Project Title

Comparative Analysis of Broking Companies and Financial

performance of Edelweiss Broking Ltd.

Summer Training Project Report submitted in partial fulfillment of the

requirements for the award if the degree of

Master in Business Administration

By

SASMITA TRIPATHI

ROLL NO. 1451770056

UNDER THE GUIDANCE OF

MR. RAVI SHANKAR

Kailash Institute of Pharmacy & Management, Gorakhpur

Affiliated to Uttar Pradesh Technical University. UP

1

2

DECLARATION BY THE STUDENT

I Sasmita Tripathi Roll No. 1451770056 declare that the project entitled Comparative Analysis

of Broking Companies and Financial performance of Edelweiss Broking Ltd.” is my own

work conducted under the supervision of MR RAVI SHANKAR as a partial fulfillment of

Summer Internship Program for the course of MBA submitted Kailash Institute of Pharmacy &

Management, Gorakhpur.

I further declare that to the best of my knowledge the project does not contain any part of any

work which has been submitted for any other project either in this institute or in any other

without proper citation.

Place :

Date : Signature of the Candidate

3

ACKNOWLEDGEMENT

I would like to extend my deepest gratitude towards those respected people who helped me to

make this project possible. I would like thank my mentor and guide at EDELWEISS Mr. Ravi

Shankar for extending his help that he has given me while making this project. Without his

efforts and vigilance this project would not have been possible. Sir I sincerely thank you for your

relentless efforts towards me. I would also like mention my sincere thanks to all the officials

present at EDELWEISS because they also played an integral part in making this project possible.

Their support and confidence in me always guided me and motivated me.

Lastly , I would like to thank my college Kailash Institute of Pharmacy & Management,

Gorakhpur. for giving us a prospect to experience such hands on training and extensive

practical learning as an extension and application of the theoretical learning we have gained so

far , as a part of our curriculum. This has resulted in immensely valuable knowledge that would

be taken from the institute.

4

TABLE OF CONTENTS

1. ACKNOWLEDGEMENT

2. INTRODUCTION

Introduction to stock exchange

Introduction of the company

3. COMPANY PROFILE

4. REVIEW OF LITERATURE

5. RESEARCH METHODOLOGY

Objective of study

Type of research

Sample design

Size of sample

Sources of data collection

6. COMPARATIVE ANALYSIS

7. FINDING & ANALYSIS

8. SUGGESTIONS

9. LIMITATIONS

10. CONCLUSION

11. APPENDIX(Questionnaire)

5

PREFACE

“A good broker system must be able to cope with an extremely complex and dynamic

environment.”

The microstructure of the stock market in which brokers work is highly dynamic and volatile.

Many stocks are available to be bought and sold, each exhibiting its own patterns and

characteristics that are highly unpredictable. With so many options and considerations that need

to be taken into account, it is an extremely arduous task for a broker to investigate aspects of the

stock market and consistently provide effective advice to their clients.

Thus, brokers perform their day-to-day tasks with the aid of a broker system. Such a system

should provide tools for interacting with exchanges and performing analysis. As a consequence,

these broker systems are quite large and complicated by themselves.

This research aims is to analysis Stock broker on the basis of their services, products,

growth, and their subsidiaries. Because Stockbrokers are one of the main participants in stock

exchanges worldwide, they often act as an agent for their clients, making trades on their behalf.

They also act as advisors, providing suggestions to their clients on what stocks to buy and sell.

6

EXECUTIVE SUMMARY

There is growing competition between brokerage firms in post reform India. For investor it is always difficult to decide which brokerage firm to choose.

Research was carried out to find which brokerage house people prefer and to figure out what people prefer while investing in stock market.

This study suggest that people are reluctant while investing in stock and commodity market due to lack of knowledge

Main purpose of investment is returns and liquidity, commodity market is less preferred by investors due to lack of awareness. The major findings of this study are that people are interested to invest in stock market but they lack knowledge.

Through this report we were also able to understand, what are our Company’s (Edelweiss Broking Ltd.) positive and strong points, on the basis of which we come to know what can be the basis of pitching to a potential client. We also gave suggestions to the company, what improvement can be done to our product.

7

INTRODUCTION

In most industrialized countries, a substantial part of financial wealth is not managed

directly by savers, but through a financial intermediary, which implies the existence of an agency

contract between the investor (the principal) and a broker or portfolio manager (the agent).

Therefore, delegated brokerage management is arguably one of the most important agency

relationships intervening in the economy, with a possible impact on financial market and

economic developments at a macro level.

In most of the metros, people like to put their money in stock options instead of dumping

it in the bank-lockers. Now, this trend pick pace in small but fast developing cities like Gurgaon,

Noida etc. My research is based on the Delhi-NCR.

As the per-capita-income of the city is on the higher side, so it is quite obvious that they

want to invest their money in profitable ventures. On the other hand, a number of brokerage

houses make sure the hassle free investment in stocks. Asset management firms allow investors

to estimate both the expected risks and returns, as measured statistically. There are mainly two

types of Portfolio management strategies.

1. Passive Portfolio Strategy

2. Active Portfolio Strategy

1. Passive Portfolio Strategy: A strategy that involves minimal expectation input, and

instead relies on diversification to match the performance of some market index. A

passive strategy assumes that the marketplace will reflect all available information in the

price paid for securities

2. Active Portfolio Strategy: A strategy that uses available information and forecasting

techniques to seek a better performance than a portfolio that is simply diversified

broadly.

8

BACKGROUND OF STOCK EXCHANGE IN INDIA

The emergence of stock market can be traced back to 1830. In Bombay, business passed in the

shares of banks like the commercial bank, the chartered mercantile bank, the chartered bank, the

oriental bank and the old bank of Bombay and shares of cotton presses. In Calcutta, Englishman

reported the quotations of 4%, 5%, and 6% loans of East India Company as well as the shares of

the bank of Bengal in 1836. This list was a further broadened in 1839 when the Calcutta

newspaper printed the quotations of banks like union bank and Agra bank. It also quoted the

prices of business ventures like the Bengal bonded warehouse, the Docking Company and the

storm tug company.

