
contract where the investors believe that the market is going to be BULLISH in
near future and put option is taken when he thinks that the market is going to be
BEARISH in the future.
In the call option investors is benefited if market drives up in future and in put will
be benefited if it slips down.
Funds mobilized in primary market rose to Rs 1, 74,143 cr through 558
issues in 2007-08 against Rs 55,654 cr through 451 issues in 2006-07. Out
of this Rs 87,029 cr were raised through 124 public and right issues against
Rs 33,508 cr through 124 issues in 2006-07. Total of Rs 42,595 cr was
raised through 85 IPOs in 2007- 08 against Rs 28,504 cr raised through 77
IPOs in 2006-07.
24. Net resource mobilization by mutual funds grew to
Rs 1,53,801 cr in 2007-08 with a 63% rise from Rs
93,984 cr in 2006-07. Cumulative Assets under management rose to Rs
5,05,152 in March 2008 from Rs 3,26,292 in March2007.
Institutional Structure of the Indian Stock Market
Market Intermediaries Number of Intermediaries as on March 31,2008
Stock exchanges (cash Market) 19
Stock Exchanges (Derivative Market) 2
Brokers (Cash Segment) 9487
Corporate Brokers (Cash Segment) 4183
Sub Brokers (Cash Segment) 44073
Brokers (Derivatives) 1442
FII 1319
Custodians 15
Depositories 2
Merchant Bankers 155
Bankers to an Issue 50
Underwriters 35
Mutual Funds 40
25. (Table 1)
Stock Trading
Traditionally stock trading is done through stock brokers, personally or through
telephones. As number of people trading in stock market increase enormously in
last few years, some issues like location constrains, busy phone lines, miss
communication etc start growing in stock broker offices. Information technology
(Stock Market Software) helps stock brokers in solving these problems with Online
Stock Trading.
Online Stock Market Trading is an internet based stock trading facility. Investor
can trade shares through a website without any manual intervention from Stock
Broker.
In this case these Online Stock Trading companies are stock broker for the
investor. They are registered with one or more Stock Exchanges. Mostly Online
Trading Websites in India trades in BSE and NSE.
There are two different type of trading environments available for online equity
trading.
Installable software based Stock Trading Terminals
These trading environment requires software to be installed on investors
computer. This software is provided by the stock broker. This software’s
require high speed internet connection. These kind of trading terminals are
used by high volume intraday equity traders.
Advantages:
➢ Orders directly send to stock exchanges rather than stock broker. This
makes order execution very fast.
➢ It provide almost each and every information which is required to a
trader on a single screen including stock market charts, live data,
alerts, stock market news etc.
26. Disadvantages:
➢ Location constrains - You cannot trade if you are not on the computer
where you have installed trading terminal software.
➢ It requires high speed internet connection.
➢ These trading terminals are not easily available for low volume share
traders.
Web (Internet) based trading application
These kind of trading environment doesn't require any additional software
installation. They are like other internet websites which investor can access
from around the world through normal internet connection.Below are few
advantages and disadvantages of Online Stock Market Trading:-
Advantages of Online Stock Trading (Website based):
➢ Real time stock trading without calling or visiting broker's office.
➢ Display real time market watch, historical data’s, graphs etc.
➢ Investment in IPOs, Mutual Funds and Bonds.
➢ Check the trading history; demat account balance and bank account
balance at any time.
➢ Provide online tools like market watch, graphs and recommendations
to do analysis of stocks.
➢ Place offline orders for buying or selling stocks.
➢ Set alert to inform you certain activity on the stock through email or
sms.
➢ Customer service through Email or Chat.
Disadvantages of Online Stock Trading (Website based):
➢ Website performance - sometime the website is too slow or not
enough user friendly.
➢ Little long learning curve especially for people who don’t know much
about computer and internet.
27. CHAPTER THREE
Religare Enterprises Ltd.
