Introduction
Indiabulls is India’s leading Financial, Real Estate and Power Company with a wide
presence throughout India. They ensure convenience and reliability in all their products
and services. Indiabulls has over 640 branches all over India. The customers of Indiabulls
are more than 4,50,000 which covers from a wide range of financial services and
products from securities, derivatives trading, depositary services, research & advisory
services, consumer secured & unsecured credit, loan against shares and mortgage &
housing finance. The company employs around 4000 Relationship managers who help
the clients to satisfy their customized financial goals. Indiabulls entered the Real Estate
business in the year 2005 with its group of companies. Large scale projects worth several
hundred million dollars are evaluated by them.
Indiabulls Financial Services Ltd is listed on the National Stock Exchange (NSE),
Bombay Stock Exchange (BSE) and Luxembourg Stock Exchange. The market
capitalization of Indiabulls is around USD 2500 million (29thDecember, 2006).
Consolidated net worth of the group is around USD 700 million. Indiabulls and its group
companies have attracted USD 500 million of equity capital in Foreign Direct Investment
(FDI) since March 2000. Some of the large shareholders of Indiabulls are the largest
financial institutions of the world such as Fidelity Funds, Goldman Sachs, Merrill Lynch,
Morgan Stanley and Farallon Capital.
1
Growth of Indiabulls
Year 2000-01:
One of India’s first trading platforms was set up by Indiabulls Financial Services Ltd.
with the development of an in-house team.
Year 2001-03:
The service offered by Indiabulls was increased to include Equity, F&O, Wholesale Debt,
Mutual fund, IPO Financing/Distribution and Equity Research.
Year 2003-04:
In this particular year Indiabulls ventured into Distribution and Commodities Trading
business.
Year 2004-05:
• This was one of the most important years in the history of Indiabulls. In this year:
• Indiabulls came out with its initial public offer (IPO) in September 2004.
• Indiabulls started its Consumer Finance business.
• Indiabulls entered the Indian Real Estate market and became the first company to
bring FDI in Indian Real Estate.
• Indiabulls won bids for landmark properties in Mumbai.
Year 2005-06:
In this year the company acquired over 115 acres of land in Sonepat for residential home
site development. The world renowned investment banks like Merrill Lynch and
Goldman Sachs increased their shareholding in Indiabulls. It also became a market leader
in securities brokerage industry, with around 31% share in Online Trading. The world’s
largest hedge fund, Farallon Capital and its affiliates committed Rs. 2000 million for
2
Indiabulls subsidiaries Viz. Indiabulls Credit Services Ltd. and Indiabulls Housing
Finance Ltd. In the same year, the Steel Tycoon Mr. L N Mittal promoted LNM India
Internet venture Ltd. acquired 8.2% stake in Indiabulls Credit Services Ltd.
Year 2006-07:
In this year, Indiabulls Financial Services Ltd. was included in the prestigious Morgan
Stanley Capital International Index (MSCI). Indiabulls Financial Services Ltd. was
benefited with the Farallon Capital agreeing to invest Rs. 6,440 million in it. The
company also received an “in principle approval” from Government of India for
development of multi product SEZ in the state of Maharashtra. Indiabulls Financial
Services Ltd acquired 100% of the equity share capital of Noble Realtors Pvt. Ltd. Noble
Realtors is a Company engaged in the business of construction and development of real
estate projects. Indiabulls Real Estate Business was demerged to become a separate entity
called Indiabulls Real Estate Ltd. The Board of Indiabulls Financial Services Ltd.,
Resolved to Amalgamate Indiabulls Credit Services Ltd and demerge Indiabulls
Securities Limited.
Indiabulls Financial Services Ltd
Year 2008-09:
Several developments across its group companies have propelled indiabulls forward and
are expected to continue to power the rise of this conglomerate. Indiabulls financial
services limited has recently signed a joint venture agreement with sogecap, the
insurance arm of Societe Generale (SocGen) for its upcoming life insurance venture.
At the same time it has also signed a Memorandum of understanding with MMTC.
On the asset management front, the company has received formal approval uhby7hbfrom
SEBI and is expected to shortly launch its first NFO.
