1 Important of financial advisor for mutual fund investors karvy final (2)

8/7/2019 1 Important of financial advisor for mutual fund investors karvy final (2)

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SUMMER TRAINING REPORT

On

IMPORTANCE OF FINANCIAL ADVISOR FOR MUTUAL

FUND INVESTORS

Submitted in the partial fulfillment of the Requirements

of Master of Business Administration

FromGautam Buddh Technical University (GBTU), Lucknow(Formerly known U.P. Technical University, Lucknow)

(Batch: 2009-11)

Guided By: PresentedBy:

Mr. Abhishek chand Pankaj kr. shuklaKarvy consultants ltd. Roll no: 0901670070Lucknow

Submitted at:

Rakshpal Bahadur Management Institute, Bareilly

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PREFACE

The successful completion of this project was a unique experience for me because by

visiting many place and interacting various person, I achieved a better knowledge about

sales . The experience which I gained by doing this project was essential at this turning

point of my career this project is being submitted which content detailed analysis of the

research under taken by me.

The research provides an opportunity to the student to devote his/her skills knowledge and

competencies required during the technical session.

The research is on the topic:

"Importance of financial advisor for mutual fund investors "

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ACKNOWLEDGEMENT

I would like to begin in the name ofGOD - THE ALMIGHTY without of whose

grace and blessing, the present work would not have taken this shape.

I would like to express my deep gratitude and sincere regards for all those people

who helped in the completion of this report. First of all I would like to thank my

project guide Mr. Abhishek chand for their valuable support and guidance.

I would like to make a special mention ourProf. and my faculty guidance Mr. for

giving me their valuable time input that helpful me in giving final touch to this report.

At last, but not least, I own the opportunity to thank my parents, family members and

friends for supporting me at every step and bearing with me.

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Contents

1-Executive summary

2-Introduction

3-Evolution of Mutual Funds

4-Benefits/Risks involved in investing Mutual Funds

5-Types of Mutual Funds

6-Organisation of Mutual Funds

7-History of Indian Mutual Fund Industry

8-Performance of Mutual Funds in India

9-Global Scenario relating to Mutual Funds

10-Karvy Mutual Fund

11- Objective of research

12-Reserch Methodology

13- FINDINGS:

14- RECOMMENDATIONS AND SUGGESTIONS

15- LIMITATIONS

16-Bibiliography

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EXECUTIVE SUMMARY

This project has been a great learning experience for me; at the same time it gave me

enough scope to implement my analytical ability. This project as a whole can be divided into

two parts:

The first part gives an insight about the mutual funds and its various aspects. It is purely

based on whatever I learned at Karvy . One can have a brief knowledge about Mutual funds

and all its basics through the project. Other than that the real servings come when one

moves ahead. Some of the most interesting questions regarding mutual funds have been

covered. Apart from Mutual Funds a light has also been through on Share trading.

All the topics have been covered in a very systematic way. The language has been kept

simple so that even a layman could understand. All the datas have been well analyzed with

the help of charts and graphs.

The second part consists of data and their analysis, collected through a survey done on

100 people. It covers the topic Awareness and Impact level among people about Mutual

Funds and Life Insurance Policies. The data collected has been well organized and

presented. Hope the research findings and conclusions will be of use. It has also covered

why people dont want to go in invest? The advisors can take further steps to approach

more and more people and indulge them for taking their advices.

About the Project

This project gives a Detail study of Importance of financial advisor for mutual fund

investors in relation to Karvy Stock Broking Limited.

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INTRODUCTION

A financial adviser (UK spelling) or financial advisor, is a professional who renders

financial services to individuals, businesses and governments. This can involve investment

advice, which may include pension planning, and/or advice on life insurance and other

insurances such as income protection insurance, critical illness insurance etc, and/or advice

on mortgages

Ideally, the financial adviser helps the client maintain the desired balance of investment

income, capital gains, and acceptable level ofrisk by using properasset allocation. Financial

advisers use stock, bonds, mutual funds, real estate investment trusts (REITs), options,

futures, notes, and insurance products to meet the needs of their clients. Many financial

advisers receive a commission payment for the various financial products that they broker,

although "fee-based" planning is becoming increasingly popular in the financial services

industry.

A further distinction should be made between "fee-based" and "fee-only" advisers. Fee-

based advisers often charge asset based fees but may also collect commissions. Fee-only

advisers do not collect commissions or referral fees paid by other product or service

providers.

Some investment advisors only charge a fee based on the assets managed for the client.

Typically they charge about 1.0 to 1.5% per year to make the investment decisions for the

client. They do not collect commissions.

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ROLEOFFINANCIALADVISOR

The main purpose of a financial adviser is to assist clients in the planning and arrangement

of their financial affairs, such as savings, retirement provisions, tax treatment and wills. To

ensure ethical practices, financial advisers must understand a client's financial situation as

well as their need for financial stability. Finance can be complicated and any adviser has

responsibilities ethically to see that a client's risk is minimized, and monetarily, that money is

maximized within the established risk boundaries.

RETIREMENTPLANNING

One of the major services that financial advisers offer is retirement planning. A financial

adviser should have knowledge of budgeting, forecasting, taxation, asset allocation, and

financial tools and products to establish realistic goals and the strategy by which to reach

them. In the United States, this will include the use of several investment tools such as

401(k)/403(b) Roth account(s), Individual Retirement Accounts/Roth IRAs, mutual funds,

stocks, bonds and CDs.

The financial adviser determines what percentage of the available income is necessary

taking into account tax liabilities, expected inflation, and projected return on investmentto

meet a minimum balance by the client's target age of retirement. This is a fairly

straightforward calculation, and many automated tools do this. The financial adviser's

greatest contribution is asset allocation: determining how to maximize the return on

investment while satisfying the client's risk tolerance.