Religare Enterprises ltd (REL), incorporated in 1984 and promoted by RANBAXY
group, is the holding company of 11 subsidiaries. It is among the leading integrated
financial services group in the country today. Religare is a diversified financial
services group of India offering a multitude of investment options. Each of its
subsidiaries is engaged in a wide spectrum of financial products and services
targeted 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
28. Mutual funds, insurance broking, commodity broking,
wealth management, advisory services, private equity, merchant banking and
trading in arts and articrafts. The major revenue drivers for the company are its
retail equity broking arm Religare Securities and Religare Finvest, which finances
loans against shares.
The diverse bouquet of financial services which Religare offers can be broadly
clubbed across three key verticals - Retail, Institutional and Wealth spectrums. The
services extend from asset management, Life Insurance, wealth management to
equity broking, commodity broking, investment banking, lending services, private
equity and venture capital. Religare has also ventured into the alternative
investments sphere through its holistic arts initiative and Film fund. With a view to
expand, diversify and introduce offerings benchmarked against global best
practices, Religare operates in the life insurance space under 'AEGON Religare
Life Insurance Company Limited' and wealth management under the brand name
'Religare Macquarie Private Wealth'.(www.religare.in)
Religare has a pan India presence, 1837* locations across 498* cities and towns. It
also currently operates from nine international locations following its acquisition
of London's brokerage & investment firm, Hichens, Harrison & Co. plc. (Now
Religare Hichens, Harrison Plc).
29. (Graph 4)
Religare (“company”) is an integrated financial services institution
offering a wide range of financial products and services to retail
investors, high net worth individuals and corporate and
institutional clients including equity and commodity broking,
online trading, wealth advisory services, investment banking and
insurance broking.
Religare has grown rapidly from what was largely an equity
trading company into a diversified financial services company
operating through its 11 subsidiaries.
As on June 30, 2008, Religare has operations at 1,575 locations
across 465 cities and towns and a large management team leading
group of over 9,500 employess.
30. Recently acquired Hichens, Harrison & Co. (“Hichens”), one of
the oldest broking firm in London, for a sum of GBP 55.5 million.
➢ Acquisition to boost the institutional and investment banking
operations of Religare and extend its geographical reach to
London, South Africa, Argentina, Brazil, Dubai, Qatar,
Singapore, Malaysia and Indonesia.
(Chart 1)
31. Diversified Integrated Financial Services Platform
Recently growth and established business testimony of Religare’s
commitment towards becoming the investment gateway of India.
Diversified product portfolio with individually focused
management teams to create optimum balance and result.
32. CORPORATE STRUCTURE OF RELIGARE
RELIGARE
FINVEST LTD
RELIGARE RELIGARE
SECURITIE COMMODITIE
S LTD S LTD
RELIGARE
INSURANCE
RELIGARE RELIGARE
FINANCE LTD LTD
BROKING RELIGARE REALTY LTD
ENTERPRISE
S LIMITED
RELIGARE
WEALTH
MANAGEMEN
T SERVICES
RELIGARE RELIGARE
CAPITAL VENTURE
MARKET LTD CAPITAL LTD
Fig 1
Religare Areas of Operation
34. Promoter Groups
Fortis Healthcare Limited
Super Religare Laboratories Limited
Religare Wellness Limited
(Formerly Fortis Healthworld)
Religare Technova Limited
(formerly Fortis Financial Services Limited)
Religare expansion as on Q1 FY09
Employee strength increased to over 9,500
Pan India presence expanded to 1,575 location in 465 cities across India
Continued focus on expanding network, investment in multiple business &
human resource in new venture of RFL and RIBL
35. Quarterly Total Revenue recorded at Rs. 2,887.49 mn, EBIDTA at Rs.
1,184.17 mn and Profit after tax at Rs. 36.68 mn
CHAPTER FOUR
36. RELIGARE SECURITIES LTD
Company Overview
Religare Securities Ltd. (“RSL”) is the wholly owned subsidiary of
REL and a securities firm in India.
Major activities and offerings of the company include equity
broking both offline and online, depository participant services,
portfolio management services and institutional brokerage.
Member of the NSE, BSE, depository participant with NSDL and
CDSL, and SEBI approved portfolio manager.
