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SUMMER TRAINING PROJECT REPORT
ON
Overview of Stock Market in IndiaFOR THE PARTIAL FULFILLMENT OF THE REQUIREMENT
FOR THE AWARD OF
MASTER OF BUSINESS ADMINISTRATION
(Uttar Pradesh Technical University, Lucknow, Uttar Pradesh)
Faculty Guide: Name of Industry guide
Assistant Professor
Submitted by:-
Ayush Srivastava
Roll No1409770014
MBA 2014-15
Galgotias College of Engineering & Technology 1, Knowledge Park – II, Greater Noida
Uttar Pradesh Technical University, Lucknow
1
DECLARATION
I hereby declare that this project report “________________________________________”
is my own work, to the best of my knowledge and belief. It contains no material previously
published or written by another person nor material which to a substantial extent has been
accepted for the award of any other degree or diploma of any other institute, except
where due acknowledgement has been made in the text.
Name –
Roll No.
Date: __/__/__ Institution Name
2
CERTIFICATE
This is to certify that Student Name………………………………………………………Roll
No…………………………..a student of MBA from Galgotias College of Engineering &
Technology has done his/her summer training at division place ………………………..…for
8 week , from joining date ……………………to the completion date …………………….
The project work entitled “………………………………………………………..”
embodies the original work done by Student’s Name………………………………during
his/her summer project training period .
Company Guide Head Training Division
3
CERTIFICATE
I hereby declare that this project report “Overview of Stock Market in India ” is my own
work, to the best of my knowledge and belief. It contains no material previously published
or written by another person nor material which to a substantial extent has been accepted for
the award of any other degree or diploma of any other institute, except where due
acknowledgement has been made in the text.
Name
Roll No.
Date: __/__/__ Institution Name
4
CERTIFICATE
This project report has been as a part of internship required during the completion of MBA
program. I was involved with SHAREKHAN LIMITED, Laxmi Nagar ,for 6 to 7 week ,
and I come across a lot of people who put in their time and effort towards me to the
workings of their organizations.
I express my thanks to my company guide Mr. Jaipal Singh (Assistant Manager), Mr. Vijay
(Senior Manager) who motivated me in all my efforts. It was truly wonderful learning
experience. Last but not least, I express my gratitude to the entire staff of SHAREKHAN
LIMITED.
These past 6 to 7 week were of utmost importance as they added value towards my path of
knowledge. I would like to end this introduction by thanking the customers and the people at
large with whom I have interacted during the course of my training.
5
CONTENT
2.2.1 Executive summary
2.2.2 Objective
2.2.3 Literature Review
2.2.4 Stock Market in India
• Definition
• Function
• Major Stock Exchanges
2.2.5
6
EXCEUTIVE SUMMARY
Conceptually the mechanism of stock market is very simple. The Indian Stock markets has
undergone a makeover with the introduction of depository system and scrip less trading
mechanism. Most of the Indian populace is now a De-mat account holder. However, there
are few which still don‘t have an account to their credit. Moreover the exchange rate
movement has a tremendous impact on the stock market and stock prices. It may affect the
same adversely or lucratively.
The objective of the project is to study the movement of stock prices in the Indian Stock
markets that would help us in understanding the stock markets in a better manner and hence
ensuring the safety of our investments as well as maximizing returns on such investments.
To get a better understanding available literature on relevant topics has been studied. The
research conducted is causal and descriptive in nature. Mainly secondary sources like
company’s website, SEBI, RBI data on stock market have been used.
Many interesting findings have been identified during the research, such as the Indian
economy has proven to be resilient to substantial exchange rate fluctuations, as firms have
learned to adapt to exchange rate variability through the development of the hedging
7
practices, lack of proper guidance and knowledge about the stock market being the prime
reason holding back an investor from opening a de-mat account. I have studied how the
investors are entering the stock market, which factors are driving the stock market, the
volatility of market, the risk, which is in the stock market.
The initial part of the project focuses on the types of the products of the company. The job
profile is to create customer, making good relationship with them to have their references
and motivating them to trade for the company benefit and their profit. It also enlightens the
readers about the sharekhan strategies to acquire the customer base. Further the project tells
us about the profile of the company (SHAREKHAN). It provides knowledge to the readers
about the company's history, mission, and customer base and about the company in detail,
and management of the company. Also it gives special emphasis on the selling of products.
The next chapter is devoted to study the comparative analysis of the competitors and the
swot analysis which tells about the Sharekhan edge over its competitors.
This project leads us towards the job descriptions and difficulties faced by me. The next part
of the project throws light upon my findings and analysis about the company and the
suggestions for the company for better performance.
8
OBJECTIVE
The primary objective of the summer internship program was to get awareness about the
stock market, its variables and the various factors that govern the stock market and also have
to practice trading in real life trough our own De-mat accounts with the help of software
‘TRADE TIGER’ provided to us by sharekhan. Along with this training for selling De-mat
accounts have been given and hence sharpening our marketing skills. So the area of
internship was both for finance as well as marketing it includes both trading and field works.
The topic chosen by me was to study overview of stock market in India. Sharekhan provided
us with timely classes regarding various aspects of share market, trading and De-mat
account. Main objectives of my internship were to:
1. To study about the stock exchanges of India.
2. To learn the various terminologies of the stock market.
3. The risk and return factors of financial investments.
4. Ways to minimize the risk of Clients as well as Broking Firms.
5. How to analyze share market.
6. How to study the market charts and making our own predictions.
7. To understand savings, investment, inflation and returns.
9
Since my area of internship was both finance and marketing, so along with analyzing the
stock market the primary focus of my internship was to understand the importance of Lead
Management System.
For this the objectives were:
1. To generate leads for opening of De-mat accounts.
2. Conducting surveys to get some leads.
3. Retrieving knowledge of De-mat Account.
4. To study the procedure adopted to open De-mat Account.
5. Knowing all the documents required for opening a De-mat account.
In share market stocks play an important role for understanding new customers. And
brokerage gives the organization as a profit. Now days LMS software is used almost by
every organization because it gives the organization a competitive edge. Also it saves the
time and efforts of the employees of the organization because LMS directly gives them the
list of consumers who want to buy their product.
10
LITERATURE REVIEW
The company has eighty years of experience in brokering business it was earlier known as
SSKI Group. The owner of the company is Mr. Dinesh Murikya. Sharekhan is one of the
leading retail brokerage firms in the country. It is the retail broking arm of the Mumbai-
based SSKI Group, which has over eight decades of experience in the stock broking
business. Sharekhan offers its customers a wide range of equity related services including
trade execution on BSE, NSE, Derivatives, depository services, online trading, investment
advice etc.
The firm’s online trading and investment site-www.Sharekhan.com-was launched on Feb 8,
2000. The site gives access to superior content and transaction facility to retail customers
across the country. Known for its jargon-free, investor friendly language and high quality
research, the site has a registered base of over 4 lakhs customers. The number of trading
members currently stands at over 3 Lakhs. While online trading currently accounts for just
over 1 per cent of the daily trading in stocks in India, Sharekhan alone accounts for 22 % of
the volumes traded online.
The objective has been to let customers make informed decisions and to simplify the
process of investing in stocks. On April 17, 2002 Sharekhan launched Speed Trade, a net-
based executable application that emulates the broker terminals along with host of other
information relevant to the Day Traders. This was for the first time that a net-based trading
station of this caliber was offered to the traders. In the last six months Speed Trade has
11
become a de facto standard for the Day Trading community over the net. Sharekhan’s
ground network includes over 250 centers in 123 cities in India, of which 20 are fully-
owned branches
STOCK MARKETS IN INDIA:
A stock market or equity market is a public entity for the trading of company stock or
shares and derivatives at an agreed price. These are securities listed on a stock exchange as
well as those only traded privately.
In the stock market, purchases and sales of shares are affected in conditions of free
competition. Government securities are traded outside the trading ring in the form of over
the counter sales or purchase. The bargains that are struck in the trading ring by the
members of the stock exchanges are at the fairest prices determined by the basic laws of
supply and demand.
The Bombay stock exchange (BSE) and National stock exchange (NSE) are the two primary
exchanges in India. BSE and NSE account for about 80% of the equity volume traded in
India.
