Equity Analysis of Karvy

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INDEX

S.NO. PARTICULARS PAGE NO.

Chapter 1. Introduction

Company Profile

Chapter 2. Equity Analysis

Chapter 3. Analysis of Indian companies

a. Infosys

b. Dena Bank

c. Dr.reddy

d. Maruti Suzuki

e. RCOM

f. HDIL

Chapter 4 Bibliography


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CHAPTER I - INTRODUCTION


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INTRODUCTION

India is a developing country. Nowadays many people are interested to invest in financial

markets especially on equities to get high returns, and to save tax in honest way. Equities are playing a

major role in contribution of capital to the business from the beginning. Since the introduction of shares

concept, large numbers of investors are showing interest to invest in stock market.

In an industry plagued with skepticism and a stock market increasingly difficult to predict and

contend with, if one looks hard enough there may still be a genuine aid for the Day Trader and Short

Term Investor.

The price of a security represents a consensus. It is the price at which one person agrees to buy

and another agrees to sell. The price at which an investor is willing to buy or sell depends primarily on

his expectations. If he expects the security's price to rise, he will buy it; if the investor expects the price

to fall, he will sell it. These simple statements are the cause of a major challenge in forecasting security

prices, because they refer to human expectations. As we all know firsthand, humans expectations are

neither easily quantifiable nor predictable. If prices are based on investor expectations, then knowing

what a security should sell for (i.e., fundamental analysis) becomes less important than knowing what

other investors expect it to sell for. That's not to say that knowing what a security should sell for isn't

important--it is. But there is usually a fairly strong consensus of a stock's future earnings that the

average investor cannot disprove

Fundamental analysis and technical analysis can co-exist in peace and complement each other. Since all

the investors in the stock market want to make the maximum profits possible, they just cannot afford to

ignore either fundamental or technical analysis.


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NEED OF THE STUDY

To start any business capital plays major role. Capital can be acquired in two ways by issuing

shares or by taking debt from financial institutions or borrowing money from financial

institutions. The owners of the company have to pay regular interest and principal amount at the

end.

Stock is ownership in a company, with each share of stock representing a tiny piece of

ownership. The more shares you own, the more of the company you own. The more shares you

own, the more dividends you earn when the company makes a profit. In the financial world,

ownership is called Equity.

Advantages of selling stock:

A company can raise more capital than it could borrow.

A company does not have to make periodic interest payments to creditors.

A company does not have to make principal payments

Stock/shares play a major role in acquiring capital to the business in return investors are paid

dividends to the shares they own. The more shares you own the more dividends you receive.

The role of equity analysis is to provide information to the market. An efficient market relies on

information: a lack of information creates inefficiencies that result in stocks being misrepresented (over

or under valued). This is valuable because it fills information gaps so that each individual investor does

not need to analyze every stock thereby making the markets more efficient.


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OBJECTIVES OF THE STUDY

The objective of this project is to deeply analyze our Indian Automobile Industry for investment

purpose by monitoring the growth rate and performance on the basis of historical data.

The main objectives of the Project study are:

Detailed analysis of Automobile industry which is gearing towards international standards

Analyze the impact of qualitative factors on industrys and companys prospects

Comparative analysis of three tough competitors TATA Motors, Maruti Suzuki and Mahindra

and Mahindra through fundamental analysis.

Suggesting as to which companys shares would be best foran investor to invest.


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SCOPE OF THE STUDY

The scope of the study is identified after and during the study is conducted. The project is based on

tools like fundamental analysis and ratio analysis. Further, the study is based on information of last five

years.

The analysis is made by taking into consideration four companies i.e. TATA Motors, Maruti

Suzuki , Ashok Leyland and Hero Honda.

The scope of the study is limited for a period of five years.

The scope is limited to only the fundamental analysis of the chosen stocks.


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METHODOLOGY

Research design or research methodology is the procedure of collecting, analyzing and

interpreting the data to diagnose the problem and react to the opportunity in such a way where the costs

can be minimized and the desired level of accuracy can be achieved to arrive at a particular conclusion.

The methodology used in the study for the completion of the project and the fulfillment of the project

objectives.

The sample of the stocks for the purpose of collecting secondary data has been selected on the

basis of Random Sampling. The stocks are chosen in an unbiased manner and each stock is chosen

independent of the other stocks chosen. The stocks are chosen from the automobile sector.

The sample size for the number of stocks is taken as 3 for fundamental analysis of stocks as

fundamental analysis is very exhaustive and requires detailed study.


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CHAPTER II - REVIEW OF LITERATURE


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WHATS THIS EQUITY ANALYSIS?

Professional investor will make more money & less loss than, who let their heart rule. Their head

eliminate all emotions for decision making. Be ruthless & calculating, you are out to make money.

Decision should be based on actual movement of share price measured both in money & percentage

term & nothing else. Greed must be avoided patience may be a virtue, but impatience can frequently be

profitable.

In Equity Analysis anticipated growth, calculations are based on considered FACTS & not on

HOPE. Equity analysis is basically a combination of two independent analyses, namely fundamental

analysis & Technical analysis. The subject of Equity analysis, i.e. the attempt to determine future share

price movement & its reliability by references to historical data is a vast one, covering many aspect from

the calculating various FINANCIAL RATIOS, plotting of CHARTS to extremely sophisticated

indicators.

A general investor can apply the principles by using the simplest of tools: pocket calculator,

pencil, ruler, chart paper & your cautious mind, watchful attention. It should be pointed out that, this

equity analysis does not discuss how to buy & sell shares, but does discuss a method which enables the

investor to arrive at buying & selling decision. The financial analysts always need yardsticks to evaluate

the efficiency & performances of any business unit at the time of investment. Fundamental analysis is

useful in long term investment decision. In Fundamental analysis a companys goodwill, its

performances, liquidity, leverage, turnover, profitability & financial health was checked & analysis with

the help of ratio analysis for the purpose of long term successful investment.

Technical analysis refers to the study of market generated data like prices & volume to determine

the future direction of prices movements.

Technical analysis mainly seeks to predict the short term price travels. The focus of technical

analysis is mainly on the internal market data, i.e. prices & volume data. It appeals mainly to short termtraders.

It is the oldest approach to equity investment dating back to the late 19th century.


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EQUITY ANALYSIS.

ENVIRONMENT & ECONOMICAL ANALYSIS.

FUNDAMENTAL TECHNICAL

ANALYSIS ANALYSIS


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FUNDAMENTAL ANALYSIS

Fundamental analysis is a method of forecasting the future price movements of a financial

instrument based on economic, political, environmental and other relevant factors and statistics that willaffect the basic supply and demand of whatever underlies the financial instrument. It is the study of

economic, industry and company conditions in an effort to determine the value of a companys stock.

Fundamental analysis typically focuses on key statistics in companys financial statements to determine

if the stock price is correctly valued. The term simply refers to the analysis of the economic well-being

of a financial entity as opposed to only its price movements.

Fundamental analysis is the cornerstone of investing. The basic philosophy underlying the

fundamental analysis is that if an investor invests re.1 in buying a share of a company, how much

expected returns from this investment he has.

The fundamental analysis is to appraise the intrinsic value of a security. It insists that no one

should purchase or sell a share on the basis of tips and rumors. The fundamental approach calls upon the

investors to make his buy or sell decision on the basis of a detailed analysis of the information about the

company, about the industry, and the economy. It is also known as top -down approach. This approach

attempts to study the economic scenario, industry position and the company expectations and is also

known as economic-industry-company approach (EIC approach)

Thus the EIC approach involves three steps:

1. Economic analysis

2. Industry analysis

3. Company analysis
http://www.investopedia.com/terms/f/fundamentalanalysis.asphttp://www.investopedia.com/terms/f/fundamentalanalysis.asphttp://www.investopedia.com/terms/f/fundamentalanalysis.asp


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1. ECONOMIC ANALYSIS

The level of economic activity has an impact on investment in many ways. If the economy grows

rapidly, the industry can also be expected to show rapid growth and vice versa. When the level of

economic activity is low, stock prices are low, and when the level of economic activity is high, stock

prices are high reflecting the prosperous outlook for sales and profits of the firms. The analysis of macro

economic environment is essential to understand the behavior of the stock prices.

