Shcil Depository)

A PROJECT REPORT ON

“Depository Participants in Bangalore”A Comparative Analysis.

Submitted toAll India Management Association Centre for Management

EducationManagement House,14 Institutional Area,

Lodhi Road,New Delhi-110003.

JULY 2004-2006

BY

CHANDRIMA NANDIRegistration No. 800420591

GUIDED BY

LATIKA ROYArea Manager

For the Partial Fulfillment ofPOST GRADUATE DIPLOMA IN MANAGEMENT

DECLARATION

I, Chandrima Nandi , studying in Alliance Business Academy, Bangalore do

hereby declare that this Project relating to Stock Holding Corporation of

India Ltd (SHCIL) and the title “A Comparative analysis of the depository

participants in Bangalore” has been prepared by me after undergoing the

prescribed industrial survey as part of the requirement of the PGDM program of

AIMA. My guide for the training has been Mrs. Latika Roy. I, further declare

that this project work is the outcome of my efforts and not a replica of any other

report/work submitted to any university or boards. I also declare the same

report has not been submitted to any other University or Board for the award of

any other degree or diploma.

Date: Name of student: Chandrima NandiPlace: Bangalore Reg. No - 800420591

ACKNOWLEDGEMENT

An exchange of ideas generates a new object to work in a better way. Apart from

the ability labor and time devotion, guidance and co-operation are two pillars for

the success of a project. Whenever a person is helped or co-operated by others,

his heart is bound to pay gratitude to others.

A satiation and pleasure that accompany the successful completion of task would

be incomplete without the mention of the people who have made it possible and

whose consent guidance and encouragement served as a guiding light for the

completion of the study.

I consider it privilege to express through my report a few words of gratitude to all

those who have guided and inspired me in completing this study. I would like to

express my deep sense of gratitude to Mr. Harish Shenoy and all the staff

members of their giving me support and helping me during my project study.

I would also like to express my sincere thanks to honorable President, Mr. Sudhir

Angur and our Director Mr. B.V.Krishnamurthy for giving me an opportunity for

undergoing this study. I would also like to express my gratitude to my project

guide Mrs. Latika Roy for her constant encouragement and guidance without the

task would not have been completed.

Last but not the least I would like to thank my parent and friends for their support

and suggestions.

THANKYOU ALL

CHANDRIMA NANDI

CONTENTS

Chapter No. Contents Page

Chapter I At a Glance 1-2

Chapter II Introduction 3-7

Background

Purpose

Objective

Limitations of the study

Plan analysis

Chapter III Industry Profile 8-23

Chapter IV Company profile 24-29

Chapter V Products and Services 30-79

Chapter VI SWOT Analysis 80-82

Chapter VII Methodology 83-84

Chapter VIII Analysis & interpretation 85-104

Chapter IX Summary of findings 105-107

Recommendations & Conclusion 108-110

Bibliography 111-112

Annexure 113-116

CONTENTS OF THE TABLES

Serial

Number

Title Page

Number

Table 1 Age group of respondents 87

Table 2 No. of shareholders trading in SHCIL 88

Table 3 No. of years the respondents holding the shares

in SHICL

89

Table 4 How safe the securities are in opting the demat 90

Table 5 Most preferred DP product 91

Table 6 Selection of the source in which information

is available

92

Table 7 Selection of Stock Exchange by the shareholders

and brokers.

93

Table 8 Attribute of services available at SHCIL 94

Table 9 Selection of investment avenues. 95

Table 10 Tailor-made services 96

Table 11 Value-added services available to the clients

at SHCIL

97

Table 12 Satisfaction in terms of Infrastructure, software

of the organization.

98

Table 13 Effectiveness of the DP services compared to

Other financial institutions.

99

Table 14 Interest rates in terms of loan against demat

Held in DP.

100

Table 15 Safety & security of the demat account. 101

Table 16 Service charges charged by SHCIL 102

Table 17 Effectiveness in settling the stock 103

Table 18 On-line trading. 104

CONTENTS OF THE GRAPHS

Serial

Number

Title Page

Number

Table 1 Age group of respondents 87

Table 2 No. of shareholders trading in SHCIL 88

Table 3 No. of years the respondents holding the shares

in SHICL

89

Table 4 How safe the securities are in opting the demat 90

Table 5 Most preferred DP product 91

Table 6 Selection of the source in which information

is available

92

Table 7 Selection of Stock Exchange by the shareholders

and brokers.

93

Table 8 Attribute of services available at SHCIL 94

Table 9 Selection of investment avenues. 95

Table 10 Tailor-made services 96

Table 11 Value-added services available to the clients

at SHCIL

97

Table 12 Satisfaction in terms of Infrastructure, software

of the organization.

98

Table 13 Effectiveness of the DP services compared to

Other financial institutions.

99

Table 14 Interest rates in terms of loan against demat

Held in DP.

100

Table 15 Safety & security of the demat account. 101

Table 16 Service charges charged by SHCIL 102

Table 17 Effectiveness in settling the stock 103

Table 18 On-line trading. 104

Stock Holding Corporation of India Limited

At a Glance

Alliance Business Academy 1


Executive Summary

The study is about comparing the different services and products offered at

SHCIL with the other Depository participants. Project mainly deals with how

the resources of the organization are used in their day-to-day activities. For a

finance manager it will be of great help to know how to properly utilize the

resources of the organization. It is not only the theory, which will help in the

corporate world, but also how things happen practically. Here there is an

opportunity to learn how the things happen practically. Every day the various

activities happening in the department are observed and understood carefully.

The study initially concentrated on obtaining the information from the investors

on various parameters. As it is a finance project mainly data will be available

internally. After finishing this task, the actual analysis of the project has been

started where certain important calculations has been done. This helped to

come out with some conclusions. Also the data pertaining to some Demat

Section Managers has been taken and analyzed which made to arrive at

some interim conclusions as a part of project.

Stock holding has various financial Products and Services to be offered to the

clients but problem lies in the low promotional activities undertaken by it, due

to which though it has the services not offered by other DP's it fails in

captivating customers. Another problem faced by it is technology; systems at

stock holding are not technologically upgraded: it follows old technology and

modes of making entries of payments into systems. Due to system error

payments to franchisees are not made on time, which in turn affects their

business relationship. Since stock holding is into DP's business from long time

it still follows old methods of operations. Thus, the researcher got interested to

conduct study on the Depository Services under the title “Comparative

analysis of various Depository Participants with reference to Stock

Holding Corporation of India limited”.



Introduction



Background

Depository

A depository is a facility for holding securities, which enables securities

transactions to be processed by book entry. To achieve this purpose, the

depository may immobilize the securities or dematerialise them (so that they

exist only as electronic records).' India has chosen the dematerialisation

route. In India, a depository is an organization, which holds the beneficial

owner's securities in electronic form, through a registered Depository

Participant (DP). A depository functions somewhat similar to a commercial

bank. To avail of the services offered by a depository, the investor has to

open an account with it through a registered DP.

Depository Participant

A Depository Participant (DP) is an agent of the depository who is authorized

to offer depository services to investors. Financial institutions, banks,

custodians and stockbrokers complying with the requirements prescribed by

SEBI/ Depositories can be registered as DP.

Benefits of Depository

Bad delivery eliminated

Immediate transfer of shares

No stamp duty on such transfers

Elimination of risks that are normally associated in dealing with

Physical certificates - loss / theft / mutilation due to careless handling /

forgery / etc

Reduced transaction cost



Services provided by Depository

Dematerialisation (usually known as demat) is converting physical

certificates to electronic form

Rematerialisation, known as remat, is reverse of demat, i.e. getting

physical certificates from the electronic securities

Transfer of securities, change of beneficial ownership

Settlement of trades done on exchange connected to the Depository

Pledge / Hypothecation of demat shares, viz. Loan against shares

Electronic credit in public offering of the Companies

Non - Cash corporate benefits, viz. Bonus / Rights - direct credit into

electronic form

No. of Depository in the country

National Securities Depository Ltd.

Central Depository Services Ltd.

Research Title

A Comparative Analysis of Depository Participants in Bangalore with

reference to India’s Largest DP “Stock Holding Corporation Of India Ltd.”

Purpose

The past few years have seen a phenomenal growth in the capital market

leading to an explosion in transaction holding despite the transparency offered

by NSE and BSE, the primitive settlement and transfer process kept the

biggest chunk of the market risk- bad delivery, delayed transfer, fake

certificates, loss and theft etc, unresolved. The Depositories is the answer to

such risk and problems.



Introduction of the depositories has paved the way for instituting an

infrastructure for eliminating these risks and increasing the efficiency of the

system.

The purpose of this study is to provide information to both the organization

and the investors/savers, providing to the former present state and future

prospect and to the later differences among the services provided by the

various depository participants.

A comparative analysis of various Depository Participants with reference to

India’s Largest DP “Stock Holding Corporation Of India Ltd.”. This study will

help to have a better understanding about where SHCIL stands in the market

today and also to compare various DPs on certain parameters.

Objectives

The main objectives of the project undertaken are-

To understand the attitude and perception of investors/savers towards

the DPs.

To ascertain SHCIL’s position in the competitive market.

To collect the data on various parameters

Tariff

Service

Reach(No. of branches)

Promoters

Product

To develop and analyze strategies of SHCIL to help improve its

market share.

To offer suggestions based upon the findings.



Limitations of the study

The study is limited only to SHCIL, JC road branch Bangalore.

There was a constraint of time.

The entire study is based on the information provided by the various

respondents at SHCIL.

For the purpose of collecting vital information, Manager of the

organization is only contacted & interviewed. Since he is an

individual, his biases may have creped into the data given.

The policy of the company does not allow getting all the information.

PLAN ANALYSIS

The collected data will be analyzed with the help of parametric techniques

such as percentages, correlation, regression, co-efficient of variation and the

like. Wherever necessary tables charts, graphs, diagrams are used.



INDUSTRY PROFILE



INDUSTRY PROFILE

FINANCIAL MARKET

Globalization of the financial market has led to a manifold increase in the

investment. New markets have been opened: new instruments have been

developed: and new services have been launched. Besides, a number of

opportunities and challenges have also been thrown open. Stock Holding

Corporation of India Limited. (SHCIL), the premier custodian of Indian capital

market providing services of international standards, is geared up to

reposition itself in the changed scenario. With world — acclaimed automation

and a team of committed professionals, SHCIL is confident of scaling new

heights. Combining its financial strength and technical expertise to serve the

clients better, wherever and whenever it is needed, SHCIL envisages acting

as a partner one can trust. The corporation has restructured and geared itself

to serve the growing needs of individual investors in the paperless

environment. The organization in its willingness to provide its state of art of

financial services in securities industries to the various segments of the

investors has expanded itself to more than 100 cities across the country. SHC

desires to give investors the time and attention in monitoring the performance

of their securities consistently. All aimed at providing the investor with

optimum financial gain.

India has a well established capital market mechanism where in effective and

efficient transfer of money capital or financial resources from the investing

class to the entrepreneur class in the private and the public sector of the

economy occur. Indian capital market has a long history of organized trading

which started with the transaction in the loan stocks of the East India

Company; from that time it has undergone drastic changes to meet the

requirements of the globalization. The Indian capital market had been

dormant in the 70’s and 80’s has witnessed unprecedented boom during the

recent years. There has been a shift of house hold savings from physical



assets to financial assets, particularly the risk bearing securities such as

shares and debentures. Capital market structure has also undergone sea

changes with number of financial services and banking companies, private

limited companies coming into the scene which made the competition in the

market stiffer.

CAPITAL MARKET

The capital market consists of primary market and secondary market

segments. The primary market deals with the issue of new instruments by the

corporate sector such as equity shares, preference shares and debentures.

The public sector consisting of central and state governments, various public

sector industrial units (PSUs), statutory and other authorities such as state

electricity boards and port trust also issue bonds. The primary market in which

public issue of securities is made through a prospectus is a retail market and

there is no physical location. Direct mailing, advertisements and brokers reach

the investors. Screen based trading eliminates the need of trading floor.

The secondary market or stock exchange where existing securities are traded

is an auction arena. Since 1995, trading in securities is screen based. Screen

based trading has also made an appearance in India. The secondary markets

consist of 23 stock exchanges including the NSE and OTCE and Inter

Connected Stock Exchanges of India ltd. The secondary market provides a

trading place for the securities already issued to be bought and sold. It also

provides liquidity to the initial buyers in the primary market to re-offer the

securities to any interested buyer at a price, if mutually accepted. An active

secondary market actually promotes the growth of the primary market and

capital formation because investors in the primary market are assured of a

continuous market and they can liquidate their investments in the stock

exchange.



DEPOSITORY

Depository is an organization where the securities of a share holder are kept

in the electronic form at the request of the shareholder through a medium of a

depository participant (DP). The principal function of a depository is to

dematerialise securities and enable their transactions in book form

electronically.

In India, the Depository Act defines a depository to mean “A company formed

and registered under the companies act, 1956 and which has been granted a

certificate of registration under sub-section (la) of section 12 of the Securities

and Exchange Board of India (SEBI) act, 1992”.