12
Definition of a stock exchange:A stock exchange, share market or bourse is a corporation or mutual organization which
provides facilities for stock brokers and traders, to trade company stocks and other
securities. Stock exchanges also provide facilities for the issue and redemption of securities,
as well as, other financial instruments and capital events including the payment of income
and dividends. The securities traded on a stock exchange include: shares issued by
companies, unit trusts and other pooled investment products and bonds. To be able to trade a
security on a certain stock exchange, it has to be listed there
“Stock exchange means any body or individual whether incorporated or not,
constituted for the purpose of assisting, regulating or controlling the business of buying,
selling or dealing in securities." The securities include:
Shares of public company.
Government securities.
Bonds
Functions of Stock Exchanges:
Continuous and ready market for securities.
Facilitates evaluation of securities.
Encourage capital formation
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Provide safety and security in deadline.
Regulate company management.
Facilitates public borrowings.
Provide clearing house facility.
Facilitates healthy speculations.
Serve as economic barometer.
Facilitates bank landings.
1. Continuous and ready market for securities.Stock exchange provides a ready and continuous market for purchase and sale of
securities. [1]
2. Facilitates evaluation of securities.Useful for evaluation of industrials securities. This enables investor to know the true
worth of their holdings at any time. Comparison of companies in same industries is
possible through stock exchange quotations. [1]
3. Encourage capital formationStock exchange accelerates the process of capital formation. It creates the habit of
saving. Investing and risk taking among the investing class and converts their
savings into profitable investment. It acts as an instrument of capital formation. [1]
4. Provide safety and security in deadline.Stock exchange provides safety, security and equity (justice) in dealings as
transactions are conducted as per well defined rules and regulations. The managing
body of the exchange keeps control on the members. Fraudulent practices are also
checked effectively. Due to various rules and regulations, stock exchange functions
as the custodian of funds of genuine investors. [1]
14
5. Regulate company management. Listed companies have to comply with rules and regulations of concerned stock
exchange and work under the vigilance (i.e supervision) of stock
exchange authorities. [1]
6. Facilitates public borrowings.Stock exchange serves as a platform for marketing Government securities. It enables
government to raise public debt easily and quickly. [1]
7. Provide clearing house facility. Stock exchange provides a clearing house facility to members. It settles the
transactions among the members quickly and with ease. The members have to pay or
receive only the net dues (balance amounts) because of the clearing house facility. [1]
8. Facilitates healthy speculations.Healthy speculation, keeps the exchange active. Normal speculation is not dangerous
but provides more business to the exchange. However, excessive speculation is
undesirable as it is dangerous to investors & the growth of corporate sector. [1]
9. Serve as economic barometer.Stock exchange indicates the state of health of companies and the national economy.
It acts as a barometer of the economic situation / conditions. [1]
10.Facilitates bank landings.
15
Banks easily know the prices of quoted securities. They offer loans to customers
against corporate securities. This gives convenience to the owners of securities.
Major Stock Exchanges of India:
NSE
NATIONAL STOCK EXCHANGE - (NSE) The National Stock Exchange of India was
set up by Government of India on the recommendation of Pherwani Committee in 1991.
It was incorporated in November 1992 as a tax-paying company. In April 1993, it was
recognized as a stock exchange under the Securities Contracts (Regulation) Act, 1956.
The National Stock Exchange (NSE) is a stock exchange located at Mumbai, India. It is
the 16th largest stock exchange in the world by market capitalization and largest in India by
daily turnover and number of trades, for both equities and derivative trading. NSE has a
market capitalization of around US$1 trillion and over 1,652 listings as of July 2012. . The
NSE's key index is the S&P CNX Nifty, known as the NSE NIFTY an index of fifty major
stocks weighted by market capitalization. The Capital Market (Equities) segment
commenced operations in November 1994 and operations in Derivatives segment
commenced in June 2000 NSE's mission is setting the agenda for change in the securities
markets in India. [2]
16
OBJECTIVE OF NSE :-
Establishing a nation-wide trading facility for equities and debt instruments.
Ensuring equal access to investors all over the country through an appropriate
communication network.
Providing a fair, efficient and transparent securities market to investors using electronic
trading systems.
Enabling shorter settlement cycles and book entry settlements systems, and Meeting the
current international standards of securities markets.
The standards set by NSE in terms of market practices and technology, have become
industry benchmarks and are being emulated by other market participants. NSE is more than
a mere market facilitator. It's that force which is guiding the industry towards new horizons
and greatest opportunities. [2]
17
BSE
The Stock Exchange, Mumbai, popularly known as "BSE" was established in 1875 as "The
Native Share and stock Brokers Association". It is the oldest one in Asia, even older than the
Tokyo Stock Exchange, which was established in 1878. It is a voluntary non-profit making
Association of persons (AOP) and is currently engaged in the process of converting itself
into demutualised and corporate entity. It has evolved over the years into its present status as
the premier Stock Exchange in the country. It is the first Stock Exchange in the Country to
have obtained permanent recognition in 1956 from the Govt. of India under the securities
contracts (Regulation) Act 1956.The Exchange, while providing an efficient and transparent
market for trading in securities, debt and derivatives upholds the interests of the investors
and ensures redresses of their grievances whether against the companies or its own member-
brokers. It also strives to educate and enlighten the investors by conducting investor
education programmers and making available to them necessary informative inputs. A
Governing Board having 20 directors is the apex body, which decides the policies and
18
regulates the affairs of the Exchange. The Governi0ng Board consists of 9 elected directors,
who are from the broking community (one third of them retire ever year by rotation), three
SEBI nominees, six public representatives and an Executive Director & chief Executive
officer and a chief operating officer. The Executive Director as the Chief Executive officer
is responsible for the day-to- day administration of the Exchange and the chief operating
officer and other Heads of Department assist him. The Exchange has inserted new Rule
No.126 A in its Rules, Byelaws pertaining to constitution of the Executive Committee of the
Exchange. Accordingly, an Executive Committee, consisting of a three elected directors,
three SEBI nominees or public representatives, Executive Director & CEO and Chief
Operating Officer has been constituted. The Committee considers judicial & quasi matters in
which the Governing Board has powers as an Appellate Authority, matters regarding
annulment of transactions, admission, continuance and suspension of member brokers,
declaration of a member-broker as defaulter, norms, procedures and other matters relating to
arbitration, fees, deposits, margins and other monies payable by the member-brokers to the
Exchange, etc. [3]
Regulatory framework of stock exchanges:A comprehensive legal framework was provided by the "securities Contract Regulation Act,
1956' and "securities Exchange Board of India 1952". Three tier regulatory structure
comprising
Ministry of finance
19
The Securities And Exchange Board of India
Governing body[1]
Present Scenario
In the current lifestyle, financial stability holds great importance. Lavish living and availing
all the conveniences of life may not be possible with a single salary, especially if you stay in
the city where cost of living is very high. This is the reason why both partners in a
household (nuclear family) work to meet both ends meet satisfactorily or even beyond
expectations. Many people have started investing in the stock market as an additional source
of income to be able to meet lifestyle changes.
In sync with the changing career trends and with the share markets platform gaining
grounds, financial institutes have introduced short term as well as long term courses on
finance, insurance, stock broking, and related subjects, helping aspirants build careers or
professionals enhancing their qualification tags with additional degrees. And a particular
section of ambitious people undertake short term courses on stock market trading to be able
to manage their own stock portfolios thus having an influence on their financial futures.
Share markets in India comprise primarily of NSE share and BSE share with share brokers
managing the transactions. The SEBI is the governing body in India, controlling the
activities of the stock exchanges, and stock brokers too function under SEBI guidelines. To
open trading accounts to be able to buy and sell shares like NSE share or BSE share, you
will have to seek the services of stock brokers. Many a broker functions online through the
medium of brokerage platforms. Once you get registered at such an online trading platform,
you can get tips and suggestions from expert brokers, helping you take your investing goals
to the next level. [4]
It is moving in the right direction that matters in share markets trading. Market analysts
and experts advice investors not to invest in individual NSE share or individual BSE share
given the market volatility and the high risks involved. And as aforementioned those who
manage their own portfolios including experts are at least able to decipher, take risks, and
buy individual stocks without paying heed to the brokers’ advice. Their deep knowledge
20
about the market and their ability to select the right stocks help them experience a win-win
situation.