The commonly analyzed macro economic factors are as follows:

Gross Domestic Product (GDP): GDP indicates the rate of growth of the economy. It represents the

aggregate value of the goods and services produced in the economy. It consists of personal consumption

expenditure, gross private domestic investment and government expenditure on goods and services and

net exports of goods and services. The growth rate of economy points out the prospects for the industrial

sector and the return investors can expect from investment in shares. The higher growth rate is more

favorable to the stock market.

COMPANYANALYSIS

INDUSTRYANALYSIS

ECONOMICANALYSIS


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Savings and investment: It is obvious that growth requires investment which in turn requires

substantial amount of domestic savings. Stock market is a channel through which the savings are made

available to the corporate bodies. Savings are distributed over various assets like equity shares, deposits,

mutual funds, real estate and bullion. The savings and investment patterns of the public affectthe stock

to a great extent.

Inflation: Along with the growth of GDP, if the inflation rate also increases, then the real growth would

be very little. The effects of inflation on capital markets are numerous. An increase in the expected rate

of inflation is expected to cause a nominal rise in interest rates. Also, it increases uncertainty of future

business and investment decisions. As inflation increases, it results in extra costs to businesses, thereby

squeezing their profit margins and leading to real declines in profitability.

Interest rates: The interest rate affects the cost of financing to the firms. A decrease in interest rate

implies lower cost of finance for firms and more profitability. More money is available at a lower

interest rate for the brokers who are doing business with borrowed money. Availability of cheap funds

encourages speculation and rise in the price of shares.

Tax structure: Every year in March, the business community eagerly awaits the Governments

announcement regarding the tax policy. Concessions and incentives given to a certain industry

encourage investment in that particular industry. Tax reliefs given to savings encourage sav ings. The

type of tax exemption has impact on the profitability of the industries.

Infrastructure facilities: Infrastructure facilities are essential for the growth of industrial and

agricultural sector. A wide network of communication system is a must for the growth of the economy.

Regular supply of power without any power cut would boost the production. Banking and financial

sectors also should be sound enough to provide adequate support to the industry. Good infrastructure

facilities affect the stock market favorably.


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2.INDUSTRY ANALYSIS

An industry is a group of firms that have similar technological structure of production and

produce similar products and Industry analysis is a type of business research that focuses on the status ofan industry or an industrial sector (a broad industry classification, like "manufacturing"). Irrespective of

specific economic situations, some industries might be expected to perform better, and share prices in

these industries may not decline as much as in other industries. This identification of economic and

industry specific factors influencing share prices will help investors to identify the shares that fit

individual expectations

Industry Life Cycle: The industry life cycle theory is generally attributed to Julius Grodensky. The life

cycle of the industry is separated into four well defined stages.

Pioneering stage: The prospective demand for the product is promising in this stage and the

technology of the product is low. The demand for the product attracts many producers to produce

the particular product. There would be severe competition and only fittest companies survive this

stage. The producers try to develop brand name, differentiate the product and create a product

image. In this situation, it is difficult to select companies for investment because the survival rate

is unknown.

Rapid growth stage: This stage starts with the appearance of surviving firms from the pioneering

stage. The companies that have withstood the competition grow strongly in market share and

financial performance. The technology of the production would have improved resulting in low

cost of production and good quality products. The companies have stable growth rate in this

stage and they declare dividend to the shareholders. It is advisable to invest in the shares of these

companies.

Maturity and stabilization stage: the growth rate tends to moderate and the rate of growth would

be more or less equal to the industrial growth rate or the gross domestic product growth rate.Symptoms of obsolescence may appear in the technology. To keep going, technological innova-

tions in the production process and products should be introduced. The investors have to closely

monitor the events that take place in the maturity stage of the industry.


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Decline stage: demand for the particular product and the earnings of the companies in the

industry decline. It is better to avoid investing in the shares of the low growth industry even in

the boom period. Investment in the shares of these types of companies leads to erosion of capital.

Growth of the industry: The historical performance of the industry in terms of growth and profitability

should be analyzed. The past variability in return and growth in reaction to macro economic factors

provide an insight into the future.

Nature of competition: Nature of competition is an essential factor that determines the demand for the

particular product, its profitability and the price of the concerned company scrips. The companies' ability

to withstand the local as well as the multinational competition counts much. If too many firms are

present in the organized sector, the competition would be severe. The competition would lead to a

decline in the price of the product. The investor before investing in the scrip of a company should

analyze the market share of the particular company's product and should compare it with the top five

companies.

SWOT analysis: SWOT analysis represents the strength, weakness, opportunity and threat for an

industry. Every investor should carry out a SWOT analysis for the chosen industry. Take for instance,

increase in demand for the industrys product becomes its strength, presence of numerous players in themarket, i.e. competition becomes the threat to a particular company. The progress in R & D in that

industry is an opportunity and entry of multinationals in the industry is a threat. In this way the factors

are to be arranged and analyzed.


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3. COMPANY ANALYSIS

In the company analysis the investor assimilates the several bits of information related to the

company and evaluates the present and future values of the stock. The risk and return associated with thepurchase of the stock is analyzed to take better investment decisions. The present and future values are

affected by a number of factors.

Competitive edge of the company: Major industries in India are composed of hundreds of individual

companies. Though the number of companies is large, only few companies control the major market

share. The competitiveness of the company can be studied with the help of the following;

Market share: The market share of the annual sales helps to determine a companys relative

competitive position within the industry. If the market share is high, the company would be able

to meet the competition successfully. The companies in the market should be compared with like

product groups otherwise, the results will be misleading.

Growth of sales: The rapid growth in sales would keep the shareholder in a better position than

one with stagnant growth rate. Investors generally prefer size and growth in sales because the

larger size companies may be able to withstand the business cycle rather than the company of

smaller size.

Stability of sales: If a firm has stable sales revenue, it will have more stable earnings. The fall in

the market share indicates the declining trend of company, even if the sales are stable. Hence the

stability of sales should be compared with its market share and the competitors market share.

Earnings of the company: Sales alone do not increase the earnings but the costs and expenses of the

company also influence the earnings. Further, earnings do not always increase with increase in sales.

The companys sales might have increased but its earnings per share may decline due to rise in costs.

Hence, the investor should not only depend on the sales, but should analyze the earnings of thecompany.


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Financial analysis: The best source of financial information about a company is its own financial

statements. This is a primary source of information for evaluating the investment prospects in the

particular companys stock. Financial statement analysis is the study of a companys financial statement

from various viewpoints. The statement gives the historical and current information about the

companys operations. Historical financial statement helps to predict the future and the current

information aids to analyze the present status of the company. The two main statements used in the

analysis are Balance sheet and Profit and Loss Account.

The balance sheet is one of the financial statements that companies prepare every year for their share-

holders. It is like a financial snapshot, the company's financial situation at a moment in time. It is

prepared at the year end, listing the company's current assets and liabilities. It helps to study the capital

structure of the company. It is better for the investor to avoid a company with excessive debt component

in its capital structure.

From the balance sheet, liquidity position of the company can also be assessed with the information on

current assets and current liabilities.

Ratio analysis: Ratio is a relationship between two figures expressed mathematically. Financial ratios

provide numerical relationship between two relevant financial data. Financial ratios are calculated from

the balance sheet and profit and loss account. The relationship can be either expressed as a percent or as

a quotient. Ratios summarize the data for easy understanding, comparison and interpretations.

Ratios for investment purposes can be classified into profitability ratios, turnover ratios, and leverage

ratios. Profitability ratios are the most popular ratios since investors prefer to measure the present profit

performance and use this information to forecast the future strength of the company. The most often

used profitability ratios are return on assets, price earnings multiplier, price to book value, price to cash

flow, and price to sales, dividend yield, return on equity, present value of cash flows, and profit margins.


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a) Return on Assets (ROA)

ROA is computed as the product of the net profit margin and the total asset turnover ratios.