Legal Framework of Depositories:

The depositories act of 1996 provides for regulation of depositories in

securities and for matter there with or incidental there to and came into from

2O” of September, 1995.

SEBI formulated the Depositories and participants regulations act, 1996 to

oversee the matter regarding admission and working of depositories and its

participant. The depositories act passed by parliament received the presidents

assent on august 1, 1996 enables the setting up of multiple depositories in the

country. Only a company registered under the Companies Act Of 1956 and

sponsored by the specified categories of institution can setup depositories in

India. The depository offers services relating to holding of securities and

facility processing of transactions in such securities in book entry form. The

transactions handed by depositories include settlement of market trades,

settlement of off trades, Securities lending and borrowing, pledge and

hypothecations.

Eligibility Criteria For a Depository:

Any of the following may be a depository:



1. A public financial institution as defined in section 4a of the Companies Act

Of 1956.

2. A bank included in the second schedule to the RBI Act, 1934.

3. A foreign bank operating in India with the approval of the RBI.

4. Recognized stock exchanges.

5. An institution engaged in providing financial services where not less than

75% of the equity is held jointly or severally by these institutions.

6. A custodian of securities approved by government of India.

7. A foreign financial services institutions approved by government of India.

The promoters of depository are also known as its sponsor. A depository

company must have a minimum worth of Rs. 100 Cr. The sponsor of the

depository has to hold at least 51% of capital of the depository company.

Agreement Between Depository and Issuers:

If either the issuer (a company which has issued securities) or the investor

opts to hold his securities in demat form, the issuer enters into an agreement

with the depository to enable the investors to dematerialize their securities.

Where an issuer has appointed a registrar to the issue and (R&T) agent, the

case may be for the securities declared for dematerialization

Rights and Obligations of Depositories:

1. Every depository should have adequate mechanisms for reviewing

monitoring and evaluating the controls, systems, procedures and safeguards.

2. Annual inspections of the procedures and same should be reported to

SEBI.

3. To ensure that the integrity of automatic data processor systems is

maintained to safeguard information.

4. Adequate measures including insurances, to protect the interests of the

beneficial owners against any risk.



Functions of Depository:

Dematerlisation

One of the primary functions of depository is to eliminate or minimize the

movement of physical securities in the market. This is done through

converting securities held in physical form in to holdings in to back entry form.

Accounts Transfer

The depository gives effects to all transfers resulting from the settlement of

trade and other transaction between various beneficial owners by recording

entries in the accounts of such beneficial owners.

Transfer and registration

A transfer is a legal change of ownership of a security in the records of the

issuer. Transfer of securities under demat occurs merely by passing book

entries in the records of the depositories, on the instructions of beneficial

owners.

Pledge and hypothecation

Depositories allow the securities placed with them to be used as collateral to

secure loans and other credits. The securities pledged are transferred to a

segregated or collateral account through book entries in the records of the

depository.

Linkages with clearing system

The clearing system performs the functions of ascertaining the pay-in (sell) or

pay (buy) of brokers who leave traded on the stock-exchange. Actual delivery

of securities to the clearing system from the selling brokers and delivery of

securities from the clearing system to the buying broker is done by depository.

To achieve this, depositories and the clearing system are linked electronically.



To handle the securities in electronic as per the Depositories Act 1996, two

depositories are registered with SEBI. They are: National Securities

Depository Limited (NSDL), Central Depository Services (India) Limited

(CDSL).

DEPOSITORY PARTICIPANTS

Depository participants (DPS) are described as an agent of the depository.

They are the intermediaries between the depository and the investors. The

relationship between the DP’s and the depository is governed by an

arrangement made between the two under the depositories act. In a strictly

legal sense a OP is an entity who is registered as such with SEBI under the

provisions of the SEBI Act. As per the provisions of this act a OP can offer

depository services only after obtaining a certificate of registration from SEBI.

Eligibility Criteria For Depository Participant

A public financial institution as defined in sections of the companies

act.

A bank included for the time being in the second schedule to the RBI.

A foreign bank operating in India with the approval of RBI.

A state financial corporation established under the provisions of section

3 of the state financial corporations act, 1951.

An institution engaged in providing financial services promoted jointly

or severally by any of the institutions mentioned above.

A custodian of securities who has been granted a certificate of

registration by SEBI.

A clearing corporations or a clearinghouse of stock exchange.

A stock broker who has been granted a certificate of registration by

SEBI.

A non-banking finance company.



A R& T agent who has been granted a certificate of registration by

SEBI.

A person desirous of becoming a DP of NSDL should make an application to

SEBI through NSDL. NSDL evaluates and sends to SEW within 30 with

recommendations. If all the conditions are met SEBI grants the registration

certificate to the applicant. SEBI prescribes a minimum net worth of

Rs.5OIakh for stock brokers, R&T agents and non-banking finance companies

(NBFCs) for granting them a certificate & registration to act as a DR. A

certificate of registration is valid for a period of 5 years. It may be renewed

after 5 years.

Rights and Obligations of Depository Participant

1. Agreement with beneficial owners:

The OP must enter into an agreement with a beneficial owner before acting as

a DR on his behalf. A DR while conducting business with a client, acts as an

agent of NSDL and is liable to the clients for all the acts and deeds performed

by him.

2. Separate accounts:

The DP shall open a separate account in the name of each beneficial owner’s

account only on receipt of instructions from beneficial owner.

3. Statement of account:

The OP should provide statements of accounts to the beneficial owner as laid

in the agreement with the beneficial owner. It should be done fortnightly if any

transactions are made and at least quarterly if no transactions are done, It can

be provided through internet.

4. Transfer or withdrawal by beneficial owner:

The DP should allow a beneficial owner to withdraw or transfer securities from

its accounts in such manner as specified in the agreement with beneficial

owner.

5. Connectivity:



The DP should maintain continuous electronic communication with each

P0SItory in which it is participant.

6. Monitoring, reviewing & evaluating internet systems & controls:

DP should have an adequate mechanism for the purposes of reviewing

monitoring and evaluating its internal accounting controls and systems. It has

to get an audit done on quarterly basis.

7. Reconciliation:

The DP shot reconcile its records with every depository in which it is

participant on a daily basis. The NSDL system is designed to do this

automatically every day at the end of the day (EOD).

8. Returns:

The DP should submit periodic returns to SEBI and to every depository in

which it is a participant.

9. DP to indemnify depository:

A DP has to indemnify the depository, its officers and employees for all costs,

fees, expenses, liabilities, taxes, actual losses and damages of any nature

what so ever suffered like failure to comply with laws, failure to deliver eligible

securities etc.

10. Prohibition of Assignment:

No DP can assign or delegate its functions as a participant to any other

person without prior approval of NSDL.

11. Insurance:

DP’s should take appropriate insurance cover to insure against losses arising

from any possible business risk and system failure.

12. Record of services:



The DP should maintain and preserve the documents for all transactions for a

minimum period of 5 years.

13. DP to ensure integrity and back-up of data:

Where DP’s maintain electronic records, they should ensure the integrity of

the data processing system. All necessary precautions should be taken to

ensure that the records are not lost, destroyed or tampered with sufficient

back-up of records should be taken and made available at all times at

different places. SEBI at any time may cancel the registration of DP if they are

not in complying with the rules laid by the depositories act. Like guilty of fraud,

repeated defaults. DR may sometimes choose to terminate its participation in

the depository by giving notice of less than 30 days.

GOVERNING BODIES OF DEPOSITORY PARTICIPANT

National Securities Depository Limited (NSDL)

National securities depository limited is the first depository to be set up in

India. It was incorporated on December 12, 1995. The Industrial Development

Bank Of India (IDBI) the largest development bank in India, UTI the largest

Indian mutual fund and the National Stock Exchange in India sponsored the

setting up of NSDL and subscribed to the initial capital. NSDL commenced

operations on November 8, 1996. Following organizations are share holders

of NSDL as on march 31, 2001:

a) INDUSTRIAL DEVELOPMENT BANK OF INDIA

b) UNITED TRUST OF INDIA

c) NATIONAL STOCK EXCHANGE

d) STATE BANK OF INDIA

e) GLOBAL TRUST BANK

f) CITIBANK

g) STANDARD CHARTED BANK



h) HDFC BANK

i) HSBC

j) DEUTSCHE BANK

k) DENA BANK

l) CANARA BANK

Ownership:

NSDL is a public limited company incorporated under the companies act,

1956. NSDL had a paid up equity capital of Rs.10 crore. The paid-up capital

has been reduced to Rs.80 crore since NSDL has bought back its shares of

the face value of Rs.4.2 crore in the year 2000. However, its network is above

Rs.100 crore as required by SEBI regulations. -

Management of NSDL:

NSDL is managed by professional board of director. The managing director

conducts the day to day operations. To assist the MD in his functions, the

board appoints an executive committee of not more than 16 members. The

eligibility criteria and period of nomination of the members of EC etc. are

governed by the bye-laws of NSDL in this regard.

Bye-laws of NSDL:

The bye-laws approved by SEBI which contain 14 chapters they are:

a) Short title and commencement

b) Definitions

c) Board of directors

d) Executive committee

e) Business rules

f) Participates

g) Safeguards to protect interest of clients and participants

h) Securities



i) Accounts by book entry

j) Reconciliation accounts and audit

k) Disciplinary action appeal

l) Appeals

m) Conciliation

n) Arbitration

Function of NSDL:

NSDL performs the following functions through Depository participants (DP)

Enables the surrender and withdrawal of securities to and from the

depository (dematerialisation and rematerialisation).

Maintains investor holdings in the electronic form.

Effects settlement of trades not done on the stock-exchange (off-

market trades).

Transfer of securities.

Pledging I hypothecation of companies or corporates.

Receipt of non-cash corporate benefits like bonus rights r electronic

form.

Stock lending and borrowing.

The investors interact with a depository participant (DP) of NSDL. A DP can

be a bank, financial institution, a custodian or a broker. Just as one opens a

bank account to avail of the services of a bank, an investor has to open an

account with a DP in order to avail of the depository facilities.

Central Depository Services Of India Limited (CDSL)

Central depository services of India ltd were the second depository to be

granted the commencement certificate by SEBI on 8 February 1999,

inaugurated on 15 July 1999. It is promoted by the Bombay stock exchange,

in association of bank of India.



Both NSDL and CDSL interface with investors through their service providers

known as DP. The depository is interconnected. It is possible to transfer

shares from one depository to another.

CDSL was promoted by The Stock Exchange, Mumbai (BSE) jointly with

leading banks such as State Bank of India, Bank of India, Bank of Baroda

HDFC Bank, Standard Chartered Bank, Union Bank of India and Centurion

Bank.

CDSL was set up with the objective of providing convenient, dependable ‘and

secure depository services at affordable cost to all market participants. Some

of the important milestones of CDSL system are:

. CDSL received the certificate of commencement of business from SEBI in

February 1999.

• Honorable union finance minister, Shri Yashwanth Sinha flagged off the

operations of CDSL on July 15 1999.

• Settlement of trades in the demat mode through BOl shareholding limited,

the clearing house of BSE started in July 1999.

• All leading stock exchanges like national stock exchange, Calcutta stock

exchange, Delhi stock exchange, stock exchange Ahmedabad, etc have

established Connectivity with CDSL.

• As at the end of Dec 2004, over 4900 issuers have admitted their securities

(equities, bonds, debentures, and commercial papers), units of mutual funds,

certificate of deposits etc. into the CDSL system.

CDSL’s demat services are extended through its agents called Depository

Participants (DP). The DP is the link between the investor and CDSL. An

investor who opens a demat account with a DP can utilize the services offered

by CDSL. While the OP processes the instructions of the investor , the

account and records thereof is maintained with CDSL A DP is thus a t centre”

for the investor.



CDSL’s system is based on centralized database architecture with on-line

connectivity with DPs. Because of this centralized architecture, the cost for

setting up a OP outfit under CDSL system is significantly lower. Similarly, the

recurring costs to be incurred by a CDSL DP in terms of maintaining back-ups

and the related data storage are minimal. This enables a CDSL DP to offer

depository services to investors at an attractive price and at the same time

achieve break-even faster at much lower volumes. The centralized

architecture also allows CDSL-DP to make available to the investors a to-the-

minute status of their account and transactions.

BENEFITS AND SAFETY OF DEPOSITORY SYSTEM

In the depository system the ownership and transfer of securities take place

by means of electronic book entries. At the outset, this system capital market

of the dangers related to handling of paper. The benefits that are accrued by

this system are:

> Elimination of bad deliveries:

Once the holdings of investors are dematerialized, the question of bad

deliveries doesn’t arise because both transfer deed and share certificate are

eliminated in depository system.

> Elimination of all risks associated with physical certificate:

Dealing fl physical securities have the associated risks of loss of certificates

during movements to and from the registrars. These expose the investor to

cost of obtaining duplicate certificates, advertisement etc., such problems

don’t arise in the depository environment.

> No stamp duty:

No stamp duty for transfer of equity instruments and units of mutual funds in

this system.

> Immediate transfer and registration of certificate:

Once the securities are credited, to the investors account on payout, he

becomes the legal owner of the securities.