Between 1840 and 1850, only half a dozen brokers existed for the limited business. But during

the share mania of 1860-65, the number of brokers increased considerably. By 1860, the number

of brokers was about 60 and during the exciting period of the American Civil war, their number

increased to about 200 to 250. The end of American Civil war brought disillusionment and many

failures and the brokers decreased in number and prosperity. It was in those troublesome times

between 1868 and 1875 that brokers organized an informal association and finally as recited in

the Indenture constituting the “Articles of Association of the Exchange”. On or about 9 th day of

July,1875, a few native brokers doing brokerage business in shares and stocks resolved upon

forming in Bombay an association for protecting the character, status and interest of native share

and stock brokers and providing a hall or building for the use of the members of such

association.

As a meeting held in the broker’ Hall on the 5 th day of February, 1887, it was resolved to execute

a formal deal of association and to constitute the first managing committee and to appoint the

first trustees. Accordingly, the Articles of Association of the Exchange and the Stock Exchange

was formally established in Bombay on 3rd day of December, 1887. The Association is now

known as “The Stock Exchange”.

9

The entrance fee for new member was Re.1 and there were 318 members on the list, when the

exchange was constituted. The numbers of members increased to 333 in 1896, 362 in 1916and

478 in 1920 and the entrance fee was raised to Rs.5 in 1877, Rs.1000 in 1896, Rs.2500 in 1916

and Rs. 48,000 in 1920. At present there are 23 recognized stock exchanges with about 6000

stock brokers. Organization structure of stock exchange varies.

14 stock exchanges are organized as public limited companies, 6 as companies limited by

guarantee and 3 are non-profit voluntary organization. Of the total of 23, only 9 stock exchanges

have been permanent recognition. Others have to seek recognition on annual basis.

These exchange do not work of its own, rather, these are run by some persons and with the help

of some persons and institution. All these are down as functionaries on stock exchange. These

are

1. Stockbrokers

2. sub-broker

3. market makers

4. Portfolio consultants etc.

10

1.) Stockbrokers

Stock brokers are the members of stock exchanges. These are the persons

who buy, sell or deal in securities. A certificate of registration from SEBI is mandatory to act as

a broker. SEBI can impose certain conditions while granting the certificate of registrations. It is

obligatory for the person to abide by the rules, regulations and the buy-law. Stock brokers are

commission broker, floor broker, arbitrageur etc.

Detail of registered brokers

Total no. of registered brokers as

on 31.03.2009

Total no. of sub-brokers as on

31.03.2009

9000 24,000

2.) Sub-broker

A sub-broker acts as agent of stock broker. He is not a member of a stock

exchange. He assists the investors in buying, selling or dealing in securities through stockbroker.

The broker and sub-broker should enter into an agreement in which obligations of both should be

specified. Sub-broker must be registered SEBI for a dealing in securities. For getting registered

with SEBI, he must fulfill certain rules and regulation.

11

3.) Market Makers

Market maker is a designated specialist in the specified securities. They

make both bid and offer at the same time. A market maker has to abide by bye-laws, rules

regulations of the concerned stock exchange. He is exempt from the margin requirements. As per

the listing requirements, a company where the paid-up capital is Rs. 3 crore but not more than

Rs. 5 crore and having a commercial operation for less than 2 years should appoint a market

maker at the time of issue of securities.

4.) Portfolio consultants

A combination of securities such as stocks, bonds and money market

instruments is collectively called as portfolio. Whereas the portfolio consultants are the persons,

firms or companies who advise, direct or undertake the management or administration of

securities or funds on behalf of their clients.

Partial fulfillment for degree of M.B.A. programmed, we received the opportunity from

Edelweiss Broking Ltd. for our summer training project report. It is basically a stock brokering

company which deals in security and derivative market, mutual funds etc.

12

Edelweiss Capital Limited: A Profile _________________________

INTRODUCTION

The Edelweiss Group is a conglomerate of 44 entities including 39 Subsidiaries and 4 Associate

companies (September‟09), engaged in the business of providing financial services, primarily

linked to the capital markets. Edelweiss Capital Limited (www.edelcap.com), incorporated in

1995, today has emerged as one of India‟s leading integrated financial services conglomerates.

The Edelweiss Group offers one of the largest range of products and services spanning varied

asset classes and diversified consumer segments. The Group‟s product offerings are broadly

divided into Investment Banking, Brokerage Services, Asset Management and Financing. The

company‟s research driven approach and consistent ability to capitalize on emerging market

trends has enabled it to foster strong relationships across corporate, institutional and HNI clients.

Edelweiss Capital Limited now employs about 1200 employees, leveraging a strong partnership

culture and unique model of employee ownership. It is a listed company since December 2007

under the symbols NSE: EDELWEISS, BSE: 532922 and Bloomberg: EDEL.IN.

13

Evolution of Edelweiss

14

Business Overview

Edelweiss‟ operations are broadly divided into Agency and Capital business lines. The Agency

business line includes Investment Banking, Broking - both Institutional and HNI/Retail, Asset

Management and Investment advisory and distribution services. The Capital business line

includes Financing and Treasury Operations. The strategies employed ensure that broadly one-

third of the total revenues are contributed by each of Agency fee & commission, Treasury

Arbitrage & Trading income and Interest income thereby achieving the intended diversification

in revenue streams.

Investment Banking

Edelweiss has one of the most extensive product offerings within Investment Banking in India,

catering to different market and client segments. The verticals within Investment Banking

include Equity Capital Markets and Advisory services which offer Mergers & Acquisitions

Advisory, Private Equity Syndication, Structured Finance Advisory, Real Estate Advisory and

Infrastructure Advisory. Edelweiss‟ leadership position in Mid-market space is reflected in the #

1 ranking in both Bloomberg tables for Mid-market Private Equity placements in CY2007 and

Prime Database league tables for IPOs in Mid-market segment in FY2008. It was adjudged

winner in the Best Merchant Banker category in the Outlook Money NDTV Profit Awards 2008.

15

Broking

Institutional Equities :

Edelweiss has one of the leading institutional equities businesses in India backed by a large and

experienced research team and a large and diversified client base. Intense servicing, seamless

execution and innovative research products have helped Edelweiss build strong relationships

with over 300 institutional investors, including FIIs and domestic institutional investors.