Share markets across the world are recuperating with traces of recession still visible in few
nations. The Indian stock market is fast recovering and the emerging opportunities have led
to the steady inflows of foreign investments. Investing in India has thus become a trend
which is likely to gain more impetus in the near future. It is the promotion oriented user
friendly policies of the Indian government that have led to this sudden surge. And owing to
the increased quantum of foreign investment inflows, India is emerging as one of the best
performing markets. [4]
The current conditions of Indian markets have drastically improved. There is absolute
transparency and instant transactions. All Indian Stock markets are now computerized and
Internet Trading has become a common phenomenon. Indian stock markets have also
developed a dynamic nature and can change from a bullish temperament to a bearish slide.
Any small bit of information or even a rumor from any part of the country can affect the
market and is a fairly accurate indicator of the prevalent atmosphere in the region or
country. People from across the country and globe get in touch with minute wise readings
on the stock market and gain a lot of trading aptitude after daily seeing BSE Top
Gainer or BSE Top Looser list which does a world of good to their investment portfolio. [4]
21
DEMAT A/C
Demat a/c is just like a saving a/c. In saving a/c we save our money and in demat we deal in
share market. Demat is dematerialization and trading in the demat mode. It is safer and faster
alternative to the physical existence of securities. Demat as a parallel solution offers from
delays, thefts, forgeries, settlement risk and paper work. This system works through depository
participants (DP) who offer demat services and the securities are held in the electronic form for
the investor directly by the depository.
22
PROFILE OF THE ORGANISATION
SHAREKHAN LIMITED
Sharekhan is one of the top retail brokerage houses in India with a strong online trading
platform. The company provides equity based products (research, equities, derivatives,
depository, margin funding, etc.). It has one of the largest networks in the country with 704
share shops in 280 cities and India’s premier online trading portal www.sharekhan.com.
With their research expertise, customer commitment and superior technology, they provide
investors with end-to-end solutions in investments. They provide trade execution services
through multiple channels - an Internet platform, telephone and retail outlets.
Sharekhan was established by Morakhia family in 1999-2000 and Morakhia family,
continues to remain the largest shareholder. It is the retail broking arm of the Mumbai-based
SSKI [SHANTILAL SHEWANTILAL KANTILAL ISWARNATH LIMITED] Group.
SSKI which is established in 1930 is the parent company of Sharekhan ltd. With a legacy of
more than 80 years in the stock markets, the SSKI group ventured into institutional broking
and corporate finance over a decade ago. Presently SSKI is one of the leading players in
institutional broking and corporate finance activities. Sharekhan offers its customers a wide
range of equity related services including trade execution on BSE, NSE, and Derivatives.
Depository services, online trading, Investment advice, Commodities, etc.
Sharekhan Ltd. is a brokerage firm which is established on 8th February 2000 and now it is
having all the rights of SSKI. The company was awarded the 2005 Most Preferred Stock
Broking Brand by Awaz Consumer Vote. It is first brokerage Company to go online. The
23
Company's online trading and investment site - www.Sharekhan.com - was also launched on
Feb 8, 2000. This site gives access to superior content and transaction facility to retail
customers across the country. Known for its jargon-free, investor friendly language and high
quality research, the content-rich and research oriented portal has stood out among its
contemporaries because of its steadfast dedication to offering customers best-of-breed
technology and superior market information.
Share khan has one of the best states of art web portal providing fundamental and statistical
information across equity, mutual funds and IPOs. One can surf across 5,500 companies for
in-depth information, details about more than 1,500 mutual fund schemes and IPO data. One
can also access other market related details such as board meetings, result announcements,
FII transactions, buying/selling by mutual funds and much more.
Sharekhan's management team is one of the strongest in the sector and has positioned
Sharekhan to take advantage of the growing consumer demand for financial services
products in India through investments in research, pan-Indian branch network and an
outstanding technology platform. Further, Sharekhan's lineage and relationship with SSKI
Group provide it a unique position to understand and leverage the growth of the financial
services sector. We look forward to providing strategic counsel to Sharekhan's management
as they continue their expansion for the benefit of all shareholders."
SSKI Corporate Finance Private Limited (SSKI) is a leading India-based investment bank
with strong research-driven focus. Their team members are widely respected for their
commitment to transactions and their specialized knowledge in their areas of strength. The
team has completed over US$5 billion worth of deals in the last 5 years - making it among
the most significant players raising equity in the Indian market. SSKI, a veteran equities
solutions company has over 8 decades of experience in the Indian stock markets.
If we experience their language, presentation style, content or for that matter the online
trading facility, we'll find a common thread; one that helps us make informed decisions and
simplifies investing in stocks. The common thread of empowerment is what Sharekhan's all
about!
24
"Sharekhan has always believed in collaborating with like-minded Corporate into forming
strategic associations for mutual benefit relationships" says Jaideep Arora, Director -
Sharekhan Limited.
Sharekhan is also about focus. Sharekhan does not claim expertise in too many things.
Sharekhan's expertise lies in stocks and that's what he talks about with authority. So when he
says that investing in stocks should not be confused with trading in stocks or a portfolio-
based strategy is better than betting on a single horse, it is something that is spoken with
years of focused learning and experience in the’ stock markets. And these beliefs are
reflected in everything Sharekhan does for us! Sharekhan is a part of the SSKI group, an
Indian financial services power house, with strong presence in Retail equities Institutional
equities Investment banking.
Sharekhan’s ground network includes over 588 centres in 148 cities in India, of which 32
are fully-owned branches. [5]
25
PROFILE OF THE COMPANY
Name of the company: Sharekhan Ltd.
Year of establishment: 1925
Headquarter : Sharekhan SSKI
A-206 Phoenix House
Phoenix Mills Compound
Lower panel
Mumbai- Maharashtra, INDIA- 400013
Nature of Business : Service Provider
Services : Depository services, Online services and
Technical Research
Number of Employees: Over 3500
Website : www.Sharekhan.com
Slogan : Your guide to the financial jungle
SSKI [SHANTILAL SHEWANTILAL KANTILAL ISWARNATH LIMITED]
With a legacy of more than 80 years in the stock markets, the SSKI group ventured
into institutional broking and corporate finance 18 years ago. Presently SSKI is one of the
leading players in institutional broking and corporate finance activities. SSKI holds a
sizeable portion of the market in each of these segments. SSKI’s institutional broking arm
accounts for 7% of the market for Foreign Institutional portfolio investment and 5% of all
Domestic Institutional portfolio investment in the country. It has 60 institutional clients
spread over India, Far East, UK and US. Sharekhan is the retail broking arm of SSKI, an
organization with more than eight decades of trust & credibility in the stock market.
26
SSKI GROUP COMPANIES
SSKI Investor
Services Ltd (Sharekhan)
S.S. Kantilal Ishwarlal Securities
SSKI Corporate FinanceIdream Productions
TECHNOLOGY USED BY COMPANY
Sharekhan has always believed in investing in technology to build its business. The
company has used some of the best-known names in the IT industry, like Sun Microsystems,
Oracle, Microsoft, Cambridge Technologies, Nexgenix, Vignette, Verisign Financial
Technologies India Ltd, Spider Software Pvt. Ltd. to build its trading engine and content .
VISION:- To be the best retail brokering Brand in the retail business of stock market.
MISSION:- To educate and empower the individual investor to make better investment decisions through quality advice and superior service.
27
Branches all over India : -
Market Share
Sharekhan enjoyed about 20 per cent market share in Web business (Internet trading) in
stock markets. Three years ago, Web trading showed lot of promise but with the market
witnessing a downturn, there was not much interest among retail customers. [6]
28
Services provided by sharekhan
EQUITIES & DERIVATIVES
PORTFOLIO MANAGEMENT
DEPOSITORY SERVICES
COMMODITIES RESEARCH
29
COMMODITIES
IPO, MUTUAL FUNDS
AREAS OF INVESTMENT THROUGH SHAREKHAN
Derivative
Commodity
Equity
Currency
DERIVATIVE MARKETS
Financial markets are, by nature, extremely volatile and hence the risk factor is an important
concern for financial agents. To reduce this risk, the concept of derivatives comes into the
picture. Derivatives are products whose values are derived from one or more basic variables
called bases. These bases can be underlying assets (for example forex, equity, etc), bases or
reference rates. For example, wheat farmers may wish to sell their harvest at a future date to
eliminate the risk of a change in prices by that date. The transaction in this case would be
the derivative, while the spot price of wheat would be the underlying asset.
Development of exchange-traded derivative
Derivatives have probably been around for as long as people have been trading with one
another. Forward contracting dates back at least to the 12th century, and may well have been
around before then. Merchants entered into contracts with one another for future delivery of
specified amount of commodities at specified price. A primary motivation for pre-arranging
a buyer or seller for a stock of commodities in early forward contracts was to lessen the
possibility that large swings would inhibit marketing the commodity after a harvest.