> Faster settlement cycle:

The exclusive demat segment follow rolling settlement of T+2 days which

enables faster turnover of stock and enhance liquidity with the investor.

> Buyer is secured:

In physical environment, the buyer is not secured since the shares purchased

may not be transferred. This is not the case with depository system.

> Faster disbursement of non-cash corporate benefits:

NSDL provides for direct credit of non-cash corporate entitlements like rights,

bonus etc., to an investors account ensuring faster disbursement.

> Reduction in rate of interest on loan:

Some banks provide these benefits against pledge of departmentalized

securities.

> Increase in maximum limit of advances:

This increases from Rs.l0 lakh to Rs.20 Lakh per borrower. There is also a

reduction in minimum margin from 50% to 25% by banks to advances against

demat securities.

> Reduction in brokerage:

Brokers may provide a reduction in the brokerage of 0.25% to 0.5% for trading

in dematerialised securities as it reduces their back office cost of handling

paper.

> Reduction in handling huge volumes of paper:

In the physical environment every entity involved in purchase or sale of

securities was to handle paper and pass on the paper to the next entity. But in

the depository system only the delivery instruction to be given by the client is

in the form of paper.

> Periodic status reports:

DP’s need to provide periodic reports to investors on their holding and

transactions.



> Dematerialized securities can be delivered in the physical segment:

From April 1998 this facility is available at stock-exchange where trading in

dematerialized securities is allowed. But physical securities are not allowed to

be delivered in the dematerialized segment, making dematerialized stocks

held with the investors more liquid than physical stocks.

>Elimination of problems related to change of address of investors,

transmission etc:

Investors have to inform the change of address to the OF which will be

reflected in the database of all the companies where the investor is a

registered holder of securities.

> Elimination of problems related to nominations:

An account holder can get securities in all companies transmitted transferred

to his account by completing formalities with a single entity.

> Elimination of problems related to selling securities on behalf of a minor:

A natural guardian is not required to take court approval for selling demat

securities on behalf of a minor.

> Convenient consideration of account:

To multiple accounts opened by investors, all accounts can be consolidated

into one account by giving instructions to DP.

> Convenient portfolio monitoring:

Client can monitor portfolio by checking a single statement of

holding/transactions

> Increased volumes:

Due to case in transaction and related costs, many players have

entered/increased their transaction, which increases liquidity.

> Newer services:



Opportunities like pledge / hypothecation and stock lending are given

specifically by depository system.

Many safety measures like investor grievances, insurances cover, computer

and communication infrastructure, periodic review, certificate of registration

were made necessary to protect investors.

Company profile



COMPANY PROFILE

STOCK HOLDING CORPORATION OF INDIA LIMITED

1.1 Introduction to the company:

Flagged off at the initiative of the Government of India, SHCIL enjoys an

enviable parentage that very few organizations can boast of, including leading

Indian Financial Institutions and the Insurance majors. It has been jointly

promoted by IDBI, ICICI, IFCI, IIBI, UTI, LIC, and GIC and its subsidiaries.

It is headed by luminaries from its promoter institutions who constitute its

Board of Directors and take policy decisions pertinent to the affairs of the

corporation. A senior management team that reports to the Managing Director

and the CEO aids, assists and strategies business lines for the Corporation.

The primary focus of the corporation was specific – to set up custodial

services of international standards in India and in the process to manage the

entire array of post trade activities of Financial Institutions and Foreign

Institutional Investors with dedicated client relationship teams and state-of-

the-art reporting systems.

The corporation quickly garnered nearly 70% market share of the domestic

custodial business and the financial figures shot up impressively for the first

decade of its existence.

With sustained market leadership, the biggest investing body of the country

in its client list, SHCIL ensures that its technology support not only holds

enormous databases together but also makes sense and service out of it too.



The Smithsonian Institute’s Award for “Innovative Use of Technology in the

Field of Finance” in1996 and “Computer Society of India Award” were

affirmations of its efforts, long before information technology started

leapfrogging across the country.

SHCIL has also received “No Action Letter” from Securities Exchange

Commission (SEC) of USA, which renders it an eligible institution to hold

assets of US-based funds.

1.2 Vision of the Company:

“To become one stop shop for all financial services”.

This vision of the company is slowly being achieved with the foray of the

company into new financial services and products into its portfolio the latest to

be the Insurance product, which would be soon distributed.

1.3 Mission of the Company:

“To spread Quality Service through the innovative use of technology”.

1.4 Objectives of the Company:

To retain the No. 1 position in the DP industry by being ahead of all

other DP service providers with the innovative use of technology.

To provide justified service to every rupee the client pays.

To ensure security and convenience of transaction to its clients at

reasonable price.

To channel technology to make convenient products for financial

market that give quantum benefits to investors, corporate houses and

brokers.

To reach 37 million Internet users in the years to come with e-

commerce projection scaling USD 1.7 billion.

To move with speed and ease, diversifying into new areas,

considerably on others and sharpening its focus and paradigms.

To increase its customer base, this at present is 7 lakh.



To evolve a new strategy to emerge as a broad based financial

powerhouse in the years to come.

To find ways to make information and reporting system more effective

for the institutional clients.

To expand to the South-East Asia, with the aim of becoming the leader.

1.5 Basic facts about SHCIL

SHCIL is India’s largest depository participant.

SHCIL has around 20% market share i.e. over 8 lakhs demat accounts.

SHCIL has approx, 50% market share of delivery- based transaction which

amount to 1.33 crore transaction.

1. Short title and commencement

2. Definitions

3. Board of directors

4. Executive committee

5. Business rules

6. Participates

7. Safeguards to protect interest of clients and participants

8. Securities

9. Accounts/transactions by book entry

10.Reconciliation, accounts and audit



HIERARCHICAL STRUCTURE OF SHCIL

List of various functional VPs:

VP (Depository Services) VP (IT)


BOARD OF DIRECTORS

MANAGING DIRECTOR & CEO

JOINT MANAGING DIRECTOR

Sr V P ( BUS. DEV) Sr VP (FINANCE) VPs (FUNCTIONAL)

DIVISIONAL MANAGERS

ASSISTANT VPs


VP (Products) VP (Personnel) VP (HRD) VP (R&D) VP (Facilitation centre coordination)

ORGANIZATION STRUCTURE AT SHCIL, BANGALORE


DyMgr

DIVISIONAL MANAGER

Dy Manager(Hubli)

KoramangalaCCMalleswaramCCJayanagarCCDavanagereCCShimogaCC

ManagerM’lore FC

B’LoreFC

Udupi CCGulbargaCC

BelgaumCC

Dy MgrAsst. Mgr(B.D)

IT &Automation

Asst. Mgr(a/c’s)

Trades

Derivatives

SNC/COP & EB

SLS

Admin.

A/C OpeningDemat

Billing


Product and services



PRODUCT PROFILE

1. ADDSHARES

SHCIL arranges loan against demat shares.

Tie up with reputed banks which offer you the most competitive interest rates

in the market.

You can use the shares in your free account as collateral and take a loan from

any of our empanelled banks.

We complete your documentation and processing and give you the cheque

within 48 hours of application.

This is a pure value-add to your depository account with us.

ADD shares are available at SHCIL centres in all the major cities.

Advantages

Our tie-ups with banks give you a wide range of banks to choose from.

This reads as a wider range of specified and non-specified shares to

get a loan against.



The ADDshares team helps you with the paper formalities precedent to

a loan.

You can now get a loan at competitive interest rates and margins. This

is a resultant of our tie-up with a wide range of banks.

ADDshares simplifies long-winded loan procedures for you and

facilitates early disbursement of funds.

ADDshares is available at any of our branches, numbering over 120.

Procedure

If you do not have a DP account with us, open one.

Fill up the loan application form.

SHCIL forwards your loan application to the bank. SHCIL takes care of pledge

creation and intimation to the bank.

SHCIL follows up with the Bank and intimates you about the sanction of the

loan.

You can collect the cheque book issued by the bank from SHCIL or get it

couriered by us to you.

Documents required

Hold a Depository Account with SHCIL.

Copy of any two of the following documents towards proof of identity:

Passport No., place of issue, expiry date

Driving license



Ration card

Voters Identity card

Copy of Income Tax Return

Pan card is a must now

Two passport size photographs.

2. EQUIBUY

Haven't we all gone through endless waiting periods after buying shares on

the exchange?

Even after payments have been made, we have to wait patiently to see those

shares reflected in the demat account. With the odd surprise of not seeing

them at all which you cannot discount.

As your depository participant, SHCIL assures you of safe delivery of shares

every time you buy on the exchange. We have lined up a panel of reputed

brokers who process your orders on priority.

Our position as the clearing corporations of leading stock exchanges ensures

smooth and sure credits into your account.



An initial advance and timely replenishments into the Purchase Advance

account take care of the payment for your purchases.

Go through the detailed Equibuy procedure and you will see how Equibuy is a

one stop shop for your share purchases.

Features

An Equibuy instruction from you gets the shares credited into your

account the next day of payout

Payment for your purchase made from a running account called

Purchase Advance into which you remit an initial advance of Rs.1000

and maintain a minimum balance of Rs.250 at all times.

Choose one or more brokers from a list of 77 brokers empanelled with

SHCIL. Registration with broker is not necessary if you are already

registered under any of our other product schemes.

Purchase on BSE or NSE.

Available at 120 plus SHCIL centers across the country.

Advantages

Buy shares with a single instruction and get an assured credit of shares

into your account the next day of payout. Leave the settlement

procedures and broker interaction to us.

Affect a faster turnaround of your portfolio.

Equibuy has a very nominal charge attached to it.

An initial advance of Rs.1,000 in the Purchase Advance account and

replenishments, as and when necessary, take care of payment for your

purchases.

Choose on the exchange to buy your shares from BSE or NSE.



Choose from a range of 77 SHCIL empanelled brokers to execute your

purchases.

Equibuy from the SHCIL center closest to you. Select from 120

plus SHCIL centers across the country.

Procedure

If you are not already registered with one or more of our 77 empanelled

brokers under any of our other product schemes, register yourself by filling up

a broker registration form.

Fill up a remittance slip to open the Purchase Advance account by making an

initial advance of Rs.1,000.

Approach any SHCIL branch and submit a purchase request slip.

Your request will be good till the end of the day. If the shares are not

purchased before the end of the day, your request lapses and a fresh request

can be submitted the next day.

Your purchase request is transmitted to the broker as soon as you place your

request.

The broker executes the trade and sends SHCIL the contract note. The

payment for the shares purchased along with the service charge is made from

the Purchase Advance account.

The shares get credited into your account the next day of payout.

Tariff

On delivery basis

0.65% of the value of transaction on delivery basis with a minimum of Rs.65

per client per broker per settlement.



Pre-Conditions for Equibuy

Have a demat account with SHCIL

Get registered with one or more of any of 77 brokers empanelled with SHCIL.

Registration with broker not necessary if you are already registered under any

of our other product schemes.

Open a running account called "Purchase Advance" by remitting an advance

Rs.1,000 by cash / cheque / DD. Replenish the balance when you need to

maintain a minimum balance of Rs.250 in the Purchase Advance account.

3. FUNDINVEST

Introduction

FundInvest is a basket of financial products, ranging from fixed income

securities like fixed deposits, Infrastructure bonds and Capital Gain Bonds to

variable income securities like Initial Public Offers (IPO’s) of Equities and

Mutual Funds. It is an attempt to offer financial products that cater to the

various investment needs of our esteemed clients. An effort to guide the

investor to a product portfolio that best suits his risk- return profile.

Applications for investments can be source from any of the SHCIL offices.

Apart from guiding our investor to pick up the right combination of investment



instruments, we help them 'after-sales' service, by acting as an interlocutor

between the investor and the issuer of the securities. SHCIL is an AMFI

Registered Mutual Fund Advisor (ARMFA).

Features

At present, we are distributing schemes of 25 different Mutual Funds

All these Funds offer wide varieties of investment option depending on the risk

appetite of the investor. Some of the major categories are:

Debt Funds: The Debt Funds have the mandate of investing primarily in Debt

papers

Equity Funds: The Equity Funds have the mandate of investing primarily in

Equities

Balanced Funds: The Balanced Funds have the mandate of investing both in

Equities as well as Debt papers.

Capital Gains Bonds come under 54 EC Capital Gains Bonds, where

investors get exemption from Capital Gain tax. These are 'on -tap ' issues. At

present, SHCIL is distributing Capital Gain Bonds of Rural Electrification

Corporation, National Housing Bank, Small Industries Development Bank of

India and National Highway Authority of India.

Infrastructure Bonds are issued by ICICI Bank and IDBI, with Section 88 as

the main feature

Private Placements: Debt papers issued for Private Placement with Structural

Obligations by the State and Central Government typically targeted for Trusts

and Provident Funds are distributed by Stock Holding.


http://online.stockholding.com/products/fundzinvest/so_fi_listofmf.html


Fixed Deposits: Fixed Deposits with high investment rating and issued by

blue- chip corporate are distributed by us. These papers generally offer 50 to

100 basis points more than bank fixed deposits of comparable period. At

present, we are distributing IDBI Suvidha Fixed Deposits and HDFC Fixed

Deposits.