Research coverage presently extends to over 145 companies across 16 sectors accounting for

nearly 70% of total market capitalization. The quality and caliber of research associated with

Edelweiss is widely regarded across the institutional community. Our commitment to provide

cutting edge research has resulted in a pioneering effort to provide online research to our clients

through the portal www.edelresearch.com with smart features of sorting of information, analysis

and archiving.

HNI Broking

Edelweiss offers dedicated brokerage services to high net-worth individuals with a strong

emphasis on building long-term relationships with clients. Product offerings include specialized

trading execution for active trading clients and structured products like equity linked capital

protection products.

16

Wealth Advisory & Investment Services

The Primary focus is on understanding each client's profile including life style, risk appetite,

growth expectations, current financial position and income requirements to create comprehensive

and tailored investment strategies. The broad range of offerings includes asset allocation

advisory to Structured Products, Portfolio Management, Mutual Funds, Insurance, Derivatives

Strategies, Direct Equity, Private Equity, and Real Estate Funds etc.

Retail Initiatives

Retail Broking and Distribution are the new initiatives of the Group under its Retail Business

strategy. An online retail broking portal www.edelweiss.in is operational and provides advisory

and research based broking services. Distribution business focuses on giving advice and

analyzing the best financial product options available in the market. It involves the distribution

of the full range of third party financial products and services including IPO syndication for the

retail customer. For the half year ended September 30, 2009 Edelweiss is ranked #2 in NIB (non

institutional bidder) category and is ranked 4th in Retail category by the number of applications

in IPOs as per Prime Database. Edelweiss also secured 1st rank in NIB category both in NHPC

and OIL India IPOs by the number of applications.

Asset Management

Alternative Asset Management focuses on advisory/management expertise for India focused

Multi-Strategy Fund, Real Estate Fund and a Bonds Fund. Recent Initiatives that have been

announced include setting up an ARC for which RBI registration has been received. On the

Domestic AMC side, Edelweiss Mutual Fund has launched a mix of debt and equity funds. The

focus of this business is on broad basing the product portfolio.

17

Financing

With a deep knowledge and understanding of capital markets, the Company‟s primary offering

in the financing business includes collateralized loan products such as promoter funding, loans

against shares, IPO financing, loans against ESOPs etc. Its prudent financing norms and a

conservative margin of safety ensures low or nil non–performing loans.

Treasury

The Treasury Operations in Edelweiss is similar to that of a Treasury in a Commercial Bank and

focuses on liquidity management and capital preservation. This business adopts a multi–

strategy/multi-book approach to diversify and grow its portfolio while imparting liquidity in the

balance sheet. The Company follows a disciplined and conservative approach to cash

management with emphasis on strong risk policies.

18

WORK STRUCTURE OF EDELWEISS

Edelweiss has always believed in investing in technology to build its business. The company has

used some of the best-known names in the IT industry, like Sun Microsystems, Oracle,

Microsoft, Cambridge Technologies, Nexgenix, Vignette, Verisign Financial Technologies India

Ltd, Spider Software Pvt Ltd. to build its trading engine and content. The Citi Venture holds a

majority stake in the company. HSBC, Intel & Carlyle are the other investors.

On April 17, 2009 Edelweiss launched Speed Trade, are net-based executable application that

emulates the broker terminals along with host of other information relevant to the Day Traders.

This was for the first time that a net-based trading station of this caliber was offered to the

traders. In the last six months SpeedTrade has become a de facto standard for the Day Trading

community over the net.

19

www.edelweiss.in

The firm’s online trading and investment site - www.edelweiss.in - was launched on Feb 8, 2009.

The site gives access to superior content and transaction facility to retail customers across the

country. Known for its jargon-free, investor friendly language and high quality research, the site

has a registered base of over 1 Lacs customers. The number of trading members currently stands

at over 7 Lacs. While online trading currently accounts for just over 5 per cent of the daily

trading in stocks in India, Edelweiss alone accounts for 27 per cent of the volumes traded online

for HNI segment.

The Corporate Finance section has a list of very prestigious clients and has many ‘firsts’ to its

credit, in terms of the size of deal, sector tapped etc. The group has placed over US$ 5 billion in

private equity deals. Some of the clients include BPL Cellular Holding, Gujarat Pipavav, Essar,

Hutchison, Planetasia, and Shopper’s Stop.

Finally, Edelweiss shifted hands and Citi venture get holds on it.20

Enter Stock for Company Details / Stocks for Comparison. 

   SENSEX 17,700.90    166.81 ( 16:03  ) | NIFTY 5,312.50   56.35 ( 16:14 ) 

                   

Copyright © 2009 ECSL. | Disclaimer | Terms & Conditions | Privacy Policy | Browser Settings About Us | Customer Service | Channel Partners | Our Offerings | Site Map 

Edelweiss : India`s leading Stock Broking Company provides online BSE and NSE Share Trading Services. Site is best viewed using Browsers Internet Explorer 7.0+ & Mozilla Firefox 2.0+ with resolution 1280 by 768.

Equities Go

FINANCIAL PERFORMANCE

Operations of the company

ESL’s operation can be broadly classified into equity brokerage services and proprietary trading.

ESL focuses on the wholesale equity segment, providing broking services to Institutional and

corporate clients and high net worth individuals.

Fund Requirements

ESL’s fund requirements arise mainly on account of working capital requirement on account of

deposits to be maintained with the exchanges for obtaining trading exposure limits and for

meeting funds requirement for institutional clients. The proceeds of the proposed CP

issue are to be used for the aforesaid purposes. Unutilized margins paid to the exchanges as on

last trading day of the month ranges from 16% to 45% during the period Apr-04 to Dec-04.

However, ESL has to maintain high margins for its intraday transactions done

on its proprietary book and for its clients.

As on 31st Dec’04, ESL has fund based bank limits on 2,400 lacs and its average

utilization level has been around 50%.

