Edelweiss

Introduction

Whether it’s retiring early, saving for children’s education,

paying off a loan or to live a secured and satisfied life everyone has

dreams they can achieve by investing their savings. Def of investing the purchase of a financial product or other item of value with an expectation of

favorable future returns.  However, the question that arises is that, should

one leave his money tucked away in the bank or plough it into the

stock market where the potential for higher returns is greater but the

chances of losing money is higher? Deciding where to invest depends

on one`s attitude towards risk (one`s capacity to take risk and one`s

tolerance towards risk) and the investment horizon and non-

availability of guaranteed-return investment products. In such a

scenario, investing in equity, which offers returns that are higher than

the inflation rate, help to build wealth and to improve the standard of

living.

India is a developing economy .its prospering in all

spheres. Share market is a compelling determinant of the economy and the

financial situation of a country. Ever since the liberalization, privatization and

globalization,the foreign investment in our country is booming. Share market is a

clear indicator of the developing trend prevailing in our country.Statistics reveal

that the trade volume has been increasing continuously,coupled with the ups and

downs which is a nature of share trading. We are living in an interlinked

world.with the growing volume of trade,it has become a necessity that people are

aware of the intricacies of the web world.

SENSEX the benchmark indicator of share trading has more than tripled ever since

on line share trading commenced.it has become imperative to be a participant of

this mode of trading.

Recently,the crisis in the financial market resulted in global inflation.the share

market was a clear indicator of the prevailing prices.

Share trading is a way of faster earning and losing money. In the recent years,a

volatile market could be witnessed. In the desire to earn money in a quick

manner,more and more people have ventured out into share trading. Lack of

awareness of many investors have made them loose lakhs of money in the stock

market. Wise plays by many others have made them earn in crores.

Where the American NASDAQ is in the commanding position,hongkong,Tokyo

etc are some of the asian exchanges being quoted repeatedly when it comes to

news about the share market. SENSEX is not far behind.indian bourses are also

often quoted.

Electronic trading or online trading eliminates the need for physical trading

floors.brokers can trade from their offices,using fully automated screen based

processes. Their workstations are connected to a stock exchange’s central

computer via satellite using Very Small Aperture Terminus(VSATs). The orders

placed by brokers reach the exchange’s central computer and are matched

electronically.

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 redemption, 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 . Usually there is a central Location at least for

recordkeeping, but trade is less and less linked to such a physical place, as

modern markets are electronic networks, which gives them advantages of speed

and cost of transactions. Trade on an exchange is by definition done in the

primary market and subsequent trading is done in the secondary market. Supply

and demand in stock markets is driven by various factors which, as in free markets,

affect the price of stocks(see stock valuation).There is usually no compulsion to

issue stock via the stock exchange itself, nor must stock be subsequently traded

on the exchange. Such trading is said to be off exchange or over-the-

counter.This is the usually way that bonds are traded. Increasingly more and

more stock exchanges are part of a global market for securities.

A.] The role of the stock exchange

Raising capital for businessess

The stock exchange provides companies with the facility to raise capital for

expansion through selling shares to the investing public.

Mobilizing savings for investment

When people draw their savings and invest in shares, it leads to a more rational

allocation of resources because funds, which could have been consumed, or kept in

idle deposits with banks are mobilized and redirected to promote business

activity with benefits for several economic growth and higher productivity

levels.

Facilitate company growth

Companies view acquisitions as an opportunity to expand product lines,

increase distribution channels, hedge against volatility, increase its market

share, or acquire other necessary business assets. A takeover bid or a merger

agreement through the stock market is one of the simplest and most common

ways to company growing by acquisition or fusion.

Redistribution of wealth

By giving a wide spectrum of people a chance to buy shares and therefore

become part-owners (shareholders) of profitable enterprises the stock market

helps to reduce large income inequalities .Both casual and professional stock

investors through stock price rise and dividends get achance to share in the profits

of promising business that were set up by other people.

Corporate governance-

By having a wide and varied scope of owners , companies generally tend to

improve on their management standards and efficiency in order to satisfy the

demands of these shareholders and the more stringent rules for public

corporations by public stock exchange and the government . Consequently , it is

alleged that public companies (companies that are owned by shareholders who are

members of the general public and trade shares on public exchange) tend to have

better management records than privately-held companies (those companies

where shares are not publicly traded ,often owned by the company founders and /

or their families and heirs , or otherwise by a small group of investors) .

However , some well-documented cases are known where it is alleged that their

has been considerable slippage in corporate governance on the part of some public

companies .

Creates investment opportunities for small investors

As opposed to their businesses that require huge capital outlay , investing in shares

is open to both the large and small stock investors because a person buys the

number of shares they can afford . Therefore the Stock Exchange provides an

extra source of income to small savers.