Businesses under Religare Securities Ltd. include:
➢ Retail Equity Broking
➢ Priority Client Equity Services
➢ Online Investment Portal
➢ Institutional Equity Broking (To be shifted to RCML)
➢ Portfolio Management Services
➢ Depository Services
Empanelment with 81 institutions including 20 mutual funds, 10
insurance companies, 35 banks and 11 FIIs. Has strong
37. institutional research team covers over 185
companies in 16 sectors
Aggressive ramp up of equity trading client accounts with market
share increasing to 3.8% in June 2008 from 2.7% in FY07 and
online trading market share increased to 8.7% in June 2008 from
7.2% in October, 2007
Received in principal approval from SEBI to act as a sponsor of
Asset Management joint venture with Aegon
Received P1 Credit Rating from CRISIL for its short term debt
issuance program for a sum of Rs. 7,000 million
Religare Securities Limited (RSL) is a leading equity and securities
firm in India. The company currently handles sizeable volumes traded
on NSE and in the realm of online trading and investments it currently
holds a reasonable share of the market. The major activities and
offerings of the company today are Equity broking, Depository
Participant Services, Portfolio Management Services, Institutional
Brokerage & Research, Investment Banking and Corporate Finance.
RSL is a member of the National Stock Exchange of India, Bombay
Stock Exchange of India, Depository Participant with National
Securities Depository Limited and Central Depository Services (I)
Limited, and SEBI approved Portfolio Manager. Religare has been
constantly innovating in terms of product and services and to offer such
incisive services to specific user segments it has also started the NRI,
FII, HNI and Corporate Servicing groups. These groups take all the
portfolio investment decisions depending upon a client’s risk / return
parameter. Religare has a very credible Research and Analysis division,
38. which not only caters to the need of our
Institutional clientele, but also gives their valuable inputs to investment
dealers. Religare is also providing in-house Depository services to its
clientele and is one of the leading depository service providers in the
country.
Product offered by Religare Securities
39. OFFERINGS OF
EQUITY
RELIGARE SECURITY
INTERNATI
AND
ONAL
DERIVAT
PM
ADVISORY
IVES
S
INVEST.
BANKIN
G
40. Equity and Trading
Race and Rally are the two products offered by Religare Securities ltd
which come under equity and derivatives.
Race
Rall
y
While Rally deals with offline facilities, Race provides for complete
online package and facility. There is difference between both offline and
online modes of trading. The difference lies on account of its schemes,
platforms and facilities provided. Initially the clients used to go for
offline modes of trading, but now with increasing use of internet online
mode has become the preference.
41. Type of Account
R-ACE (Basic)
It's the basic online trading account provided by Religare. Investor can
trade and access their account information online and over the phone as
well. This account comes with a browser based online trading platform
and no additional software installation needed.
This account also provides Lifetime free DP account with no annual
maintenance charges.
R-ACE Lite (Advanced)
It's the advanced account option for the investor with Religare. This
trading account provides the entire feature of R-ACE (Basic) account. In
addition it also provides real-time streaming stock quotes and alerts.
This trading platform is also browser based and no software installation
is needed.
R-ACE Pro (Professional)
As the name indicates this account is for high volume traders. Along
with the features from above 2 accounts, this account also comes with a
Trading Terminal, software which needs to install on your computer.
This terminal directly connects the investor to stock market and having
all industry standard Treading terminal features including technical
charting (intra-day and EOD), multiple watch list, advanced hot-key
functions for faster trading, derivative chains, futures & options
calculator. As in basic and advance account, trading is available online
through internet and offline though phone.
42. Brokerage and Account opening fees:
Religare offers three kinds of accounts as above. Below are detail about
fees and activation charges for each account:
1. R-ACE
Account activation charges Rs.299/-.
2. R-ACE Lite
Account activation charges Rs.499/-..
3. R-ACE Pro
Account activation charges Rs.999/-.
4. All the account comes with free annual maintenance charge.
5. All account comes with free DP account.
6. Brokerage at Religare
On the basis of volume and frequency of trading, Religare provide
different options for brokerages. On the broader way they divided
into three categories:
○ Classic Account
Intraday brokerage varies from 0.3% to 0.5%.