ROA = (Net Profit/Total income) x (Total income/Total Assets)

This ratio indicates the firm's strategic success. Companies can have one of two strategies: cost

leadership, or product differentiation. ROA should be rising or keeping pace with the company's

competitors if the company is successfully pursuing either of these strategies, but how ROA rises will

depend on the company's strategy. ROA should rise with a successful cost leadership strategy because

the companys increasing operating efficiency. An example is an increasing, total asset, turnover ratio as

the company expands into new markets, increasing its market share. The company may achieve

leadership by using its assets more efficiently. With a successful product differentiation strategy, ROA

will rise because of a rising profit margin.

b) Return on Investment (ROI)

ROI is the return on capital invested in business, i.e., if an investment Rs 1 crore in men,

machines, land and material is made to generate Rs. 25 lakhs of net profit, then the ROI is 25%. The

computation of return on investment is as follows:

Return on Investment (ROI) = (Net profit/Equity investments) x 100

As this ratio reveals how well the resources of a firm are being used, higher the ratio, better are

the results. The return on shareholders investment should be compared with the return of other si milar

firms in the same industry. The inert-firm comparison of this ratio determines whether the investments

in the firm are attractive or not as the investors would like to invest only where the return is higher.

c) Return on Equity

Return on equity measures how much an equity shareholder's investment is actually earning. The

return on equity tells the investor how much the invested rupee is earning

from the company. The higher the number, the better is the performance of the company and suggests

the usefulness of the projects the company has invested in.

The computation of return on equity is as follows:


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Return on equity = (Net profit to owners/value of the specific owner's

Contribution to the business) x 100

The ratio is more meaningful to the equity shareholders who are invested to know profits earned

by the company and those profits which can be made available to pay dividend to them.

d) Earnings per Share (EPS)

This ratio determines what the company is earning for every share. For many investors, earnings

are the most important tool. EPS is calculated by dividing the earnings (net profit) by the total number of

equity shares.

The computation of EPS is as follows:

Earnings per share = Net profit/Number of shares outstanding

The EPS is a good measure of profitability and when compared with EPS of similar other companies, it

gives a view of the comparative earnings or earnings power of a firm. EPS calculated for a number of

years indicates whether or not earning power of the company has increased.

e) Dividend per Share (DPS)

The extent of payment of dividend to the shareholders is measured in the form of dividend per

share. The dividend per share gives the amount of cash flow from the company to the owners and is

calculated as follows:

Dividend per share = Total dividend payment / Number of shares outstanding

The payment of dividend can have several interpretations to the shareholder. The distribution of

dividend could be thought of as the distribution of excess profits/abnormal profits by the company. On

the other hand, it could also be negatively interpreted as lack of investment opportunities. In all,

dividend payout gives the extent of inflows to the shareholders from the company.


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f) Dividend Payout Ratio

From the profits of each company a cash flow called dividend is distributed among its

shareholders. This is the continuous stream of cash flow to the owners of shares, apart from the price

differentials (capital gains) in the market. The return to the shareholders, in the form of dividend, out of

the company's profit is measured through the payout ratio. The payout ratio is computed as follows:

Payout Ratio = (Dividend per share / Earnings per share) * 100

The percentage of payout ratio can also be used to compute the percentage of retained earnings.

The profits available for distribution are either paid as dividends or retained internally for business

growth opportunities. Hence, when dividends are not declared, the entire profit is ploughed back into the

business for its future investments.

g) Dividend Yield

Dividend yield is computed by relating the dividend per share to the market price of the share. The

market place provides opportunities for the investor to buy the company's share at any point of time. The

price at which the share has been bought from the market is the actual cost of the investment to the

shareholder. The market price is to be taken as the cum-dividend price. Dividend yield relates the actual

cost to the cash flows received from the company. The computation of dividend yield is as follows:

Dividend yield = (Dividend per share / Market price per share) * 100

High dividend yield ratios are usually interpreted as undervalued companies in the market. The market

price is a measure of future discounted values, while the dividend per share is the present return from the

investment. Hence, a high dividend yield implies that the share has been under priced in the market. On

the other hand a low dividend yield need not be interpreted as overvaluation of shares. A company that

does not pay out dividends will not have a dividend yield and the real measure of the market price will

be in terms of earnings per share and not through the dividend payments.


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h) Price/Earnings Ratio (P/E)

The P/E multiplier or the price earnings ratio relates the current market price of the share to the

earnings per share. This is computed as follows:

Price/earnings ratio = Current market price / Earnings per share

This ratio is calculated to make an estimate of appreciation in the value of a share of a company

and is widely used by investors to decide whether or not to buy shares in a particular company. Many

investors prefer to buy the company's shares at a low P/E ratio since the general interpretation is that the

market is undervaluing the share and there will be a correction in the market price sooner or later. A

very high P/E ratio on the other hand implies that the company's shares are overvalued and the investor

can benefit by selling the shares at this high market price.

i) Debt-to-Equity Ratio

Debt-Equity ratio is used to measure the claims of outsiders and the owners against the firms

assets.

Debt-to-equity ratio = Outsiders Funds / Shareholders Funds

The debt-equity ratio is calculated to measure the extent to which debt financing has been used in

a business. It indicates the proportionate claims of owners and the outsiders against the firms assets.

The purpose is to get an idea of the cushion available to outsiders on the liquidation of the firm.

Technical analysis:-

Technical analysis refers to the study of market generated data like prices & volume to

determine the future direction of prices movements.

Technical analysis mainly seeks to predict the short term price travels. It is important criteria for

selecting the company to invest. It also provides the base for decision-making in investment. The one of

the most frequently used yardstick to check & analyze underlying price progress. For that matter a verity

of tools was consider.

This Technical analysis is helpful to general investor in many ways. It provides important & vitalinformation regarding the current price position of the company.

Technical analysis involves the use of various methods for charting, calculating & interpreting

graph & chart to assess the performances & status of the price. It is the tool of financial analysis, which

not only studies but also reflecting the numerical & graphical relationship between the important

financial factors.


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The focus of technical analysis is mainly on the internal market data, i.e. prices & volume data. It

appeals mainly to short term traders. It is the oldest approach to equity investment dating back to the late

19th century.

It uses charts and computer programs to study the stocks trading volume and price movements

in the hope of identifying a trend.

In fact the decision made on the basis of technical analysis is done only

after inferring a trend and judging the future movement of the stock on

the basis of the trend. Technical Analysis assumes that the market is efficient and the price has already

taken into consideration the other factors related to the company and the industry. It is because of this

assumption that many think technical analysis is a tool, which is effective for short-term investing.


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CHAPTER III - INDUSTRY PROFILE


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FINANCIAL MARKET:

Financial markets are helpful to provide liquidity in the system and for smooth functioning

of the system. These markets are the centers that provide facilities for buying and selling of financial

claims and services. The financial markets match the demands of investment with the supply of

capital from various sources.


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According to functional basis financial markets are classified into two types.

They are:

Money markets (short-term)

Capital markets (long-term)

According to institutional basis again classified in to two types. They are

Organized financial market

Non-organized financial market.

The organized market comprises of official market represented by recognized institutions, bank

and government (SEBI) registered/controlled activities and intermediaries. The unorganized market is

composed of indigenous bankers, moneylenders, individual professional and non-professionals.

MONEY MARKET:

Money market is a place where we can raise short-term capital.

Again the money market is classified in to

Inter bank call money market

Bill market and

Bank loan market Etc.

E.g.; treasury bills, commercial papers, CD's etc.

CAPITAL MARKET:

Capital market is a place where we can raise long-term capital.

Again the capital market is classified in to two types and they are

Primary market and

Secondary market.

E.g.: Shares, Debentures, and Loans etc.


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PRIMARY MARKET:

Primary market is generally referred to the market of new issues or market for

mobilization of resources by the companies and government undertakings, for new projects as also

for expansion, modernization, addition, diversification and up gradation. Primary market is also

referred to as New Issue Market. Primary market operations include new issues of shares by new and

existing companies, further and right issues to existing shareholders, public offers, and issue of debt

instruments such as debentures, bonds, etc.

The primary market is regulated by the Securities and Exchange Board of India (SEBI a

government regulated authority).