30
31
The need for a derivative market
The derivative market performs a number of economic functions:
1. They help in transferring risks from risk adverse people to risk oriented people.
2. They help in the discovery of future as well as current prices.
3. They catalyze entrepreneurial activity.
4. They increase the volume traded in markets because of participation of risk averse People
in greater numbers.
5. They increase savings and investment in the long run.
COMMODITY
Although commodity derivatives command a humble share of 6% in the derivatives segment
across the world, yet these record high volumes in the markets the world over compared to
equity derivatives. In an era where risks to investments are on the rise, India needs to switch to
commodity derivatives and also to weather derivatives (when these are launched), if it needs to
top the list of developed nations. Of course with the other asset classes offering attractive
returns, "Why Commodities?" is the inevitable question that pops in one's mind today, more so
considering that the BSE Sensitive Index is scaling new highs by the day. Well, despite offering
relatively lower returns, commodity derivatives provide unique money-making opportunities to
a wider section of market participants, starting from planters to exporters, importers et al. And to
the agrarian Indian population commodities are obviously not new, nor are the advantages of
trading in them unknown.
No balance sheet, P&L statement, EBITDA and reading between the lines.
Commodity trading is about the simple economics of supply and demand.
Supports are known, only resistance matters! Minimum support price acts as a
statutory support for many commodities.
No Dollar-Rupee premiums/discounts. No hedging on the NYMEX. Indian
commodity derivatives hedge both forex and commodity specific risks at a single
cost.
32
No breaking of heads over market direction. Seasonality patterns quiet often provide
clue to both short- and long-term players.
No scam, no price rigging. Commodity trading comes with nil insider trading and
company specific risk.
EQUITY
Trading accounts
With a Sharekhan online trading account you can buy and sell shares in an instant. Any time
you want, from anywhere you like. A Sharekhan online trading account comes with a
depository participant account where you can keep all your shares, in safe custody with
National Securities Depository.
You can also link a Sharekhan online trading account to an Internet banking account of your
choice, so that you can move cash in and out of this account easily, without the bother of
writing cheques all the time.Sharekhan offers two types of trading accounts to suit your
trading habits: Sharekhan Classic account and Sharekhan speed trade account.
CURRENCY
Currency trading means to trade in currency of different countries and price varies because
of supply and demand.
Sharekhan is providing offline currency trading facility
33
Types of Accounts in Sharekhan Limited
Sharekhan offers two types of trading account for its clients
1. Classic Account
The Classic Account enables customers to trade online on the NSE and the BSE, invest in
IPO and Mutual Funds and access all the research and transaction reports through
Sharekhan's website. This account allow investors 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. This
account is suitable for the retail investors.
This account comes with the following features:
a) Online trading account for investing in Equities and Derivatives
b) Free trading through Phone (Dial-n-Trade)
c) Integration of: online Trading + Saving Bank + De-mat Account.
d) Instant cash transfer facility against purchase & sale of shares.
e) Instant order and trade confirmations by e-mail.
f) Single screen interface for cash and derivatives. [6]
2- Speed Trade AccountThis is an internet-based software application, which enables one to buy and sell in an
instant. It is ideal for active traders and jobbers who transact frequently during day's session
to capitalize on intra-day price movement. This account has the following features:
a) Instant order Execution and Confirmation.
b) Single screen trading terminal for NSE Cash, NSE F&O & BSE.
c) Real-time streaming quotes, tic-by-tic charts.
d) Market summary (Cost traded scrip, highest value etc')
e) Hot keys similar to broker's terminal.
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f) Alerts and reminders.
g) Back-up facility to place trades on Direct Phone line. [6]
3. Trade TigerTrade tiger is a next-generation online trading product that brings the power of broker's
terminal to customer pc. It is session to capitalize on intra-day price movement. Trade tiger
is an internet -based application available on a CD, which provides everything a trader needs
on one screen.
Key Features:-
a) A single platform for multiple exchange BSE & NSE (Cash & F&o), MCX,
NCDEX, Mutual Funds, IPOs.
b) Multiple Charts with Tick by Tick Intraday and End of Day Charting powered with
various Studies.
c) Graph Studies include Average, Band- Bollinger, Know Sure Thing, MACD, RSI,
etc.
d) Apply studies such as Vertical, Horizontal, Trend, Retracement & Free lines.
e) User can save his own defined screen as well as graph ternplate, that is, saving the
layout for future use.
f) User-defined alert settings on an input Stock Price trigger[6]
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PROCESS ON ACCOUNT OPENING
LEAD MANAGEMENT SYSTEM (LMS)/ REFERENCES
CONTACT
TELEPHONE AND PERSONAL VISIT
APPOINMENT
DEMONSTRATION
AGREE DISAGREE NO
DOCUMENTATION
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FILLING THE FORM
SUBMISSION THE FORM
LOGIN OF THE FORM
SENDING ACCOUNT OPNING KIT TO CUSTOMER
TRADING
37
DOCUMENTATION:
Pan Card (mandatory)
Residence Proof (Permanent)
Passport
Pan Card
Driving License
Voter's ID
MAPIN UIN Card
Passport (valid)
Driving License (valid)
Bank Statement (latest)
Telephone Bill (latest)
Electricity Bill (latest)
Ration Card
Flat Maintenance Bill (latest)
Insurance Policy (latest)
Leave-License/Purchase Agreement
Two Photographs (Passport size)
38
ACCOUNT OPENING CHARGES
For classic account Cheque of Rs. 750/= In Favor of Sharekhan Ltd. or Rs. 500/= or
375/= in case of corporate offer.
For Speed trade Account Cheque of Rs. 1000/= In Favor of Sharekhan Ltd.
CHARGE STRUCTURE OF SHAREKHAN
Charge Classic Account Speed Trade Account
Account Opening Rs. 750/- Rs. 1000/-
Monthly Commitment Nil Rs. 500/-
Brokerages Intraday – 0.10% - 0.5%
Delivery – 0.50% - 0.25%
Intraday – 0.10% - 0.5%
Delivery – 0.50% - 0.25%
DEPOSITORY CHARGES OF SHAREKHANAnnual Maintenance Charges (AMC) Rs. NIL first year
Rs. 300/= p.a. from second year onward
Brokerage:
0.10 % Plus Taxes for Each leg of Intra-day trade
0.50 % Plus Taxes for trades resulting in delivery
Minimum Brokerage Intra Day per Share:
5 Paisa each leg (buy or sell) for Intra-day Trades (For e.g. on an Rs 20 Scrip, brokerage
@0.1% = 2 p, but there is a min chargeable amt of 5 p).
39
CLOSURE OF ACCOUNT
CLOSURE ON CLIENT’S REQUEST
A DP can close a depository account on receipt of an application in the prescribed format.
The application should be made by the account holder or by all the joint-holders. An
account can be closed only when there is no balance in the account. In case there is any
balance in the account sought to be closed, the following steps are necessary.
(a) Re-materialization of all securities standing to the credit of the account at the
time of making the application for closure; or
(b) Transferring the balance to the credit of another account opened by the same
account holder(s) either with the same participant or with a different participant.
Before closing the account the DP should ensure that all pending transactions
have been settled. The request for closure should be processed only after ensuring
that there is unbalance lying in the account.
CONSOLIDATION OF ACCOUNT
Some clients could have opened multiple accounts to dematerialize their shares held
in multiple combination and sequence of names. However, they may not need so
many accounts after they have dematerialized their shares and may want to bring all
their share holdings into one or fewer accounts. This can be achieved by using
normal off market transfer instruction.
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CLOSURE BY DP
The DP may also initiate closure of a client's account if the client has defaulted in
performing its obligations laid out in the client-participant agreement. The
participant should give sufficient notice to the client before initiating closure of his
account. The notice should clearly state the reasons for closure of account. The
process of closing account in such a case is the same that of client-initiated closure.