INVESTING

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Financial advisers may help their clients invest for both long and short term goals. It is the

financial adviser's duty to determine the clients' goals and risk tolerance and then to

recommend appropriate investments. Generally, a long time horizon allows for the advisor to

recommend more volatile investments with potentially greater risks and rewards. Such

investments include direct investment in stocks or through collective investment products

such as mutual funds and unit investment trusts/unit trusts.

If the client has shorter term goals, the adviser should recommend less volatile investments

with shorter time spans. Such investments could include cash deposits, certificates of

deposit, and short term bonds. While these types of investment generally have lower returns

there is less volatility and there is less likelihood of losing principal capital. Although short-

term investments can guard against loss of capital, their value can be eroded by inflation

over longer periods of time.

COMPENSATION

FEE-ONLY

As defined by the review materials for the Certified Financial Plannerexam and the National

Association of Personal Financial Advisors, fee-only financial advisors, such as an

investment advisor, are compensated solely by the client, typically achieved through a

combination of hourly fees (including retainers), financial planning fees, and asset

management fees. Neither advisors nor affiliates may receive commissions, rebates,

awards, finders fees, bonuses or other forms of compensation from others as a result of a

clients implementation of the individuals planning recommendations. [2] The fee-only model

of compensation reduces the potential forconflicts of interest between the advisor and the

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client in that the advisor is not beholden to insurance companies, particular investments,

and other financial companies.

A clear distinction should be made between brokers, who often refer to themselves as "fee-

based" (receiving both fees and commissions) and "fee-only" (someone who never receives

compensation or incentives from a third party.)

A fee-only advisor may reduce conflicts of interest such as:

Advising a client to buy products and make investments when holding cash and other

liquid assets may have been a more suitable recommendation at that time.

An incentive to generate commissions through the unnecessary buying and/or selling

of securities (also known as churning).

An incentive to convert non-cash assets such as real estate and collectibles to cash

and securities so that the advisor can generate a commission.

An incentive to make recommendations that pay higher sales commissions to the

advisor when a less expensive alternative may have been available.

Working on a fee-only basis allows the advisor to:

Customize an investment portfolio that is designed to help the client realize short-

term and long-term investment goals.

Provide simplified performance reporting, making it easy for clients to monitor their

accounts.

Support the client with ongoing professional advice, timely information about

accounts and updates on the worlds financial markets.

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Manage a client's portfolio and make investment changeswithout commissionsas

a client's objectives or the economic climate changes.

COMMISSION-BASED

Many financial advisers receive a commission payment for the various financial products

that they broker, although "fee-based" planning is becoming increasingly popular in the

financial services industry.

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INVESTOR PERCEPTION

INVESTOR PERCEPTION ANDREALITY

In the case of visual Investor Perception , some people can actually see the percept shift in

theirmind's eye[4]. Others, who are not picture thinkers, may not necessarily perceive the

'shape-shifting' as their world changes. The 'esemplastic' nature has been shown by

experiment: an ambiguous image has multiple interpretations on the perceptual level. The

question, "Is the glass half empty or half full?" serves to demonstrate the way an object can

be perceived in different ways.

Just as one object can give rise to multiple percepts, so an object may fail to give rise to any

percept at all: if the percept has no grounding in a person's experience, the person may

literally not perceive it.

The processes of Investor Perception routinely alter what humans see. When people view

something with a preconceived concept about it, they tend to take those concepts and see

them whether or not they are there. This problem stems from the fact that humans are

unable to understand new information, without the inherent bias of their previous knowledge.

A persons knowledge creates his or her reality as much as the truth, because the human

mind can only contemplate that to which it has been exposed. When objects are viewed

without understanding, the mind will try to reach for something that it already recognizes, in

order to process what it is viewing. That which most closely relates to the unfamiliar from our

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past experiences, makes up what we see when we look at things that we dont comprehend.

[5]

This confusing ambiguity of Investor Perception is exploited in human technologies such as

camouflage, and also in biological mimicry, for example by European Peacock butterflies,

whose wings bear eye markings that birds respond to as though they were the eyes of a

dangerous predator. Perceptual ambiguity is not restricted to vision. For example, recent

touch Investor Perception research Robles-De-La-Torre & Hayward 2001 found that

kinesthesia based haptic Investor Perception strongly relies on the forces experienced

during touch.[6]

Cognitive theories of Investor Perception assume there is a poverty ofstimulus. This (with

reference to Investor Perception ) is the claim that sensations are, by themselves, unable to

provide a unique description of the world. Sensations require 'enriching', which is the role of

the mental model. A different type of theory is the perceptual ecology approach ofJames J.

Gibson. Gibson rejected the assumption of a poverty of stimulus by rejecting the notion that

Investor Perception is based in sensations. Instead, he investigated what information is

actually presented to the perceptual systems. He and the psychologists who work within this

paradigm detailed how the world could be specified to a mobile, exploring organism via the

lawful projection of information about the world into energy arrays. Specification is a 1:1

mapping of some aspect of the world into a perceptual array; given such a mapping, no

enrichment is required and Investor Perception is direct Investor Perception .