Delivery brokerage varies from 0.30% to 0.50%..
○ Freedom Account
In this payment scheme, investor has to pay a fix amount in
advance for Annual Subscription (Rs 4000). This one time
payment enable account holder to trade for Rs. 3,00,000
intraday & derivative trading and Rs. 40,000 of delivery
based trading for zero brokerage.
○ Trump Account
Trump account has two payment options
1. Trump Plus has annual subscription fees of Rs 2,500,
43. Brokerage on Delivery Trades of 0.25% and Brokerage on
Intraday Trades & F&O Trades of 0.025%.
2. Trump Super has annual subscription fees of Rs. 15,000,
Brokerage on Delivery Trades of 0.15% and Brokerage on
Intraday Trades & F&O Trades of 0.015%.
Advantages of Religare
• Religare gives interest on unutilized cash when investor is waiting
to make next trade or online investment.
• Religare Allow their investor to trade without having to worry
about cash margin. Investor can get exposure (on cash segment) as
high as 20 times for intraday trades.
• They provide intraday reports and historical charting.
• Lifetime free DP account.
• Varity of fee structure to fulfill need of different type of investors.
44. Equity Broking and Online Trading
Equity client base of over 4.6 lacs, recorded an increase of more than
11% in last quarter
Total Equity brokerage of Rs. 749 mn for Q1 FY 09
Equity market share increased from 3.46% to 3.84% in last quarter
Online client base of over 78,500 clients, recorded an increase of
20% in last quarter
Online brokerage for the quarter accounted for Rs. 32 mn
Increased Client Coverage
(Graphs-5 & 6)
45. Increased Online Trading and Portfolio Management Client
(Graphs-7 & 6)
Increased Income from Various Business Lines
46. (Graphs-8 & 9)
SWOT ANALYSIS
STRENGTHS WEEKNESS
➢ Strong corporate ➢ No satisfactory Brand
relationship with its awareness and no Brand
promoter RANBAXY recall value
➢ Collaborations with highly ➢ In case of intraday the
reputed international order is automatically
companies AEGON and squared off at 3.10 pm
MACQUERIE. ➢ Problem in linking
➢ Provides transparency to Religare demat account
clients with the five banks HDFC,
➢ Highly qualified research CITIBANK, AXIS, ICICI,
team INDUS Bank.
➢ Strong network throughout
India, strong presence in
WEST, NORTH and
SOUTH
47. OPPURTUNITIES THREATS
➢ Even the strong players in ➢ Competition from major
the market holds 6% of players like ICICI
market share, so there is a DIRECT, SHAREKHAN,
good potential for growth INDIA BULLS, KOTAK
➢ The growing interest of etc.
people in the stock market ➢ The downfall in the stock
➢ Indian stock market story market
going strong
CHAPTER FIVE
48. The Competetor
The existing major players in the stock broking industry besides
Religare Securities ltd. are:
1. ICICIDirect
2. India Bulls
3. Share Khan
4. India Infoline
5. Kotak
6. Reliance money
49. ICICIDIRECT
ICICIDirect (or ICICIDirect.com) is stock trading company of ICICI
Bank. Along with stock trading and trading in derivatives in BSE and
NSE, it also provides facility to invest in IPOs, Mutual Funds and
Bonds. Trading is available in BSE and NSE.
Trade In: BSE and NSE
Type of Account
ICICIDirect offers 3 different online trading platforms to its
customers:
1. Share Trading Account
Share Trading Account by ICICIDirect is primarily for buying and
selling stocks in NSE and BSE. This account allows Cash Trading,
50. Margin Trading, Margin PLUS Trading, Spot Trading, Buy Today Sell
Tomorrow and Call and Trade on phone.
ICICIDirect.com website is the primary trading platform for this trading
account. They also provide installable application terminal based
application for high volume trader.
2. Wise Investment Account
Along with stock trading and IPO investing in BSE and NSE, Wise
Investment account also provide options to invest in Mutual Funds and
Bonds online.