CLOSURE /SHIFTING OF CLEARING ACCOUNT
A clearing member may transfer its clearing account from one DP to another DP. For
this, simultaneously applications have to be made for closure of account to the
earlier DP and for opening of new clearing member account to the new DP. On
receipt of the application, the new DP forwards the application to the depository for
approval and allotment of a new CM-BP-ID. Once the new CM-BP-ID is allotted,
the new DP opens a new clearing account and intimates the depository about the new
client-ID. On receipt of intimation from the new participant, the depository advises
the old DP to close the account. The old DP then closes the account and intimates the
clearing member. All payout of securities, subsequent to closure of old clearing
account, take place in the new account
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SHAREKHAN SERVICES Dial-N-Trade
Along with enabling access for your trade online, the Classic and Speed trade Account also
gives you our Dial-n-trade services. With this service, all you have to do is dial our
dedicated phone lines 1-800-22-7500 and 39707500.
Features Of Dial –N-Trade
– Dedicated toll free number for order placements.
– Automatic fund transfer with phone banking(only with Citibank)
– Simple and secure IVR based system fro authentication.
– No wait time. On entry of phone Id and TPIN, the call is transferred.
– Trusted, professional advice of Tel.-brokers who offer undiluted sharekhan research inputs.
– After- hours order placement facility (only between 9 a.m. to 9:55 a.m. and 3:30 p.m. to 6 p.m.)
IPO ON-Line
Can apply all the forthcoming IPO online for free
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Research tips
Company provide 4-6 e-mails to their customers per day. These are :
– Pre Market: Pre-market report covering views, events and more.
– Daring Derivatives: Covers Futures & Options commentary and trading calls
– High Noon: It is aimed at traders; this technical daily newsletter carries Punters Calls and Smart Chart. It’s released at noon to be acted upon during the course of the day 31
– Post-Market Report: Updates you days happening...
– Eagle Eye: is aimed at traders; this technical daily newsletter carries Punters Calls, Hit List and Smart Chart. It’s released at the end of the day to be acted on following day
– Investor Eye: is aimed at investors; this fundamental daily newsletter carries most important news reports, research update on our Stock Idea and other fundamental reports.
– Value Line: A fundamental monthly newsletter, Sharekhan Value Line is targeted at investors and is a wrap-up of the month gone by.
– Market Outlook: a monthly offering discussing our outlook on the market
– Sharekhan Special: specialized reports on unique market opportunities like dividend-yielding stocks and value stocks, or analysis of major
events like the Union Budget, and reports on other market related themes or trends.
– Stock Ideas: aimed at investors and it presents our best stock picks in today's market.
– Mutual Fund Reports: covers monthly update on what’s in what’s out, Top Fund Picks and Industry Update.
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Online trade in shares
Sharekhan customers can online trade through there computers, through Internet during the market timings
Online fund transferWe have tie up with ten banks for online fund transferring i.e. ICICI, HDFC,
IDBI, CITI, UNION Bank of India, Bank of India OBC, INDUSIND, Yes Bank and
UTI bank for online money transfer.
• Value line magazine
A monthly investment report based on fundamental research with
Stock Ideas
Stock Updates
Earnings Guide
Stock Records
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Mutual Fund Guide
Market Outlook
Sector Updates
MARKETING STRATEGIES OF THE COMPANY
Tele Calling :
The company uses the tele-calling/ phone calling to reach the customer, which is interested.
This is the most important technique to save time and giving demo of the company’s
product through making call in order to know the customer interest towards the product.
This is the strategy with which one can motivate customer to go for the product and etc.
LMS:
It is leads management system which means leads are generated by the customer who wants
to purchase the product of the company. Company provides facility to the customer on
online to fill the registration form through which the company’s executives can provide
more information to the customer.
Yellow Pages :Yellow pages are used to gather data for making calls so that customer who did not fine time
and are unaware of the product can know about the product. Customers are given freedom to
ask question related to the products this is the technique used to increase the awareness of
the company.
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Canopy’s:
This is the most important technique used by sharekhan securities to market its product in
different areas of the city, company put their canopies and customer who are willing to
know about the product come forward and provide best of their knowledge. Besides these
companies executives ask customer to fill the questionnaire that tells the company about the
levels of brand awareness. It also increases the product awareness because it is generally put
at the crowdies places like near main markets, cinema s, hotels, ATM or etc where people
come in good numbers.
Direct Marketing :
Sharekhan executive’s reaches to the does of the customer by fixing appointments with the
interested customer, they describe the details of the product. Executive give demonstration
of the products so that customer can understand better.
Advertising:
Advertising is the most important tool of increasing awareness of the product and this is the
most widely used technique by the company to tell about the new features and new lunch by
giving briefing of the product.
Sharekhan use banners, distribution of pamphlets, and advertisement in newspapers,
magazines.
References:
Sharekhan strategy is to satisfy the customer in terms of their need by providing them
timely services and knowledge about the trade in equities, mutual funs by giving tips for
investment advises through e-mails or toll free calls for this purpose customers are
provided relationship manager who give investment advise and also make transaction on
46
their behalf on demand. B satisfying customer executives ask their references that not only
increase the awareness but also increase the good will of the company.
Competitiveness:
The company is innovative and uses the latest technology to improve the product to fulfill
the demands of the customers. Sharekhan make it easy for the customer to make online
transaction of shares. The company is competitive in terms of the product price and facilities
it offers to the customer.
Internet:
Company provides detailed information about the products on Internet so that customer can
know about the product easily and completely.
HIERARCHY IN SHAREKHAN
There are 14 main hierarchical levels in Sharekhan:
1) Trainees
2) Super trainees
3) Sales executives
4) Assistant sales manager
5) Area sales manager :
6) City sales manager
7) Assistant branch manager
8) Branch manager
9) Regional head
10) Cluster head
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11) Business head
12) Country head
13) Directors
14) CEO
SWOT ANALYSIS
A SWOT analysis focuses on the internal and external environments, examining strengths
and weaknesses in the internal environment and opportunities and threats in the external
environment.
STRENGTHS
Services
As a product Sharekhan is a extremely innovative product with very less cost. Services like
online trading facility, institutional and domestic broking, customized research reports with
almost 80% efficiency etc give Sharekhan an edge over its competitors. Sharekhan provides
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other support services that make retail investors more confident and assured with their
trading. SMS alerts (allowing traders and investors to make the most of the available
opportunities), Softer, intangible features like imagery, equity driving preference. Through
efficient trading processes Investors can place their orders directly on the Internet, do all the
information seeking and basically own the investing process.
Distribution Network
Sharekhan with almost 250 branches spread across 123 cities beefed up by comprehensive
online research, advice and transaction services. In near future expect to make 200000+
retail customers being serviced through centralized call centre / web solution,
60 branches/semi branches servicing affluent/aggressive traders through highly skilled
financial advisors, 250 independent investment managers/franchisees servicing 50000
highly valued clients, strong advisory role through Fundamental & technical research and
new initiatives are being made in Portfolio Management Services & Commodities trading.
Marketing
Sharekhan is a product of SSKI, a veteran equities solutions company with over decades of
experience in the Indian stock markets. Sharekhan does not claim expertise in too many
things. Share khan’s expertise lies in stocks and that's what it talks about with authority. So
when he says that investing in stocks should not be confused with trading in stocks or a
portfolio-based strategy is better than betting on a single horse, it is something that is spoken
with years of focused learning and experience in the stock markets.
Products
Company’s product line is quite flexible in the sense that there is a product for every kind of
investors. Also all the products cover all the loopholes of all the products offered by the
other competitors like low cost, user-friendly online trading services etc.
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WEAKNESS
Customer Satisfaction
As far as customer satisfaction goes Sharekhan has to tighten their socks. Many broking
houses catering to heavy investors or small segment of the market can afford to and does
provide relationship managers for their customers, who can understand the trading needs of
individual customers, and advise accordingly. However, a broking house like Sharekhan,
which caters to the mass segment, is in no position to provide relationship managers for
individual customers
.
Branding
Though the company has a efficient products but large part of investment interested
population does not know the company. The most basic expectation for a trader or investor
when one begins trading is that one must get timely delivery of shares and proceeds from
sale of shares. Also ones cash balances with the broker must be safe and secure. Though this
confidence in the broker comes with time and experience, good and transparent practices
also play a major role in imbibing confidence in traders.
Competition from banks
Most of the banks due to good branding have the faith of the customers of their banking
database. So they enjoy the liberty of huge database and customers find it more reliable to
trade there rather than with a unknown broker. Also banks like HDFC Bank and ICICI Bank
have the advantage of linking the trading accounts of their customers to saving accounts.
This makes trading easier, and at the same time a trader withdraws exactly as much money
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from his account as is needed to complete the trade. Similarly sales proceeds are credited
directly to saving account.