3
Promoters for Indiabulls
Sector
Since Indiabulls derives most of its revenues from the brokerage business, its fortunes are
very much dependent on the Performance of the capital markets, i.e. debt, derivative and
equity markets.
The Indian equity markets have grown from strength to strength in the last decade with
combined daily volumes of all segments on the BSE and the NSE touching Rs 232 bn in
April 2004, from Rs 5 bn in FY96.
Total shareholders in the country are over 20 m (2% of population) and this is the third
largest after the US and Japan, in absolute terms.
However, if one were to compare the percentage of all households in India that are
invested in the stock markets, it is only about 1.9% as compared to an estimated 52%
(including indirect ownership by way of mutual funds) of all households in the US. This
highlights the long-term potential for the sector. to apply
4
The Team:
Indiabulls Securities Ltd, main strength lies in its formidable team. This team
comprising highly qualified and experienced personnel has been responsible for the
overall management of the company and has provided direction in diverse areas of
business strategy, operating management, regulatory reporting, human resources
development and product development.
Regional Manager
Dashmeet Singh
Branch Manager
Senior Sales Manager
Sujeet Roy Chowdary
RM/SRM
Satish Kumar
Back Office Local Compliance
Executive Officer S
Ifran Khan Chary
ARM
5 Raja
Dealer
Badri Nath
Vision statement:
To become the preferred long term financial partner to a wide base of customers whilst
optimizing stake holder’s value
Mission statement:
To establish a base of 1 million satisfied customers by 2010. We will create this by being
a responsible and trustworthy partner
Corporate action:
Indiabulls Securities Ltd is listed on the National Stock Exchange (NSE) and the
Bombay Stock Exchange (BSE) and its global depository shares are listed on the
Luxembourg Stock Exchange
6
Reasons to choose Indiabulls Securities Ltd:
The Indiabulls Financial Services stock is the best performing stock in the MSCI Index –
the global benchmark for equity investments
A person who bought Indiabulls shares in the IPO at Rs. 19 (US$ 0.48) in September
2004 has been rewarded almost 100 times in three and a half years – a feat unparalleled
in the history of Indian capital markets
Indiabulls Real Estate Limited partnered Farallon Capital Management LLC of the US to
bring the first Foreign Direct Investment into real estate
2) Expertise: Brings within customer reach, about institutional expertise and companies
valuable understanding of the financial markets
3) One-stop shop: Caters to all customers’ investment needs under one roof.
4) Trust: Enjoys the pedigree of Indiabulls Securities Ltd and share its expertise in
financial services.
5) Personalized service: Helps customer through the entire investment process, step by
step, with innovative and efficient services.
6) Unbiased & Objective advice: We partner you in your investment process, with our
team of expert investment advisors
7
Reasons to apply
Online trading potential is huge: Online trading accounted for 5% of overall market in
FY04 as compared to an estimated 3% in FY03. Indiabulls currently has almost 20%
market share of volumes in the Internet trading space. The table below indicates the
growth in volumes of the Internet trading segment on the NSE over the last few years.
The growth is indicative of the potential of this segment, which we believe is likely to be
robust going forward as well.
FY00 3
FY01 61 123,578 73 0.5
FY02 82 231,899 81 1.6
FY03
CM 80 346,420 154 2.5
F&O** 13 69,340 51 1.4
FY04
CM 70 413,454 379 3.5
F&O** 14 164,642 430 2
8
Indiabulls is also into mutual fund and insurance advisory businesses. Though this field is
extremely competitive and requires significant research skills, these are highly profitable
business segments. Though these businesses currently account for an insignificant portion
of overall revenues, considering the penetration levels of mutual funds and insurance in
the country, prospects are promising.
Indiabulls has set aggressive targets to expand its business in the offline space. This
includes investments in upgradation of branch network and opening another 75 branches
by the end of calendar year 2009 (150 in total). The company has also indicated its intent
to acquire strategic stake in other companies towards growing the business inorganically
Products provided
Power Indiabulls An online trading system designed for the high-volume trader. The
platform provides enhanced trade information and executes orders on an integrated
software based trading platform.