Online Mutual funds investment allows investor to invest on-line in
around 19 Mutual Fund companies. ICICI Direct offers various options
while investing in Mutual Funds like Purchase Mutual Fund,
Redemption and switch between different schemes, Systematic
Investment plans, Systematic withdrawal plan and transferring existing
Mutual Funds in to electronic mode. This account also provides facility
to invest in Government of India Bonds and ICICI Bank Tax Saving
Bonds. ICICIDirect.com website is the primary tool to invest in Mutual
Funds, IPOs, Bonds and stock trading.
Active Trader Account
Active Trader account gives more personalized investment options to the
investors. It allows investor to use online and offline stock trading. It
also provides with independent market expertise and support through a
dedicated Relationship Manager from ICICI. Active Trader also
provides commodity trading.
Brokerage and fees
1. Account opening fees : Rs 750/- (One time non-refundable)
2. Brokerage: ICICIDirect.com brokerages varies on volume of
trade and inclusive of demat transaction charges, service taxes and
51. courier charges for contract notes. It ranges
from 0.1% to 0.15% for margin trades, 0.2% to 0.425% for squared
off trades and 0.4% to 0.85% on delivery based trades.
Advantages of ICICIDirect
1. 3-in-1 account integrates your banking, broking and demat
accounts. All accounts are from ICICI and very well integrated.
This feature makes ICICI the most interesting player in online
trading facility. There is absolutely no manual interfere require.
This is truly online trading environment.
2. Unlike most of the online trading companies in India which require
transferring money to the broker's pool or towards deposits, at
ICICIDirect you can manage your own demat and bank accounts
through ICICIdirect.com. Money from selling stock is available in
ICICI bank account as soon as the ICICIDirect receive it.
3. Investment online in IPOs, Mutual Funds, GOI Bonds, and Postal
Savings Schemes all from one website. General Insurance is also
available from ICICI Lombard.
4. Trading is available in both BSE and NSE.
Disadvantages of ICICIDirect
1. Getting access to ICICIDirect.com website during market session
can be frustrating.
2. ICICIDirect brokerage is high and not negotiable.
3. Not all stocks are available under Margin Plus.
52. INDIABULLS
Indiabulls is India's leading Financial Services and Real Estate Company
having presence over 414 locations in more than 124 cities. Indiabulls
Financial Services Ltd is listed on the National Stock Exchange,
Bombay Stock Exchange, Luxembourg Stock Exchange and London
Stock Exchange.
Type of Account
Indiabulls Equity Trading Account
Indiabulls Equity Trading Account is standard Online trading account
from India bulls and along with online trading it also provides priority
telephone access that gives you direct access to your Relationship
Manager and full access to 'Indiabulls Equity Analysis'.
Application Trading Terminal (Need Installation)
Power Indiabulls
Power Indiabulls trading terminal is the most advanced new generation
trading platform with great speed. This trading terminal is built in
JAVA.
Power Indiabulls is extremely reach in features including Live
Streaming Quotes, Fast Order Entry and execution, Tic by Tic Live
Charts, Technical Analysis, Live News and Alerts, Extensive Reports
for Real-time Accounting.
Brokerage and fees :
1. Account opening fees : Rs 1200/- (One time non-refundable) as
below:
53. 250/- Equity Trading Account opening charge
200/- Demat Account opening charge
750/- Software changes
Advantages of Indiabulls Equity Trading Account
Brokerage is less compare to other online trading companies.
Provide trading terminal 'power bulls', a java based software. It's very
fast in terms of speed and execution.
SHAREKHAN
Sharekhan is online stock trading company of SSKI Group, provider of
India-based investment banking and corporate finance service.
ShareKhan is one of the largest stock broking houses in the country. S.S.
Kantilal Ishwarlal Securities Limited (SSKI) has been among India’s
leading broking houses for more than a century.
54. Sharekhan's equity related services include trade execution on BSE,
NSE, Derivatives, commodities, depository services, online trading and
investment advice. Trading is available in BSE and
NSE. Along with Sharekhan.com website,
ShareKhan has around 510 offices (share shops) in
170 cities around the country.