OPPORTUNITIES
The external environment analysis may reveal certain new opportunities for profit and growth.
Ever-increasing market
After the NSE brought the screen based trading system stock markets are now more secured
which has attracted lot of retail investors and the demand is increasing day by day. This has
resulted in improved liquidity and heavy volumes on transactions. Sharekhan is one of the
early entrants here. As to how much it will roar and how swift it can swoop on the market,
the future alone can answer such queries. Sharekhan has been a mega player and is known
for being a mover of stocks. It is also known for putting big deals through and enjoys good
networking with the FIIs. It has been dynamic enough to move with the times and capture
the opportunities that the market throws up from time to time.
Improving Technology
In country like India technology is always improving which gives the company a chance to
keep on improving their product with time whereas for the small players like local brokers it
will be difficult to keep the same pace as the changing technology. Also with SEBI lying
down some strict guidelines small brokers are finding it harder to retain the customers with
no research department and small capital. The traditional business model is highly
dependent on a large network of sub-brokers, and many established players may not have
systems (technology, customer service, etc.) capable of directly servicing so many retail
customers.
Unfulfilled needs of the customers
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With so many competitors offering their products in the market but no one is able to
completely satisfy the customers. Some have the problem of lack of information or some
were scared of volatility of the stock markets. Sharekhan has the opportunity to tap this
unsatisfied set of customers and to make hold in the market. The Internet serves to break all
barriers to information, as it offers an extremely hassle-free investing platform. And,
Sharekhan hopes to fully utilize and capitalize on this platform. This original idea by
Sharekhan itself was born out of the consumer's need for a more transparent, easy to
understand and convenient option of investing in stocks.
Education Level
The education level in the country is improving year after year as far as technology goes.
With that the understanding of the stock market is also increasing and a lot of retail
investors are steeping in the markets which are being shown by increasing volumes,
transactions and indices.
THREATS
New Competitors
A lot of new competitors are trying to enter the market in this bullish run to taste the flavor
of this cherry. This is creating a lot of competition for large players like Sharekhan and it is
creating little confusion in the minds of the customers about the services provided by the
broker. Also many banking firms are entering into the market with huge investment.
Competitors like ICICI, kotak, HDFC, 5-paisa etc. are posing a lot of threats to the
company.
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Technology based business
53
Online trading is totally based on the technology, which is quite complex. Typically, the
technology solution has to start from the Internet front-end (or the screen that you see when
you begin trading). Then it needs to get into the 'middle tier' of risk management systems
that assess data from banks and depository participants (DP), calculate client risk at that
point in time, and give the 'Go/No go' advice to the trade. So technology is a kind of threat
because unless until it is working properly it is good but Internet is not that safe. Though a
lot of cyber laws are being made but not yet executed.
PROBLEMS OF THE ORGANISATION
Lack of awareness of Share khan and stock market:
Since the area is not known before it takes lot of time in convincing people to start investing
in shares primarily in IPO’s.
Lack of Techno Savvy people and poor internet penetration
Since most of the people are quite experienced and also they are not techno savvy. Also
Internet penetration is poor in India.
Some respondents are unwilling to talk
Some respondents either do not have time or willing does not respond, as they are quite
annoyed with the phone call.
Inaccurate Leads:
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Sometimes leads are provided which had error in it, which varies from only 5-digit phone
number, some people have registered to know about their personal queries. They are the
unsatisfied clients of the company.
Misleading concepts:
Some people think that as all the shares are in electronic form and they don’t have any
physical proof. Sometimes this leads to a great misconception of the entire process.
Advantages of Sharekhan:
Online trading is very user friendly and one doesn't need any software to access.
They provide good quality of services like daily SMS alerts, mail alerts, stock
recommendations etc.
Sharekhan has ability to transfer funds from most banks. Unlike ICICI Direct, HDFC
etc., so investor not really needs to open an account with a particular bank as it can
establish link with most modern banks.
Awards and Achievements:
A rated among the top 20 wired companies along with Reliance, HUJI, Infosys etc.
by ‘Business Today” January 2004 edition.
Awarded “Top Domestic Brokerage House” four times by Euro Money and Asia
Money.
Pioneers of online trading in India amongst the top 3 online trading websites from
India. Most preferred financial destination amongst online broking customers.
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India’s mot preferred brokers within 5 yrs “ Awaaz Customers Award 2005”
It was Winner of “Best Financial Website” award.
The team has completed over US$5 billion worth of deals in the last 5
years - making it among the most significant players raising equity in the
Indian market.
SSKI, a veteran equities solutions company has over 8 decades of experience in
the Indian stock markets. If we experience their language, presentation style,
content or for that matter the online trading facility, we'll find a common
thread; one that helps us make informed decisions and simplifies
investing in stocks.
Future plan :-
200000 plus retail customers being serviced through centralized call centers / web
solutions.
Branches / Semi branches servicing affluent / aggressive traders through high skills
financial advisor.
250 independent investment managers / franchisee servicing 50000 highly valued
clients.
New initiatives Portfolio Management Services and commodities trading.
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JOB DESCRIPTION
My job as an intern is very simple at sharekhan. It’s more over a learning experience. In the
initial days of training we were told about Sharekhan, organizational structure, history of
Sharekhan, products, Sharekhan research reports, trading techniques, clients, de-mat
account, online trading accounts, learned how to buy and sell shares through these online
terminals, sales technique, Sharekhan’s brokerage.
My job is to trade for myself, analyze the graphs, understanding the trend of markets and
applying techniques taught to us in the training session. We used to trade through live
terminal known as Trade Tiger. Trade Tiger is software of Sharekhan which is given to
customers for trading. Stop loss, hedging, brokerage calculation were some of the
techniques we used while trading.
Beside this we were also asked to complete some sales target of opening a de-mat account
so that we could have practical knowledge about what we have learned. We were sent to
different places to sell de-mat account. Selling so what I had to do is to identify the
prospective client and then try to convince them.
We were provided with some survey forms which we have to get filled by unknown
peoples. Then we have to filter for clients who are willing to trade and hence would be
interested in opening de-mat account. So by this way we make our own leads for the target.
Then with those list of interested client we have contact them through teller calling. We
have to sell them de-mat account with sharekhan. Then if we get some lead, then with that
client we have to fix an appointment in which we have to present sharekhan. Our mentor
accompany with us while demonstrating the software TRADE TIGER to the client. If client
agrees for the account then we have to complete the formalities for opening a De-mat
account.
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Tasks given
To collect the leads.
To do the telle calling and take appointments.
To attend the appointment on prescribed time.
To tell the client about the company and its products.
To tell the client about the advantages of opening a De-mat account with Sharekhan
limited.
To convince the clients to do Online Trading.
To explain him the terms and conditions of the product.
To convince the client to open De-mat account at Sharekhan ltd.
To give a live demo of how the online terminal works.
By means of presentation explaining them how to trade online.
To take signatures of the client on the KYC (know your customer) form.
To collect the documents required to open a De-mat account.
To fill up the KYC form for the customer.
To install the software in the client`s computer.
To make the client trade.
To sell the mutual funds.
To get the references from the client.
To conduct seminars in the banks and good companies.
To submit the daily report of myself and of all the 6 people in my group to the
company guide.
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STRATEGY ADOPTED:-
59
BROKERAGE STRUCTURE OF SHAREKHAN
Brokerage:
INTRADAY DELIVERY
CASH- EQUITIES 0.05% 0.5%
FUTURE AND OPTIONS 0.05%
PREPAID SCHEME 0.025% 0.25%
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COMPARATIVE ANALYSIS OF STOCK BROKERS IN DELHI REGION
1. Religare
2. ICICI direct
3. Angel Broking
4. Indiabulls
On the Basis of brokerages :-
There are the two type of the transaction:-
Intra-day based Delivery based
On the Basis of Charges
ICICI
Direct
Sharekhan Indiabulls Angel Broking Ltd.
A/C opening
Fee
750 750 500 500
Recurring fee
For trading A/C
0 0 0 0
Demat AMC 500 300 0 0
Delivery
Brokerage
75p 50p 50p 50p
Intraday
Brokerage
0.15 0.10 0.10 0.5
Initial margin
Required
Nil Nil Nil 5000
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Angel Broking Ltd. :- Account opening charges are as follows:- Rs.749.But there is no AMC in it.
Share khan ltd:- There is no ACCOUNT OPENING CHARGES but require margin money of Rs
5000 for trading purposes.