Government raises capital for development projects

Governments at various levels may decide to borrow money in order to finance

infrastructure projects such as sewage and water treatment works or housing

estates by selling another category of securities known as bonds .These bonds can

be raised through the Stock Exchange whereby members of the public buy them ,

thus loaning money to the government . The issuance of such municipal bonds can

obviate the need to directly tax the citizens in order to finance development ,

although by securing such bonds with the full faith and credit of the government

instead of with collateral , the result is that the government must tax the citizens or

otherwise raise additional funds to make any regular coupon payments and refund

the principal when the bonds mature.

Barometer of the economy

At the stock exchange , share prices rise and fall depending , largely , on market

forces. Share prices rise tend to rise or remain stable when companies and the

economy in general show signs of stability and growth .An economic recession ,

depression , or financial crisis could eventually lead to a stock market crash .

Therefore the movement of the general tend in the economy .The listing

requirements are the set of conditions imposed by a given stock exchange upon

companies that want to be listed on that exchange .Such conditions sometimes

include minimum number of shares outstanding , minimum market capitalization ,

and minimum annual income.

ABOUT EDELWEISS (atleast 10 pages)

MY WORK AT EDELWEISS

At EDELWEISS , initially we were imparted process and product knowledge. We were given sufficient time to know about the products and also about sales and distribution channel. We had to work with the sales representatives and think of ways of improving the sales and distribution channel and implementing them. The main aim was to increase sales and for this, different ways were tried and implemented. We were provided with database and had to make calls from the data. Company activity was also one of the major sources for generating business. Initially they even accompanied sales representatives to the clients place. Main objective was to know the need of the customer and how to fulfill that in the best way.

The project dealt with various fields like:

1. Demat account2. ESOP

This experience helped me to understand the basic functioning of the EDELWEISS as a Broking House and I came to know the products of Edelweiss. The Training Sessions were held by different persons . We were assigned targets to sell the ESOP funding facility and Demat A/c of Edelweiss. The training for ESOP was conducted by Mr. Hiren Doshi from Edelweiss Broking Ltd. The training for De-mat was conducted by _________of Reliance Money. These training gave me an insight into the products that Edelweiss deals in. The best learning experience was that I started from the very basics of getting to that position and not from the position itself. This helped me get useful insight and understanding of various financial products, the market details about them and the benefits provided by them to the customers.

Our task was divided in 4 phases:

1. Product knowledge: This included the theoretical knowledge about the field and products which needed to be marketed.

2. Pitching in retail sector: This included the implementation of the knowledge imparted to us and the test of our marketing skills. Initially we were accompanied by other sales executive so that we can learn how to deal with the customers and understand their need. This also enhanced our interpersonal skills and confidence level.

3. Implementation in retail sector and pitching in corporate: By the start of this phase we were confident enough about the pitching and fulfilling the needs of the customer in the retail sector. This also included of the ways we should pitch the corporate.

4. Implementation at corporate levels: This included the implementation of the all the knowledge and ways learnt for the pitching and extracting business out of the corporate.

With the end of 8 weeks every phase was completed and it gave us the real experience of retail as well as corporate world.

COMPETITORS OF EDELWEISS.

TRADING PORTAL

Online trading refers to buying and selling of the

shares/stocks/contracts/bonds with the use of internet. In this shares

are not issued in physical form rather they are transferred in the

dematerialized form in the Demat account directly.

DEMAT ACCOUNT

In India, a Demat account , the abbreviation for dematerialized

account , is a type of banking account which dematerializes paper-

based physical stock shares. The dematerialized account is used to

avoid holding physical shares: the shares are bought and sold through

a broker. This account is popular in India. The Securities and

Exchange Board of India (SEBI) mandates a Demat account for share

trading above 500 shares. As of April 2006, it became mandatory that

any person holding a Demat account should posses a Permanent

Account Number (PAN).

What are the benefits of opening a Demat account?

Demat account has become a necessity for all categories of investors

for the following reasons/ benefits:

SEBI has made it compulsory for trades in almost all scrip’s to

be settled in Demat mode. Although, trades up to 500 shares

can be settled in physical form, physical settlement is virtually

not taking place for the apprehension of bad delivery on

account of mismatch of signatures, forgery of signatures, fake

certificates, etc.

It is a safe and convenient way to hold securities compared to

holding securities in physical form..

No stamp duty is levied on transfer of securities held in Demat

form.

Instantaneous transfer of securities enhances liquidity.

It eliminates delays, thefts, interceptions and subsequent

misuse of certificates.

Change of name, address, registration of power of attorney,

deletion of deceased's name, etc. - can be effected across

companies by one single instruction to the DP.

Each share is a market lot for the purpose of transactions - so

no odd lot problem.

Any number of securities can be transferred/delivered with one delivery order. Therefore, paperwork and signing of multiple transfer forms is done away with. It facilitates taking advances against securities on low margin/low interest.

DEMAT ACCOUNT

There are many broking houses doing business in India and they

charge a brokerage on every transaction made online or offline.