? SME finance
? Mortgage loans
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? Loan against shares and
Divisions:
Retail Offerings:
10
Services:
Power Indiabulls: An online trading system designed for the high-volume trader. The
platform provides enhanced trade information and executes orders on an integrated
software based trading platform.
1) Equities
2) Commodities
3) Wholesale debts
5) Depository services
8) Depository Services
9) Payment Gateway
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Online Banks Tie-ups for trading:
HDFC BANK,
ICICI BANK,
IDBI BANK,
CITI BANK.
Company Achievements:
The Indiabulls Group is one of the top fifteen conglomerates in the country with
businesses in several significant sectors.
The Indiabulls Financial Services stock is the best performing stock in the MSCI Index –
the global benchmark for equity investments.
Indiabulls Real Estate Limited partnered Farallon Capital Management LLC of the US to
bring the first Foreign Direct Investment into real estate.
Indiabulls Financial Services Limited was accorded the highest rating P1+ for short term
debt and the highest rating of AAA (SO) by CRISIL for loan receivables securitization
while Indiabulls Securities Limited is the only broker in India to be assigned CRISIL’s
highest broker quality grading of BQ1.
12
Company competitors
Birla Money,
Indiainfoline Ltd.
13
Financial position:
14
Share holding pattern as
31/12/2009 30/09/2009 30/06/2009
on :
Face value 2.00 2.00 2.00
Sub total 58832990 18.99 58197722 18.78 78729246 31.04
General public 24911235 8.04 20359934 6.57 16241286 6.40
Grand total 309888300 100.00 309880800 100.00 253629769 100.00
15
ABOUT INDIABULLS GROUP
The Indiabulls Group is one of the top fifteen conglomerates in the country with
businesses in several significant sectors.
The group companies have a market capitalisation of over Rs. 25,000 crore (US$ 6.25
billion) while group revenues have grown at a cumulative annual rate of over 100% to
now reach Rs. 3100 crore (US$ 775 million) and the group profit has surged to over Rs.
1200 crore (US$ 300 million). Its companies, listed in important Indian and overseas
markets, have
distributed over Rs. 700 crore (US$ 175 million) as dividend in the year 2008.
Indiabulls Financial Services Limited was accorded the highest rating P1+ for short term
debt and the highest rating of AAA (SO) by CRISIL for loan receivables securitisation
while Indiabulls Securities Limited is the only broker in India to be assigned CRISIL’s
highest broker quality grading of BQ1.
The Indiabulls Financial Services stock is the best performing stock in the MSCI Index –
the global benchmark for equity investments.
A person who bought Indiabulls shares in the IPO at Rs. 19 (US$ 0.48) in September
2004 has been rewarded almost 100 times in three and a half years – a feat unparalleled
in the history of Indian capital markets
16
Indiabulls Real Estate Limited partnered Farallon Capital Management LLC of the US to
bring the first Foreign Direct Investment into real estate.
In 1999, three IIT-Delhi alumni Sameer Gehlaut, Rajiv Rattan and Saurabh Mittal
acquired Orbis,a Delhi based stock broking company. Young entrepreneur Sameer
Gehlaut established Indiabulls in 2000, after acquiring orbis Securities, a stock brokerage
company in Delhi. The group started its operations from a small office near Hauz Khas
bus terminal in Delhi.The office had a tin roof and two computers. The idea of leveraging
technology for trading stocks led to the creation of Indiabulls Incorporated on 10th
January 2000, it was converted into a public limited company on 27th February 2004.
Its original idea of leveraging technology bore fruit when Indiabulls was accorded
permission to conduct online trading on Indian stock exchanges.
The company had achieved the distinction of becoming only the second brokerage firm in
India to be granted this consent. The challenges facing it were immense – not least of all
the mind set of investors who were called to make the big leap from traditional stock
trading to a completely online interface. Having overcome this resistance, the company
later expanded its service portfolio to include equity, F&O, wholesale debt, mutual fund
distribution and equity research.
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Opportunities were opening up in retail and infrastructure as well. To cement its position
in the Indian business and industry firmament,
Indiabulls acquired Pyramid Retail In 2007 and marked its presence in the power sector
by launching Indiabulls Power
Brand Values
Indiabulls is amongst the largest non-banking financial services companies in India and
enjoys strong brand recognition and customer acceptance.