Initial Public Offer: IPO’s offered from blue-chip corporate can be subscribed

from Stock Holding. Issues recently distributed by us are Canara Bank,

Allahabad Bank, Bharti Tele and I- Flex.

List of Mutual Funds

Alliance Capital Mutual Fund

Birla Sunlife Mutual Fund

BOB Mutual Fund

Canbank Mutual Fund

Cholamandalam Mutual Fund

Deutsche Mutual Fund

DSP ML Mutual Fund

GIC Mutual Fund

HDFC Mutual Fund

HSBC Mutual Fund

IL & FS Mutual Fund

ING Savings Mutual Fund

JM Mutual Fund

Kotak Mutual Fund



LIC Mutual Fund

Principal Mutual Fund

Prudential ICICI Mutual Fund

Reliance Mutual Fund

Sahara Mutual Fund

Standard Chartered Mutual Fund

Sundaram Mutual Fund

Tata Mutual Fund

Templeton Mutual Fund

UTI Mutual Fund

4. GOI BONDS

Savings Bonds are issued by RBI on behalf of Government of India in the

following series.

8.0% taxable bonds

These Bonds are held in electronic form in an account called Bond Ledger

Account (BLA). Bond Ledger Accounts can be opened and operated with RBI

designated Receiving Offices. SHCIL has been designated as one of the

Receiving Offices by RBI for this purpose. Subscriptions for Savings Bonds

can be submitted at any of our branches.



Savings Bonds being sovereign in nature are absolutely safe and an attractive

investment option in the current volatile market situation.

The following categories can subscribe to Savings Bonds:

Category of Investor 8.0% (Taxable)

1. Individual

His or her individual capacity.

Individual capacity on joint basis.

Individual capacity on anyone or survivor basis.

On behalf of a minor as father/mother/legal guardian.

2. HUF (Hindu Undivided Family)

3. Charitable Institution

Charitable Institution to mean a Company registered under Section 25 of the

Indian Companies Act 1956

An Institution which has obtained a Certificate of Registration as a Charitable

Institution in accordance with a law in force

Any institution which has obtained a certificate from Income tax Authority for

the purposes of Section 80G of the Income Tax Act, 1961

4. University

University means a University established or incorporated by a Central, State

or Provincial Act and includes an Institution declared under section 3 of the

University Grants Commission Act, 1956 to be a University for the purposes of

that Act



Features

The salient features of the Bonds are listed below:

1. Investment Limit

Minimum investment is Rs.1000 and there is no maximum limit

2. Interest Option

Payable half yearly on 1st Feb, 1st Aug or cumulative on maturity.

3. Tax Benefits

Interest is taxable under IT Act 1961. Exempt from Wealth Tax under

Wealth Tax Act 1957

4. Transferability

Non-transferable, non-tradable and cannot be used as collateral for

borrowings

5. Nomination

Only sole holder or surviving holder can nominate

6. Repayment

Repayable on expiry of 6 years from date of issue. No interest would

accrue after maturity

7. Premature Encashment is not available.

Advantages



Hassle free maintenance: The GOI Bonds are held in electronic form in

an account called Bond Ledger Account. This ensures smooth

investing minus paperwork.

Electronic Clearing Services: You can avail of Electronic Clearing

System (ECS) services. This ensures automatic credit of benefits and

redemptions when they accrue.

Easy access: You can apply for subscriptions into these Bonds in any

SHCIL center across the country.

Dispatch: Certificate of Holdings is dispatched to the client through

courier on realization of subscription.

Procedure

Subscription is a very simple process. Obtain the application form from any

of SHCIL notified centers across India.

SHCIL officials will assist you in filling up your application form.

Fill up ALL the relevant columns provided in the Application Form. e.g. For

ECS facility, a proof of the ECS Account like Cancelled Cheque / Banker's

Certification authenticating the Account No. and MICR details.

Attach a cheque / draft / pay order in accordance with the series of

subscription you want to make for the requisite amount in favour of “Stock

Holding Corporation of India Ltd. A/C GoI 8.0% Savings (Taxable) Bonds”

A Certificate of Holding will be issued specifying the investment(s) made

under the Bond Ledger Account. The Date of Investment will be the Date of

Realization of the instrument(s).

Documents required



ECS Mandate Documents

Power of Attorney Documents (If appointed

HUF Declaration (for HUF investors only)

Certificate of Identity - for address change and nominee claims

Minor - Birth certificate, Legal or Natural guardian certificate

Form 60 or PAN for investments above Rs.50,000

Charitable Institutions - TDS exemption certificate from IT Department, Board

resolution, Trust Deed

Form 15H (Individuals Claiming Exemption of TDS)

Universities - Incorporation Certificate under Section 3 of the University

Grants Commission Act, 1956

5. INSURANCE

Introduction

SHCIL, a company promoted by Insurance majors & Financial Institutions, is a

Corporate Agent of LIC for Life Insurance products and NIA for General

Insurance products.

SHCIL has a dedicated team of IRDA Certified Insurance Advisors to provide

all services relating to Insurance. We also provide Free Professional advice to

clients on need base insurance.



SHCIL has 100 odd Branches all over India to take care of all your Insurance

related queries and needs.

Features

An insurance policy compensates you against the financial impact that

can arise following loss, damage or destruction of your property (such as

home or vehicle) or your health or life.

A fundamental principle of insurance is to put you in the same financial

position after a loss or accident that you enjoyed before the loss. This is

relatively easy with repair or replacement of (say) a car, but is much more

difficult with the loss of a life. The insurance policy is a contract and like any

contract contains clauses and conditions. Claims are settled in accordance

with the conditions detailed in the policy.

SHCIL distributes Life insurance policies of LIC and Non-Life insurance

policies of NIA.

The service is available at any of over 100 branches of SHCIL.

LIC products

1. KEY MAN INSURANCE

2. CHILDREN’S POLICY

Komal jeewan plan 159

Jeewan kishore plan102

Jeewan Chayya plan103

3. ENDOWMENT POLICY



Endowment with profits plan14

Limited payment endowment with profits plan48

Jeewan Mitra plan 133

Jeewan Mitra plan 149

Join life (Jeewan Sathi) policy plan 89

4. RETIREMENT PLAN

KEY MAN INSURANCE

Key Man Insurance is an insurance taken by a business firm on life of an

employee (Key Man) whose services contribute substantially to the success of

the business of the firm.

The object of Key man insurance is to indemnify business firm from the loss of

earnings may occur because immediate replacement of the Key Man may not

be possible.

Section 37 (1) of the Income Tax Act ,1961 provides that any expenditure laid

out or expended wholly and exclusively for the purposes of business or

profession shall be allowed as a deduction in the computation of income from

business or profession.

Only Partnership firms and Companies are eligible for Key Man Insurance. If a

Key Man is an employee/officer in the Company /firm, the quantum of sum

Assured will be limited to ten times of annual remuneration paid to the

employee. The value of perquisites can also be considered as part of

remuneration to the extent of 30% of salary for this purpose.

KOMAL JEEWAN Plan 159



Under this children’s plan, the payment of premium ceases on policy

anniversary immediately after the child attains 18 years of age. The plan,

besides offering risk cover, also offers payment of Sum Assured in

installments at age 18, 20, 22, 24 and Guaranteed and Loyalty additions, if

any, at 26 years of age. The close relations such as grandparents, elder

brothers or sisters, uncles both from paternal or maternal side can gift 'single

premium policy' for love and affection under this plan. In such cases also, the

policies will be proposed by father, mother or legal guardian.

JEEWAN KISHORE Plan102

High bonus from day one.

Child becomes owner of the policy automatically at the age of 18 years.

Risk commences after 2 years of policy or on completion of 7 years of

age, whichever is later.

No medical examination of the child if age is less than 10 years.

JEEWAN CHAYYA Plan 103

Ideal for parents having less than a year old child.

Makes provision for education/ marriage of the child.

Extra benefit of waiver of premium in case of death of the policy holder.

This policy is given under non-medical scheme up to sum assured of Rs.1

lakh, if the prospect is having a child of less than one year of age as on date

of registering the proposal. This non-medical is exclusive for other policies.

ENDOWMENT WITH PROFITS Plan 14

Moderate Premiums

High bonus



High liquidity

Savings oriented

This policy not only makes provisions for the family of the Life Assured in

event of his early death but also assures a lump sum at a desired age. The

lump sum can be reinvested to provide an annuity during the remainder of his

life or in any other way considered suitable at that time. Premiums are usually

payable for the selected term of years or until death if it occurs during the term

period.

LIMITED PAYMENT ENDOWMENT WITH PROFITS Plan 48

Just as in the case of limited payment whole life polices, here, too, the

payment of premium can be limited either to a single payment or to a term

shorter than the policy. The endowment is, however, payable only at the end

of the policy term, or upon death of the policy holder if it takes place earlier.

If payment of the premiums ceases after at least three years' premiums have

been paid, a free paid-up Policy for an amount bearing the same proportion to

the sum assured as the number of premiums actually paid bears to the

number stipulated for in the policy, will be automatically secured provided the

reduced sum assured, exclusive of any attached bonus, is not less than

Rs.250 Such reduced paid-up Policy will not be entitled to participate in the

profits declared thereafter, but such Bonus as has already been declared on

the Policy will remain attached thereto.

JEEWAN MITRA Plan 133

The benefits of this policy can be considered only for standard and

substandard lives Class I and II. It cannot be allowed for people engaged in

hazardous occupations. Individuals engaged in dangerous pursuits will be



rated against the revised tabular occupational extra rates. This policy covers

the risk for triple the sum assured.

JEEWAN ANAND Plan 149

Jeevan Anand is a With Profit Assurance Plan. It is a combination of the

Whole Life Plan and the most popular Endowment Assurance Plan. The plan

provides the pre-decided Sum Assured and Bonuses at the end of the

stipulated premium paying term, but the risk cover on the life continues till

death.

Moderate Premiums

High bonus

High liquidity

Savings oriented

JOINT LIFE (Jeewan Saathi) POLICY Plan 89

This policy is issued on the lives of the husband and wife provided the

female's life belongs to Category I or is actively engaged in her spouse's

business. In case of death of one of the policy holder the surviving partner

gets the sum assured, the premium is stopped and on death or maturity full

sum assured along with bonus is paid back.

RETIREMENT PLAN

Its once again that time of the year when most of you are on the look out for

tax saving avenues for investment. And for most, insurance has been on the

top of the list of choices. While earlier, buying insurance was mainly for tax



benefits, but these days with increased awareness, consumers have been

narrowing down on picking up the right policy that suits their future needs.

NIA Products

1. MEDICLAIM POLICY

2. FIRE INSURANCE

3. PRIVATE CAR INSURANCE

4. HOUSEHOLDER’S POLICY

MEDICLAIM POLICY

This insurance policy can be used to protect the insured party against

expenses incurred for hospitalization for illness/ injury/ diseases as well as

domiciliary hospitalization. Suitable for:

Each and every person aged between 5 and 75 years of age. Children

aged between 3 months and 5 years have to be insured along with

their parents.

Government or private institutions for their employees.

Clubs or associations for their bona-fide members.

FIRE INSURANCE

This policy offers protection against loss or damage of property/ materials

caused by fire. The insurance should be taken for a maximum amount of its

current value after considering factors of wear and tear as well as

depreciation.

Suitable for:



This policy is vital for every individual or corporate body with respect to the

property where they have insurable interest. Since insurable interest signifies

the right to insure, the person or corporate body must be legally competent to

enter into a fire insurance contract.

PRIVATE CAR INSURANCE

Riskscovered

This insurance policy protects the motor vehicle from loss or damage

By fire, lightning, self-ignition, explosion, burglary, housebreaking or

theft.

Riot or strike.

Flood, earthquake, cyclone or inundation.

Transit by road, air, elevators or lifts.

Liability for third party's injury or death, third party property and towards

the paid driver too.

Drunken driving.

HOUSEHOLDER’S POLICY

The Householder's Insurance Policy comprises of ten sections covering of the

insured's building, fixtures and fittings, contents, jewellery and valuables,

television sets and VCRs, bicycles, accompanied baggage as well as

personal accident and public liability benefits. Of these ten, the insured party

must opt for at least three sections and section 2 is compulsory.

If the insured party opts for cover for more than 4 sections excluding

compulsory sections, a discount of 15 percent is offered on the Non-Tariff

sections. For more than 6 sections, excluding Sections I and II, 20 percent

discount is offered on Non-Tariff sections.



5. STOCK DIRECT

STOCKdirect has changed the way you look at trading in securities. From

your desktop you can now send instructions for buying/selling shares. Three-

way hands shake between leading brokers, national and international banks

and SHCIL is the crux of STOCKdirect.

STOCKdirect - India's first online trading platform was launched in 1999.

Today STOCKdirect is the most secure online trading platform which

combines encryption technology / digital signature as well as Smart Card

security features.

A few clicks will seamlessly check your funds and security positions, route the

order to the broker of your choice and do the necessary fund and share

movements for you. For people who are not inclined to trading on the net, we

have Request Transmitting Machines (RTMs) placed at specified SHCIL

centres. This is an electronic touch screen kiosk where you can insert your

smart card and trade effortlessly.