Share khan has one of the best state of art web
portal providing fundamental and statistical
information across equity, mutual funds and IPOs.
You can surf across 5,500 companies for in-depth
information, details about more than 1,500 mutual
fund schemes and IPO data. You can also access
other market related details such as board meetings,
result announcements, FII transactions, buying/selling by mutual funds
and much more.
Trade In: BSE and NSE
Type of Account
1.ShareKhan Classic account
Allow investor to buy and sell stocks online along with the following
features like multiple watch lists, Integrated Banking, demat and digital
contracts, Real-time portfolio tracking with price alerts and Instant credit
& transfer.
a. Online trading account for investing in Equities and Derivatives
b. Free trading through Phone (Dial-n-Trade)
I. Two dedicated numbers for placing your orders with your
cell phone or landline.
55. II. Automatic funds transfer with phone banking (for Citibank
and HDFC bank customers)
III.Simple and Secure Interactive Voice Response based system
for authentication
IV.get the trusted, professional advice of our telebrokers
V. After hours order placement facility between 8.00 am and
9.30 am
c. Integration of: Online trading + Bank + Demat account
d. Instant cash transfer facility against purchase & sale of shares
e. IPO investments
f. Instant order and trade confirmations by e-mail
g. Single screen interface for cash and derivatives
2. ShareKhan SpeedTrade account
This accounts for active traders who trade frequently during the day's
trading session. Following are few popular features of SpeedTrade
account.
a. Single screen interface for cash and derivatives
b. Real-time streaming quotes with Instant order Execution &
Confirmation
c. Hot keys similar to a traditional broker terminal
d. Alerts and reminders
e. Back-up facility to place trades on Direct Phone lines
Brokerage:
Some stock trading companies charge direct percentage while others
charge a fixed amount per Rs 100. Sharekhan charges 0.5% for inter day
shares and 0.1% for intra day or you could say Sharekhan charges 50
paise per Rs 100.
56. Advantages of Sharekhan:
A. Online trading is very user friendly and one doesn't need any
software to access.
B. They provides good quality of services like daily SMS alerts, mail
alerts, stock recommendations etc.
C. Sharekhan has ability to transfer funds from most banks. Unlike
ICICI Direct, HDFC Sec, etc., so investor not really needs to open
an account with a particular bank as it can establish link with most
modern banks.
Disadvantages of ShareKhan
A. They charge minimum brokerage of 10 paisa per stock would not
let you trade stocks below 20 rs. (If you trade, you will loose
majority of your money in brokerage).
B. Lots of hidden rules and charges.
C. They do not provide facility to book limit order trades during after-
hours.
D. Classic account holders cannot trade commodities.
E. Cannot purchase mutual funds online.
58. RESEARCH METHODOLOGY
DESCRIPTIVE RESEARCH DESIGN
The research design adopted in this study is DESCRIPTIVE RESEARCH
DESIGN. A descriptive research design is the one which is description of the state
of affairs as it exists at present. It includes survey and fact finding enquiries of
different kinds. The researcher has no control over the variables. The researcher
used this research design to find out the respondents attitude and opinion about
ULIP policies offered.
SAMPLING DESIGN
A sample design is a definite plan for obtaining a sample from a given population.
It refers to the techniques or procedures the researcher would adopt in selecting
items for the sample.
CONVENIENCE SAMPLING
The researcher adopted convenience sampling. It is the non probability sampling is
that sampling procedures does not any basis for estimating the probability that each
item in the population has of included in the sample. The researcher selects the
people according to their convenient.
59. SAMPLE SIZE
A sample of 50 people was taken for the survey. The required data collected
through questionnaire.
SAMPLE DESIGN
DETAILS OF THE SURVEY CONDUCTED
Sample Size 50
20-30 years
30-40 years
Target Population
40-50 years
above 50 years
Noida, Greater Noida, Laxmi
Location
nagar,Nehru Place.
Type of questionnaire Structured
No. of Questions involved 12
60. DATA COLLECTION
The information required for our project was collect mainly from the primary
sources and even from secondary sources. The primary source consists of the data
analyzed from questionnaire and interaction with the user at that time only. And
internet is used as secondary source.