The company attributes its dominant position in the brokerage industry to the preferential
status it enjoys with investors Coupled with its forays into various segments; the Group
believes that the bulk of its brand story is yet to be written.
Indeed, when a case study on India’s youngest brands which have had a profound impact
on the economy is crafted, Indiabulls will feature prominently in it.
Recent Developments
Several developments across its group companies have propelled Indiabulls forward and
are expected to continue to power the rise of this conglomerate.
Indiabulls Financial Services Limited has recently signed a joint venture agreement with
Sogecap, the insurance arm of Societe Generale (SocGen) for its upcoming life insurance
venture.
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At the same time it has also signed a Memorandum of Understanding with MMTC, the
largest commodity trading house in India, to establish a Commodities Exchange with
26% Ownership held by MMTC.
On the asset management front, the company has received formal approval from SEBI
and is expected to shortly launch its first NFO.
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Saurabh K Mittal Executive Director
The present study to review the online trading procedure a case study of ONLINE
TRADING at INDIA BULLS as the exchange has changed it’s trading from the
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outcry mode to online trading on 20th February 1997, there is need to assess the
performance of the capital market.
• It is to analyze the changes in trading after the exchange shifted from outcry to
online trading system.
• It is to study the functions of INDIA BULLS through various departments.
• To know the online screen based trading system adopted by INDIA BULLS
and about its communication facilities. The appropriate configuration to set
the network, which would link the to individual INDIA BULLS members.
• To know about the latest and future development in the stock exchange
trading system.
The data collection methods include both primary and secondary collection methods.
Primary method: This method includes the data collected from the personal
interaction with authorized members of Sharekhan Securities limited.
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The lecturers delivered by the superintendents of respective departments.
The brochures and material provided by India bulls Securities limited.
The data collected from the magazines of the NSE, economic times, etc.
Various books relating to the investments, capital market and other related topics.
The study is confined to online trading procedure only. Problems of listing are not
covered due to limited time and to keep the study in manageable limits.
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CHAPTER-2
INDUSTRY PROFILE
23
FINANCIAL MARKET:
24
Financial markets are helpful to provide liquidity in the system and for smooth
functioning of the system. These markets are the centers that provide facilities for
buying and selling of financial claims and services. The financial markets match the
demands of investment with the supply of capital from various sources.
According to functional basis financial markets are classified into two types.
They are:
Money markets (short-term)
Capital markets (long-term)
According to institutional basis again classified in to two types. They are
Organized financial market
Non-organized financial market.
MONEY MARKET:
Money market is a place where we can raise short-term capital.
Again the money market is classified in to
Inter bank call money market
Bill market and
Bank loan market Etc.
E.g.; treasury bills, commercial papers, CD's etc.
CAPITAL MARKET:
Capital market is a place where we can raise long-term capital.
Again the capital market is classified in to two types and they are
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Primary market and
Secondary market.
E.g.: Shares, Debentures, and Loans etc.
PRIMARY MARKET:
Primary market is generally referred to the market of new issues or market for
mobilization of resources by the companies and government undertakings, for new
projects as also for expansion, modernization, addition, diversification and up
gradation. Primary market is also referred to as New Issue Market. Primary market
operations include new issues of shares by new and existing companies, further and
right issues to existing shareholders, public offers, and issue of debt instruments such
as debentures, bonds, etc.
The primary market is regulated by the Securities and Exchange Board of India
(SEBI a government regulated authority).
Function:
The main services of the primary market are origination, underwriting, and
distribution. Origination deals with the origin of the new issue. Underwriting contract
make the shares predictable and remove the element of uncertainty in the
subscription. Distribution refers to the sale of securities to the investors.
The following are the market intermediaries associated with the market:
1. Merchant banker/book building lead manager
2. Registrar and transfer agent
3. Underwriter/broker to the issue
4. Adviser to the issue
5. Banker to the issue
6. Depository
7. Depository participant
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To ensure healthy growth of primary market, the investing public should be protected.