Features

A single instruction enables you to combine your trading, fund and

share transfers with SHCIL taking care of the settlement.

Trade from home on the Internet with a floppy containing the

STOCKdirect software or use the Smart Card to trade through the

Request Transmitting Machines (RTMs) placed at specified SHCIL

centers and partner banks' designated branches.

Security measures based on encryption and digital signature coupled

with smart card technology make your online deals 100% secure.

Open an account with our partner Banks or open a Purchase Advance

account with SHCIL to facilitate your fund transfers.



Choose the exchange to trade from BSE & NSE.

Advantages

OneStopShop

Give a single instruction towards funds confirmation for buy orders,

order routing to your broker and fund and share movements for

settlement purpose.

Convenience

Trade from home through the net or use the RTMs placed at specified

SHCIL centres.

Security

Digital Signature & Smart Card technology based on 128 bit Encryption

make your transactions 100% secure.

Cost-Effective

No minimum value of transaction.

ChoiceofStockExchanges

Buy/Sell shares on BSE / NSE.

Procedure

If you already have a demat account with us, fill up a conversion form to

convert your demat account to STOCkdirect. If you do not have a demat

account, fill up a demat Account Opening form and submit it at any of our

branches.

Register with any of our 77 empanelled brokers by filling up the broker

registration form and submit it along with the account opening / conversion

form.

Open a savings bank account with our partner banks or You have the option

of opening with SHCIL a running account called the Purchase Advance by

remitting an initial advance of Rs.1,000 by way of cash / cheque / DD.



Should you decide to open a Bank account, fill up your bank account number

in the conversion form and submit a photocopy of a cheque leaf from your

cheque book for MICR details

If you have a PC with internet, you can opt for the software option;

alternatively you can opt for the Smart Card option. You may go in for both the

options also.

Within a week of your account opening / conversion, you will be sent an

operating kit containing the following:

-Smart card and/or software.

-Delivery instruction slips.

-Operating manual.

Tariff

Brokerage

0.50% with a minimum of Rs 50/- per client per broker per settlement*.

Normal ISA charges applicable as per client's tariff scheme. Service tax

applicable as per GOI notifications.

Media charges (One time charge)

-Smart Card option: Rs 600/-

-Software option: Rs 600/- (Slashed to Rs 100 for a limited time).

-Smart card and Software option: Rs 1000/-



Checklist

You need to be a beneficiary account-holder with SHCIL. You can convert

your existing Demat account into a STOCKdirect account by filling up a

conversion form.

Open a Savings / Current Account with any of SHCIL'S partner Banks. The

minimum balance to be maintained in the Bank account is Rs

1,000/-.Alternately, you can open a running account called Purchase Advance

to facilitate your fund transfers. If you opt for Purchase Advance, The

following conditions apply:

- You make an initial remittance of Rs. 1000/- into the purchase

advance.

- Minimum amount of Rs.250 to be maintained in the Purchase

Advance.



SERVICE PROFILE

Depository participants

Introduction

Our Depository Participant services address your individual

investment needs. With a parentage of leading financial institutions

and insurance majors and a proven track record in the Custodian

business, we have reiterated our past success by establishing

ourselves as the first ever and largest Depository Participant in

India.

Our Depository Participant services address your individual investment needs.

With a parentage of leading financial institutions and insurance majors and a

proven track record in the Custodian business, we have reiterated our past

success by establishing ourselves as the first ever and largest Depository

Participant in India.

From a tentative foray in 1998 into the individual investor arena to servicing

around seven lakh accounts, we have endeavored to constantly add and

innovate to make business a pleasure for you.

Over 100 of our networked branches ensure we are available where you look

out for us.

Across the country, fourteen Depository Participant Machines (DPMs)

connected to NSDL and seven connected to CDSL ensure fast and direct

processing of your instructions.

Our customer-centric account schemes have been designed keeping in mind

the investment psyche of our clients. Your DP account with us takes care of



your Depository needs like dematerialisation, rematerialisation and pledging

of shares.

Matching of your scanned signature on every debit instruction with a digitally

scanned original in our system makes all your trading transactions absolutely

secure. Proactive backup of your instructions prior to execution in the

Depository makes us oblivious to system crashes.

At SHCIL, we place a very high premium on client reporting. Periodic

statements sent to you keep you informed of your account status. Dedicated

Customer Care lines manned by trained staff answer your queries on demat /

trades / holdings. The latest in client response at SHCIL is Interactive Voice

Response (IVR) system for round the clock information on your account.

Registration on our website, SHCIL Interactive, enables you to check your

account-related information, stock market reports and statistics, Corporate

benefits declared by companies, real-time quotes of scrip’s on BSE and NSE

and so much more online.

Open account

Before you open your account……

You can collect your account opening form from any of our branches or

download it from our site itself.

As prescribed by Depository bye-laws, accounts have to be opened in

the exact order in which the name(s) appear on the share certificate.

Remember that Holding pattern A B is not the same as BA. However,

minor differences like abbreviations, spelling mistakes can be ignored

provided signatures recorded with the registrar / company is the same.

Get your account opening from details right.

All columns are filled in. Write NA wherever not applicable.



Bank account number with complete address and 9 digit MICR

numbers are filled correctly. This will facilitate effective disbursement of

monetary corporate actions into your account.

Signature of account holders are always in black.

In case of Power of Attorney, Power of attorney holder has to sign at all

places in lieu of the holder. Certified copy of the POA has to be

provided along with the account opening forms.

If you would like to receive credit of shares purchased directly into your

account, mark standing instruction as 'Yes'.

Your account is opened.

Once your account is opened, you will be allotted a client identity number.

You will be sent an operating kit containing:

Details of your account as recorded by SHCIL.

Copy of the agreement entered into with SHCIL.

"Delivery instruction by client" booklet allotted to your demat account.

This booklet helps you transfer shares from your account to broker

account and other accounts.

Now you are ready to operate your DP account.

Maintenance

Change in permanent/correspondence address

A request letter ( format available on the site) signed by all the holders is

required Along with this Photocopy of proof of identification and proof of new

address is required. Please also bring the originals with you for verification



purpose. Client or the authorized bearer can visit our branch for the same.

Copy of the latest transaction statement received from SHCIL is also required.

Change in signature

Request letter (format available) signed by the client. The new signature to be

attested by the bank. The request may be submitted along with the copy of

POI and the photocopy of the latest transaction statement received from

SHCIL.

Addition of PAN/Mapin

Request letter signed by the client giving the PAN/Mapin number.

Accounts with Power of Attorney

These accounts can be operated by both the client and the POA Holder. In

case the client has given the POA in favour of 2 or more persons, then the

mode of operation of the POA holders is also to be mentioned. In case the

power of attorney is to be revoked, a letter signed by the client is required.

Change of Telephone Number

Request letter signed by all the holders, with a photocopy of the recent

telephone bill and proof of identification of one of the holder.

Instruction by Fax

Clients may avail this facility by faxing their delivery instructions to SHCIL, by

executing the fax indemnity.

Change in Standing Instruction

For recording any change in the standing instruction (for receiving direct

credits) in the demat account, we require a letter signed by all the holders.



Change in Power of Attorney Details

If you have given POA details and you wish to operate the account yourself,

the POA has to be revoked by you in writing.

Death of Beneficiary account holder(s) - Transmission of account

Transmission of account takes place in the event of death of the beneficiary

account holder(s). There can be three situations in transmission of account.

See which category you fit into and follow the relevant procedure:

- When the account has joint holders and one of the holder dies.

- When the account has a sole holder with a nominee.

- When the account has a sole holder without a nominee.

If the shares are transmitted to beneficiary accounts of surviving holders and

this beneficiary account is in a DP other than SHCIL.

o Classify the transmission case into the above categories.

o Over and above the documents explained above, the

client master list from the target DP has to be submitted.

Freezing of account

An account is frozen/suspended

- Only on your instruction.

- By competent authority i.e. by the Depository / SEBI.

- On receipt of court order.

Defreezing of account

Defreezing of an account takes place,



- Only on your instruction.

- For defreezing pledge accounts, your instruction has to be

accompanied by bank authorization.

Demat

Dematerialisation is the process of conversion of shares from physical form to

the electronic mode. Our dedicated demat team enable you to convert your

physical holdings into electronic mode in a quick and hassle-free manner.

As per SEBI, scrips can be divided as:

Scrips eligible for demat.

These scrips can be traded either in physical or electronic form.

Scrips falling under compulsory demat.

These scrips can be traded only in electronic form.

Scrips falling under transfer cum demat.

In this category, the shares purchased by you in the physical form can be sent

to the Registrar / Company for transfer and dematerialisation at the same

time.

Submit Demat Request Form

Once your demat account is opened with us and you have received your

client identity number, you can start dematerialising your shares. You can



submit the shares over the counter at any of our branches. Do go through the

tips given on filling up the DRF to avoid rejection.

Your shares are dematerialized

When the company gives you credit, these shares will reflect under

"free" column. Now you can sell these shares. In case the company is

not satisfied with the details furnished, it will reject the shares.

If your shares have been rejected by the company, SHCIL will forward

the shares to you on receiving them from the company.

Direct Demat

Transfer cum Demat or Direct Demat is a process wherein the shares

purchased by you in the physical form can be sent to the registrar / company

for transfer and dematerialisation at the same time.

What you need to do

Send the physical certificates along with duly executed Transfer Deeds

to the company / Registrar indicating your intention to directly demat

the shares after transfer.

The company upon effecting the transfer will send you a letter

containing details of the share certificates.

Submit this letter with a duly filled DRF to us well within the specified

date mentioned in the letter. If the letter does not reach the company /

registrar before the specified date, the Company / Registrar dispatches

the physical certificates back to you.

What happens in Direct demat

Based on guidelines issued by SEBI, the procedures for transfer cum demat

is as follows:



Firstly, you will send the physical certificates along with duly executed

Transfer Deeds directly to the company / Registrar indicating your

intention to directly demat the shares after transfer.

The company / registrar, upon effecting transfer will send you a letter.

This letter will contain all the details of certificates such as folio No. ,

certificate no, Distinctive Range Number (DNR), etc.

The certificates will be retained by the company / registrar. You will fill

the demat particulars in the DRF, attach it with the letter sent by the

company and submit the same to us.

The letter also specifies a date by which the letter needs to be

returned to them. You will have to submit the DRF along with the

company letter to us before the specified date.

If the letter does not reach the Company / Registrar before the

specified date, the Company / Registrar despatches the physical

certificates back to you.

We at our end process this letter in lieu of certificates and create a

DRN and forward the same to the company / registrar along with the

DRF submitted by you.

The company gives credit against the DRN on receipt of the DRF and

ensures defacing of certificates at their end.

The defacing of certificates at the company's end is very crucial to

ensure that the certificates are not re-circulated and misused. Hence

Transfer cum Demat procedure is admissible only in case of

companies identified by NSDL and categorized as eligible for direct

demat. NSDL permits companies after due certification by auditors on

the internal controls in place at the company.



Pledge

You can pledge or hypothecate your dematerialised shares against loan or

credit facilities extended by a pledgee who also has an account with a DP

The pledge procedure

Pledgor fills in a form requesting the DP to pledge shares and hands it

over to the DP

If the form is complete in all respects, the DP processes the form and

generates a pledge / hypothecation instruction number for the request

Securities to the extent of the instruction are debited from the free or

locked-in balances and credited as pledged balances of the pledgor so

that they cannot be used for any transactions

The pledgee will submit a form to its DP to accept / reject the pledge /

hypothecation request

If the pledgee accepts the request by the pledgor, the acceptance is

communicated electronically to the pledgor's DP. Once the pledgee's

DP confirms the acceptance of the pledge, the pledgor cannot cancel

the pledge / hypothecation order. The pledgee's DP executes the

pledge / hypothecation request as per the instructions given

In case the pledgee rejects the pledge request, the pledgor's DP is

intimated electronically. Now the securities which were earlier credited

as pledged balances will be credited to free / locked-in balances

Once the loan is repaid by the pledgor, the pledgor initiates the closure

of the plegde. The request for closure is transmitted electronically to

the pledgee's DP. The pledgee's acceptance / rejection of the request

for closure of pledge is transmitted electronically to the pledgor's DP



If the pledge is closed, the securities will be reflected as free / locked-in

balances

In case the pledgor defaults in repaying the loan to the pledgee, the

pledgee instructs his DP to invoke the pledge / hypothecation.

Reports

You get the following information at your doorstep:

Transaction cum billing and holding statement if there has been a

transaction in the account

o Weekly for traders

o Monthly for others

The transaction cum billing and holding statement will have the

following details :

o Details of transfers executed

o Confirmation of dematerialisation / rematerialisation requests

o Rejection of dematerialisation / rematerialisation requests

o Movement of securities

Movement of securities on account of pledge creation / closure /

invocation.

Information of allotment details in case of primary market issues

Quarterly holding statement if there is no transaction in the account.