Function:

The main services of the primary market are origination, underwriting, and distribution.

Origination deals with the origin of the new issue. Underwriting contract make the shares predictable

and remove the element of uncertainty in the subscription. Distribution refers to the sale of securities

to the investors.

The following are the market intermediaries associated with the market:

1. Merchant banker/book building lead manager

2. Registrar and transfer agent

3. Underwriter/broker to the issue

4. Adviser to the issue

5. Banker to the issue

6. Depository

7. Depository participant

Investors protection in the primary market:

To ensure healthy growth of primary market, the investing public should be protected. The

term investor protection has a wider meaning in the primary market. The principal ingredients of

investors protection are:

Provision of all the relevant information

Provision of accurate information and

Transparent allotment procedures without any bias.


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SECONDARY MARKET

The primary market deals with the new issues of securities. Outstanding securities are traded

in the secondary market, which is commonly known as stock market or stock exchange. The

secondary market is a market where scrips are traded. It is a market place which provides liquidity

to the scrips issued in the primary market. Thus, the growth of secondary market depends on the

primary market. More the number of companies entering the primary market, the greater are the

volume of trade at the secondary market. Trading activities in the secondary market are done through

the recognized stock exchanges which are 23 in number including Over The Counter Exchange of

India (OTCE), National Stock Exchange of India and Interconnected Stock Exchange of India.

Secondary market operations involve buying and selling of securities on the stock exchange

through its members. The companies hitting the primary market are mandatory to list their shares on

one or more stock exchanges in India. Listing of scrips provides liquidity and offers an opportunity

to the investors to buy or sell the scrips.

The following are the intermediaries in the secondary market:

1. Broker/member of stock exchangebuyers broker and sellers broker

2. Portfolio Manager

3. Investment advisor

4. Share transfer agent

5. Depository

6. Depository participants.


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STOCK MARKETS IN INDIA:

Stock exchanges are the perfect type of market for securities whether of government and

semi-govt bodies or other public bodies as also for shares and debentures issued by the joint-stock

companies. 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.

Definition of a stock exchange:

Stock exchange means a body or individuals 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

History of Stock Exchanges:

The only stock exchanges operating in the 19th century were those of Mumbai setup in 1875

and Ahmedabad set up in 1894. These were organized as voluntary non-profit-marking associations

of brokers to regulate and protect their interests. Before the control on securities under the

constitution in 1950, it was a state subject and the Bombay securities contracts (control) act of 1925

used to regulate trading in securities. Under this act, the Mumbai stock exchange was recognized in

1927 and Ahmedabad in 1937. During the war boom, a number of stock exchanges were organized.

Soon after it became a central subject, central legislation was proposed and a committee headed by

A.D.Gorwala went into the bill for securities regulation. On the basis of the committees

recommendations and public discussion, the securities contract (regulation) act became law in 1956.


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Functions of Stock Exchanges:

Stock exchanges provide liquidity to the listed companies. By giving quotations to the listed

companies, they help trading and raise funds from the market. Over the hundred and twenty years

during which the stock exchanges have existed in this country and through their medium, the central

and state government have raised crores of rupees by floating public loans. Municipal corporations,

trust and local bodies have obtained from the public their financial requirements, and industry, trade

and commerce- the backbone of the countrys economy-have secured capital of crores or rupees

through the issue of stocks, shares and debentures for financing their day-to-day activities,

organizing new ventures and completing projects of expansion, diversification and modernization.

By obtaining the listing and trading facilities, public investment is increased and companies were

able to raise more funds. The quoted companies with wide public interest have enjoyed some

benefits and assets

valuation has become easier for tax and other purposes.

The major stock exchanges are:

NSE(National Stock Exchange):

The National Stock Exchange of India Limited has genesis in the report of the High Powered

Study Group on Establishment of New Stock Exchanges, which recommended promotion of a

National Stock Exchange by financial institutions (FIs) to provide access to investors from all

across the country on an equal footing. Based on the recommendations, NSE was promoted by

leading Financial Institutions at the behest of the Government of India and was incorporated in

November 1992 as a tax-paying company unlike other stock exchanges in the country. On its

recognition as a stock exchange under the Securities Contracts (Regulation) Act, 1956 in April 1993,

NSE commenced operations in the Wholesale Debt Market (WDM) segment in June 1994. The

Capital Market (Equities) segment commenced operations in November 1994 and operations in

Derivatives segment commenced in June 2000


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NSE's mission is setting the agenda for change in the securities markets in India. The NSE was set-

up with the main objectives of:

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 greater

opportunities.

BSE(Bombay Stock Exchange):

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.


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A Governing Board having 20 directors is the apex body, which decides the policies and regulates

the affairs of the Exchange. The Governing 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

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.

REGULATORY FRAME WORK OF STOCK EXCHANGE

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

The Securities And Exchange Board of India

Governing body


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Members of the stock exchange:

The securities contract regulation act 1956 has provided uniform regulation for the admission of

members in the stock exchanges. The qualifications for becoming a member of a recognized stock

exchange are given below:

The minimum age prescribed for the members is 21 years.

He should be an Indian citizen.

He should be neither a bankrupt nor compound with the creditors.

He should not be convicted for fraud or dishonesty.

He should not be engaged in any other business connected with a company.

He should not be a defaulter of any other stock exchange.

The minimum required education is a pass in 12th standard examination.

SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI)

The securities and exchange board of India was constituted in 1988 under a resolution of

government of India. It was later made statutory body by the SEBI act 1992.according to this act,

the SEBI shall constitute of a chairman and four other members appointed by the central

government.

With the coming into effect of the securities and exchange board of India act, 1992 some of the

powers and functions exercised by the central government, in respect of the regulation of stock

exchange were transferred to the SEBI.

OBJECTIVES AND FUNCTIONS OF SEBI

To protect the interest of investors in securities.

Regulating the business in stock exchanges and any other securities market.

Registering and regulating the working of intermediaries associated with securities market as

well as working of mutual funds.

Promoting and regulating self-regulatory organizations.

Prohibiting insider trading in securities.

Regulating substantial acquisition of shares and takeover of companies.

Performing such functions and exercising such powers under the provisions of capital issues

(control) act, 1947and the securities to it by the central government.


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SEBI GUIDELINES TO SECONDARY MARKETS: (STOCK EXCHANGES):

Board of Directors of Stock Exchange has to be reconstituted so as to include non-members,

public representatives and government representatives to the extent of 50% of total number of

members.

Capital adequacy norms have been laid down for the members of various stock exchanges

depending upon their turnover of trade and other factors.

All recognized stock exchanges will have to inform about transactions within 24 hrs.

TYPES OF ORDERS:

Buy and sell orders placed with members of the stock exchange by the investors. The orders

are of different types.

Limit orders:

Orders are limited by a fixed price. E.g. buy Reliance Petroleum at Rs.50.Here, the order has

clearly indicated the price at which it has to be bought and the investor is not willing to give more

than Rs.50.

Best rate order:

Here, the buyer or seller gives the freedom to the broker to execute the order at the best

possible rate quoted on the particular date for buying. It may be lowest rate for buying and highest

rate for selling.

Discretionary order:

The investor gives the range of price for purchase and sale. The broker can use his discretion to

buy within the specified limit. Generally the approximation price is fixed. The order stands as this

buy BRC 100 shares around Rs.40.

Stop loss order:

The orders are given to limit the loss due to unfavorable price movement in the market. A

particular limit is given for waiting. If the price falls below the limit, the broker is authorized to sell

the shares to prevent further loss. E.g. Sell BRC limited at Rs.24, stop loss at Rs.22.


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Buying and selling shares:

To buy and sell the shares the investor has to locate register broker or sub broker who render

prompt and efficient service to him. The order to buy or sell specifying the number of shares of the

company of investors choice is placed with the broker. The order may be of any type. After

receiving the order the broker tries to execute the order in his computer terminal. Once matching

order is found, the order is executed. The broker then delivers the contract note to the investor. It

gives the details regarding the name of the company, number of shares bought, price, brokerage, and

the date of delivery of share. In this physical trading form, once the broker gets the share certificate

through the clearing houses he delivers the share certificate along with transfer deed to the investor.