The term investor protection has a wider meaning in the primary market. The
principal ingredients of investors’ protection are:
Provision of all the relevant information
Provision of accurate information and
Transparent allotment procedures without any bias.
SECONDARY MARKET
The primary market deals with the new issues of securities. Outstanding securities are
traded in the secondary market, which is commonly known as stock market or stock
exchange. “The secondary market is a market where scrip’s are traded”. It is a
market place which provides liquidity to the scrip’s issued in the primary market.
Thus, the growth of secondary market depends on the primary market. More the
number of companies entering the primary market, the greater are the volume of trade
at the secondary market. Trading activities in the secondary market are done through
the recognized stock exchanges which are 23 in number including Over The Counter
Exchange of India (OTCE), National Stock Exchange of India and Interconnected
Stock Exchange of India.
Secondary market operations involve buying and selling of securities on the stock
exchange through its members. The companies hitting the primary market are
mandatory to list their shares on one or more stock exchanges in India. Listing of
scrip’s provides liquidity and offers an opportunity to the investors to buy or sell the
scrip’s.
The following are the intermediaries in the secondary market:
1. Broker/member of stock exchange – buyers broker and sellers broker
2. Portfolio Manager
3. Investment advisor
4. Share transfer agent
5. Depository
6. Depository participants.
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STOCK MARKETS IN INDIA:
Stock exchanges are the perfect type of market for securities whether of government
and semi-govt bodies or other public bodies as also for shares and debentures issued
by the joint-stock companies. In the stock market, purchases and sales of shares are
affected in conditions of free competition. Government securities are traded outside
the trading ring in the form of over the counter sales or purchase. The bargains that
are struck in the trading ring by the members of the stock exchanges are at the fairest
prices determined by the basic laws of supply and demand.
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The only stock exchanges operating in the 19th century were those of Mumbai setup in
1875 and Ahmedabad set up in 1894. These were organized as voluntary non-profit-
marking associations of brokers to regulate and protect their interests. Before the
control on securities under the constitution in 1950, it was a state subject and the
Bombay securities contracts (control) act of 1925 used to regulate trading in
securities. Under this act, the Mumbai stock exchange was recognized in 1927 and
Ahmedabad in 1937. During the war boom, a number of stock exchanges were
organized. Soon after it became a central subject, central legislation was proposed and
a committee headed by A.D.Gorwala went into the bill for securities regulation. On
the basis of the committee’s recommendations and public discussion, the securities
contract (regulation) act became law in 1956.
Stock exchanges provide liquidity to the listed companies. By giving quotations to the
listed companies, they help trading and raise funds from the market. Over the hundred
and twenty years during which the stock exchanges have existed in this country and
through their medium, the central and state government have raised crores of rupees
by floating public loans. Municipal corporations, trust and local bodies have obtained
from the public their financial requirements, and industry, trade and commerce- the
backbone of the country’s economy-have secured capital of crores or rupees through
the issue of stocks, shares and debentures for financing their day-to-day activities,
organizing new ventures and completing projects of expansion, diversification and
modernization. By obtaining the listing and trading facilities, public investment is
increased and companies were able to raise more funds. The quoted companies with
wide public interest have enjoyed some benefits and assets valuation has become
easier for tax and other purposes.
29
At present there are 23 stock exchanges recognized under the securities contracts
(regulation), Act, 1956. Those are:
30
Madhya Pradesh Stock Exchange Ltd.
NSE
The National Stock Exchange of India Limited has genesis in the report of the High
Powered Study Group on Establishment of New Stock Exchanges, which
recommended promotion of a National Stock Exchange by financial institutions (FI’s)
31
to provide access to investors from all across the country on an equal footing. Based
on the recommendations, NSE was promoted by leading Financial Institutions at the
behest of the Government of India and was incorporated in November 1992 as a tax-
paying company unlike other stock exchanges in the country. On its recognition as a
stock exchange under the Securities Contracts (Regulation) Act, 1956 in April 1993,
NSE commenced operations in the Wholesale Debt Market (WDM) segment in June
1994. The Capital Market (Equities) segment commenced operations in November
1994 and operations in Derivatives segment commenced in June 2000
NSE's mission is setting the agenda for change in the securities markets in India. The
NSE was set-up with the main objectives of:
The standards set by NSE in terms of market practices and technology, have become
industry benchmarks and are being emulated by other market participants. NSE is
more than a mere market facilitator. It's that force which is guiding the industry
towards new horizons and greater opportunities.