21

BRIEF FINANCIAL

As on/For the

Period ended

31st March

2012 2013 2014 2015

Brokerage

Income

207 151 290 891

Inc from

Securities

&derivatives

36 121 147 295

Total Income 287 301 587 1394

Employee Costs 35 65 100 229

Operating and

Other Expenses

166 171 286 660

Interest Paid 64 46 63 63

Total Expenses 287 289 462 1030

PBT 1 11 126 364

PAT -12 10 104 243

Networth 537 536 772 1015

Total Capital

Employed

527 1355 1559 2315

22

SOLVANCY RATIOS

Overall

Debt/Equity

Ratio

1.11 1.47 0.96 1.27

Interest

Coverage ratio

1.01 1.25 2.99 6.77

Current Ratio 1.36 1.79 2.96 1.31

OPERATING EFFICIENCY

Operating

Expenses/Total

Incom

0.70 0.79 0.66 0.64

Interest

Expended/total

Income

0.22 0.15 0.11 0.05

23

PROFITABILITY RATIO

PAT/Total

Income (%)

-4.20 3.29 17.69 17.42

Return on Net

Worth (%)

1.86 15.87 27.18

Return on

Capital

Employed (%)

1.05 7.13 12.54

24

BROKERAGE INCOME

2012 2013 2014 20090

100200300400500600700800900

BROKERAGE INCOME

COMMENT

Brokerage income of ESL has grown at CAGR of 63% from Rs. 207 lacs in FY15 to Rs. 891

lacs in FY12. The growth has been particularly strong in FY12 and H1FY’14, on account of

buoyancy in the equity market.

Brokerage income contributed 64% of the ESL’s total income in FY09. Total

income has grown at 70% p.a. from Rs.287 lacs in FY01 to Rs.1,394 lacs in FY04. However,

from a loss of Rs.12 lacs incurred in FY12 (on account of prior period adjustment, PBT was

positive), ESL registered a profit of Rs.243 lacs in FY15.

25

INCOME FROM SECURITIES AND DERIVATIVES

2012 2013 2014 20090

50

100

150

200

250

300

INCOME FROM SECU-RITIES AND DERIVA-TIVES

COMMENT

The percentage of income from securities and derivatives is higher because percentages of

deleing with securities and derivatives is higher. And the continuous increasing branches in the

country.

26

PROFIT AFTER TAX

2012 2013 2014 2009-50

0

50

100

150

200

250

East

COMMENT

In 2012 company balance sheet shows higher depreciation and reduction of the fictitious assets

and high investment to launch on line web portal.

27

NET WORTH

2012 2013 2014 20090

200

400

600

800

1000

1200

East

COMMENT

Company is eager to invest in the Indian market.

28

News Roundup: Edelweiss To Buy Anagram For Rs 150 Cr

January 13 2010, 16:04:13 IST | TEAM VCC

Edelweiss Capital, one of the largest brokerages in India, is close to buying Anagram Stock Broking for Rs 150Cr.

Edelweiss To Buy Anagram For Rs 150 Cr - Edelweiss Capital Ltd, one of the largest brokerages in India,

is close to buying Anagram Stock Broking for Rs 150 crore. Anagram has 169 branches   and 3000,00 clients

mainly in Gujarat and Maharashtra. Anagram is owned by Lalbhai group , which has companies like Arvind

Mills. Edelweiss is present in institutional equities, equity financing and investment banking, among

others. (Mint)

RETURN ON NET WORTH

2007 2014 20150

5

10

15

20

25

30

RETURN ON NET WO...

COMMENT

These ratios shows response from the investors is good and supportive that’s why company

showing good returns .

29

PRODUCTS OFFERED BY EDELWEISS BROKING LTD.

1- Equity Trading Platform (Online/Offline).

2- Portfolio Management Service.

REASONS TO CHOOSE EDELWEISS BROKING LIMITED

Experience

EDELWEISS has more than ten year of trust and credibility in the Indian stock market. In the

Asia Money broker's poll held recently, Edelweiss won the 'India's best research house for 2006'

award. Ever since it launched Edelweiss as its retail broking division in February 2008, it has

been providing institutional-level research and broking services to individual investors.

Technology

With their online trading account one can buy and sell shares in an instant from any PC with an

internet connection. Customers get access to the powerful online trading tools that will help them

to take complete control over their investment in shares.

Accessibility

30

Edelweiss provides ADVICE, EDUCATION, TOOLS AND EXECUTION services for

investors. These services are accessible through many centers across the country (Over 650

locations in 150 cities), over the Internet (through the website www.edelweiss.in) as well as over

the Voice Tool.

Knowledge

In a business where the right information at the right time can translate into direct profits,

investors get access to a wide range of information on the content-rich portal,

www.sharekhan.com. Investors will also get a useful set of knowledge-based tools that will

empower them to take informed decisions.

Convenience

One can call Edelweiss’s Dial-N-Trade number to get investment advice and execute his/her

transactions. They have a dedicated call-center to provide this service via a Toll Free Number

1800-22-750 from anywhere in India.

Customer Service

Its customer service team assist their customer for any help that they need relating to

transactions, billing, demat and other queries. Their customer service can be contacted via a toll-

free number, email or live chat on www.sharekhan.com.

31

Investment Advice

Edelweiss Broking Ltd. has dedicated research teams of more than 100 people for fundamental

and technical research. Their analysts constantly track the pulse of the market and provide timely

investment advice to customer in the form of daily research emails, online chat, printed reports

etc.

32

Benefits

· Free Depository A/c

· Instant Cash Tranfer

· Multiple Bank Option.

· Secure Order by Voice Tool Dial-n-Trade.

· Automated Portfolio to keep track of the value of your actual purchases.

· 24x7 Voice Tool acess to your trading account.

· Personalised Price and Account Alerts delivered instantly to your Mobile Phone & E-mail

address.

· Live Chat facility with Relationship Manager on Yahoo Messenger

· Special Personal Inbox for order and trade confirmations.

· On-line Customer Service via Web Chat.

· Enjoy Automated Portfolio.

· Buy or sell even single share

· Anytime Ordering.

33

Edelweiss Broking Ltd. offers the following products:-

FREE ACCOUNT OPENING

This is a User Friendly Product which allows the client to trade through website

www.edelweiss.in and is suitable for the retail investors who is risk-averse and hence prefers to

invest in stocks or who do not trade too frequently.

Features

· Online trading account for investing in Equity and Derivatives via www.edelweiss.in

· Live Terminal and Single terminal for NSE Cash, NSE F&O & BSE.

· Integration of On-line trading, Saving Bank and Demat Account.