ICICI direct:- A one-time charge of Rs. 750 at the time of account opening will be charged .
You may later upgrade your Invest account to an ICICI direct.com share trading account when you desire to trade in equity.
Religare:- There is a nominal charge of Rs. 500 only towards stamp duty, legal and
processing fees for opening the account. This includes the registration and account opening charges. Bank and Depository Participant (DP) account opening charges, if applicable, are payable separately.
Indiabulls:- Account opening charges are Rs. 900. There is no AMC and no margin money is
required.
Comment:-
India Bulls charge maximum account opening charges but there are no such
charges in Share khan pvt. Ltd.
On the Basis of Customer Preferences
According to survey 70 % peoples are satisfied with Share khan Ltd because of their
RM’s facility and power of Share khan Ltd software.
According to survey, Share khan Ltd open new branches for individually handle to
their customer, but in ICICI direct, Religare there is no separate offices for this .So
people prefer Share khan Ltd.
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On The Basis Of Facilities
Basis of difference
Share khan Angel Broking Religare ICICI Direct India bulls
Share trading Yes Yes Yes Yes Yes
Commodity Trading Yes Yes Yes Yes Yes
Demat Opening Right
Yes No Yes Yes Yes
MINIMUM INVESTMENT IN MUTUAL FUND:
INVESTMENT MINIMUM AMOUNT
Mutual Fund (Any Company) 5000
Systematic Investment Plan (Any Company) 500
JOB CHALLENGES
Understanding the share market
Trading with taking a stop loss
Fulfilling the de-mat account target in three months
Identify the prospective clients and convincing them.
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LEARNING EXPERIENCE AND INSIGHT GAIN
Business experience gained
The experience I gained in my Summer Internship Program was unique in every way. I have
gained both kinds of business experiences positive as well as negative. The environment at
Share khan was extremely friendly. The entire staff treated us as if we are the full time
employees there and have been working there for years. We learnt all about share trading.
Even we did online trading ourselves. Doing trading live was a great experience that I
couldn't have ever learnt if I had not joined Share khan. We learnt how market moves,
which move will lead us to profit and which will lead us to loss.
If we had incurred loss, instead of getting sad and depressed we learnt how to become strong
and cover the loss the next day. Online trading taught us the feeling of passion towards our
work. There was hardly any negative experience that I went through. The only one negative
thing was that the organization's environment was over friendly due to which there was a
lack of discipline
I think. Even though punctuality was there but there was no fixed time for lunch or other
activities.
My Summer Internship Program was a total learning experience for me. When we used to
trade every day, we applied new approaches to gain rather than losing money. Each
approach was different from another as market fluctuations were not in our hand. Every time
we had to think of some new concepts and ideas to recover the loss or to gain money.
During the online trading, we applied all our theoretical knowledge that was given to us by
our Corporate Mentor.
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LEARING
During my summer training I have learned
Importance of information technology in the field of stock broking is immense.
The terminal through which the brokers buy and sell shares is software that
completely depends on the internet. For sharekhan this terminal has been designed
by the software company. Buying and selling through internet is fast. As soon as the
prices of the shares goes up or comes down then they can be sold or purchased
instantly within seconds.
In sharekhan limited. I have learned a lot relating to the finance, learned the meaning
of words that are mostly used in the share market.
Learned about various product of sharekhan limited, learned various aspects
regarding share market.
Learned about various product used in the share market especially demat account.
Got the practical knowledge of the market
Learned some marketing techniques also by convincing people to open a demat
account.
Learn to operate TRADE TIGER, a trading software provided by sharekhan.
Trade tiger
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Salient features of trade tiger:
A single platform for multiple exchange BSE & NSE (Cash & F&O), MCX,
NCDEX, Currency, Mutual Funds, IPOs
Multiple Market Watch available on a Single Screen
Multiple Charts with Tick by Tick Intraday and End of Day Charting powered with
various Studies
Graph Studies include Average, Band-Bollinger, Know Sure Thing, MACD etc
Apply studies such as Vertical, Horizontal, Trend, Retracement & Free lines
User-defined alert settings on an input Stock Price trigger
Premium Calculator, Span Calculator
Shortcut key for FAST access to order placemenzts & reports
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Online fund transfer activated with 12 Banks
Trade tiger is my instrument for internship. I have done trading in different market through
this software. We can access our de-mat account through this software. This is share khan’s
one of the best product. Now I am very familiar with this software and can use it efficiently.
Market TimingsTrading on the equities segment takes place on all days of the week (except Saturdays and
Sundays and holidays declared by the Exchange in advance). The market timings of the
equities segment are:
A) Pre-open session
Order entry & modification Open : 09:00 hrs
Order entry & modification Close : 09:08 hrs*
*with random closure in last one minute. Pre-open order matching starts immediately after
close pf pre-open order entry.
B) Regular trading session
Normal / Retail Debt / Limited Physical Market Open : 09:15 hrs
Normal / Retail Debt / Limited Physical Market Close : 15:30 hrs
Block deal session is held between 09:15 hrs and 09:50 hrs
C) The Closing Session is held between 15.40 hrs and 16.00 hrs
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RESEARCH METHOLOGY USED
During the Internship our group member fill a questionnaire to the
public
Sample Size:
In this research 50 respondents are there included.
Research Instrument:
In this research we have used face to face conversation for getting the result.
Que.: Do you invest into stock market?
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Yes No0%
10%
20%
30%
40%
50%
60%
Que: If yes, where do you investing?
Equity Commodity Derivative Currency0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
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Que.:- If yes, from which brokerage house you do trading ?
Indiabulls Angel Broking Sharekhan Others0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Que.: Which way you prefer for trading?
Offline Online0%
10%
20%
30%
40%
50%
60%
70%
70
Que.:-Have you ever heard about Share khan broking firm?
Yes No0%
10%
20%
30%
40%
50%
60%
70%
Que.:- Are you interested because we have scheme going on?
Yes No0%
10%
20%
30%
40%
50%
60%
70%
71
Que.:- If yes, can we take an appointment?
Yes No0%
10%
20%
30%
40%
50%
60%
ANALYSIS OF DATA COLLECTED
Student’s work profile (role and responsibilities) :
This work was at SHAREKHAN LTD. with a profile of sales trainee. This profile offers
us to understand the need of customer and provide them the best deal possible with
maximization of the profit, both for the company as well as for the customer.
Generation of leads:
Since this work was new in the field so this work had to start from scratch and generate new
leads to sustain in the market.
Cold calling is one of the trusted ways of getting to the customers without meeting
them. Although the rate of conversion remained very less, for cold calling the quality and
accent remains a very important criterion. This activity gives us mixed result. This activity
often got success and generated many leads through it but it also landed me in awkward
72
position where the customer were in different mood and made us hear words for which a
marketer should be always prepared to hear. Corporate calls always remained more difficult
to crack with respect to retail sector.
Analysis of Calling :
The first step in the project execution as mentioned above was the Tele calling of the
inactive clients to start trading again. The total number of clients called was 90 which are
categorize on the basis of their response to the calls, the responses are categorized into 5
broad categories because the responses were open ended and was not easy to summarize all
the responses as such so these responses are slightly modified and categorized accordingly
to analyze. The responses of all the clients are recorded as shown in the table below :
RESPONSE OF CLIENT :-
Status Of Calling No of Respondent
Interested 15
Call Not Receiving 25
Interested In Currency 5
Meeting Done 5
Not Interested 40
Interpretation of the Data
From the given data it can be easily identified that the percentage of the clients not
interested in trading is the highest and the second highest is of the clients who were
not receiving the call and they can be considered as not interested clients but we
cannot make a guess so we have kept those clients in different segment. If we
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consider from the data of the highest two categories than we can say that almost 72%
of the clients are not interested.
Only 22% of the clients found to be interested in further working with the company
and want to activate their accounts out of which some wants relaxation in the
brokerage and need a RM so that they might stay updated.
5% of the clients was done with the meetings with RMs and was ready to invest
again.
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Interested Call not Received Interested in Currency
Meeting Done Not Interested0
5
10
15
20
25
30
35
40
45
Response From Client
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During the Internship we also conduct a research on account Holder
of Sharekhan Pvt. Ltd . For the feedback purpose
Sample Size :-
In this research 50 account holder are included .
Research Instrument:
In this research we have used telephonic conversation for getting the feedback of account holder .
Que.: In Which Product do you trade?
Equity Derivative Commodity Currency0
5
10
15
20
25
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Que .: Through Which do you trade ?