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BSE
The Stock Exchange, Mumbai, popularly known as "BSE" was established in 1875
as "The Native Share and Stock Brokers Association". It is the oldest one in Asia,
even older than the Tokyo Stock Exchange, which was established in 1878. It is a
voluntary non-profit making Association of Persons (AOP) and is currently engaged
in the process of converting itself into demutualised and corporate entity. It has
evolved over the years into its present status as the premier Stock Exchange in the
country. It is the first Stock Exchange in the Country to have obtained permanent
recognition in 1956 from the Govt. of India under the Securities Contracts
(Regulation) Act 1956.The Exchange, while providing an efficient and transparent
market for trading in securities, debt and derivatives upholds the interests of the
investors and ensures redresses of their grievances whether against the companies or
its own member-brokers. It also strives to educate and enlighten the investors by
conducting investor education programmers and making available to them necessary
informative inputs.
A Governing Board having 20 directors is the apex body, which decides the policies
and regulates the affairs of the Exchange. The Governing Board consists of 9 elected
directors, who are from the broking community (one third of them retire ever year by
rotation), three SEBI nominees, six public representatives and an Executive Director
& Chief Executive Officer and a Chief Operating Officer.
The Executive Director as the Chief Executive Officer is responsible for the day-to-
day administration of the Exchange and the Chief Operating Officer and other Heads
of Department assist him.
The Exchange has inserted new Rule No.126 A in its Rules, Byelaws pertaining to
constitution of the Executive Committee of the Exchange. Accordingly, an Executive
33
Committee, consisting of three elected directors, three SEBI nominees or public
representatives, Executive Director & CEO and Chief Operating Officer has been
constituted. The Committee considers judicial & quasi matters in which the
Governing Board has powers as an Appellate Authority, matters regarding annulment
of transactions, admission, continuance and suspension of member-brokers,
declaration of a member-broker as defaulter, norms, procedures and other matters
relating to arbitration, fees, deposits, margins and other monies payable by the
member-brokers to the Exchange, etc.
34
The securities and exchange board of India was constituted in 1988 under a resolution
of government of India. It was later made statutory body by the SEBI act
1992.according to this act, the SEBI shall constitute of a chairman and four other
members appointed by the central government.
With the coming into effect of the securities and exchange board of India act, 1992
some of the powers and functions exercised by the central government, in respect of
the regulation of stock exchange were transferred to the SEBI.
35
• All recognized stock exchanges will have to inform about transactions within 24
hrs.
TYPES OF ORDERS:
Buy and sell orders placed with members of the stock exchange by the investors. The
orders are of different types.
Limit orders: Orders are limited by a fixed price. E.g. ‘buy Reliance Petroleum at
Rs.50.’Here, the order has clearly indicated the price at which it has to be bought and
the investor is not willing to give more than Rs.50.
Best rate order: Here, the buyer or seller gives the freedom to the broker to execute
the order at the best possible rate quoted on the particular date for buying. It may be
lowest rate for buying and highest rate for selling.
Discretionary order: The investor gives the range of price for purchase and sale. The
broker can use his discretion to buy within the specified limit. Generally the
approximation price is fixed. The order stands as this “buy BRC 100 shares around
Rs.40”.
Stop loss order: The orders are given to limit the loss due to unfavorable price
movement in the market. A particular limit is given for waiting. If the price falls
below the limit, the broker is authorized to sell the shares to prevent further loss. E.g.
Sell BRC limited at Rs.24, stop loss at Rs.22.