· Instant cash transfer facility against purchase & sale of shares.

· Competitive transaction charges.

· Instant order and trade confirmation by E-mail.

· Streaming Quotes (Cash & Derivatives).

· Personalized market watch.

· Single screen interface for Cash and derivatives and more.

· Provision to enter price trigger and view the same online in market watch.

34

XPRESS

XPRESS is an internet-based software application that enables you to buy and sell in

an instant. It is ideal for active traders and jobbers who transact frequently during day’s session

to capitalize on intra-day price movement.

35

Features

· Instant order Execution and Confirmation.

· Single screen trading terminal for NSE Cash, NSE F&O & BSE.

· Technical Studies.

· Multiple Charting.

· Real-time streaming quotes, tic-by-tic charts.

· Market summary (Cost traded scrip, highest clue etc.)

· Hot keys similar to broker’s terminal.

· Alerts and reminders.

· Back-up facility to place trades on Direct Phone lines.

· Live market debts.

Funds Transfer

Transfer funds between your savings account and trading account.

Avail a pay-in and pay-out option where you can transfer funds from and to your

trading account.

Tie ups with HDFC Bank, ICICI Bank and Axis Bank, Yes Bank, Kotak bank

wherein you can easily transfer funds from any of these banks.

36

ORDER BOOK

Along with enabling access for trade online, the CLASSIC and XPRESS ACCOUNT

also gives Dial-n-trade services. With this service, one can dial ESELWEISS’s dedicated phone

lines 1-800-22-7500.

Beside this, Relationship Managers are always available on Office Phone and Mobile to

resolve customer queries.

37

38

MOBILE TRADING

EDELWEISS had introduced mobile trading, A mobile based software where one can

watch Stock Prices, Intra Day Charts, Reasearch & Advice and Trading Calls live on the Mobile.

(As per SEBI regulations, buying-selling shares through a mobile phone are

not yet permitted.)

www.edelweiss.in

39

MOBILE WEBSITE

KEY FEATURES

Instant Market Updates

All Company Stock Quotes

Smart Financial Snapshots

Trading Strategies

Portfolio Tracker

ADVANCED BROKERAGE ACCOUNT

Customers pay Advance Brokerage on trading Account and enjoy uninterrupted trading in

their Account. Beside this, great effective brokerages are also available (up to 50%) on

brokerage.

IPO ON-LINE

Customers can apply to all the forthcoming IPOs online. This is quite hassle-free,

paperless and time saving. Simply allocate fund to IPO Account, Apply for the IPO and Sit Back

& Relax.

Mutual Fund Online

Investors can apply to Mutual Funds of Reliance, Franklin Templeton Investments, ICICI

Prudential, SBI, Birla, Sundaram, HDFC, DSP Merrill Lynch, PRINCIPAL and TATA with

Edelweiss.

Zero Balance ICICI Saving Account

Edelweiss had tied-up with Yes bank for Zero Balance Account for Edelweiss’s Clients.

Now their customers can have a Zero Balance Saving Account with Yes Bank after your demat

Account creation with Edelweiss.

40

CHARGE STRUCTURE

Plan Advance

Brokerage

Fee

Validity

Period

Brokerage Rates Equivalent delivery

Turnover limit

Deliver

y

Futures and

Intraday Cash

EBSPN01    Rs 2450    12

months

 

0.33%

             0.033% 750000

EBSPN02 Rs 4950 12

Months

0.27% 0.027% 1800000

EBSPN03   Rs 9950 12 Months 0.22% 0.022% 4500000

EBSPN04 Rs 15000 12 Months 0.17% 0.017%       9000000

EBSPN04 Rs.

50000

12 month 0.11% 0.011%       45000000

EBCRB06 Rs

1,10,000

12

month

0.09% 0.009% 125000000

EBCRB07

Rs

1,11,111

3 month 0.05% 0.005% 200000000

EXPOSURE: 6 TO 7 TIMES (ON MARGIN MONEY)

41

MAJOR PLAYERS IN THE REGION

1. Karvy

2. Indiainfoline

3. ICICI direct

4. HDFC security

5. Indiabulls

6.Religare

7.Edelweiss Broking Ltd.

KARVY

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 corporate, comprising the who is who of

Corporate India. Karvy has a professional management team and ranks among the best in

technology, operations and research of various industrial segments.

History of Karvy :- 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, karvy utilized its experience and superlative expertise to go from strength to strength, to

42

better their services, to innovate, diversify and in the process, evolved as one of India’s premier

integrated financial service enterprise.

PRODUCT AND SERVICES OF KARVY GROUP

1. Karvy comtrade.

2. Karvy consultant ltd.

3. Karvy merchant banking.

4. Karvy global services ltd.

43

ICICI DIRECT

ICICI Web Trade Limited (IWTL) maintains www.icicidirect.com (herein after referred to as the

"Website") whereas IWTL is an affiliate of ICICI Bank Limited and the Website is owned by

ICICI Bank Limited. IWTL has launched and established an online trading service on the

Website.

PRODUCTS AND SERVICES OF ICICI DIRECT

1. Investing in Mutual funds

2. Personal Finance

3. Customer Service Features

4. IPO’s

5. Margin Trading

6. Margin PLUS Trading

7. Call Trade

8. Trading on NSE/BSE

9. Trade in derivatives

44

INDIAINFOLINE SECURITY PRIVATE LTD

India Infoline.com Securities Pvt. Ltd. is a wholly owned subsidiary of India Infoline.com Ltd

and is the stock broking arm of India Infoline.com. The subsidiary was formed to comply with

regulatory guidelines. www.5paisa.com is a focused website for online stock market trading.

5paisa.com is a trade name owned by the India Infoline.com group. IILSPL has applied for

trading membership of the BSE under Securities and Exchange Board of India (Stock Brokers

and Sub-Brokers) Rules 1992.

IILSPL is in the business of providing broking services online via the Internet ("E-broking

Services") and has been permitted by the NSE by way of registration permission no:

NSEIL/CMO/INET/1103/2000 dated 03/July/2000, and will be applying for permission to the

BSE, to provide E-broking Services to its clients. IILSPL is a TRADING MEMBER of the

National Stock Exchange of India.