The investor has to fill the transfer deed and stamp it. The stamp duty is one of the percentage

considerations, the investor should lodge the share certificate and transfer deed to the register or

transfer agent of the company. If it is bought in the DEMAT form, the broker has to give a matching

instruction to his depository participant to transfer shares bought to the investors account. The

investor should be account holder in any of the depository participant. In the case of sale of shares

on receiving payment from the purchasing broker, the broker effects the payment to the investor.

Share groups:

The scrips traded on the BSE have been classified into A,B1,B2,C,F and Z groups. The

A group represents those, which are in the carry forward system. The F group represents the debt

market segment (fixed income securities). The Z group scrips are of the blacklisted companies. The

C group covers the odd lot securities in A, B1&B2 groups.

ROLLING SETTLEMENT SYSTEM:

Under rolling settlement system, the settlement takes place n days (usually 1, 2, 3 or 5days)

after the trading day. The shares bought and sold are paid in for n days after the trading day of the

particular transaction. Share settlement is likely to be completed much sooner after the transaction

than under the fixed settlement system.

The rolling settlement system is noted by T+N i.e. the settlement period is n days after the trading

day. A rolling period which offers a large number of days negates the advantages of the system.

Generally longer settlement periods are shortened gradually.


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SEBI made RS compulsory for trading in 10 securities selected on the basis of the criteria that they

were in compulsory demat list and had daily turnover of about Rs.1 crore or more. Then it was

extended to A stocks in Modified Carry Forward Scheme, Automated Lending and Borrowing

Mechanism (ALBM) and Borrowing and lending Securities Scheme (BELSS) with effect from Dec

31, 2001.

SEBI has introduced T+5 rolling settlement in equity market from July 2001 and subsequently

shortened the cycle to T+3 from April 2002. After the T+3 rolling settlement experience it was

further reduced to T+2 to reduce the risk in the market and to protect the interest of the investors

from 1st April 2003.

Activities on T+1:

Conformation of the institutional trades by the custodian is sent to the stock exchange by 11.00

am. A provision of an exception window would be available for late confirmation. The time limit

and the additional changes for the exception window are dedicated by the exchange.

The exchanges/clearing house/ clearing corporation would process and download the obligation files

to the brokers terminals late by 1.30 p.m on T+1. Depository participants accept the instructions for

pay in securities by investors in physical form upto 4 p.m and in electronic form upto 6 p.m. the

depositories accept from other DPs till 8p.m for same day processing.

Activities on T+2:

The depository permits the download of the paying in files of securities and funds till 10.30

a.m on T+2 from the brokers pool accounts. The depository processes the pay in requests and

transfers the consolidated pay in files to clearing House/clearing Corporation by 11.00am/on T+2.

The exchange/clearing house/clearing corporation executes the pay-out of securities and funds latest

by 1.30 p.m on T+2 to the depositories and clearing banks. In the demat mode net basis settlement is

allowed. The buy and sale positions in the same scrip can be settled and net quantity has to be

settled.


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COMPANY PROFILE


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BACKGROUND

In 1982, a group of Hyderabad-based practicing Chartered Accountants started Karvy

Consultants Limited with a capital of Rs.1,50,000 offering auditing and taxation services initially. Later,

it forayed into the Registrar and Share Transfer activities and subsequently into financial services. All

along, Karvy's strong work ethic and professional background leveraged with Information Technology

enabled it to deliver quality to the individual.

A decade of commitment, professional integrity and vision helped Karvy achieve a leadership position

in its field when it handled the largest number of issues ever handled in the history of the Indian stock

market in a year. Thereafter, Karvy made inroads into a host of capital-market services, - corporate and

retail which proved to be a sound business synergy.

Today, Karvy has access to millions of Indian shareholders, besides companies, banks, financial

institutions and regulatory agencies. Over the past one and half decades, Karvy has evolved as a

veritable link between industry, finance and people. In January 1998, Karvy became the first Depository

Participant in Andhra Pradesh.

GROUP COMPANIES

KARVY CONSULTANTS LIMITED

Deals in Registrar and Investment Services.


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KARVY SECURITIES LIMITED

Deals in distribution of various investment products, viz., equities, mutual funds, bonds and debentures,

fixed deposits, insurance policies for the investor.

KARVY INVESTOR SERVICES LIMITED

Deals in Issue management, Investment Banking and Merchant Banking.

KARVY STOCK BROKING LIMITED

Deals in buying and selling equity shares and debentures on the National Stock Exchange (NSE), the

Hyderabad Stock Exchange (HSE) and the over-the-counter Exchange of India(OTCEI).

As the flagship company of the Karvy Group, Karvy Consultants Limited has always remained at the

helm of organizational affairs, pioneering business policies, work ethic and channels of progress. Having

emerged as a leader in the registry business, the first of the businesses that we ventured into, we have

now transferred this business into a joint venture with Computershare Limited of Australia, the worlds

largest registrar. With the advent of depositories in the Indian capital market and the relationships that

we have created in the registry business, we believe that we were best positioned to venture into this


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Stock Broking Services|Distribution of Financial Products|Depository Participants |Advisory Services

|Research|Private Client Group

Member - National Stock Exchange (NSE), The Bombay Stock Exchange (BSE), and the Hyderabad

Stock Exchange (HSE).

Karvy Stock Broking Limited, one of the cornerstones of the Karvy edifice, flows freely towards

attaining diverse goals of the customer through varied services. Creating a plethora of opportunities for

the customer by opening up investment vistas backed by research-based advisory services. Here, growth

knows no limits and success recognizes no boundaries. Helping the customer create waves in his

portfolio and empowering the investor completely is the ultimate goal.

Stock Broking Services

It is an undisputed fact that the stock market is unpredictable and yet enjoys a high success rate as a

wealth management and wealth accumulation option. The difference between unpredictability and a

safety anchor in the market is provided by in-depth knowledge of market functioning and changing

trends, planning with foresight and choosing ones options with care. This is what we provide in

our Stock Broking services. We offer services that are beyond just a medium for buying and selling

stocks and shares. Instead we provide services which are multi dimensional and multi-focused in their

scope.
http://www.karvy.com/aboutUs/ksbl.htm#SBS#SBShttp://www.karvy.com/aboutUs/ksbl.htm#SBS#SBShttp://www.karvy.com/aboutUs/ksbl.htm#DFP#DFPhttp://www.karvy.com/aboutUs/ksbl.htm#DFP#DFPhttp://www.karvy.com/aboutUs/ksbl.htm#DFP#DFPhttp://www.karvy.com/aboutUs/ksbl.htm#DP#DPhttp://www.karvy.com/aboutUs/ksbl.htm#DP#DPhttp://www.karvy.com/aboutUs/ksbl.htm#DP#DPhttp://www.karvy.com/aboutUs/ksbl.htm#AS#AShttp://www.karvy.com/aboutUs/ksbl.htm#AS#AShttp://www.karvy.com/aboutUs/ksbl.htm#AS#AShttp://www.karvy.com/aboutUs/ksbl.htm#Research#Researchhttp://www.karvy.com/aboutUs/ksbl.htm#Research#Researchhttp://www.karvy.com/aboutUs/ksbl.htm#Research#Researchhttp://www.karvy.com/aboutUs/ksbl.htm#PCG#PCGhttp://www.karvy.com/aboutUs/ksbl.htm#PCG#PCGhttp://www.karvy.com/aboutUs/ksbl.htm#PCG#PCGhttp://www.karvy.com/aboutUs/ksbl.htm#PCG#PCGhttp://www.karvy.com/aboutUs/ksbl.htm#Research#Researchhttp://www.karvy.com/aboutUs/ksbl.htm#AS#AShttp://www.karvy.com/aboutUs/ksbl.htm#AS#AShttp://www.karvy.com/aboutUs/ksbl.htm#DP#DPhttp://www.karvy.com/aboutUs/ksbl.htm#DFP#DFPhttp://www.karvy.com/aboutUs/ksbl.htm#DFP#DFPhttp://www.karvy.com/aboutUs/ksbl.htm#SBS#SBS


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There are several advantages in utilizing our Stock Broking services, which are the reasons why it is one

of the best in the country. We offer trading on a vast platform; National Stock Exchange, Bombay Stock

Exchange and Hyderabad Stock Exchange. More importantly, we make trading safe to the maximum

possible extent, by accounting for several risk factors and planning accordingly. We are assisted in this

task by our in-depth research, constant feedback and sound advisory facilities. Our highly skilled

research team, comprising of technical analysts as well as fundamental specialists, secure result-oriented

information on market trends, market analysis and market predictions. This crucial information is given

as a constant feedback to our customers, through daily reports delivered thrice daily.