Buying and selling shares: To buy and sell the shares the investor has to locate
register broker or sub broker who render prompt and efficient service to him. The
order to buy or sell specifying the number of shares of the company of investors’
choice is placed with the broker. The order may be of any type. After receiving the
order the broker tries to execute the order in his computer terminal. Once matching
order is found, the order is executed. The broker then delivers the contract note to the
investor. It gives the details regarding the name of the company, number of shares
bought, price, brokerage, and the date of delivery of share. In this physical trading
form, once the broker gets the share certificate through the clearing houses he delivers
36
the share certificate along with transfer deed to the investor. The investor has to fill
the transfer deed and stamp it. The stamp duty is one of the percentage
considerations, the investor should lodge the share certificate and transfer deed to the
register or transfer agent of the company. If it is bought in the DEMAT form, the
broker has to give a matching instruction to his depository participant to transfer
shares bought to the investors account. The investor should be account holder in any
of the depository participant. In the case of sale of shares on receiving payment from
the purchasing broker, the broker effects the payment to the investor.
Share groups: The scrips traded on the BSE have been classified into
‘A’,’B1’,’B2’,’C’,’F’ and ‘Z’ groups. The ‘A’ group represents those, which are in
the carry forward system. The ‘F’ group represents the debt market segment (fixed
income securities). The Z group scrips are of the blacklisted companies. The ‘C’
group covers the odd lot securities in ‘A’, ‘B1’&’B2’ groups.
37
settlement experience it was further reduced to T+2 to reduce the risk in the market
and to protect the interest of the investors from 1st April 2003.
Activities on T+1: conformation of the institutional trades by the custodian is sent to
the stock exchange by 11.00 am. A provision of an exception window would be
available for late confirmation. The time limit and the additional changes for the
exception window are dedicated by the exchange.
The exchanges/clearing house/ clearing corporation would process and download the
obligation files to the broker’s terminals late by 1.30 p.m on T+1. Depository
participants accept the instructions for pay in securities by investors in physical form
upto 4 p.m and in electronic form upto 6 p.m. the depositories accept from other DPs
till 8p.m for same day processing.
Activities on T+2: The depository permits the download of the paying in files of
securities and funds till 10.30 a.m on T+2 from the brokers’ pool accounts. The
depository processes the pay in requests and transfers the consolidated pay in files to
clearing House/clearing Corporation by 11.00am/on T+2. The exchange/clearing
house/clearing corporation executes the pay-out of securities and funds latest by 1.30
p.m on T+2 to the depositories and clearing banks. In the demat mode net basis
settlement is allowed. The buy and sale positions in the same scrip can be settled and
net quantity has to be settled.
38
CHAPTER-3
PROJECT ANALYSIS
OUTCRY SYSTEM
The broker has to buy or sell securities for which he has received the orders. For this,
the broker or his authorized representatives goes to the stock exchange. This method
is called the open outcry system. Basically the brokers shout while buying or selling
the securities. The floor of the stock exchange is divided into a number of markets
also known as ‘post pit’ or wing based on particular securities dealt there.
In the post pit or wing, the broker using ‘open outcry’ method makes an offer or bid
price. For making the necessary bargain, he quotes his purchase or sale price, also
known as offer or bid price. The dealer, to whom the price is quoted, quotes his own
price when the quotation of the dealer suits the broker, he may loose the bargain. If he
is not satisfied with the quote price, he may turn to some other dealer. On the close of
39
the bargain, the dealer as well as the broker makes a brief note of the particulars of
the deal. Such notes are made on some pad and on it the number of shares, the price
agreed upon, the name of the party, what membership number etc., are noted.
DISADVANTAGES OF OUTCRY SYSTEM:
• It lacks transparency.
• The scope of manipulation, speculation and mal practice is more.
• Signal were more important in the outcry system any member who could not
interpret the buy/sell signal correctly often landed himself in disaster situation.
• In audibility was another disadvantage of the outcry system.
• Due to the above disadvantages of the outcry system the SHAREKHAN has
shifted from outcry system to online trading from February 29th 1997.