(Buying and Selling are treated as separate transaction). Reliance

Money’s advantage over others is that it’s charging the lowest

brokerage in the market which is just 1 paisa on every executive trade

irrespective of the volume traded. Reliance Money, the brokerage and

distribution arm of Reliance ADA Group, aims to tap investors in the

smaller towns and cities through a flat fee structure. The current

leaders in the retail broking segment like ICICI Direct, India Infoline

and Indiabulls offer a ‘pay per use’ model where the customer pays a

percentage of the amount transacted by him. Reliance Money’s

brokerage rates are quite competitive.

The new wonder is Reliance Money's pre-paid card for stock

market brokerage. Reliance Money, the financial services division of

Anil Dhirubhai Ambani Group-promoted Reliance Capital, is bringing

to the market pre-paid cards in denominations of Rs500, Rs1000,Rs

2500,Rs 5000,Rs 10000.

These cards would offer brokerage at one-third of the rate being

charged by institutional and individual brokerage houses. Sample this.

For a pre-paid card worth Rs500, an investor can trade up to Rs2 lakh

in both non delivery and delivery option.

The Rs1000 worth pre-paid card, total trading limit would reach

Rs 1 crore, of which Rs 90lakhs is for the non delivery segment and

Rs10 lakh for delivery-based activities.

For Rs2500 pre-paid card, total trading limit is fixed at Rs3

crore,of which Rs2.70crore is for the non delivery option and Rs 30

lakhs for delivery option.

For the Rs 5000 pre-paid card, the total trading limit is Rs 7

crore,out of which Rs 6.30crore is for non delivery option and Rs 70

lakhs for delivery option.

For the Rs.10000 pre paid card,the total trading limit is Rs

20crore,out of which Rs 18 crore is for non delivery option and Rs 2

crore for delivery option.

Reliance Money offers most competitive brokerage rates -  0.01paise for

intraday trades and 0.05paise for delivery trades. 

Target low level of retail penetration in India - less than 3 per

cent of household financing savings makes it into equity markets

Reliance Money consumers can trade in equities, commodities

and offshore Investments , IPO’s,  Mutual Funds, Insurance, Money

transfer and Money Changing - all through single window, both off-

line and online.

Reliance Money has already tied-up with CMC Capital Plc UK to

offer offshore Investment products to Indian consumers as per

guidelines.

RESEARCH METHEDOLOGY

Objective of research;

The main objective of this project is concerned with getting the opinion of

people regarding demat account and other financial products, to target them

and create awareness while with the generation of leads.

I have tried to explore the general opinion about the products and services

provided by Edelweiss.It also covers why/ why not investors are availing the

services of financial advisors.

It is also shown that what are demat a/c, mutual funds and life insurance and

how they work.

Scope of the study:

The research was carried out in Cuttack city only. I have visited people randomly

nearby my locality, different shopping malls, small retailers etc.

Data sources:

Research is totally based on primary data. Secondary data can be used only for the

reference. Research has been done by primary data collection, and primary data

has been collected by interacting with various people. The secondary data has been

collected through various journals and websites.

Sampling:

Sampling procedure:

The sample is selected in a random way, irrespective of them being investor or not

or availing the services or not. It was collected through mails and personal visits to

the known persons, by formal and informal talks and through filling up the

questionnaire prepared.

Sample size:

The sample size of my project is limited to 100 only.

Sample design:

Data has been presented with the help of pie charts.

1. Preference of Investment

Fig.1 Result of Preference of

Investment

Interpretation: This shows that although the mutual funds market is on

the rise yet, the most favored investment continues to be in the Share Market. So,

with a more transparent system, investment in the Stock Market can definitely be

increased.

1. Awareness on Online Share Trading

Interpretation: With the increase in cyber education, the awareness towards

online share trading has increased by leaps and bounds. This awareness is expected

to increase further with the increase in Internet education.

1. Preference of investing in stock market

Fig. 2 Result of Awareness of Online Share Trading

45%

20%

35%

Chart Title

High returns and high risk

Tax Benefits

Short term gain from investment

INTERPRETATION: The study shows that most of the people prefer to invest in

stock market because of high risk and high return whereas some other try to

capture the short term gain from investment. But a very few section of people

invest because of the benefits they gain in tax.

4. Awareness of Edelweiss as a Brand

Fig.3 Result of Awareness of Edelweiss as a

Brand

Interpretation: This pie-chart shows that Edelweiss has a reasonable

amount of Brand awareness in terms of a premier Retail stock broking company.

This brand image should be further leveraged by the company to increase its

market share over its competitors.

. Awareness of Edelweiss Facilities

Interpretation: Although there is sufficiently high brand equity among the

target audience yet, it is to be noted that the customers are not aware of the

facilities provided by the company meaning thereby, that, the company should

concentrate more towards promotional tools and increase its focus on product

awareness rather than brand awareness.

Fig .4 Result of Awareness of Edelweiss

Facilities