The Pre-session Report, where market scenario for the day is predicted, The Mid-session Report, timed

to arrive during lunch break , where the market forecast for the rest of the day is given and The Post-

session Report, the final report for the day, where the market and the report itself is reviewed. To add to

this repository of information, we publish a monthly magazine Karvy ; The Finapolis,

which analyzes the latest stock market trends and takes a close look at the various investment options,

and products available in the market, while a weekly report, called Karvy Bazaar

Baatein, keeps you more informed on the immediate trends in the stock market. In addition, ourspecific industry reports give comprehensive information on various industries. Besides this, we also

offer special portfolio analysis packages that provide daily technical advice on scrips for successful

portfolio management and provide customized advisory services to help you make the right financial

moves that are specifically suited to your portfolio.

Our Stock Broking services are widely networked across India, with the number of our trading terminals

providing retail stock broking facilities. Our services have increasingly offered customer oriented

convenience, which we provide to a spectrum of investors, high-net worth or otherwise, with equal

dedication and competence.


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But true to our spirit, this success is not our final destination, but just a platform to launch further

enhanced quality services to customer-friendly stock management. Over the years we have ensured that

the trust of our customers is our biggest returns. Factors such as our success in the Electronic custody

business has helped build on our tradition of trust even more. Consequentially our retail client base

expanded very fast.

To empower the investor further we have made serious efforts to ensure that our research calls are

disseminated systematically to all our stock broking clients through various delivery channels like email,

chat, SMS, phone calls etc.

Our foray into commodities broking has been path breaking and we are in the process of converting

existing traders in commodities into the more organized mainstream of trading in commodity futures,

both as a trading and risk hedging mechanism.

In the future, our focus will be on the emerging businesses and to meet this objective, we have enhanced

our manpower and revitalized our knowledge base with enhances focus on Futures and Options as well

as the commodities business.

Depository Participants

The onset of the technology revolution in financial services Industry saw the emergence of Karvy as an

electronic custodian registered with National Securities Depository Ltd (NSDL) and Central SecuritiesDepository Ltd (CSDL) in 1998. Karvy set standards enabling further comfort to the investor by

promoting paperless trading across the country and emerged as the top 3 Depository Participants in the

country in terms of customer serviced.


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Offering a wide trading platform with a dual membership at both NSDL and CDSL, we are a powerful

medium for trading and settlement of dematerialized shares.

We have established live DPMs, Internet access to accounts and an easier transaction process in order to

offer more convenience to individual and corporate investors.

A team of professional and the latest technological expertise allocated exclusively to our demat division

including technological enhancements like SPEED-e, make our response time quick and our delivery

impeccable. A wide national network makes our efficiencies accessible to all.

www.karvydp.com

Distribution of Financial Products

The paradigm shift from pure selling to knowledge based selling drives the business today. With our

wide portfolio offerings, we occupy all segments in the retail financial services industry.

A 1600 team of highly qualified and dedicated professionals drawn from the best of academic and

professional backgrounds are committed to maintaining high levels of client service delivery. This has

propelled us to a position among the top distributors for equity and debt issues with an estimated market

share of 15% in terms of applications mobilized, besides being established as the leading procurer in all

public issues.
http://www.karvydp.com/http://www.karvydp.com/http://www.karvydp.com/http://www.karvydp.com/http://www.karvydp.com/


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To further tap the immense growth potential in the capital markets we enhanced the scope of our retail

brand, Karvy the Fin polis, thereby providing planning and advisory services to the mass affluent.

Here we understand the customer needs and lifestyle in the context of present earnings and provide

adequate advisory services that will necessarily help in creating wealth. Judicious planning that is

customized to meet the future needs of the customer deliver a service that is exemplary. The market-

savvy and the ignorant investors, both find this service very satisfactory. The edge that we have over

competition is our portfolio of offerings and our professional expertise. The investment planning for

each customer is done with an unbiased attitude so that the service is truly customized.

Our monthly magazine, Fin polis, provides up-dated market information on market trends, investment

options, opinions etc. Thus empowering the investor to base every financial move on rational thought

and prudent analysis and embark on the path to wealth creation.

http://mfportfolio.karvy.com

Advisory Services

Under our retail brand Karvy the Finapolis', we deliver advisory services to a cross-section of

customers. The service is backed by a team of dedicated and expert professionals with varied experience

and background in handling investment portfolios. They are continually engaged in designing the right

investment portfolio for each customer according to individual needs and budget considerations with a

comprehensive support system that focuses on trading customers' portfolios and providing valuable

inputs, monitoring and managing the portfolio through varied technological initiatives. This is made

possible by the expertise we have gained in the business over the years. Another venture towards being

investor-friendly is the circulation of a monthly magazine called Karvy - the Finapolis'. Covering the

latest of market news, trends, investment schemes and research-based opinions from experts in various

financial fields.www.the-finapolis.com
http://mfportfolio.karvy.com/http://mfportfolio.karvy.com/http://www.the-finapolis.com/http://www.the-finapolis.com/http://www.the-finapolis.com/http://www.the-finapolis.com/http://mfportfolio.karvy.com/


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Private Client Group

This specialized division was set up to cater to the high net worth individuals and institutional clients

keeping in mind that they require a different kind of financial planning and management that will

augment not just existing finances but their life-style as well. Here we follow a hard-nosed business

approach with the soft touch of dedicated customer care and personalized attention.

For this purpose we offer a comprehensive and personalized service that encompasses planning and

protection of finances, planning of business needs and retirement needs and a host of other services, allprovided on a one-to-one basis.

Our research reports have been widely appreciated by this segment. The delivery and support modules

have been fine tuned by giving our clients access to online portfolio information, constant updates on

their portfolios as well as value-added advice on portfolio churning, sector switches etc. The investment

recommendations given by our research team in the cash market have enjoyed a high success rate.

KEY PEOPLE (BOARD OF DIRECTORS)

1. Parthasarathy C

2. Yugandhar M

3. Ramakrishna M S

4. Prasad v Potluri


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Overview:

KARVY , is a premier integrated financial services provider, and ranked among the top five in the

country in all its business segments, services over 16 million individual investors in various capacities, and

provides investor services to over 300 corporates, comprising the who is who of Corporate India. KARVY covers

the entire spectrum of financial services such as Stock broking, Depository Participants, Distribution of financial

products - mutual funds, bonds, fixed deposit, equities, Insurance Broking, Commodities Broking, Personal

Finance Advisory Services, Merchant Banking & Corporate Finance, placement of equity, Initial public offers,

among others. Karvy has a professional management team and ranks among the best in technology, operations

and research of various industrial segments.

Karvy

the early days

The birth of Karvy was on a modest scale in 1981. It began with the vision and enterprise of a

small group of practicing Chartered Accountants who founded the flagship company Karvy

Consultants Limited. They started with consulting and financial accounting automation, and carved

inroads into the field of registry and share accounting by 1985.

Since then, they have utilized our experience and superlative expertise to go from strength to

strengthto better our services, to provide new ones, to innovate, diversify and in the process, evolvedKarvy as one of Indias premier integrated financial service enterprise.

Thus over the last 20 years Karvy has traveled the success route, towards building a reputation as

an integrated financial services provider, offering a wide spectrum of services. And they have made this

journey by taking the route of quality service, path-breaking innovations in service, versatility in service

a finally totally in service.

Their values and vision of attaining total competence in their servicing has served as the building

block for creating a great financial enterprise, which stands solid on their fortresses of financial strength

- their various companies. With the experience of years of holistic financial servicing behind them and

years of complete expertise in the industry to look forward to, they have now emerged as a premier

integrated financial services provider.