Through Trade Tiger
Through Phone0%
10%
20%
30%
40%
50%
60%
Que.: Do Trade Tiger help you improve your Trading?
Yes No0%
10%
20%
30%
40%
50%
60%
77
Que.: If Yes ….then rate this?
Highly Satisfied Satisfied Niether Sat./Nor Unsat.
Unsatisfied0
2
4
6
8
10
12
14
16
18
20
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CONCLUSION AND RECOMMENDATION
SHAREKHAN is one such place or organization where a customer is fully satisfied by the
varied range of services provided by them which includes De-mating of Shares, Stock
Broking, investments in equities, derivatives, commodities, Mutual Funds, Currency, best
research reports. They also provide beneficial schemes even to small investors and they also
have the facility of Online De-mat Services. It is a place which is providing various services
all under one roof it is also known to be a Sharekhan's Share Shops.
The major merits or strengths of Sharekhan, being the co-operative attitude of the staff
members towards themselves as well as towards the clients. They help the customers by
providing correct information about the various services and about various products
available with them. Thus, we can say that SHAREKHAN is one of the most prestigious
financial organisations of India as far as:-
Service space
Attitude of staff
Dissemination of information
Promptness of query handling
Processing time
Value added services are concerned and therefore the satisfaction level of its
customers is also very high.
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Recommendations Sharekhan needs to make its marketing team strong and also it should increase
marketing activities such as promotional campaigns.
Sharekhan should educate the investors about their products and services by
organizing classes, corporate presentations, taking part in consumer fairs and
organizing events.
Sharekhan can also use Newspapers and Local New Channels as a medium of
advertising.
Due to investors of online trading there has been greater benefit to the investors as
they could sell/buy shares as and when required and that to with online trading.
The broker’s has a greater scope than compared to the earlier times because of
invention of online trading.
Sharekhan should widen their reach tools as they need more relationship managers
who will tell the customers about investment.
The company should also come up with schemes wherein brokerage is less than the
earlier existing schemes. These schemes should be provided to those customers who
do not trade.
Sharekhan should tie up with more banks for online fund transfer that reduces the
paper work for customer and ease in trading.
The company can increase the customer base if the account opening charges it
reduces from 750 to 500, which will boost the competition.
The company should revise the advertising strategy to increase its brand awareness. I
suggest making advertisement on television so that maximum market can be
targeted.
The company should focus on the customer satisfaction and provide them with full
care and advice even after they get a De-mat alc opened.
Although people have heard about online trading of securities still people have great
doubt about its operational feasibility as they are not clear about the concept. Special
awareness programs using various media mixes should be carried out to remove fear
from the minds of people and make it familiarize.
ANNEXURE80
At the Market: - An order to buy or sell at the best price possible at the time an
order reaches the trading pit.
Bid: - A bid subject to immediate acceptance made on the floor of exchange to buy a
definite number of futures contracts at a specific price.
Buy on Close: - To buy at the end of trading session at the price within the closing
range.
Buy on opening: - To buy at the beginning of trading session at a price within the
opening range.
Call: - An option that gives the buyer the right to a long position in the underlying
futures at a specific price, the call writer (seller) may be assigned a short position in
the underlying futures if the buyer exercises the call.
Cross hedge: - When a cash commodity is hedged by using futures contract of other
commodity.
Delivery: - The tender and receipt of actual commodity, or in case of agriculture
commodities, warehouse receipts covering such commodity, in settlement of futures
contract. Some contracts settle in cash (cash delivery). In which case open positions
are marked to market on last day of contract based on cash market close.
Derivatives: - These are financial contracts, which derive their value from an
underlying asset. (Underlying assets can be equity, commodity, foreign exchange,
interest rates, real estate or any other asset.) Four types of derivatives are trades
forward, futures, options and swaps. Derivatives can be traded either in an exchange
or over the counter.
Exchange: - Central market place for buyers and sellers. Standardized contracts
ensure that the prices mean the same to everyone in the market. The prices in an
exchange are determined in the form of a continuous auction by members who are
acting on behalf of their clients, companies or themselves.
Forward contract: - It is an agreement between two parties to buy or sell an asset at
a future date for price agreed upon while signing agreement. Forward contract is not
traded on an exchange. This is oldest form of derivative contract. It is traded in OTC
Market. Not on an exchange. Size of forward contract is customized as per the terms
of agreement between buyer and seller. The contract price of forward contract is not
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transparent, as it is not publicly disclosed. Here valuation of open position is not
calculated on a daily basis and there is no requirement of MTM. Liquidity is the
measure of frequency of trades that occur in a particular commodity forward contract
is less liquid due to its customized nature. In forward contracts, counter- party risk is
high due to customized & bilateral nature of the transaction. Forward contract is not
regulated by any exchange. Forward contract is generally settled by physical
delivery. In this case delivery is carried out at delivery center specified in the
customized bilateral agreement.
Futures Contract:- It is an agreement between two parties to buy or sell a specified
and standardized quantity and quality of an asset at certain time in the future at price
agreed upon at the time of entering in to contract on the futures exchange. It is
entered on centralized trading platform of exchange. It is standardized in terms of
quantity as specified by exchange. Contract price of futures contract is transparent as
it is available on centralized trading screen of the exchange. Here valuation of
Mark-to-Mark position is calculated as per the official closing price on daily basis
and MTM margin requirement exists. Futures contract is more liquid as it is traded
on the exchange. In futures contracts the clearing-house becomes the counter party to
each transaction, which is called novation. Therefore, counter party risk is almost
eliminated. A regulatory authority and the exchange regulate futures contract.
Futures contract is generally cash settled but option of physical settlement is
available. Delivery tendered in case of futures contract should be of standard
quantity and quality as specified by the exchange.
Futures Market:-It facilitates buying and selling of standardized contractual
agreements (for future delivery) of underlying asset as the specific commodity and
not the physical commodity itself. The formulation of futures contract is very
specific regarding the quality of the commodity, the quantity to be delivered and date
for delivery. However it does not involve immediate transfer of ownership of
commodity, unless resulting in delivery. Thus, in futures markets, commodities can
be bought or sold irrespective of whether one has possession of the underlying
commodity or not. The futures market trade in futures contracts primarily for the
purpose of risk management that is hedging on commodity stocks or forward buyers
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and sellers. Most of these contracts are squared off before maturity and rarely end in
deliveries.
Hedging: - Means taking a position in futures market that is opposite to position in
the physical market with the objective of reducing or limiting risk associated with
price.
In the money: - In call options when strike price is below the price of underlying
futures. In put options, when the strike price is above the underlying futures. In-the-
money options are the most expensive options because the premium includes
intrinsic value.
Market to Market: - The practice of crediting or debating a trader’s account based
on daily closing prices of the futures contracts he is long or short.
Option: - It gives right but not the obligation to the option owner, to buy an
underlying asset at specific price at specific time in the future.
Out-of-the money: - Option calls with the strike prices above the price of the
underlying futures, and puts with strike prices below the price of the underlying
futures.
Put: - In options the buyer of a put has the right to continue a short position in an
underlying futures contract at the strike price until the option expires; the seller
(writer) of the put obligates himself to take a long position in the futures at the strike
price if the buyer exercises his put.
Ratio hedging: - Hedging a cash position with futures on a less or more than one-
for-one basis.
BIBLIOGRAPHY
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Wikipedia, (d.n.a), “bombay stock exchange”, retrieved from
http://en.wikipedia.org/wiki/National_Stock_Exchange_of_India, 2013
Wikipedia, (d.n,a) “national stock exchange of india” retrieved from
“http://en.wikipedia.org/wiki/National_Stock_Exchange_of_India”,
Current scenario of Indian stock market, (June, 2013) posted in IFTA, retrieved from
http://www.ifta.in/the-current-stockmarket-scenario-in-india,
Company profile, sharekhan official website, (d.n.a), retrieved from, http://www.sharekhan.com/Products/TradeTiger/Default.aspx?sourceid=18&campid=61,
about equities, NSE, (d.n.a), retrieved from,
http://www.nseindia.com/products/content/equities/equities/about_equities.htm,
From Slideshare website
http://www.slideshare.net/AdnanAli25/savedfiles?s_title=sharekhan-ppt&user_login=nikipatel23From Slideshare Website
http://www.slideshare.net/AdnanAli25/savedfiles?s_title=sharekhan-ppt&user_login=Saumyajeetpatra
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