DATA COLLECTION METHOD
Data is collected through questionnaire schedule method. It means the
investigators are trained to collect the information required for an enquiry through
schedule. The trained investigators meet the people concerned and fill up the
schedules with the information supplied by them.
Limitations:
• Time limitation
• Research has been done only in Delhi.
• Companies did not disclose their secrets data and strategies.
• Possibility of Error in data collection.
• Possibility of Error in analysis of data due to small sample size.
62. ANALYSIS AND INTERPRETATION
1. How much income are you able to save or invest?
a. 0 - 10% b. 10 - 20%
c. 20 – 30% d. 30 – 40%
e. others
others, 3 0-10% , 8
30-40% , 9
0-10%
10-20%
20-30%
30-40%
20-30% , 11 10-20% , 19 others
ANALYSIS:
Among the 50 questionnaires filled, it was clear that among them maximum people
invest in the category of 10-20%. Thus Religare has the opportunity to capture this
segment. But people are not aware of the services so here Religare has to work in
this area.
63. 2. You invest in which of the following financial
instruments?
(a) Securities
(b) Mutual fund
(c) Commodities
(d) Insurance
(e) Other Instruments
ANALYSIS:
The above observation speaks about the financial instruments in which the people
invest; most of the people invest in the securities through share market and then
invest in the insurance. Thus more focus should be made on securities so that
company has the maximum investment. This would ultimately increase the profits.
3. Do you invest/interested in stock market?
(a) YES
(b) NO
64. no
42%
yes
no
yes
58%
ANALYSIS:
It can be seen that among the whole population around 58% people either invest in
stock market or they are actually interested, but don’t have a good knowledge
about it. So these people can actually become Religare’s target market but religare
has to provide them the better services and brokerage plans and also, providing
them the initial platform of online trading.
4. Do you have a demat account?
(a) YES
(b) NO
65. no, 18
yes
no
yes, 32
ANALYSIS:
Among 50 respondents 32 actually have a demat account and are aware of the
dealings in stock trading. The rest 18 are still in the other category. So strategies
should be made to convert these people in to our potential customers.
5. If yes, which type of demat account do you have?
(a) Online
(b) Offline
66. online, 11
online
offline
offline, 21
ANALYSIS:
Among 50 respondents 32 had a demat account. Of these 32, 21 have their demat
account offline and rest 11 have their demat accounts online. As online broking is
still at a premature stage in India. Thus more and more awareness should be made
about the online broking services.
6. In which company you have your demat account?
(a) India Infoline (b) India Bulls (c) Kotak
(d) Religare (e) ICICI direct (f) Share khan
67. (g) Others
ANALYSIS:
Among these 32 people most of them have their demat account with ShareKhan
and Indiabulls. Thus these two are Religare’s biggest competitors. Also
ICICIDirect gives a good competition to Religare. These brands have a good brand
recall as compared to Religare.
1.Do you trade in Futures and Options?
(a) Yes
(b) No
68. ANALYSIS:
It can be seen that among the population who invest in stock market, around 37%
people either trade in future or they trade in option. So these people can actually
become Religare’s target market as they generate heavy brokerage for the
company. Religare has to provide them the better services and brokerage plans and
also, providing them the initial platform of online trading.
8. How often you trade in the stock market
(a) Everyday (b) 2-3 Days a week
(c) 12-18 days a month (d) 2-3 days a month
ANALYSIS:
The above observation speaks about the; most of the people do trading every day.
Thus more focus should be made on the traders which are every day traders. The
company should also focus on the others also because they are the traders for the
long term investment and also, provide heavy brokerage to the company.
69. 9. Do you pay AMC (Annual Maintenance Charge)?
(a) Yes
(b) No
ANALYSIS:
A good percentage of people give the annual maintenance charge to the company.
Religare can have the advantage of attracting their customers as they don’t charge
the AMC on its brokerage plans and which will work to generate sales.
70. 10. How much Brokerage do you pay on Intraday?