Preconceptions can influence how the world is perceived. For example, one classic

psychological experiment showed slower reaction times and less accurate answers when a

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deck ofplaying cards reversed the color of the suit symbol for some cards (e.g. red spades

and black hearts).[7]

There is also evidence that the brain in some ways operates on a slight "delay", to allow

nerve impulses from distant parts of the body to be integrated into simultaneous signals. [8]

INVESTOR PERCEPTION -IN-ACTION

An ecological understanding of Investor Perception derived from Gibson's early work is that

of "Investor Perception -in-action", the notion that Investor Perception is a requisite property

of animate action; that without Investor Perception action would be unguided, and without

action Investor Perception would serve no purpose. Animate actions require both Investor

Perception and motion, and Investor Perception and movement can be described as "two

sides of the same coin, the coin is action". Gibson works from the assumption that singular

entities, which he calls "invariants", already exist in the real world and that all that the

Investor Perception process does is to home in upon them. A view known as social

constructionism (held by such philosophers as Ernst von Glasersfeld) regards the continual

adjustment of Investor Perception and action to the external input as precisely what

constitutes the "entity", which is therefore far from being invariant. [9]

Glasersfeld considers an "invariant" as a target to be homed in upon, and a pragmatic

necessity to allow an initial measure of understanding to be established prior to the updating

that a statement aims to achieve. The invariant does not and need not represent an

actuality, and Glasersfeld describes it as extremely unlikely that what is desired or feared by

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an organism will never suffer change as time goes on. This social constructionist theory thus

allows for a needful evolutionary adjustment. [10]

A mathematical theory of Investor Perception -in-action has been devised and investigated

in many forms of controlled movement, and has been described in many different species of

organism using the General Tau Theory. According to this theory, tau information, or time-

to-goal information is the fundamental 'percept' in Investor Perception .

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MUTUAL FUND

A Mutual Fund is a body corporate registered with SEBI (Securities Exchange Board of

India) that pools money from individuals/corporate investors and invests the same in a

variety of different financial instruments or securities such as equity shares, Government

securities, Bonds, debentures etc.Mutual funds can thus be considered as financial

intermediaries in the investment business that collect funds from the public and invest on

behalf of the investors. Mutual funds issue units to the investors.The appreciation of the

portfolio or securities in which the mutual fund has invested the money leads to an

appreciation in the value of the units held by investors.The investment objectives outlined by

a Mutual Fund in its prospectus are binding on the Mutual Fund scheme. The investmentobjectives specify the class of securities a Mutual Fund can invest in. Mutual Funds invest in

various asset classes like equity, bonds, debentures, commercial paper and government

securities. The schemes offered by mutual funds vary from fund to fund. Some are pure

equity schemes; others are a mix of equity and bonds. Investors are also given the option of

getting dividends, which are declared periodically by the mutual fund, or to participate only in

the capital appreciation of the scheme.

Evolution of Mutual Fund

The first investment trust (now called mutual fund) began in the Netherlands in the early

1800s. The first in the U.S. was the New York Stock Trust, which started in 1889. Since

Boston was the economic center of the nation until the turn of the century, the majority of

funds started thereFidelity, Pioneer and Putnum Fund, to name a few. A fund that was

comprised of both stocks and bonds (the Wellington Fund) started in 1928 and is still part of

Vanguard. As the 20's crashed to a close, there were 10 mutual funds in the nation.

The Sixties saw the growth in aggressive (high risk) funds that were labeled, in the

vernacular of the times, "hot-shot" or "go-go" funds. They were sexy and fast, there were a

hundred of them by the late Sixties and a lot of people dumped a lot of money in them until

the bearish times of 1969 freaked everybody out: investors yanked out their money and

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have been kicking themselves ever since, because some funds increased in value by more

than 9,000%.

Until this time, people had been paying sales commissions on their funds. In the '70s, no-

load funds were invented, and the biggest today. Vanguard Funds, wasfounded in 1977. Atthe end of the Sixties, there were nearly 250 different mutual funds;today, they number over

6,000. But here's the thing: the last time a mutual fund went bankrupt was 1940. And mutual

funds often outperform the stock market.

Benefits involved in investing Mutual Fund

There are several benefits from investing in a Mutual Fund:

Small investments

Mutual funds help you to reap the benefit of returns by a portfolio spread across a wide

spectrum of companies with small investments.

Professional Fund Management

Professionals having considerable expertise, experience and resources manage the pool

ofmoney collected by a mutual fund. They thoroughly analyse themarkets and economy to

pick good investment opportunities.

Spreading Risk

An investor with limited funds might be able to invest in only one or two stocks/bonds, thus

increasing his or her risk. However, a mutual fund will spread its risk by investing a number

of sound stocks or bonds. A fund normally invests in companies across a wide range of

industries, so the risk is diversified.

Transparency

Mutual Funds regularly provide investors with information on the value of their investments.

Mutual Funds also provide complete portfolio disclosure of the investments made by various

schemes and also the proportion invested in each asset type.

Choice

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The large amount of Mutual Funds offer the investor a wide variety to choose from. An

investor can pick up a scheme depending upon his risk/ return profile.

Regulations

All the mutual funds are registered with SEBI and theyfunction within the provisions of strict

regulation designed to protect the interests of the investor.

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TYPES OF MUTUAL FUNDS

Mutual funds are classified in the following manner:

(a) On the basis of Objective

Equity Funds/ Growth Funds

Funds that invest in equity shares are called equity funds. They carry the principal objective

of capital appreciation of the investment over the medium to long-term. They are best suited

for investors who are seeking capital appreciation. There are different types of equity funds

such as Diversified funds, Sector specific funds and Index based funds.

Diversified funds

These funds invest in companies spread across sectors. These funds are generally meant

for risk-averse investors who want a diversified portfolio across sectors.

Sector funds

These funds invest primarily in equity shares of companies in a particular business sector or

industry. These funds are targeted at investors who are bullish or fancy the prospects of

a particular sector.

Index funds

These funds invest in the same pattern as popular market indices like S&P CNX Nifty or

CNX Midcap 200. The money collected from the investors is invested only in the stocks,

which represent the index. For e.g. a Nifty index fund will invest only in the Nifty 50 stocks.

The objective of such funds is not to beat the market but to give a return equivalent to the

market returns.

Tax Saving Funds

These funds offer tax benefits to investors under the Income Tax Act. Opportunities

provided under this scheme are in the form of tax rebates under the Income Tax act.

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Debt/Income Funds

These funds invest predominantly in high-rated fixed-income-bearing instruments like

bonds, debentures, government securities, commercial paper and other money market

instruments. They are best suited for the medium to long-term investors who are averse to

risk and seek capital preservation. They provide a regular income to the investor.

