BY: HIMANSHU JINDIA JUHI DARGAN SUKHBIR SINGH VIDYANAND
KUMAR
Securities Broking
the right destination for financial talent
IntroductionBroker y primarily work as agent for buying and
selling of securities y earn commission for each of the
transactions Broker is an intermediary who facilitates entry &
exit in Equity market
History Origin Pre-Independence Scenario Post-Independence
Scenario
Economic Environment
Structure 191 companies listed under NSE and BSE Divided into
four regions North 40% South 24% East 5% West -- 31%
Source : CMIE database(Prowess)
Income of the IndustryTotal Income10000 9000 8000 7000 6000 5000
4000 3000 2000 1000 0
Amount in Crores (Rs.)
Mar-04 1913.34
Mar-05 2386.62
Mar-06 4221.4
Mar-07 6359.37
Mar-08 9237.85
Mar-09 6443.73
Total Income
Source : CMIE database(Prowess)
Trading Statistics of Stock ExchangesShares Traded3000000
2500000 In Lakhs 2000000 1500000 1000000 500000 0
2004
2005 1485947
2006 1411945
2007 2467606
2008 2158786
Shares Traded 1270535
Source : SEBI Handbook 2009
Registered Brokers and Sub-BrokersStock ExchangesAhmadabad
Bangalore BSE Bhubaneswar Calcutta Cochin Coimbatore Delhi Gauhati
ICSE Jaipur Ludhiana
Brokers325 257 984 213 926 435 135 375 103 946 488 301
Sub-Brokers96 158 30059 17 84 43 19 261 4 3 33 36Source : SEBI
Handbook 2009
Contd.Stock ExchangesMadhya Pradesh Madras NSE OTCEI Pune UPSE
Vadodara
Brokers174 183 1243 713 188 351 312
Sub-Brokers5 110 31328 19 156 3 37
Total
8652
62471
Source : SEBI Handbook 2009
Shining Stones of the Industry
Geojit Financial Services Ltd. ICICI 3% IndiaBulls Securities
Ltd 8% Securities Ltd. 6% India Infoline Ltd. 9%
%AGE MARKET SHARE (2009)
HDFC Securities Ltd. 2%
Others 60% Kotak Securities Ltd. 12%
Source : CMIE database(Prowess)
Major PlayersIncome1600 1400 1200 1000 800 600 400 200 0 In
Crores (Rs.)
2005 Kotak Securities Ltd. 368.48 India Infoline Ltd. 0.8
IndiaBulls Securities 114.59 Ltd. ICICI Securities Ltd 48.68
2006 661.36 0.21 317.86 71.43
2007 875.45 248.36 444.55 436.47
2008 1413.22 657.53 617.46 747.65
2009 712.08 571.54 393.62 514.77
Source : CMIE database(Prowess)
AdvertisementNewspapers
Print Media Media Electronic Media
Magazines Brochures Internet Television
Advertising expenses80 70 60In Crores (Rs.)
50 40 30 20 10 0 2004 10.16 2005 19.46 2006 34.57 2007 49.46
2008 69.48 2009 56.41
Advertising expenses
Source : CMIE database(Prowess)
Products
EQUITY TRADING
DERIVATIVES
COMMODITIES TRADING
OTHERS
Major Element of CostCompensation to employees2500 2000In
Crores
1500 1000 500 0
2005 409.22
2006 768.16
2007 1442.16
2008 2090.77
2009 1803.79
Compensation to employees
Source : CMIE database (Prowess)
TECHNOLOGICAL ENVIRONMENT
Introductiony Development in information, communication and
network technologiesy Created a paradigm shift in securities
market operations y Bringing about innovations in product and
services y Provide new business opportunities y Insure timeliness
and satisfaction in customer service
Technology of NSE IT set is largest by any company in India Use
satellite communication technology Energize participation from
around 200 cities spread all
over the country With up gradation of trading hardware, NSE
today can
handle up to 15 million trades per daySource :
www.nseindia.com
Types of Trading Environment
Trading Offline Online
Mobile Tradingy Broking houses are now betting on mobile trading
to
boost revenuesy Provides a Java application for your cell phone
y BSE launched its Mobitrack service
Political and Legal Environment
Why strict rules and regulations are there in stock market?STOCK
MARKET AND SCAM
Harshad Mehta scam (4000 crores) Ketan Parekh scam (2000
crores)
: 1992 : 2001
Source : www.subashares.com
SECURITIES AND EXCHANGE BOARD OF INDIAHow to become a Stock
Broker? SEBI (STOCK BROKERS AND SUB-BROKERS) RULES AND
REGULATION,1992 Registration of stock brokers Registration of
sub-brokers Code of conduct for stock brokers Code of conduct for
Sub-brokersSource : SEBI Manual, 2007
Cont. Regulation of transaction between clients and brokers Risk
disclosure document Unique client code Model tripartite agreement
Dealing by foreign brokersSource : SEBI Manual, 2007
Bitter & Curative experience in legal frame workBadla in
share market (Badla to Derivatives) Harshad Mehta Scam and Others.
Settlement Period & Settlement Cycle Know your customers (KYC
Norms)
Source : www.ezineaticles.com
Socio-Cultural Environment
Psychological Nervesy People encourage themselves to invest in
stock market y Festivals
Social Responsibilityy Provide the facility of free
demonstrations y Limited number of clients under the relationship
manager y Promotional activities for the awareness of the customer
y Co-operation with other department and other branches y Should
not give fake news to their customers
Contd.y Complete information about products and services
offeredy Educate about the rules and regulations of SEBI to
its
customers
Health of Brokersy Neck inclined to one side causes pain y
Headache y Loss in Vision y Stress y Diabetes due to stress