Tariff

1 Annual membership charge Rs. 500/-



2 Purchase (market and off market) Nil

3 Sale (market and off market) 0.05% (min. Rs.25/-)

plus NSDL/CDSL

charges

4 Custody charges NIL

5 Dematerialisation Rs.3/- per certificate

6 Postage per demat request Rs. 25/-

7 Rematerialisation Rs. 25/- per certificate

8 Postage per remat request Rs. 25/-

9 Creation/confirmation of creation of pledge 0.02% plus NSDL /

CDSL charges

10 Closure/confirmation of closure of pledge 0.02% plus NSDL /

CDSL charges

11 Invocation of pledge Rs. 50/- per txn.

12 Late transaction charges (per txn.) Rs. 10/-

Payment option

Client pays an Imprest of Rs.1000/- per depository account, which will

be adjusted against depository charges. The Imprest option is payable

by cheque/cash and is non-interest bearing. The client undertakes to

replenish the balance before it falls below Rs.250/-.

Client authorizes SHCIL to collect the dues through ECS facility



Clearing member

Introduction

SHCIL's long-standing association with Clearing Members has

enabled it to develop services based on an understanding of their

working and their requirement for timely and accurate information.

We accept deposits of base capital and Additional base capital requirements

stipulated by NSE for clearing members trading on its capital market segment.

Besides, our new products with a broker empanelment clause ensure a

mutually beneficial tie-up. Clearing members stand to earn a steady income

from our product transactions and new adds to their client-base, while we

capitalise on their rapport with the market.

We currently offer Depository services to more than 680 clearing members of

various exchanges connected with NSDL and CDSL. Our Customer Care

lines answer all your DP queries while the Interactive Voice Response (IVR)

system gives you information on your account and other valuable data like CC

calendar details, tariff, ISIN information, etc. via telephone, fax and e-mail.

Advantages

For Institutional & Retail clearing members We have customised tariff

for clearing members benefiting

o brokers having very high average trade value

o brokers with big retail clientele

Special tariffs for :

o CM Principal Accounts

o NSCCL CM Accounts



o Unified Settlement Pool Accounts on CDSL.

Our Customer Care helplines give timely and accurate information to

CMs. The Interactive Voice Response (IVR) system at SHCIL gives

round the clock information on holdings & transactions, Pay in / Pay out

details, overdue cum holding details, etc. via telephone, fax or e-mail.

Updated Transaction Statements are available on the website FREE of

any charge whatsoever. Members have a choice of accessing their

statements date-wise for the last one month or settlement-wise for the

same period. Current trading day transactions are also made

available , updated to the hour.

Besides the transaction statements, the Delivery-Out report, which is

an extremely critical report for Clearing Members, is also made

available on the website, updated to the hour.

Open an account – Requirements

In case of Proprietor's account, if authorised signatory is a person

other than the account holder, then Power Of Attorney is to be

submitted by Proprietor giving authority to that person.

If you are shifting from another DP

to SHCIL

If you are opening a fresh Pool

account .

Account opening form Account opening form

Board resolution

Memorandum Of

Association

Authorised Signatories (for

corporates)

Board resolution

Memorandum Of

Association

Authorized

Signatories (for

corporates)



SEBI Registration Certificate clearly

indicating that it is for stockbroker.

SEBI Registration Certificate clearly

indicating that it is for stockbroker.

Closure Letter addressed

to old DP duly stamped

and acknowledged by old

DP.

Closure letter and Shifting

letter has to be on the

letterhead of CM

Closure letter should be

duly stamped and

acknowledged by old DP.

Letter from Stock

Exchange stating CC

CM ID.

In case of ISE

mention on the letter :

Subject : Allotment of CC

CM ID

Shifting Letter addressed to NSDL

stating :

CM Name

old CM BP ID

old DP Name

New DP name.

Custodial services

Custodial services for Base Capital / Additional Capital requirements



We accept deposits of Base Minimum Capital (Base Capital) and

Additional Base Capital as stipulated by NSE for clearing members to

be able to trade on its capital market segment.

The securities being deposited shall be subject to legal and beneficial

ownership of:

TM clearing member / spouse in case of individuals

o Any of the partners / their spouses in case of partnership.

o Any of the directors in case of corporate TM clearing member.

The following securities can be deposited to qualify as

deposit :

o Listed equity shares of approved companies

subject to 15% margin

o Equity shares of Approved companies in demat

form subject to 15% margin (Nifty Scrips) and 25% margin (30

other scrips pertaining to Junior Nifty group)

o Listed units of mutual funds subject to 15% margin

o Unlisted units of mutual funds subject to 15%

margin of the NAV of the units prevalent on the last day of the

preceding month

o Listed PSU bonds subject to 15% margin

o Other debt securities admitted for trading on

Wholesale debt market segment of NSE subject to 15% margin

o Listed GOI / Treasury bills subject to 10% margin



o Units under Unit Scheme 1964 of UTI to be valued

at the lowest of the repurchase prices prevalent in the preceding

12 months

o Deposit of Fixed Deposit Receipts (FDRs) issued

by approved Banks. In case of FDRs, the members have to

submit the following:

A Letter from the Bank in a specified format.

A Letter from the Member in a specified

format

SHCIL Charges upfront

National Savings Certificate and Kisan

Vikas Patra issued by Post office,

SGL Securities,

Certificate of Deposits (CDs) issued by

Banks / Institution.

o NSE members may also pledge dematerialised

shares in favour of NSCCL for security Base Capital and

additional base capital requirements. The demat shares pledged

by a member as additional base capital will be considered for

the purpose of gross exposure computation. In case of demat

scrips, the following conditions apply:

The member has to open a separate

beneficiary account for Base Capital and

Additional Base Capital



-Closure of pledge takes place at the

instruction of NSCCL Replacement /

Addition of securities also available

-in the name of Corporate / Directors

of the Company in case of Corporate

clearing members

-in the name of Proprietor / spouse in

case of Proprietary concerns,

The securities to be pledged to be

transferred to the account. Pledge

Instruction along with pledge deed in

specified format to be given to SHCIL

After pledge is created in favour of NSCCL,

valuation is given to NSCCL by SHCIL

Closure of pledge takes place at the

instruction of NSCCL Replacement /

Addition of securities also available

Reporting

Among the host of Reporting features offered by SHCIL, the notable ones are

Online Transaction updates during the day.

Online date-wise transaction reports, settlement number wise reports

etc

Online redressal of queries through email

Intimation of failed trades



Settlement wise holding statements after payout

Faxes / Emails on specific request

DO Reporting

Some of these highly specialized reports are provided to you ONLINE and

FREE only by SHCIL.

Derivatives

Introduction

SHCIL is a Custodian/Professional Clearing Member of derivative

segment at the Bombay Stock Exchange and at the Futures &

Options Segment of the NSEIL respectively.

We have developed in-house Back Office systems and procedures to cater to

the needs of various entities in the segment. A dedicated team of

professionals handle derivative operations and assist its clients.

As a professional clearing member, SHCIL performs the following functions:

Clearing - Computing obligations of all his TM’s i.e. determining

positions to settle.

Settlement - Performing actual settlement.

Collateral Management - Collection of collateral (cash/cash equivalents

and securities), valuation on a regular basis (as per J. R. Varma

recommendations) and setting up exposure limits for TMs and

Institutional clients.

Risk Management - Setting position limits based on upfront

deposits/margins for each TM and monitoring positions on a

continuous basis.



Advantages

SHCIL has always been a pioneer in clearing and settlement services in the

cash segment at both the exchanges. SHCIL has the capability to handle

large volumes of business with greatest accuracy, keeping customer interests

as the top priority.

SHCIL in it’s endeavor to serve various entities in the derivatives segment has

developed indigenous solution keeping in view the strict regulatory

requirements.

Privacy of each TM’s operations strictly maintained :SHCIL being a

professional clearing member has no trading interests in the derivatives

segment. There is strictly no dissemination of information on trading or

any other operation of any of its clients.

One-point contact for all the activities :SHCIL’s Derivatives segment is

centralized and all operations are handled by an exclusive derivatives

team.

Dedicated team of professionals to handle Derivatives operations:

SHCIL has a well-trained team of professionals supported by best

systems, to handle derivatives operations at NSE and BSE. Clients can

approach the team for troubleshooting, conceptual understanding or

any other operational issue related to derivatives trading.

Tie-up with banks having nation-wide reach for banking

activities :Since settlement in derivatives trading takes place daily.

Funds movement has to be fast. SHCIL has tie up with banks (HDFC

Bank, ICICI Bank, GTB, IDBI Bank, UTI Bank, Canara Bank etc.)

having wide reach and modern facilities like TT/anywhere banking etc.

to contain the time lag in banking transactions.

Network of more than 130 branches to support outstation clients:

SHCIL has nation wide reach with its 130 plus branches across the

country to support outstation clients. SHCIL’s branches are geared up



to provide derivatives clearing and settlement services to trading members

operating from respective branches.

In built checks and controls: SHCIL has indigenously designed

systems that take care of the stringent regulatory requirements for

derivatives trading in India.

Collateral Management: SHCIL has excellent system to manage

cash/cash equivalents/securities deposited as collateral for derivatives

trading. Clients are informed as and when expiry of any instrument

approaches. Securities are transferred in minimum possible time.

Corporate actions on securities are monitored and clients are being

informed accordingly.

Support from Institutional participants: SHCIL being a custodian

clearing member having major institutional clients like UTI, IDBI etc.

who are also promoters of SHCIL, provides more credibility to its

clients.

Competitive service charges: SHCIL is the pioneer in introducing

Derivatives Clearing and Settlement services in the country. To

promote derivatives trading, the service charges are designed not

become a hindrance for anybody entering this market.

More leverage: There is no need to block assets worth Rs. 50 lakh as

initial margin deposits with exchange. Instead a Trading member can

take huge exposures by investing the same amount through a PCM

like SHCIL.

Low investments: Derivatives trading require complying with stringent

regulatory requirements and huge investment in back office systems

for a Clearing Member. By choosing a PCM like SHCIL, a trading

member can start trading with very little investment in back office

systems since a PCM takes care of the back office activities.



Institutional Advantage: Advantage of trading for institutional clients. A

trading member can execute institutional orders without shrinking his

own exposure limits as institutional trades are confirmed online by the

respective PCM.

Confidentiality of Trades: Since SHCIL has no trading rights, the

business details of a trading member are not likely to be

misused .There is no overlapping of business interests.

Focus: Due to highly competitive nature of the market, SHCIL’s service

charges are normally very low and it makes more business sense for a

TM to outsource the clearing and settlement activities and focus on the

core business of trading.

Open an account – Requirements

Agreement: The TM has to sign an agreement with SHCIL to clear his

trade in the format prescribed by NSE/BSE and suitably modified by

SHCIL. The agreement has to be signed before the TM begins his

trading. A copy of the CM-TM agreement will be forwarded to

NSCCL/BSE along with the agreement the trading member should also

submit :

o Board Resolution appointing SHCIL as clearing member

o Attested copy of Memorandum & Articles of Association

o Copy of SEBI registration certificate

Consent: At the application stage, a TM must mention that Stock

Holding Corporation of India Ltd. (SHCIL) will clear his trades.

o Letter of consent from SHCIL can be obtained, which the TM

has to forward to BSE/NSE as the case may be.

Application Form: An application form, provided by SHCIL, to be filled

by TM, giving details of addresses, phones, accounts etc. Approved e-



mail addresses should be mentioned in the application for receiving

daily bills.

MARGINS: Trading Members have to deposit margins with the

Clearing Member for the purpose of taking Exposure on the Exchange

and for daily settlement. At SHCIL, there are two components of

Margins i.e. initial margin (IM) for exposure and maintenance margin (MM)

for daily settlement.

Initial Margin(IM)

minimum Rs. 10 lakh as initial margin (IM) in either of the following ways:

o entire Rs. 10 lakh in cash OR

o Rs. 2 lakh in cash and Rs. 8 lakh as cash equivalent * OR

o Rs 2 lakh in cash, balance Rs. 8 lakh as a combination of cash

equivalent * and specified demat securities (subject to maximum of

Rs. 5 lakh after valuation)

Note: The above proportion is valid for NSE. For BSE minimum cash

requirements are Rs.2.5 lakh. BSE Members can start trading with Rs 7.50

lakh(Rs.2.5 lakh in cash, balance Rs. 5.00 lakhs as a combination of cash

equivalent and specified demat securities (subject to maximum of Rs. 2.50

lakhs after valuation)

Maintenance Margin (MM)

A trading member has to deposit a certain percentage of initial margin (IM) in cash

only towards his daily settlement of marked-to-market margins, premiums or any

other charges payable by the TM.

Initial Margin(IM) ** Maintenance Margin (MM)



More than or equal to Rs. 50

lakh

10% of initial margin in cash only

***

Less than Rs. 50 lakh 20% of initial margin in cash only

* Cash equivalent includes Bank guarantee, fixed deposit receipts or govt.

securities (As per J R Varma Committee report on derivatives)

** The specified initial margin range should be for a period of at least one

continuous month

*** Subject to bank operating powers and banker’s certificate on credit limits

for the bank account

Reporting

SHCIL provides various reports relating to the trading and settlement of its

clients on its website .These reports can be downloaded by the client by using

a unique PIN number and password. The main reports that are provided are :

Daily trades reports

Marked-to-market profit/loss reports

Collateral margin reports

Account statements

Outstanding position reports

Span margins requirement report three times during the day based on

the parameters specified by the exchange

Monthly ledger reports and any other relevant report required by a

client is also provided.