Liquid Funds/Money Market Funds

These funds invest in highly liquid money market instruments. The period of investment

could be as short as a day. They provide easy liquidity. They have emerged as an

alternative for savings and shortterm fixed deposit accounts with comparatively higher

returns. These funds are ideal for corporates,institutional investors and business houses

that invest their funds for very short periods.

Gilt Funds

These funds invest in Central and State Government securities. Since they are Government

backed bonds they give a secured return and also ensure safety of the principal amount.

They are best suited for the medium to long-term investors who are averse to risk.

Balanced Funds

These funds invest both in equity shares and fixed-income-bearing instruments (debt) in

some proportion. They provide a steady return and reduce the volatility of the fund while

providing some upside for capital appreciation. They are ideal for medium to long-term

investors who are willing to take moderate risks.

b) On the basis of Flexibility

Open-ended Funds

These funds do not have a fixed date of redemption. Generally they are open for

subscription and redemption throughout the year. Their prices are linked to the daily net

asset value (NAV). From the investors' perspective, they are much more liquid than closed-

ended funds.

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Close-ended Funds

These funds are open initially for entry during the Initial Public Offering (IPO) and thereafter

closed for entry as well as exit. These funds have a fixed date of redemption. One of the

characteristics of the close-ended schemes is that they are generally traded at a discount to

NAV; but the discount narrows as maturity nears. These funds are open for subscription

only once and can be redeemed only on the fixed date of redemption. The units of these

funds are listed on stock exchanges (with certain exceptions), are tradable and the

subscribers to the fund would be able to exit from the fund at any time through the

secondary market.

Different investment plans that Mutual Funds offer

The term investment plans generally refers to the services that the funds provide to

investors offering different ways to invest or reinvest.The different investment plans are an

important consideration in the investment decision, because they determine the flexibility

available to the investor. Some of the investment plans offered by mutual funds in India are:

Growth Plan and Dividend Plan

A growth plan is a plan under a scheme wherein the returns from investments are

reinvested and very few income distributions, if any, are made. The investor thus only

realizes capital appreciation on the investment. Under the dividend plan, income is

distributed from time to time. This plan is ideal to those investors requiring regular income.

Dividend Reinvestment PlanDividend plans of schemes carry an additional option for reinvestment of income distribution.

This is referred to as the dividend reinvestment plan. Under this plan, dividends declared by

a fund are reinvested in the scheme on behalf of the investor, thus increasing the number of

units held by the investors.

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Rights that are available to a Mutual Fund holder in India

As per SEBI Regulations on Mutual Funds, an investor is entitled to:

1. Receive Unit certificates or statements of accounts confirming your title within 6 weeks

from the date your request for a unit certificate is received by the Mutual Fund.2. Receive information about the investment policies, investment objectives, financial

position and general affairs of the scheme.

3. Receive dividend within 42 days of their declaration and receive the redemption or

repurchase proceeds within 10 days from the date of redemption or repurchase.

4. The trustees shall be bound to make such disclosures to the unit holders as are essential

in order to keep them informed about any information, which may have an adverse bearing

on their investments.

5. 75% of the unit holders with the prior approval of SEBI can terminate the AMC of the

fund.

6. 75% of the unit holders can pass a resolution to wind-up the scheme.

7. An investor can send complaints to SEBI, who will take up the matter with the concerned

Mutual Funds and follow up with them till they are resolved.

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ORGANISATION OF A MUTUAL FUND

There are many entities involved and the diagram below illustrates the organisational set up of

a mutual fund:

Mutual funds have a typical organisation in which five key parlies or players or special

bodies or constituents are involved. They are:

The sponsors, the Board of Trustees (EOT) or Trust Company (TC)

The Asset Management Company (AMC)

The custodian, and

The unit-holders

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They are usually formed by an investment adviser or manager or sponsor who selects and

appoints a BOT, which, in turn, hires or contracts a separate AMC which is run by

professional managers. The AMC conducts the necessary research, and based on it,

manages the fund or portfolio. It is responsible for floating, managing, redeeming the

schemes; it also handles the administrative chores. It receives the fees for the services

rendered by it. The custodian is responsible far coordination with brokers, the actual transfer

and storage of stocks, and handling the property of the trust. He is answerable to the

AMC.As per the current regulations in force in India, every MF proposed by a sponsor has to

be setup as a trust under the Indian Trust Act, 1882 (and not as a company under the

Companies Act, 1956). The UT1, however, was set up under a special UTI Act, 1963. All

MFs have to be registered with the SEBI. It is required that the first four constituents of the

MF should maintain an arm's length relationship among themselves in order to reduce

conflict of interests, and to safeguard the interests of the investors.Mutual funds can sell

their units directly to the investors or they may employ the sales forced brokers and agents

for that purpose. Some MFs in the US charge their investors a sales fee for the costs

involved in selling the fund, and they are known as "load funds". Those who do not charge,

such a fee arc known as "no-load funds". All funds charge their shareholders a management

fee which is paid out of the fund's income.

Sponser

The sponsor is the promoter of the mutual fund. He sponsor establishes the mutual

fund

Sponsor appoints the trustees .custodians and the AMC with prior approval of

SEB1,and in and registers the same with SEB1.accordance with regualation.

Sponsor must have at least 5 years track record of business interest in the financial

markets,

Sponsor must have been profit making in at least 3 of the above 5 years-

Sponsor must contribute at least 40% of the capital of the AMC.

Trustee

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The mutual fund, which is a trust,is managed either by a trust companies or a board of

trustees and governed by the provisions of the Indian Trust Act. The AMC and other

functionaries are functially accountable to trustees.

The sponsor executes and registers a trust deed in favour of the trustees .the thirdschedule of SEB1 regulation specifies the contents of the trust deed.

The appointment of all trustees has to be done with prior approval of SEB1

There must be at least 4 members in the board of trustees must be independent.