(a) (0.01 – 0.02) % (b) (0.02 – 0.03) %
(c) (0.03 – 0.04) % (d) (0.04 – 0.05) %
(e) 0.05 % or more
ANALYSIS:
It can be seen that the companies are charging brokerage according to their own
means. So, the companies are creating biasness between the customers. Even if the
customers portfolio is the same then also the brokerage may vary from the person
to person. So, religare has the best feature of providing less brokerage and
according to the customers wants.
11. How much Brokerage do you pay on Delivery?
(a) (0.1 – 0.2) % (b) (0.2 – 0.3) %
(c) (0.3 – 0.4) % (d) (0.4 – 0.5) %
(e) 0.5 % or more
ANALYSIS:
71. Here also you can see that the long term investors have to give brokerage
according to what the company wants. So, here also the biasness is created in the
mind of the customers. So, Religare got a great opportunity to attract the customers
by giving the brokerage plans according to what the customer want.
12. Are they getting the good services?
(a) Yes
(b) No
ANALYSIS:
It can be seen from the observations that there are customers who are not satisfied
by the services given by the brokerage companies can be converted by providing
better services to them. Sometimes even if the customers have the same or more
investment then also, he is getting fewer services than the other one. So, Religare
can convert them by providing better services to them.
72. CHAPTER EIGHT
RECOMMENDATIONS
On the basis of these findings and analysis, It has can be surely said that in stock
broking industry, differentiation can become the key to higher revenues. Better
73. service, straight through processing(STP), immediate execution, portfolio services,
investment advisors and telephone call centers or branch investment offices are
needed to retain customers and to increase the revenue base. As more number of
people will get comfortable with internet/technology, broking (especially online
broking) will have a completely new meaning with more fringes coming into the
picture and more firms will offer umbrella services to their clients. Thus more of
strategies should be undertaken
➢ Providing better plans and schemes than our competitors like
Sharekhan, Indiabulls, and ICICI direct are providing in terms of
brokerage and subscription.
➢ Formulation of more corporate schemes for employees of
organizations falling under Religare’s corporate category.
➢ Drafting a website which is both professional and user friendly
➢ Associating Religare with Ranbaxy to make it a power brand.
➢ Taking Religare from the brand recognition stage to brand insistence
stage.
➢ Religare should make its brokerage structure more flexible to give a
good competition to the investors
➢ Some more collaboration with international firms and increasing its
outlets not only in India but also outside the world
➢ Also, to attract the NRIs so, that to increase its share in the stock
exchanges as they provide the largest share in terms of the investment.
75. 1. How much income are you able to save or invest?
(a) 0 - 10% (b) 10 - 20%
(c) 20 – 30% (d) 30 – 40%
(e) Others
2. You invest in which of the following financial instruments?
(a) Securities (b) Mutual fund
(c) Commodities (d) Insurance
(e) Other Instruments
3. Do you invest/interested in stock market?
(a) YES (b) NO
4. Do you have a demat account?
(a) YES (b) NO
5. If yes, which type of demat account do you have?
(a) Online (b) Offline
76. 6. In which company you have your demat account?
(a) India Infoline (b) India Bulls (c) Kotak
(d) Religare (e) ICICI direct (f) Share khan
(g) Others
1. Do you trade in Futures and Options?
(a) YES (b) NO
8. How often you trade in the stock market
(a) Everyday (b) 2-3 Days a week
(c) 12-18 days a month (d) 2-3 days a month
9. Do you pay AMC (Annual Maintenance Charge)?
(a) Yes (b) No
10. How much Brokerage do you pay on Intraday?
(a) (0.01 – 0.02) % (b) (0.02 – 0.03) %
(c) (0.03 – 0.04) % (d) (0.04 – 0.05) %
(e) 0.05 % or more
77. 11. How much Brokerage do you pay on Delivery?
(a) (0.1 – 0.2) % (b) (0.2 – 0.3) %
(c) (0.3 – 0.4) % (d) (0.4 – 0.5) %
(e) 0.5 % or more
12. Are they getting the good services?
(a) Yes (b) No
CHAPTER TEN