PRODUCT OFFERED BY IILSPL

Stock market:-IILSPL deals in stock market by trading in equity and derivatives.

Personal finance:- It Deals In Mutual Fund And Insurance.

Online Trading :- It provides services in stock and commodity trading (through Internet).

45

HDFC SECURITY

HDFC security is the subsidiary of HDFC (Housing Development Financial Corporation).

www.hdfcsec.com would have an exclusive discretion to decide the customers who would be

entitled to its online investing services. www.hdfcsec.com also reserves the right to decide on the

criteria based on which customers would be chosen to participate in these services .The present

web site (www.hdfcsec.com) contains features of services that they offer/propose to offer in due

course. The launch of new services is subject to the clearance of the regulators. i.e. SEBI, NSE

and BSE.

PRODUCT OFFERED BY HDFC SECURITY

Online trading for Resident & Non Resident Indians.

Cash-n-Carry on both NSE and BSE.

Day trading on both NSE and BSE.

Trade on Futures & Options on the NSE.

Online IPO's.

Telephone-based Broking (Equity & Derivatives).

46

INDIABULLS SECURITIES LIMITED

Indiabulls Securities Limited was incorporated as GPF Securities Private Limited on June 9,

1995. The name of the company was changed to Orbis Securities Private Limited on December

15, 1995 to change the profile of the company and subsequently due to the conversion of the

company into a public limited company; the name was further changed to Orbis Securities

Limited on January 5, 2004. The name of the company was again changed to Indiabulls

Securities Limited on February 16, 2004 so as to capitalize on the brand image of the term

“Indiabulls” in the company name. ISL is a corporate member of capital market & derivative

segment of The National Stock Exchange of India Ltd. At present, ISL accounts for

approximately 3% of the total daily turnover of the Exchange with 32,359 client relationships

and 70 branches spread across the country as of April 30, 2004.

INDIABULLS CREDIT SERVICES LIMITED:- Indiabulls Credit Services has been valued

at Rs. 263 crore with the Rs. 87.6-crore infusion. Indiabulls Credit Services Ltd, the recently

formed subsidiary of broking firm, Indiabulls Financial Services Ltd. Faralon Capital, a San

Francisco-based private equity fund, and its affiliates have acquired 33.3 per cent stake for Rs

87.6 crore.

47

INDIABULLS REAL ESTATE:- Indiabulls through its group companies has entered Indian

Real Estate business in 2005. It is currently evaluating several large-scale projects worth several

hundred million dollars. Indiabulls became the first company to bring FDI in Indian Real Estate

through a JV with Farallon Capital Management, a respected US based investment firm.

PRODUCT OFFERED BY INDIA BULLS

Equity & Debt Stock Broking

Insurance

Commodity trading

Depository Services

Derivatives Broking Services

Equity Research Services

Mutual Fund Distribution

IPO Distribution

48

SHAREKHAN

Sharekhan is one of the leading retail brokerage of Citi Venture which is running successfully

since 1922 in the country. Earlier it was the retail broking arm of the Mumbai-based SSKI

Group, which has over eight decades of experience in the stock broking business. Sharekhan

offers its customers a wide range of equity related services including trade execution on BSE,

NSE, Derivatives, depository services, online trading, investment advice etc.

PRODUCT OFFERED BY SHAREKHAN

Equity & Debt Stock Broking

Commodity trading

Depository Services

Derivatives Broking Services

49

Equity Research Services

Mutual Fund Distribution

IPO Distribution

Online Broker Brokerage for DeliveryBrokerage for Intraday

tradingAMC*

Sharekhan

brokerage charges0.03% - 0.50% 0.03% - 0.10% 300

Karvy

brokerage charges0.30% - 0.50% 0.03% - 0.15% 300

ICICI direct

brokerage charges0.75% 0.15% 500

Indiabulls

brokerage charges0.25% - 0.50% 0.05% - 0.10% Nil

HDFC Securities

brokerage charges0.50% 0.15% 500

Religare

brokerage charges0.20% - 0.30% 0.02% - 0.03% 250

Reliance Money

brokerage charges0.01% 0.01% card system

Indiainfoline

brokerage charges0.50% 0.10% Nil

AMC=ACCOUNT MAINTENANCE CHARGES.

50

REVIEW OF LITERATURE

According to SEBI, Professional Rating of market intermediaries, as a concept, is a matter of

debate and discussions. The need for rating is felt not only from the point of view of greater

disclosure requirements for investor’s interests, considering the important role such

intermediaries play, being an interface between investors and exchanges but also from the point

of view of measuring the adequacy of systems and controls to meet internal as well as external

compliance requirements.

So that need for Intermediaries Rating services (Brokers), In view of the developments that are

taking place in the capital markets, the need to constantly upgrade and improve systems and

procedures in operation as well as skill sets has gained considerable importance. Besides

compliance with regulatory requirements both in letter and spirit has assumed significance so as

to mitigate risk and ensure adequate protection of investors’ interest.

And Rating objectives / benefits are rated entity would be in a position to brand its image and

capitalize the same for generating more business. In a nutshell, the product may accrue

significant benefits to all stakeholders including the investors, stock brokers themselves, the

regulator and others who will benefit from the transparency and the consequential focus on

efficiency.

According to SEBI and Intermediaries Regulation and Supervision Department, different factors

are consider for rating process Organization structure, Policy on Investors interest, Risk

51

Management Policy and System, Organization process and procedures, Management policy on

compliance, Financials, History/Background, Firm’s positioning.

According to Michal Parness, Founder & CEO

Investors don’t Make Money in the Stock Market. One reason the institutions make so much

money is that they are trading. They make money every time you buy or sell. They make

money whether you win or lose. That means that when you’re investing, you’re basically just

sitting there. You’re not going anywhere. You’re not making money as an investor.

Trading the Trend: The Only Way to Make Money in the Market

If you don’t know this already, “Trend Trading” means trading trends based on human

emotions. Not lagging indicators. Not complex statistical analysis and not Ph.D. level

mathematical equations. With trend trading, you look for market movement. That could mean

stocks that are going to move up or down during the course of a day (intraday). You’ll play the

gaps up and down, often several days a week.

The “Trend trading” means being aware and taking advantage of trends like the run-ups that

happen around earning sessions. These are trends that have worked time and time again in the

market. They consistently yield results.