Trustees of one mutual fund cannot be trustees of another mutual fund, unless he is

an independent trustees in both cases, and has the approval of both the boards.

Asset Management Company

The trustees on the advise of the sponsors, usually appoint the AMC. The AMC has to be

SEB1 registered entity and should have a minimum net worth management agreement with

the AMC.which spells out the functions of the AMC.

The following are various types of AMC's we have in India:

AMC's owned by banks.

AMC's owned by the Indian private sector companies

AMC's owned by the financial institutions.

AMC's owned by the foreign institution investors.

AMC's owned jointly by Indian and foreign sponsors.

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AUDIT

Legal advisor advise mutual fund on regulatory and taxation issues. Every mutual fund has

an employee designated as compliance officer, who works under the advise of the legal

advisor. The AMC aiso has its accounts and annual reports, these two sets of accounts are

required to be statutory audited. SEB1 regulation stipulate that auditors of the fund can not

also be the auditors of the AMC- the two sets of accounts have to be

audited by to separate auditing firms. audotors charge a fee from the mutual fund for these

services.

TRANSFER

As the fund stands ready to redeem the unit on any working day, the transfer facility is

found redundant. However, if a transferee becomes a holder of scheme's units in an official

capacity by operation of law or is a scheduled bank/ financial institution upon enforcement of

a pledge, then the trustee shall subject to production of necessary evidence, procide to

affect the transfer, if the intended transferee is otherwise in line with terms of the schemes

-In case any pledge/charge over the scheme's units is the registered with the trustee,

transfer will be affected in accordance with the procedure outlined in the detailed offer

document.

BANKERS

A Fund's activities involve dealing with money on a continuous basis primarily with respects

to buying and selling units, paying for investment made, receiving the proceeds on sale of

investment and discharging its obligations towards operating expenses. A fund's bankers

therefore play.

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STRUCTURE OF A MUTUAL FUND

Sponsor

Mutual

fundTrustee

s

ASSET

MANAGEMENT

COMPANY

Custodia

n

Registra

r

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How Mutual Fund Works

The flow chart below describes broadly the working of a mutual fund.

DEMATERIALIZED TRADING

Indian investor community has undergone sea changes in the past few years.

India now has a very large investor population and ever increasing volumes of

trades. However, this continuous growth in activities has also increased

problems associated with stock trading. Most of these problems arise due to

the intrinsic nature of paper based trading and settlement, like theft or loss of

share certificates. This system requires handling of huge volumes of paper

leading to increased costs and inefficiencies. Risk exposure of the investor due

to this trading in paper.

Some of these risks are:

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1. Delay in transfer of shares.

2. Possibility of forgery on various documents leading to bad deliveries,

legal disputes etc.

3. Possibility of theft of share certificates in the market.

4. Multiplication or loss of share certificates in transit.

5. Prevalence of fake certificates in the market.

The physical from of holding and trading in securities also acts as a

bottleneck for broking community in capital market operations.

The introduction of NSE and BOLT has increased the reach of capital market

manifolds. The increase in number of investors participating in the capital

market has increased the possibility of being hit by a bad delivery. The cost

and time spent by the brokers for rectification of these bad deliveries tends to

be higher with the geographical spread of the clients. The increase in trade

volumes lead to exponential rise in the back office operations thus limiting the

growth potential of the broking members. The inconvenience faced by

investors (in areas that are far flung and away from the main metros) in

settlement of trade also limits the opportunity for such investors, especially in

participating in auction trading. This has made the investors as well as broker

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wary of Indian capital market. In this scenario, dematerialized trading is

certainly a welcome move.

What is Dematerialization?

Dematerialization or Demat is a process whereby your securities like shares,

debentures etc, are converted into electronic data and stored in computers by

a Depository. Securities registered in your name are surrendered to depository

participant (DP) and these are sent to the respective companies who will

cancel them after Dematerialization and credit your depository account with

the DP. The securities on Dematerialization appear as balances in your

depository account. These balances are transferable like physical shares. If at

a later date, you wish to have these Demat securities converted back into

paper certificates; the Depository helps you to do this.

Dematerialization is the process of converting the securities held in physical

form (certificates) to an equivalent number of securities in electronic form and

crediting the same to the investors Demat account. Dematerialized securities

do not have any certificate numbers or distinctive numbers and are dealt only

in quantity i.e.; the securities are fungible.

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Dematerialization of your holdings is not mandatory. You can hold your

securities either in demat form or in physical form. You can also keep part of

your holdings (in the same scrip) in demat form & part in physical form.

However, securities specified by SEBI can be delivered only in demat form in

the stock exchanges connected to NSDL and / or CDSL.

WHAT IS DEPOSITORY?

Depository functions like a securities bank, where the dematerialized physical

securities are traded and held in custody. This facilitates faster, risk free and

low cost settlement. Depository is much like a bank and performs many

activities that are similar to a bank. Following table compares the two.

BANK DEPOSITORY

HOLDSFUNDSINACCOUNTS HOLDSSECURITIESINACCOUNTTRANSFERS FUNDS BETWEEN

ACCOUNTS

Transfers securities between

accounts

Transfers without handling

money

Transfers without handling

securities

Safekeeping of money Safekeeping of securities

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NSDL and CDSL

At present there are two depositories in India, National Securities Depository

Limited (NSDL) and Central Depository Services Limited (CDSL). NSDL is the

first Indian depository; it was inaugurated in November 1996. NSDL was set up

with an initial capital of US$28mn, promoted by Industrial Development Bank of

India (IDBI), Unit Trust of India (UTI) and National Stock Exchange of India Ltd.

(NSEIL). Later, State Bank of India (SBI) also became a shareholder.

The other depository is Central Depository Services (CDS). It is still in the

process of linking with the stock exchanges. It has registered around 20 DPs

and has signed up with 40 companies. It had received a certificate of

commencement of business from Sebi on February 8, 1999.