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KARVY has got 510 Branches Al lover and is Employing 7000 people under it.

Karvy credo

Their Clients, Their Focus;

Clients are the reason for our being.

Personalized service, professional care; pro-activeness are the values that help them nurture enduring

relationships with their clients.

Respect for the individual;

Each and every individual is an essential building block of their Organization. They are the

kiln that hones individuals to perfection. Be they their employees, shareholders or investors. They do so by

upholding their dignity & pride, inculcating trust and achieving a sensitive balance of their professional and

personal lives.

Teamwork;

None of us is more important than all of us.

Each team member is the face of Karvy. Together they offer diverse services with speed, accuracy and quality to

deliver only one product: excellence.

Responsible Citizenship;

A social balance sheet is as rewarding as a business one.

As a responsible corporate citizen, their duty is to foster a better environment in the society where they live and

work. Abiding by its norms, and behaving responsibly towards the environment, is some of their growing

initiatives towards realizing it.


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Integrity:

Everything else is secondary.

Professional and personal ethics are their bedrock. They take pride in an environment that encourages honesty

and the opportunity to learn from failures than camouflage them. They insist on consistency between works and

actions.

MILESTONES


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Karvy Group of Companies


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Karvys alliances:

Karvy Computer share Private Limited is a 50:50 joint venture of Karvy Consultants Limited and

Computer share Limited, Australia. Computer share Limited is world's largest -- and only global hare registry,

and a leading financial market services provider to the global securities industry. The joint venture with

Computer share, reckoned as the largest registrar in the world, servicing over 60 million shareholder accounts

for over 7,000 corporations across eleven countries spread across five continents. Computer share manages

more than 70 million shareholder accounts for over 13,000 corporations around the world. Karvy Computer

share Private Limited, today, is India's largest Registrar and Share Transfer Agent servicing over 300 corporate

and mutual funds and 16 million investors.

Achievements:

Among the top 5 stock brokers in India (4% of NSE volumes) India's No. 1 Registrar & Securities

Transfer Agents.

Among the to top 3 Depository Participants Largest Network of Branches & Business Associates ISO

9002 certified operations by DNV.

Among top 10 Investment bankers Largest Distributor of Financial Products.

Adjudged as one of the top 50 IT uses in India by MIS Asia.

Fully Fledged IT driven operations.

Quality policy:

To achieve and retain leadership, Karvy shall aim for complete customer satisfaction, by combining its human

and technological resources, to provide superior quality financial services. In the process, Karvy will strive to

exceed Customer's expectations.


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Quality Objectives

As per the Quality Policy, Karvy will:

Build in-house processes that will ensure transparent and harmonious relationships with its clients and

investors to provide high quality of services.

1) Establish a partner relationship with its investor service agents and vendors that will help in keeping up

its commitments to the customers.

2) Provide high quality of work life for all its employees and

3) Equip them with adequate knowledge & skills so as to respond to customer's needs.

4) Continue to uphold the values of honesty & integrity and strive to establish unparalleled standards in

business ethics.

5) Use state-of-the art information technology in developing new and innovative financial products and

services to meet the changing needs of investors and clients.

6) Strive to be a reliable source of value-added financial products and services and constantly guide the

individuals and institutions in making a judicious choice of same.

7) Strive to keep all stake-holders (shareholders, clients, investors, employees, suppliers and regulatory

authorities.

At Karvy Commodities, they are focused on taking commodities trading to new dimensions of reliability

and profitability. They have made commodities trading, an essentially age-old practice, into a

sophisticated and scientific investment option. Here they enable trade in all goods and products of

agricultural and mineral origin that include lucrative commodities like gold and silver and popular items

like oil, pulses and cotton through a well-systematized trading platform.

Their technological and infrastructural strengths and especially our street-smart skills make them an

ideal broker. Their service matrix is holistic with a gamut of advantages, the first and foremost being their legacy

of human resources, technology and infrastructure that comes from being part of the Karvy Group.


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Their wide national network, spanning the length and breadth of India, further supports these

advantages. Regular trading workshops and seminars are conducted to hone trading strategies to perfection.

Every move made is a calculated one, based on reliable research that is converted into valuable information

through daily, weekly and monthly newsletters, calls and intraday alerts. Further, personalized service is

provided here by a dedicated team committed to giving hassle-free service while the brokerage rates offered

are extremely competitive.

Their commitment to excel in this sector stems from the immense importance that commodity broking

has to a cross-section of investors farmers, exporters, importers, manufacturers and the Government of India

itself. The reason for choosing the Karvy as the base to do the project is that Karvy has a variety of services

that are provided by them in the financial markets and as a Finance student I feel that taking this company as

the base we can know about the various financial services that take place in the market and gain knowledge

about them and can have a more view of the financial markets through the ways the services are provided and

the rules involved in providing these services by KARVY.


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DATA ANALYSIS & INTERPRETATIONS


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INFOSYS

Infosys is an information technology services company headquartered in Bengaluru, India.

Infosys is one of the largest IT companies in India with 122,468 employees (including subsidiaries) as of2010. It has offices in 33 countries and development centres in India, China, Australia, UK, Canada andJapan.

Infosys was founded on 2 July 1981 by seven entrepreneurs, Nagavara Ramarao Narayana Murthy,Nandan Nilekani, Kris Gopalakrishnan, S. D. Shibulal, K Dinesh and with N. S. Raghavan officiallybeing the first employee of the company. The founders started the company with an initial investment ofINR 10,000. The company was incorporated as "Infosys Consultants Pvt Ltd." in Model Colony, Puneas the registered office.

Infosys headquarters in Bengaluru, India

Infosys went public in 1993. Interestingly, Infosys IPO was under subscribed but it was bailed outbyUS investment banker Morgan Stanley which picked up 13% of equity at the offer price of Rs. 95 pershare.[8]The share price surged to Rs. 8,100 by 1999. By the year 2000 Infosys's shares touched Rs. 310before the catastrophic incident ofSeptember 11th, changed all that.[9]

According to Forbes magazine, since listing on the Bombay Stock Exchange till the year 2000, Infosys'sales and earnings compounded at more than 70% a year.[10]In the year 2000, President of the UnitedStates Bill Clinton complimented India on its achievements in high technology areas citing the exampleof Infosys.[11]Infosys will invest $100 million (Rs 440 crore) on establishing a 20,000-seater campus in

Shanghai.[12]

In 2001, it was ratedBest Employer in India by Business Today. Infosys was rated best employer towork for in 2000, 2001, and 2002 by Hewitt Associates. In 2007, Infosys received over 1.3 millionapplications and hired fewer than 3% of applicants

Infosys was the only Indian company to win the Global MAKE (Most Admired Knowledge Enterprises)award for the years 2003, 2004 and 2005, and is inducted into the Global Hall of Fame for the same.

Infosys Technologies Ltd.