52

OBJECTIVE OF RESEARCH

Each research study has its own specific purpose. It is like to discover to Question through the

application of scientific procedure. But the main aim of our research to find out the truth that is

hidden and which has not been discovered as yet. Our research study has two objectives:-

PRIMARY OBJECTIVE: -How EDELWEISS BROKING LTD is best services providers as a

stock broker in the metros.

SECONDARY OBJECTIVE: -

1. To know about the awareness towards stock brokers and share market.

2. To study about the competitive position of Sharekhan Ltd in Competitive Market.

3. To study about the effectiveness & efficiency of Edelweiss Broking Ltd in relation to its

competitors

4. To study about whether people are satisfied with Edelweiss Services & Management System

or not

5. To study about the difficulties faced by persons while Trading in Edelweiss.

53

6. To study about the need of improvement in existing Trading system.

SAMPLING UNITS

Sampling unit may be a geographical one, such as Metros etc. The researcher will have to

decide one or more of such units that he has to select for his study.

In my research study Delhi NCR as a sampling unit.

SIZE OF SAMPLE

“This refers to the number of items to be selected from the universe to constitute a sample”

In our research sample size is 500.

But we also study the 5 stock broker companies related to security & commodity market like

India-infoline, ICICI direct, HDFC securities, Karvy consultant ltd. for the appropriate

collection of the information.

SOURES OF DATA COLLECTION

While deciding about the method of data collection to be used for the study the researcher should

keep to types of data.

1. Primary

2. Secondary Data.

We use in our research primary data, as well as secondary data. Primary means collected a

fresh, and the first time data and secondary means which are already available like annual

report, magazines etc.

54

Survey Method: - Survey refers to the method of securing information concerning phenomena

under study from all or selected number of respondents of the concerned area. In a survey the

investigator examines those phenomena which exist in the universe independent of his action. We

used the Scheduling Method.

Scheduling: - In this method the enumerators along with schedules, go to respondents, put to

them the questions from the Performa in the order the questions are listed and recorded the

replies in the space meant for the same in the Performa.

COMPARATIVE ANALYSIS

After the whole study, we find out the following results:

Results on the Basis of charges

There are the two type of the transaction:-

1. Intra-day based

2. Delivery based

55

Karvy ICICI direct HDFC securities Sharekhan India Infoline India bulls0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.05

0.1

0.35

0.05 0.05

0.1

0.25

0.75 0.75

0.5

0.2

0.5

INTRA-DAYDELIVERY

All the figures are in paisa/100 rupees.

Comment:- According to the survey HDFC securities charge maximum brokerage as compare to

others whereas India Infoline Ltd. charge only 0.20 paisa on maximum investment.

56

Results On the basis of Account opening charges

HDFC securities ltd:- Account opening charges w.e.f. April 2005 are as follows:- Rs.749, if the

customer has an existing relationship with HDFC

Sharekhan ltd:- There is no ACCOUNT OPENING CHARGES but require margin money of Rs

5000 for trading purposes.

ICICI direct:- A one-time charge of Rs. 750 at the time of account opening will be charged. You

may later upgrade your Invest account to an ICICI direct.com share trading account when you

desire to trade in equity.

India Infoline:- There is a nominal charge of Rs. 500 only towards stamp duty, legal and

processing fees for opening the account. This includes the registration and account opening

charges. Bank and Depository Participant (DP) account opening charges, if applicable, are

payable separately.

KARVY consultants ltd:- Account Opening Charges Are 452 But now SEBI banned on opening

of new demat account of Karvy.

Indiabulls:- Account opening charges are Rs. 900. There is no AMC and no margin money is

required.

57

Edelweiss Broking Ltd.:- Account opening charges are nil. And the requirement of the margin

money is Rs 1000.

Comment:- India Bulls charge maximum account opening charges but there are no such charges

in Sharekhan pvt. Ltd. And Edelweiss Broking Ltd.

58

Results on the basis of customer preferences

1. According to survey 40 % peoples are satisfied with IndiaBull Ltd because of their RM’s

facility and power of IndiaBull Ltd software. And 90% people of exist clients are satisfied with

Edelweiss Broking Ltd.

2. According to survey, Edelweiss Broking Ltd open new branches for individually handle to

their customer, but in ICICI direct, HDFC security there is no separate offices for this .

Results On The Basis Of Facilities

Basis of

difference

Sharekhan

Ltd.

Karvy India

Infoline

ICICI

direct

Indiabulls HDFC Edelweiss

Broking

Ltd.

Share

trading

Yes Yes Yes Yes Yes Yes Yes

Commodity

trading

Yes Yes Yes Yes Yes Yes No

d-mat

opening

rights

Yes No Yes Yes Yes No Yes

Karvy and HDFC securities are not providing complete range of trading facilities.

59

FINDINGS & ANALYSIS

1) Do you know about investment options available?

KNOWLEDGE %AGE

Yes 80%

No 20%

TOTAL 100

80%

20%

YesNo

COMMENT

Only 80% people knows the exact meaning of investment. Because of remaining 20% take

his/her residential property as an investment. According to law purpose this is not an investment

because of it is not create any profit for the owner.

60

2) Most preferable investment scenario.

INVESTMENT

SCENARIO

%AGE

Banks 24%

Derivatives & securities

market

28%

Insurance 4%

Bonds 20%

Real estate 20%

Others 4%

TOTAL 100

61

24%

28%

4%

20%

20%4%

BanksDerivatives & securities marketInsuranceBondsReal estateOthers

COMMENT

Today scenario is changed so that most area covered by the derivative and securities market. It is

28% of the total population.

62

3) What is the basic purpose of your investment?

INVESTMENT

PURPOSE

PERCENTAGE

Liquidity 30%

Returns 25%

Capital

appreciation

10%

Tax benefits 20%

Risk covering 5%

Others 10%

TOTAL 100

30%

25%10%

20%

5% 10%

LiquidityReturnsCapital appreciationTax benefitsRisk coveringOthers

COMMENT:- 75% people are interested in liquidity, returns and tax benefits. And remaining

25% are interested in capital appreciations, risk covering, and others.

63

4) Most important things you take into your mind while making investments?