Non-resident Indian



Introduction

Over the years, SHCIL has grown to become a major player in the

capital market. With a network of more than 120 offices operating

across the country and franchisees operating abroad, SHCIL

provides Depository Participant and related services close to 0.7

million satisfied investors out of which over 6000 are NRI Clientele .

SHCIL has a full fledged NRI cell operating specifically to cater needs

pertaining to Depository account opening and maintenance. NRI cell co-

ordinates with prospective NRI customers, collects and assists in obtaining

the relevant documents and ensures the Depository Account is opened hassle

free.

NRI Cell collects physical certificates to be sent for demat and ensures that

the certificates are in order and can be sent for dematerialisation under the

existing guidelines issued by the depositories. Instructions for trade are

accepted by fax on request by NRI Cell to ensure timely settlement of trades.

In this case later on the client needs to regularize by sending the original trade

delivery instruction. Any tariff and billing related query are addressed by NRI

Cell. In short NRI Cell is a single point contact for any matter relating to NRI

Depository operations.

Open account

Before you open your account….

Ascertain your NRI Depository Account status as per guidelines issued

by RBI from time to time.

In case of Joint Account, status of the first holder is reckoned for all

purposes.



If scrip is held by three holders of whom the first is a NRI and the other

two or residents, then the account falls under NRI category.

Accounts have to be opened in the exact order in which the names

appear on the certificate. Holding pattern A B is not the same as B A.

Get your account opening form details right….

All columns are filled in. Write NA wherever not applicable.

Specify status as Non Repatriable (NRO) or repatriable (NRE). Status

cannot be changed once account is opened.

Bank account details should be compulsorily provided along with 9 digit

MICR code

Ensure that the account status and bank details are as below :

o If the status is NRE, bank details can be "NRE' or 'NRO'.

o If the status is NRO, bank details can be 'NRO' only.

Copy of RBI approval is not mandatory and the standing instruction for

automatic credits may be marked as 'Y' without furnishing RBI

approval. However, the onus of reporting to RBI is on the client.

Proof of identity by way of Copy of your Passport and Bank Account

attestation is compulsory.

Initial the agreement on the front side and sign in the order of holders

in the backside of the agreement

Where the account is being opened by POA(proof of address)



o The POA shall sign at all places in lieu of the original holder(s).

However, the photographs will be those of the original holder(s)

only.

o A certified true copy of the POA has to be provided with the account

opening form along with the signature and photograph of the POA.

o The account may be operated either by the original holder or by the

POA.

Nomination

o Nominee may be any person other than the account holders.

o Photograph of the nominee has to be affixed on the nomination

form.

o The nominee must sign across the photograph and in the space

provided below.

o If the nominee is a minor, the guardian shall sign at all places where

the nominee is supposed to sign.

o Photograph of the guardian also has to be affixed on the nomination

form.

Custodial

Introduction



Since its commencement in 1988 as the first dedicated Custodian in

the country, SHCIL has been providing Custodial Services of

international standards to Domestic Mutual Funds, Financial

Institutions and Foreign Institutional Investors.

With almost 70% of the Institutional business in its fold, SHCIL has evolved

over the times to meet the changing requirements of dynamic markets and

demanding clients.

A dedicated pool of trained and highly experienced professionals work literally

round the clock on state of the art computer systems, dedicated

communication channels, well connected to Client institutions, Stock

Exchanges, Clearing houses, Depositories and leading Institutional brokers.

In terms of collective man-years, SHCIL has the most experienced team in the

entire Industry.

Trade processing services

SHCIL has specially trained personnel handling thousands of trade

instructions involving large values on sophisticated systems using digital

signature on STP (Straight Through Processing) systems, ensuring smooth

trade confirmations to Stock Exchanges, reporting and resolution of

mismatches with Clients, etc.

Settlement services

Institutional trades are either settled through the Clearing House of the Stock

Exchanges or as DVP directly with the contracting broker or Counter Party. As

a Custodian SHCIL strives for timely settlement of Funds and Securities.

Funds are collected/ deposited from/to client and settled with the Clearing

Houses/ Brokers/ Counter Parties.



In the present context, most of the Institutional trades are settled in the

Depository mode. For the Institutional segment alone, SHCIL has a unique

clearing code on the two principal stock exchanges and separate DPM units

on both NSDL and CDSL.This ensures smooth settlement of transactions on

both Exchanges/Depositories, based on the deliverables and receivables

received by them for each settlement.

For the occasional delivery and receipt of securities in the physical mode,

SHCIL ensures prompt scrutiny, processing and lodgment of securities with

the respective Company/Registrar and Transfer Agent, with the objective of

final transfer to the purchaser, with objections handling if needed, thus

facilitating delivery of securities to the parties concerned on sale.

Physical custody services

The transferred physical securities, when received, are held in state-of-the-art,

high-security vaults on behalf of the clients. A pioneer in introducing the bar-

coding system to track certificates, SHCIL ensures the availability of each and

every share certificate at a moments notice.

Institutional DP services

SHCIL has installed dedicated DPM’s (Depository Participant Modules) on

both the Depositories, viz. NSDL (National Securities Depository Ltd) and

CDSL (Central Depository Services Ltd).

A dedicated Institutional DP team at SHCIL addresses your need for all core

DP services like conversion of physical holdings into electronic form,

settlement of trade instructions, rematerialisation, repurchase and pledge

instructions, providing of holding and transaction statements and daily

reconciliation of client holdings.

SHCIL also provides special services like providing dematerialisation and

corporate action follow-up, saleable holding reports used by many fund



managers, monitoring of CP Redemptions, prepayments and providing

customized reports like put/call forecasts and non equity holding reports.

Corporate Actions, Primary markets and related services

The Corporate Actions team ensures timely collection of monetary and non-

monetary benefits on behalf of the client. It covers all activities relating to

Corporate Actions like calculation of entitlements, reconciling with

companies/registrars prior to due date, collection of monetary Corporate

Actions from the premises of the company/registrar and transfer of the same

to clients. In case of any shortage, active follow up is done with each

company. Customized reporting to clients on the status of Corporate Actions

is done periodically.

This team is supported by a highly specialized ‘Databank’ team, which is

unique to SHCIL. This team tracks over 8500 Companies, over 12000 issued

securities, 2500 Registrars, besides all relevant information available in all

main stock Exchanges and Depositories. The team ensures prompt

availability of information on all Corporate Announcements, ISIN listings etc to

the Corporate Actions team.

The Primary Markets team takes care of applications on behalf of clients for

primary market issues, calculates the entitlements, follows up for allotment or

refunds and sends customized reports to clients.

Client relationship management

Every Institutional client is assigned to an experienced Manager with a

dedicated team whose sole task is in resolving special issues relating to the

client. This team acts as a single point contact for all Client matters. They also

ensure standardized and highly customized reports to clients at desired

intervals.



Swot analysis

SWOT ANALYSIS



STRENGTHS:

1. SHCIL is the first depository participant. It has the opportunity of

holding more than 7000000 accounts at all centers.

2. Multiple products and services: SHCIL provides a variety of services

under the same roof.

3. It is the member of both NSDL and CDSL.

4. The company has more than 100 branches all over the world. It is very

much accessible to the clients.

5. The company has highly computerized, state of art technology to

facilitate the business and minimize the risk from automated

operations.

6. The company has to its credit 70% of the institutional business.

7. The company is blessed with a trained pool of professional staff and

very good customers.

8. The employees are assigned to different departments on rotation basis.

This results in a pool of staff that will always be ready to replace others

in case of their absence.

9. Since the main business of the company is providing DP services,

unlike the service provided by banks it leads in specialization.

10. The variety of services offered has enabled SHCIL to have a much

more competitive edge about financial services than its competitors.

WEAKNESS

1. Improper or insufficient credit collection procedure, which has resulted

in a large amount or receivables.

2. The clients are not provided any incentives or motivations, which would

encourage them to make timely payment.

3. The company has not undertaken sufficient steps to create awareness

among the clients about SHCIL. The only procedure adopted is the

Internet.

4. The company has also failed in creating awareness among the clients

regarding the necessity of updating the information with regard to their



address, which makes some of the services rendered by the company

futile.

5. The HR department is placed in Mumbai. So the newly recruited

employees lack sufficient training facilities.

OPPORTUNITIES

1. The company can take steps to increase the awareness among the

clients and thereby increase the business.

2. The company has regularly come with new products and services in

order to proceed ahead of its competitors.

3. The company can attract more number of franchises.

THREATS

1. The number of competitors is increasing at a higher rate. Their charges

are also low when compared to the charges of SHCIL. The nearest

competitors are banks providing DP services along with their regular

services.

2. The company does not charge any amount for closing the account.

Since retaining the customer is very important and most of the

customers will not think of closing the account at time of opening the

account the company can charge some for closure.

3. The discounts and offers given by other DP’s when compared to offers

of SHCIL are leading to reduction in the number of clients.



Methodology



Methodology

Type of research Descriptive and Exploratory

research.

Sampling technique Non probability sampling.

Sampling size 50

Sample description Canara Bank, Bangalore stock

exchange, ICICI, IL&FS, UTI,

SHCIL.

Instrumentation technique Interview, questionnaire

Sources of data collection Primary data was collected by

conducting Interview and

secondary data was collected

from magazines, books, and

internet.

Software used for data analysis MSexcel

It is a survey method. The questionnaire and interview schedule, personal

interview will be relied upon for gathering primary data. An aggregate of 40

respondents from various Depository Participants responded to the

questionnaire.

For the purpose of secondary data books, articles, reports, annual reports

of the stock exchanges, news papers, CD-ROM, Internet, Nifty, BSE, BGSE,

are planned to be used.



Analysis & Interpretation

ANALYSIS



The researcher used a structured questionnaire for eliciting the required

responses relating to Depository Services at SHCIL.

50 respondents were approached for this purpose, out of which 40

respondents co-operated with the researcher in filling the questionnaire.

The various responses were classified, and tabulated. A simple statistical

analysis was made by the researcher.

An attempt is made to present the analysis covering different aspects of

Depository Services at Stock Holding Corporation of India Limited.

1. Table showing the age group of respondents



Age (In years) Frequency %

20-30 8 20

30-40 12 30

40-50 16 40

50 & above 4 10

Total 40 100

Table No: 1

Graph showing age group of Depository Holders

Graph No: 1

Analysis: From the above table we can see that the normal range of

Depository Holders age varies between 20-50 yrs, with the highest 40% falling

between 40-60 followed by 30% falling between 30-40 and 20% between the

age group 20-30 and the lowest is 60 & above.

Inference: 40% of brokers and investors fall in the age group 40-60yrs.

2. Table showing the number of respondents investing in shares


05

1015202530354045

20-30 30-40 40-50 50 &above

Age

Resp

on

den

ts


Particulars Frequency %

Yes 32 80

No 8 20

Total 40 100

Table No: 2

Graph showing the Number of share holders

80

20

yes

no

Graph No: 2

Analysis: From the above Graph it can be analyzed that 80% of the

respondents are Stock Holders. Remaining 20% of the respondents are not.

Inference: 80% of the respondents are the stock holders.

3. Table showing the No. of years holding & trading in SHCIL.



Years Frequency %

0-5 16 40

5-10 12 30

10-15 8 20

15-20 4 10

Total 40 100

Table No: 3

Graph showing the No. of years the respondents holding and trading in

SHCIL

Graph No: 3

Analysis: From the above it can be analyzed that the company has been

grown well from past 5 to 10 yrs. 30% of the people are trading from 5-10

years & 40% from 0-5 years.

Inference: 40% of the Depository Holders are trading between 0-5 years.

4. Table showing how secure the securities in opting the demat.


0

5

10

15

20

25

30

35

40

Respondents

0-5yrs 5-10yrs 10-15yrs 15-20yrs

Years


Particulars Frequency Percentage

Excellent 24 60

Very Good 8 20

Good 6 15

Average 2 5

Total 40 100

Table No: 4

Graph showing the degree of securities in Demat Account

Graph No: 4

Analysis: From the above table survey inferred that 60% of the Depository

Holders are giving their consent as excellent about Demat. That is the

securities of the shareholders in electronic form is more safe and secured.

Inference: Dematerialization plays a major role in providing safety and

security to the holders.

5. Table showing the most preferred DP Product



ExcellentVeryGood

GoodAverage

60

2015

50

10

20

30

40

50

60

%


Broking/Internet

Trading

8 20

Mutual Funds 16 40

Government Bonds 8 20

Insurance 8 20

Total 40 100

Table No: 5

Graph showing the most preferred DP Product

ern

et

Tra

din

g

Bro

kin

g/I

nte

rne

t

Mutu

al F

unds

Govt.