These depositories have appointed different Depository Participants (DP) for

them. An investor can open an account with any of the depositories DP. But

transfers arising out of trades on the stock exchanges can take place only

amongst account-holders with NSDLs DPs. This is because only NSDL is

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linked to the stock exchanges (nine of them including the main ones-National

Stock Exchange and Bombay Stock Exchange).

In order to facilitate transfers between investors having accounts in the two

existing depositories in the country the Securities and Exchange Board of India

has asked all stock exchanges to link up with the depositories. Sebi has also

directed the companies registrar and transfer agents to effect change of

registered ownership in its books within two hours of receiving a transfer

request from the depositories. Once connected to both the depositories the

stock exchanges have also to ensure that inter-depository transfers take place

smoothly. It also involves the two depositories connecting with each other. The

NSDL and CDSL have signed an agreement for inter-depository connectivity.

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WHAT IS A DP?

A depository is like a bank where securities are held in electronic

(dematerialized) form. In India, there are two Depositories National securities

Depositories Limited (NSDL) and Central Depository Services Limited (CSDL).

Under the Depositories Act, investors can avail of the services of the

Depositories through Depository Participants (DP) such as ICICI bank. DPs

are like bank branches wherein shares in physical form need to be deposited

for converting the same to electronic (Demat) form.

NSDL carries out its activities through various functionaries called business

partners who include Depository Participants (DPs), issuing corporate and their

Registrars and Transfer Agents, Clearing corporations/Clearing Houses etc.

NSDL is electronically linked to each of these business partners via a satellite

link through Very Small Aperture Terminals (VSATs). The entire integrated

system (including the VSAT linkups and the software at NSDL and each

business partners end) has been named as the NEST [National Electronic

Settlement & Transfer] system.

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The investor interacts with the depository through a depository participant of

NSDL. A DP can be a bank, financial institution, a custodian or a broker.

Just as one opens a bank account in order to avail of the services of a bank,

an investor opens a depository account with a depository participant in order to

avail of depository facilities.

SAVINGS

Trading in dematerialized shares results in substantial savings for the

investors. Following tables gives an idea about these savings.

Savings for a person who buy shares for long term investment

(On a purchase of Rs10000)

ItemPhysical

(Rs)

Depository (demat)

(RS)Savings (Rs)

Brokerage 75-100 50-75 25-50

*Stamp Duty 50 - 50

Postal Charges 10-30 - 10-30

Company Objection (courier

etc.)

10-30 - 10-30

Settlement charges - 5-10 -(5-10)

#Custody (5 years) - 10-50 -(10-50)

Total 35-100

* Stamp duty of 0.5%

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# Custody charge of 0.05%- 0.1%

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Savings for an investor who sells dematerialized shares

(For a sale of Rs10000)

Item Physical (Rs)Depository (demat)

(Rs)

Savings

(Rs)

*Brokerage 75-100 50-75 25-50

Company Objection (courier,

etc.)

10-30 - 10-30

Settlement charges - -(5-10) -(5-10)

Total 25-75

Many brokers offer reduced brokerage for selling of dematerialized securities

since they will not have the fear of bad delivery.

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Savings for a trader who buys and sells very often.

(For a trader who turns over his portfolio of Rs10000 ten times in a year.)

Item Physical (Rs) Depository (demat) (Rs) Savings (Rs)

*Brokerage 750-1000 500-750 250-500

Settlement charges - 50-100 -(50-100)

Custody (5 years) - 2-10 -(2-10)

Total 140-390

* Many brokers offer reduced brokerage for sell of dematerialized securities

since they would not have fear of bad delivery.

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BANK ACCOUNTS

How to open a bank account with a DP

Opening a depository account is as simple as opening a bank account. You

can open a depository account with any DP convenient to you.

To open an account you have to:

Fill up the account opening form, which is available with the DP.

Sign the DP-client agreement, which defines the rights and duties of the DP

and the person wishing to open the account.

Receive your client account number (client ID).

This client ID along with your DP ID gives you a unique identification in the

depository system.

There is no restriction on the number of depository accounts a person can

open. However, if your existing physical shares are in joint names, you have to

open the account in the same order of names before you submit your share

certificates for demat. A sole holder of the share certificates cannot add more

names as joint holders at the time of dematerializing his share certificates.

However, if the investor wants to transfer the ownership from his individual

name to a joint name, he should first open an account as the sole holder

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(account A) and dematerialize the share certificates. He should then open

another depository account (account B) in which he is the first holder and the

other person is the second holder and make an off market transfer of the

shares from the account A to account B. The investor will incur a charge on

this transaction. Alternatively, the certificates can be transferred to the joint

ownership and then sent for Dematerialization.

Right now, as per the Companies Act, there is no nomination facility for shares

(whether in the physical or in the electronic form). The nomination facility for

shares can be availed of only when the relevant provisions in the Companies

Act are amended. NSDL captures the details of the nominee when the account

is opened so as to offer the facility as soon as the relevant amendments are

effected in the Law.

A client can choose to open more than one account with same DP. In addition

to this, he has a choice of opening accounts with more than one DP. However

a broker can open just one Clearing Member account per card/ stock exchange

for clearing purpose, but he can still open multiple beneficiary accounts

Beneficiary is the personal account wherein brokers can keep their personal

holdings.

A broker has only one Clearing Member-pool-account. One Clearing Member

pool account is opened per card/ stock exchange to settle trades in the

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dematerialized form. The Clearing Corporation/ House just deals with one

designated account for pay-in and payout and the broker's clients know to

which account they have to deliver and receive securities from.

A clearing member cannot hold his personal holdings in his clearing member

account. A broker may deal in the depository system as a clearing member

only through a special account, known as the Clearing Member account. This

account can be used only for clearing purposes and not for holding his own

securities in it. As this is a transitory account, the securities held in this account

are not eligible for corporate actions. Therefore, the broker will have to open a

separate beneficiary owner account to hold his investments.