FACTOR %AGE

Risk 8%

Returns 17%

Both 75%

TOTAL 100

8% 17%

75%

RiskReturnsBoth

COMMENT

75% people are considered the both factors risk as well as returns but, only 25% considered the

risk or returns factor.

5) Awareness related to security markets

64

KNOWLEDGE PERCENTAGE

Complete 8%

Partial 75%

Nil 17%

TOTAL 100

8%

75%

17%

CompletePartialNil

COMMENT

On that basis, we conclude that 17% people know nothing about the securities investments and

75% people have partial knowledge about it, so, some promotional activities are required for

increasing the awareness about security market.

6) Do you have any de-mat & trading account?

ACCOUNTS PERCENTAGE

65

Yes 60%

No 40%

TOTAL 100%

60%

40%

YesNo

COMMENT

Only 75% respondents have de-mat and trading account and remaining 25% says no because

they don’t know why shares move up and down.

7) In which company you have d-mat and trading account?

COMPANY PERCENTAGE

66

SHAREKHAN 38%

INDIAINFOLINE 20%

ICICI DIRECT 14%

INDIA BULLS 12%

KARVY 9%

Others 7%

TOTAL 100

38%

20%14%

12%9%

7%

SHAREKHANINDIAINFOLINEICICI DIRECTINDIA BULLSKARVYOthers

COMMENT

In Sharekhan Ltd 38% respondents have de-mat & trading account because of better services and

no annual maintenance and other charges.

8) Specify the reason of satisfaction with the current broking house.

SATISFACTION PERCENTAGE

67

Operating expenses 18%

Services 25%

Brokerage 57%

TOTAL 100

18%

25%57%

Operating expensesServicesBrokerage

FINDINGS

According to the survey most of the customers of “Sharekhan Ltd” says that it is pocket friendly.

68

Coming to faith 70% say Sharekhan Ltd is better than others stock brokers due to customers

satisfaction.

Lack of promotional activities undertaken by Sharekhan securities Ltd. in Chandigarh Region.

Main purposes of investments are returns & liquidity.

Investors take risk as well as returns into their mind while making the investment.

Businessmen are more interested in the stock market than the others.

Commodity market is less preferred by the investors.

People want to invest their money in the security market but they haven’t the proper knowledge.

People are not aware of hedging in stock market.

People pay more emphasis on brokerage than service provided by brokerage houses.

69

SUGGESTIONS

Commitment should be equalized for every person.

Provide the facility of free demonstrations for all.

Improvement in the opening of De-mat & contract notice procedure is required.

There should be a limited number of clients under the relationship manger. So that he can

handle new as well as old customer properly.

Some promotional activities are required for the awareness of the customer.

People at young age should be encouraged to invest in stock market.

Seminars should be held for providing information to prospective and present customers.

70

LIMITATIONS

As only CHANDIGARH dealt in survey so it does not represent the view of the total

Indian market.

Size of the research may not be substantial.

There was lack of time on the part of respondents.

The survey was carried through questionnaire and the questions were based on

perception.

There may be biasness in information by market participant.

Complete data was not available due to company privacy and secrecy.

71

CONCLUSION

On the basis of the study it is found that Sharekhan Ltd is better services provider than the other

stockbrokers because of their timely research and personalized advice on what stocks to buy and

sell. Sharekhan Ltd. provide the facility of Trade tiger as well as relationship manager facility

for encouragement and protect the interest of the investors. It also provides the information

through the internet and mobile alerts that what IPO’s are coming in the market and it also

provides its research on the future prospect of the IPO.

Study also concludes that people are not much aware of commodity market and while it’s going

to be biggest market in India.

The company should also organize seminars and similar activities to enhance the knowledge of

prospective and existing customers, so that they feel more comfortable while investing in the

stock market.

72

APPENDIX

QUESTIONNAIRE

DATE:

NAME  

OCCUPATION  

AGE  

CONTACT NO.  

1) Do you know about Investment options available?

a) Yes b) No

2) Do you know about the different types of investment alternatives?

a) Insurance & mutual funds b) Banks

c) Real estate d) Share market73

e) Commodity f) Others

3) What is the basic purpose of your investment?

a) Liquidity b) Returns

c) Capital appreciation d) Risk covering

e) Tax benefits

4) What are the most important things you take into account, while making any investment?

a) Risk b) Returns c) Both

5) Do you have any knowledge of share markets?

a) Partial b) Complete c) Nil

6) Do you have any D-mat & Trading account?

a) Yes b) No

74

7) In which company you have D-mat & Trading account?

a) Sharekhan Ltd b) Karvy

c) Indiainfoline d) ICICI direct

e) Indiabulls f) HDFC securities

g) Others

8) Are you satisfied with you present broking company?

a) Yes b) No

9) What is the reason? Please specify.

a) Services _______________________________________

b) Brokerage _____________________________________

c) Operating expenses ______________________________

d) Others ________________________________________

75

10) What is your trading exchange preference?

a) NSE b) BSE

c) MCX d) NCDEX

12) Do you know about Sharekhan Ltd?

a) Yes b) No

Suggestion:-

 

 

76

BIBLIOGRAPHY

Books:

BERI

G C. MARKETING RESEARCH

NEW DELHI, TATA Mc GRAW-HILL PUBLISHING COMPANY LIMITED.

KOTHARI

RESEARCH METHODOLOGY

NEW DELHI, VIKAS PUBLISHING HOUSE PVT.LTD.1978.

GOYAL, DR.ALOK,

FINANCIAL MARKET OPERATION

NEW DELHI, V.K. (INDIA) ENTERPRISES .

77

Magazines:

VALUELINE (SHAREKHAN MONTHLY RESEARCH MAGAZINE)

CAPITAL MARKET (5PASISA.COM), NEW DELHI.

THE FINAPOILS (YOUR PERSONAL FINANCE ADVISOR FROM KARVY).

Internet:

http://WWW.MONEYCONTROL.COM

http://WWW.CAPITALINE.COM

http://WWW.SHAREKHAN LTD.COM

http://WWW.INDIAINFOLINE.COM

http://WWW.ICICIDIRECT.COM

http://WWW.HDFCSECURITY.COM

http://WWW.KARVY.COM

78