Bonds

Insura

nce

20

40

20 20

0

10

20

30

40

Graph No: 5

Analysis: The above survey reveals that 40% of the holders are interested to

invest their savings in Mutual funds because they are less risky. The

Government bonds, Broking, & Insurance constitute the next preferred DP

product.

Inference: Majority of 40% of holders are interested in Mutual Funds.

6. Table showing the source in which the information is available regarding SHCIL




Newspaper 4 10

Magazines 4 10

Word of mouth 16 40

Internet 16 40

Total 40 100

Table No: 6

Graph showing the source in which the information is available

1010

40

40Newspapers

Magazins

Word of mouth

Internet

Graph No: 6

Analysis: From the above survey it is revealed that the information about the

SHCIL is more effective through Internet and Word of mouth, i.e. the 40%

from Internet & 40% from Word of mouth, 10% is followed by Newspapers &

10% by Magazines

Inference: Internet constitute the largest source of SHCIL related

information..

7. Table showing the selection of stock exchange to traded by both

shareholders and brokers.




NSE 20 50

BSE 20 50

TOTAL 40 100

Table No: 7

Graph showing the selection of stock exchange to trade by the

shareholders

50 50

0

10

20

30

40

50

BSE NSE

Graph No: 7

Analysis: From the above survey it is clearly inferred that 50% of

shareholders are using BSE for trading and also remaining 50% are trading in

NSE.

Inference: Both NSE & BSE are equally preferred for trading purpose,

accounting for 50% each of the responses.

8. Table showing the attribute of services expected by the investor




Quality of Service 8 20

Market Updates 8 20

Returns Provided 12 30

Safety & Security 12 30

Total 40 100

Table No: 8

Graph showing the attribute of services influences the investors

Graph No: 8

Analysis: From the above table it can be inferred that equal number of

respondents i.e. 30% each consider Returns and Safety as important

attributes followed by other attributes such as 20% each consider Quality of

service and Market updates.

Inference: Safety & Security, Returns constitute the most preferred

attributes.

9. Table showing areas of investment that most investors prefer in

SHCIL


0

5

10

15

20

25

30

Quality ofService

MarketUpdates

ReturnsProvided

Safety &Security



Equity Shares 16 40

Mutual Funds 12 30

Bonds 8 20

Others 4 10

Total 40 100

Table No: 9

Graph showing areas of investment that the most investors prefer

40

30

20

10

0

5

10

15

20

25

30

3540

EquityShares

MutualFunds

Bonds Others

Graph No: 9

Analysis: Majority 40% of the investors are having the habit of investing in

the Equity shares, 30% of them have invested in Mutual funds and 20% are

invested in Bonds & 10% in others.

Inference: Equity shares are the best options for investment in which

investors are preferring it first.

10.Table showing whether SHCIL provide Tailor made services




Yes 16 40

No 24 60

Total 40 100

Table No: 10

Graph showing the Services provide are Tailor made or not

Graph No: 10

Analysis: From the above table we can analyze that 60% of the Depository

holders are not satisfied with the services. Out of 100 only 40% of investors

are accepted as Tailor made services.

Inference: From the above analysis we can infer that majority of investors

will expect better service.

11.Table showing through which SHCIL provides the Value-added

services to clients


40

60

Yes

No



Online transaction

updates

16 40

Faxes / E-mails 8 20

Portfolio updates 4 10

Daily updates

(Website)

12 30

Total 40 100

Table No: 11

Graph showing the Value-added services provided by SHCIL

Graph No: 11

Analysis: From the above table we can analyze that the 40% of the

respondents says that the value-added services provided by SHCIL is through

online transaction, 30% by website, 20% E-mails, 10% portfolio updates.

Inference: Majority of the respondents accept that the value-added services

are through online transaction updates.

12.Table showing how satisfying is SHCIL in terms of Infrastructure

& the hardware, software installed for serving clients


40

20

10

30

05

1015202530354045

tes

Online trans.Updates

Faxes / E-mails

Portfolioupdates

Dailyupdates/website



Excellent 12 30

Very Good 20 50

Good 6 15

Average 2 5

Total 40 100

Table No: 12

Graph showing how satisfying SHCIL is in terms of Infrastructure,

software etc

Graph No: 12

Analysis: The above survey reveals that the Depository holders are satisfied

in terms of infrastructure and software with the result of 30% as excellent,

50% as Very good followed by 15% as Good and 5% as Average.

Inference: Majority of the DP holders are satisfied.

13.Table showing how efficient & effective the DP services of SHCIL

compared to other financial institutions


30

50

15

5

0

10

20

30

40

50

excellent Very Good Good Average


Particulars Frequency PercentageExcellent 20 50Very Good 16 40Good 4 10Average 0 0Total 40 100

Table No: 13

Graph showing how efficient & effective the DP services of SHCIL

compared to other financial institutions

Graph No: 13

Analysis: From the above table it is analyzed that 50% of respondents are

agreed as excellent & more effective DP services in SHCIL when compare to

other institution.

40% of respondents agreed as Very good, 10% as Good & 0% as average.

Inference: DP services of SHCIL is excellent when compare to other

financial institutions.

14.Table showing how satisfactory are the interest rates in terms of

loan against demat held in DP.


50

40

10

00

10

20

30

40

50

60

Excellent Very Good Good Average



Yes 16 40

No 24 60

Total 40 100

Table No: 14

Graph showing the interest rates in terms of loan against demat.

Graph No: 14

Analysis: From the above table it is analyzed that 60% of respondents are

not satisfied with interest rates in terms of loan against demat.

Inference: Through the graph we can say that the interest rates are high.

15.Table showing how safe & secure the demat is


40

60

Yes

No



Yes 36 90

No 4 10

Total 40 100

Table No: 15

Graph showing how safe the demat is

Graph No: 15

Analysis: From the table it is analyzed that 90% of Depository holders are

feeling that demat is safe & secure, whereas only 10% are feeling unsatisfied.

Inference: Majority of respondents are safe with demat.

16.Table showing service charges charged by SHCIL.


90

10

Yes

No



High 24 60

Reasonable 16 40

Low 0 0

Total 40 100

Table No: 16

Graph showing service charges charged by SHCIL.

Graph No: 16

Analysis: From the above survey it has inferred that 60% of respondents are

feeling that the service charges charged by SHCIL is high, and 40% as

reasonable, 0% as low.

Inference: Majority that is 60% of respondents are not satisfied with service

charges.

17.Table showing how effective the SHCIL in settling the stock.


60

40

00

10

20

30

40

50

60

70

High Reasonable Low



Fast 20 50

Slow 20 50

Total 40 100

Table No: 17

Graph showing how effective the SHCIL in settling the stock.

Graph No: 17

Analysis: From the above table it can be interred that 50% of the

respondents are telling fast in settling the stock & other 50% are telling slow in

settling.

Inference: The respondents are equally responding for the effectiveness in

settling the stock.

18.Table showing how satisfactory is the on-line trading


50 50

0

10

20

30

40

50

60

Fast Slow



Excellent 20 50

Very Good 8 20

Good 12 30

Average 0 0

Total 40 100

Table No: 18

Graph showing how satisfactory is the on-line trading

Graph No: 18

Analysis: The responses to the On-line trading ranges between ‘Good’ and

‘Excellent’, 100% of the respondents record their responses between ‘Good

and Excellent.

Inference: It is inferred that the number of respondents are very much

satisfied with the on-line trading in SHCIL.


50

20

30

00

10

20

30

40

50

60

Excellent Very Good Good Average


Summary of Findings



FINDINGS

Based on the data analysis and interpretation, the following findings noted:

20% of the respondents, who are not stock holders are under the age

group of 20-30 and 50 and above.

Out of the entire DP holders 10% of them trading in 15-20 years, 20%

are 10-15 years, 30% are 5-10 years, 40% are 0-5years. This

indicates the popularity of the organization in the last 10 years, during

which time 70% of the existing members are trading from

0-5 years, whereas the previous 10 years the total percentage is only

30%. This indicates a healthy trend form last 10 years.

From the analysis part it shows the most preferred DP product is

Mutual Funds. It shows that the Interest of the investors would be

funds which has less risk and high returns. This is substantiated the

fact that 40% of the holders are interested to invest in Mutual Funds

and other investments are distributed as Bonds, Broking and

Insurance.

From the survey it is noted that the best method of spreading

information seems to be Internet, which draws the interest of investors

better than any other media.

The survey indicates the trading is equally shared between BSE and

NSE.

The respondents gave equal interest to Safety and Security, Returns

provided and quality of service, only 10% as Market updates.



Therefore it is essential for the company to give more priority about Safety

and Security and returns.

Though the Equity shares has got the highest risk, the investors are

willing to take risk by investing in Equity shares for higher returns since

the SHCIL is doing well.

It is also noted that 60% of the investors expect Tailor-made services.

It is noted from the survey the Value-added services provided by

SHCIL is through Online updates.

The survey indicates majority of respondents are satisfied in terms of

Infrastructure, hardware and software installed for serving clients.

The services provided by the SHCIL is better when compared to other

financial institutions.

The investors feel that the Interest rates provided or charged by SHCIL

is high against demat held in DP.

The survey indicates that the investors are more safe and secured from

the demat in SHCIL



Recommendations &

Conclusion



RECOMMENDATIONS

Since the interest and web based communication is getting popular

SHCIL should update their website atleast on a weekly basis so that

the major percentage of the remaining i.e. 20% can be brought in.

Since Dematerialization plays a major role in influencing DP holders

there must be increased effort in promoting enhanced services

involving security and safety.

To encourage the existing and prospective shareholders good returns

must be ensured in addition to security and safety.

Since the Investors taken interest in Equity shares SHCIL should

provide frequent updates on the web relating to Equity share trading

movement.

Since the Investors expect better service form SHCIL, it should provide

value-added services.

It is necessary for the organization to sustain their primary position as

compare to other Financial Institutions as innovative and useful

services.

It is necessary to reduce the service charges charged by SHCIL

It is also necessary to reduce the Interest rates on loans against

demat.

The online trading efforts must be made more scientific and effective.



Conclusion

On the whole, my project at SHCIL was worthwhile as I got the opportunity to

learn a lot about the capital market. It was a wonderful experience interacting

with employees of the organization and simultaneously enhancing my

knowledge and skills about stock market operations. I got to know about the

process of dematerialization, account opening and how the trades department

settles the various transactions etc.

Working at SHCIL and preparing this project report was a learning experience

and I shall make immense use of it in my career.



ANNEXURE.1

BIBLIOGRAPHY

BOOKS:

AUTHOR TITLE OF THE PUBLISHER’S PLACE OF BOOK NAME PUBLICATION

GURUSWAMY “Financial Service and Himalaya Delhi Markets”

GORDEN “Financial Markets and Himalaya Delhi AND Services”NATRAJ

AVADHANI “Investment and Securities Himalaya Delhi Markets in India”

PRASSANNA “Financial Management” Tata McGraw DelhiCHANDRA Hill

L.M.BHOLE “Financial Institutions Tata McGraw Delhi and Markets” Hill

MAGAZINES:

Dalal Street

Business today



Money

Business India.

NEWS PAPERS:

The Economic Times

Business standard

Outlook money

INTERNET / WEBSITE

WWW.google.com

WWW.online.stockholding.com

WWW.Sharekhan.com


http://WWW.Sharekhan.com/

http://WWW.google.com/


ANNEXURE.2

STUDY ON COMPARATIVE ANLYSIS OF THE DEPOSITORY

PARTICIPANTS

QUESTIONNAIRE

1. Name of the Respondent …………………………………….

2. Address and Phone No. ………………………………...........

3. Sex

Male Female

4. Occupation

5. Age Group (in years)

20-30 30-40

40-50 50-60

6. Are you a Share holder?

Yes No

7. Since how long are you holding and trading the securities in SHCIL?

0-5yrs 5-10yrs



10-15yrs 15-20yrs

8. How secure do you feel by opting your securities in demat form?

Excellent Very Good

Good Average

9. Which DP Product do you prefer?

Broking/Internet trading

MF Mobilization

Government Bonds

Insurance

10. Through which source do you avail information regarding SHCIL?

Newspaper

Magazines

Word of mouth

Internet

11. What is the most preferred area of avenues of investment?

Mutual Funds

Government Bonds

Equity Shares

Others Specify

12. Does SHCIL provide Tailor- made services?

Yes No



13. What are the attribute of services expected by the investor?

Quality of Service

Market Updates

Returns Provided

Safety and Security

14. The SHCIL provide Value-added services to client by

Online transaction updates

Faxes / E-mails

Portfolio updates

Daily updates

15. How satisfying is SHCIL in terms of Infrastructure and the hardware and

software installed for serving its clients?

Excellent Very Good

Good Average

16. How efficient and effective is the DP services of SHCIL when compared

to other financial institution?

Excellent Very Good

Good Average



17. The loan against demat shares held in the DP a/c with SHCIL is

satisfactory in terms of interest rates

Yes No

18. Do you think demat is safe and secure?

Yes No

19. The service charges charged by SHCIL?

High Reasonable Low

20. How often the stocks are settled?

Fast Slow

21. How satisfying is the On-line trading for you?

Excellent Very Good

Good Average


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