There is no compulsion for the client to open his account with the same DP as

that of his broker. Even if he has an account with another DP, he can carry out

normal business with his broker. There is no loss in operational efficiency. But

it is possible that opening account with his broker's DP may work out to his

advantage, as some DPs may offer special charge structure if the broker and

his clients are dealing through him.

How to choose a DP

Following are the few aspects that you should consider before choosing a DP:

1. Branch-level service.

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Most DPs offer depository services from their main branch as well as through

other branches and franchisees. Higher the number of branches your DP has,

(which offer depository services) greater will be the geographical convenience

you will have.

Recently Department of Telecommunications has allowed the DPs (only bank-

DPs at present) to connect their entire internal network to NSDL. The NSDL is

making changes in its software for DPs to meet the DoT conditions. After it is

done DPs will be able to execute your instructions directly at the branch level

thus saving time and improving efficiency. So check before opening an account

whether your DP (if it is a bank-DP) intends to interconnect its branch network

with that of NSDL. Before opening an account with a DP you should also check

whether the DP is offering all the services through its branches.

DPs mandate a time limit for submission of debit instructions before settlement

pay-in time. It should be checked whether the time limit applies equally to all

the branches (or franchisees) of the DP or whether it varies.

Backup facilities

Having an adequate backup system is extremely necessary for a DP. In case

of a system failure all the data could be lost if backup facilities are not present.

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Although depositories too have the data with them but a strong system with

your DP ensures no risks and hassles.

So before opening an account get details from your DP about its computer

system's technical specifications and backup facilities.

Safe procedures.

Your securities account can get debited only if you submit to your DP a duly

filled and signed 'delivery instruction' (debit instruction) form (separate for

market trades and off-market transfers) that authorizes the DP to debit your

account. You will execute this form only when you have sold shares. But you

could have worries that some one else can forge your signature on such a

form, which your DP will not be able to detect, and your account will get

debited .To get rid of these worries you should check that delivery instruction

form book that you get from your DP must be serial-numbered with numbers

unique to your account and recorded in the DP's system.

Whenever there is a debit or credit in an a/c the DP is supposed to send a

transaction statement and a holding statement to the investors within a

fortnight. In case there have been no transactions they generate just a holding

statement every quarter. So check for the statements regularly since all DPs

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are not very punctual about sending transaction and holding statements. These

statements will ensure that youre a/c is proper.

There is an additional safety feature available with the DPs. You can freeze

your account on the debit side if you do not want to sell the shares from your

account, this will ensure that no debit is done in your account. Your account

will continue to receive credits arising from fresh purchases but no debit will be

permitted. A special form that you can get from the DP is executed that

instructs your DP to freeze your account (only for the debit side or completely).

When you want to sell your shares you can execute the same form to unlock

your account.

Customer Service

DPs should have adequate customer service facilities. This is one of the most

important aspects while deciding your DP. At some time or other you will need

some information on your account. Your DP should be able to provide you

quick service, so check whether your DP has a dedicated customer service

department.

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If you are not happy with the service, you get from your DP or you are not sure

that your shares will be safe you should not think twice of taking your shares to

another DP.

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However, securities that have to be mandatorily settled in demat form (both by

institutional investors & all category of investors) cannot be settled in physical

form. Also for securities that have to be mandatorily settled in demat form by all

categories of investors the concept of market lot is eliminated ie the tradable lot

is one share from the date they become compulsory.

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exchanges. All trading members of stock exchanges are clearing

members of clearing houses. In addition, for settlement of institutional

trades, custodians are also allowed to act as clearing members.

Clearing members of clearing house, dealing in dematerialized securities

are expected to open a clearing account with any DP for the purpose of

settling trades in dematerialized securities. As, in the mixed (unified)

segment, there is a possibility for all clearing members to receive

dematerialized securities, they are expected to open clearing accounts.

If there is any short delivery at the time of pay-in of securities, these short

positions are auctioned in the Demat segment as done in the Unified

(erstwhile-physical) segment.

For trades executed on Wednesday (TD 1):

Final/ Net obligation statement download - Friday (T+2nd working day)

Settlement day (SD 1) ie pay in and pay out of funds and securities - next

Wednesday (T+5th working day)

Auction trade day (ATD 1) - next Thursday (T+6th working day)

Auction settlement day (ASD 1) - Monday (2nd working day from auction

trade day ie T+8th working day)

Similarly, for trades executed on Thursday (TD 2):

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Final/ Net obligation statement download - Monday (T+2nd working day)

Settlement day (SD 2) - next Thursday (T+5th working day)

Auction trade day (ATD 2) - next Friday (T+6th working day)

Auction settlement day (ASD 2) - Tuesday (2nd working day from auction

trade day ie T+8th working day)

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CHARGES

NSDL Charges for DPs

NSDL does not charge the investor directly but charges its DPs, who are free

to charge their clients.

NSDL charges its DPs under the following heads:

2.6(a)-1: Transaction Fees :

1. Market Trade :

Sale - nil;

Purchase - 5 basis points (i.e. 0.05% of the value of net receipts to a clearing

members account)

2. Off Market Trade:

Sale - nil;

Purchase - 10 basis points (i.e. 0.1% of value of securities).

2.6(a)-2: Custody Fees :

3.5 basis points p.a.(i.e. 0.035% p.a. of average value of securities)

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COMPANY PROFILE

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 20 million

individual investors in various capacities, and provides investor services to

over 300 corporates, comprising the who's who of Corporate India. KARVY

covers the entire spectrum of financial services such as Stock broking,

Depository Participants, Distribution of financial products like mutual funds,

bonds, fixed deposit, Merchant Banking & Corporate Finance, Insurance

Broking, Commodities Broking, Realty Services, Personal Finance Advisory

Services, placement of equity, IPOs, among others. Karvy has a professional

management team and ranks among the best in technology, operations, and

more importantly, in research of various industrial segments.