Industry : Computers - Software

BSE Code : 500209

NSE Code : INFOSYSTCH
http://en.wikipedia.org/wiki/Bengaluruhttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Chinahttp://en.wikipedia.org/wiki/Australiahttp://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/Canadahttp://en.wikipedia.org/wiki/Japanhttp://en.wikipedia.org/wiki/Nagavara_Ramarao_Narayana_Murthyhttp://en.wikipedia.org/wiki/Nandan_Nilekanihttp://en.wikipedia.org/wiki/Kris_Gopalakrishnanhttp://en.wikipedia.org/wiki/S._D._Shibulalhttp://en.wikipedia.org/wiki/N._S._Raghavanhttp://en.wikipedia.org/wiki/Indian_Rupeehttp://en.wikipedia.org/wiki/Bengaluruhttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Initial_public_offeringhttp://en.wikipedia.org/wiki/Morgan_Stanleyhttp://en.wikipedia.org/wiki/Infosys#cite_note-7http://en.wikipedia.org/wiki/Infosys#cite_note-7http://en.wikipedia.org/wiki/Infosys#cite_note-7http://en.wikipedia.org/wiki/September_11_attackshttp://en.wikipedia.org/wiki/Infosys#cite_note-8http://en.wikipedia.org/wiki/Infosys#cite_note-8http://en.wikipedia.org/wiki/Infosys#cite_note-8http://en.wikipedia.org/wiki/Bombay_Stock_Exchangehttp://en.wikipedia.org/wiki/Infosys#cite_note-9http://en.wikipedia.org/wiki/Infosys#cite_note-9http://en.wikipedia.org/wiki/Infosys#cite_note-9http://en.wikipedia.org/wiki/President_of_the_United_Stateshttp://en.wikipedia.org/wiki/President_of_the_United_Stateshttp://en.wikipedia.org/wiki/Bill_Clintonhttp://en.wikipedia.org/wiki/Infosys#cite_note-10http://en.wikipedia.org/wiki/Infosys#cite_note-10http://en.wikipedia.org/wiki/Infosys#cite_note-10http://en.wikipedia.org/wiki/Infosys#cite_note-infy-11http://en.wikipedia.org/wiki/Infosys#cite_note-infy-11http://en.wikipedia.org/wiki/Infosys#cite_note-infy-11http://en.wikipedia.org/wiki/Business_Todayhttp://en.wikipedia.org/wiki/Business_Todayhttp://en.wikipedia.org/wiki/Infosys#cite_note-infy-11http://en.wikipedia.org/wiki/Infosys#cite_note-10http://en.wikipedia.org/wiki/Bill_Clintonhttp://en.wikipedia.org/wiki/President_of_the_United_Stateshttp://en.wikipedia.org/wiki/President_of_the_United_Stateshttp://en.wikipedia.org/wiki/Infosys#cite_note-9http://en.wikipedia.org/wiki/Bombay_Stock_Exchangehttp://en.wikipedia.org/wiki/Infosys#cite_note-8http://en.wikipedia.org/wiki/September_11_attackshttp://en.wikipedia.org/wiki/Infosys#cite_note-7http://en.wikipedia.org/wiki/Morgan_Stanleyhttp://en.wikipedia.org/wiki/Initial_public_offeringhttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Bengaluruhttp://en.wikipedia.org/wiki/Indian_Rupeehttp://en.wikipedia.org/wiki/N._S._Raghavanhttp://en.wikipedia.org/wiki/S._D._Shibulalhttp://en.wikipedia.org/wiki/Kris_Gopalakrishnanhttp://en.wikipedia.org/wiki/Nandan_Nilekanihttp://en.wikipedia.org/wiki/Nagavara_Ramarao_Narayana_Murthyhttp://en.wikipedia.org/wiki/Japanhttp://en.wikipedia.org/wiki/Canadahttp://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/Australiahttp://en.wikipedia.org/wiki/Chinahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Bengaluru


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You can view latest Board of Directors of the company.

S.No Name Designation

1 Mr. R Seshasayee Additional Director

2 Mr. N R Narayana Murthy Chairman & Chief Mentor

3 Mr. T V Mohandas Pai Director

4 Mr. Srinath Batni Director

5 Mr. K Dinesh Director

6 Mr. S D Shibulal Director & COO

7 Mr. Sridar A Iyengar Independent Director

8 Prof. Marti G Subrahmanyam Independent Director

9 Mr. David L Boyles Independent Director

10 Dr. Omkar Goswami Independent Director

11 Mr. K V Kamath Independent Director

12 Prof. Jeffrey S Lehman Independent Director

13 Mr. Deepak M Satwalekar Independent Director

14 Mr. S Gopalakrishnan Managing Director & CEO

Share holdings pattern :

Above is the share holding pattern of INFOSYS

which shows that Indian promoter share in the

company is 16.05% that means if they are not in the

position to raise further money from general public,

Company already raised huge money by selling their

large stake to institutional investors about

8.43%.Others also has very big stake in the

company of about 18.78


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BSE:

DateOpenPrice

HighPrice

LowPrice

ClosePrice WAP

No.ofShares Average

15-Dec-11 3153 3209 3150 3203.65 3196.335605 92463 3179.5

16-Dec-11 3211.1 3296.95 3211.1 3292.3 3273.431605 137005 3254.025

20-Dec-11 3225.15 3363 3225.15 3350.9 3332.853212 163774 3294.075

21-Dec-11 3350 3370 3311 3329.25 3339.063551 89267 3340.5

22-Dec-11 3325.1 3357 3313.5 3336.9 3339.324609 63233 3335.25

23-Dec-11 3340 3366 3330 3362.5 3360.008814 113006 3348

24-Dec-11 3343.2 3378 3340 3368.5 3363.790416 90885 3359

27-Dec-11 3360 3391 3360 3378.75 3380.962499 42372 3375.528-Dec-11 3378 3386 3364.15 3381.85 3379.447715 55303 3375.075

29-Dec-11 3377.15 3406.8 3372 3399.5 3393.496588 120027 3389.4

30-Dec-11 3400 3447 3400 3440.5 3435.019576 116162 3423.5

31-Dec-11 3427 3454 3406.4 3445 3432.105913 64959 3430.2

3342.002083

03-Jan-12 3449 3458.85 3427 3452.9 3445.424991 48314 3442.925

04-Jan-12 3453 3489.9 3453 3468 3475.226844 61042 3471.45

05-Jan-12 3464.7 3476 3447 3467.65 3464.992952 39728 3461.5

06-Jan-12 3473 3492 3444 3475.85 3473.07083 95764 3468

07-Jan-12 3475 3493.95 3356 3366.5 3420.086561 97931 3424.975

10-Jan-12 3380 3441.8 3352 3396.65 3400.165103 155521 3396.9

11-Jan-12 3384 3418.8 3290.25 3329.25 3345.326401 145456 3354.525

12-Jan-12 3348.15 3388 3321.05 3374.95 3361.599817 110477 3354.525

13-Jan-12 3290 3290 3201 3212.3 3242.071787 439701 3245.5

14-Jan-12 3206.8 3277 3190 3201.95 3234.353351 192675 3233.5

17-Jan-12 3200 3282 3192 3267.95 3242.760343 125475 3237

18-Jan-12 3248 3332 3248 3318.15 3301.559123 218199 3290

19-Jan-12 3306.8 3310 3237 3252 3264.491404 84576 3273.5

20-Jan-12 3238 3297.85 3221 3289.1 3270.341111 121538 3259.425

21-Jan-12 3267 3277 3233 3248.75 3251.70629 54227 3255

24-Jan-12 3244.4 3287 3228.5 3278.2 3265.35484 54092 3257.75

25-Jan-12 3275 3301 3235.35 3254.1 3276.495309 47641 3268.175

27-Jan-12 3266 3275 3186 3195.2 3206.669275 114500 3230.528-Jan-12 3204.05 3268.8 3145 3173.5 3214.02738 156211 3206.9

31-Jan-12 3139 3139 3091.55 3116.3 3114.659411 76450 3115.275

3312.36625

OPEN HIGH LOW CLOSE LAST PREVCLOSE TOTTRDQTY TIMESTAMP AVERAGE


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NSE:

3146.7 3209 3146.7 3203.45 3203 3158.65 1031799 15-Dec-11 3177.85

3219.4 3300 3210 3293.3 3295.8 3203.45 1063643 16-Dec-11 3255

3252.1 3363.8 3252 3349.95 3350 3293.3 1418290 20-Dec-11 3307.9

3350.55 3369.6 3311.05 3329.25 3333.25 3349.95 1007480 21-Dec-11 3340.325

3325 3359.7 3313.75 3332.5 3327.35 3329.25 740910 22-Dec-11 3336.725

3344 3372 3329.25 3367.9 3370 3332.5 778938 23-Dec-11 3350.625

3347 3381.8 3342.05 3370.15 3365.7 3367.9 452508 24-Dec-11 3361.925

3357 3391.8 3357 3376.9 3379.8 3370.15 461470 27-Dec-11 3374.4

3371 3389.95 3363.5 3382.65 3381.8 3376.9 319305 28-Dec-11 3376.725

3381 3415 3371.1 3404.9 3410.1 3382.65 475365 29-Dec-11 3393.05

34

Documents

Equity Analysis of Karvy