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Karvy 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. We started with consulting

and financial accounting automation, and carved inroads into the field of

registry and share accounting by 1985. Since then, we 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,

evolved Karvy 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 we have made this journey by taking the route

of quality service, path breaking innovations in service, versatility in service

and finallytotality in service.

Our highly qualified manpower, cutting-edge technology, comprehensive

infrastructure and total customer-focus has secured for us the position of an

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emerging financial services giant enjoying the confidence and support of an

enviable clientele across diverse fields in the financial world.

Our values and vision of attaining total competence in our servicing has served

as the building block for creating a great financial enterprise, which stands

solid on our fortresses of financial strength - our various companies.

With the experience of years of holistic financial servicing behind us and years

of complete expertise in the industry to look forward to, we have now emerged

as a premier integrated financial services provider.

And today, we can look with pride at the fruits of our mastery and experience

comprehensive financial services that are competently segregated to service

and manage a diverse range of customer requirements.

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The Karvy Credo

Our Clients. Our Focus

Clients are the reason for our being.

Personalized service, professional care; pro-activeness are the values that

help us nurture enduring relationships with our clients.

espect for the individual

Each and every individual is an essential building block of our

organization.

We are the kiln that hones individuals to perfection. Be they our employees,

shareholders or investors. We do so by upholding their dignity & pride,

inculcating trust and achieving a sensitive balance of heir professional and

personal lives.

Teamwork

None of us is more important than all of us.

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Each team member is the face of Karvy. Together we offer diverse services

with speed, accuracy and quality to deliver only one product: excellence.

Transparency, co-operation, invaluable individual contributions for a collective

goal, and respecting individual uniqueness within a corporate whole, is how we

deliver again and again.

Responsible Citizenship

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

As a responsible corporate citizen, our duty is to foster a better environment in

the society where we live and work. Abiding by its norms, and behaving

responsibly towards the environment, are some of our growing initiatives

towards realizing it.

Integrity

Everything else is secondary.

Professional and personal ethics are our bedrock. We take pride in an

environment that encourages honesty and the opportunity to learn from failures

than camouflage them. We insist on consistency between works and actions.

KARVY CONSULTANTS LIMITED

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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 activity as a Depository Participant.

We were one of the early entrants registered as Depository Participant with

NSDL (National Securities Depository Limited), the first Depository in the

country and then with CDSL (Central Depository Services Limited). Today, we

service over 6 lakhs customer accounts in this business spread across over

250 cities/towns in India and are ranked amongst the largest Depository

Participants in the country. With a growing secondary market presence, we

have transferred this business to Karvy Stock Broking Limited (KSBL), our

associate and a member of NSE, BSE and HSE.

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IT enabled services

Our Technology Services division forms the ideal platform to unleash our

technology initiatives and make our presence felt on the Internet. Our past

achievements include many quality websites designed, developed and

deployed by us. We also possess our own web hosting facilities with dedicated

bandwidth and a state-of-the-art server farm (data center) with services

functioning on a variety of operating platforms such as Windows, Solaris, Linux

and Unix.

The corporate website of the company, www.karvy.com, gives access to in-

depth information on financial matters including Mutual Funds, IPOs, Fixed

Income Schemes, Insurance, Stock Market and much more. A link called

Resource Center, devoted solely to research conducted by our team of

experts on various financial aspects like Sector Research, deals exclusively

with in-depth analysis of the key sectors of the Indian economy. Besides, a

host of other links like My Portfolio which acts as a personalized and

customized financial measure, makes this site extremely informative about

investment options, market trends, news as also about our company and each

of the services offered here.

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KARVY STOCK BROKING LIMITED

Stock Broking Services | Distribution of Financial Products | Depository

Participants | Advisory Services | Research | Private Client Group

Member - Natio nal 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.

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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. 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

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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, our specific 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

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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.

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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 Securities Depository 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.

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.

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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.

To further tap the immense growth potential in the capital markets we

enhanced the scope of our retail brand, Karvy the Finapolis , 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

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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, Finapolis, 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.

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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.

Advisory Services

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MUTUAL FUND SERVICES

We have attained a position of immense strength as a provider of across-the-

board transfer agency services to AMCs, Distributors and Investors.

Nearly 40% of the top-notch AMCs including prestigious clients like Deutsche

AMC and UTI swear by the quality and range of services that we offer. Besides

providing the entire back office processing, we provide the link between

various Mutual Funds and the investor, including services to the distributor, the

prime channel in this operation.

Carrying the limitless' ideology forward, we have explored new dimensions in

every aspect of Mutual Fund servicing right from volume management, cost

effective pricing, delivery in the least turnaround time, efficient back-office and

front-office operations to customized service. We have been with the AMCs

every step of the way, helping them serve their investors better by offering

them a diverse and customized range of services. The first to market'

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Karvy has been a customer centric company since its inception. Karvy offers a

single platform servicing multiple financial instruments in its bid to offer

complete financial solutions to the varying needs of both corporate and retail

investors where an extensive range of services are provided with great

volume-management capability.

Today, Karvy is recognized as a company that can exceed customer

expectations which is the reason for the loyalty of customers towards Karvy for

all his financial needs. An opinion poll commissioned by The Merchant Banker

Update and conducted by the reputed market research agency, MARG

revealed that Karvy was considered the Most Admired in the registrar

category among financial services companies.

We have grown from being a pure transaction processing business, to one of

complete shareholder solutions.

CORPORATE SHAREHOLDER SERVICES

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KARVY GLOBAL SERVICES LIMITED

The specialist Business Process Outsourcing unit of the Karvy Group. The

legacy of expertise and experience in financial services of the Karvy Group

serves us well as we enter the global arena with the confidence of being able

to deliver and deliver well.

Here we offer several delivery models on the understanding that business

needs are unique and therefore only a customized service could poss

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