MANUAL TRADING
Trading on stock exchanges is officially done in the trading ring. In the trading ring
the space is provided for specified and non-specified sections, the members and their
authorized assistants have to wear a badge or carry with them an identity card given
by the exchange to enter the trading ring. They carry a sauda book or confirmation
memos, duly authorized by the exchange and carry a pen with them. The stock
exchanges operations are floor level are technical in nature .Non-members are not
permitted to enter in to stock market. Hence various stages have to be completed in
executing a transaction at a stock exchange .The steps involved in this method of
trading have given below:
Choice of broker:
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The prospective investor who wants to buy shares or the investors, who wants to sell
shares and transact business, have to act through member brokers only. They can also
appoint their bankers for this purpose as per the present regulations.
Placement of order:
The next step is the placing order for the purchase or sale of securities with a broker.
The order is usually placed by telegram, telephone, letter, fax etc or in person. To
avoid delay, it is placed generally over the phone. The orders may take any one of the
forms such as At Best Orders, Limit Order, Immediate or Cancel Order, Limited
Discretionary Order, and Open Order, Stop Loss Order.
Orders are executed in the trading ring of the BSE. This works from 11:30 to 2.30
P.M on all working days Monday to Friday, and a special one-hour session on
Saturday. The members or the authorized assistants have to wear a badge given by the
exchange to enter into the trading ring. They carry a sauda Block Book or
conformation memos, which are duly authorized by the exchange when the deal is
struck; both broker and jobber make a note in their sauda block books. From the
sauda book, the contract notes are drawn up and posted to the client. A contract note
is written agreement between the broker and his clients for the transaction executed.
Both sale and purchase bills are prepared along with the contract note and it is posted
on the same day or the next day. This in a purchase transaction, once the shares are
delivered to the client effects payment for the purchases and pays the stamp fees for
41
transfer, a bill is made out giving the total cost of purchase, including other expenses
incurred by the broker in the price itself. With this, the process ends.
DEMATERLIZATION:
42
Rematerialization is the process of converting electronic shares in to physical shares.
Benefits of Demat:
• It reduces the risk of bad deliveries, in turn saving the cost and wastage of
time associated with follow up for rectification. This has lead to reduction in
brokerage to the extent of 0.5% by quite a few brokerage firms.
• In case of transfer of electronic shares, you save 0.5% in stamp duty. You
avoid the cost of courier / notarization.
• You can receive your bonuses and rights issues into your DA as a direct
credit, this eliminating risk of loss in transit.
• You can also expect a lower interest charge for loans taken against Demat
shares as compared to loans against physical shares.
• There is no lost in transit, thus the overheads of getting a duplicate copy in
such circumstances is reduced.
• RBI has also reduced the minimum margin to 25% for loans against
dematerialized securities as against 50% for loans against physical securities.
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ONLINE TRADING
Before getting in to the online trading we should know some things about the internet,
e-commerce and etc.
1. What is Internet?
Internet is a worldwide, self-governed network connecting several other smaller
networks and millions of computers and persons, to mega sources of information.
This technology shrinks vast distances, accelerating the pace of business reforms and
revolutionizing the way companies are managed. It allows direct, ubiquitous links to
anyone anywhere and anytime to build up interactive relationships.
A combination of time and space, called the Internet promises to bring unprecedented
changes in our lives and business. Internet or net is an inter-connection of computer
communication networks spanning the entire globe, crossing all geographical
boundaries. It has re-defined the methods of communication, work study, education,
business, leisure, health, trade, banking, commerce and what not it is virtually
changing every thing and we are living in dot.com age. Net being an interactive two
way medium, through various websites, enables participation by individuals in
business to business and business to consumer commerce, visit to shopping arcades,
games, etc. in cyber space even the information can be copied, downloaded and
retransmitted.
The use of Internet has grown 2000 percent in last decade and is currently growing at
10 percent per month. In India, growth of Internet is of recent times. It is expected to
bring changes in every functional area of business activity including management and
financial services. It offers stock trading at a lower cost. Internet can change the
nature and capacity of stock broking business in India.
2. E-commerce
Electronic commerce is associated with buying and selling over computer
communication networks. It helps conduct traditional commerce through new way of
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transferring and processing of information. Information is electronically transferred
from computer to computer in an automated way. E-commerce refers to the paperless
exchange of business information using electronic data inter change, electronic
technologies. It not only reduces manual processes and paper transactions but also
helps organization move to a fully electronic environment and change the way they
operated.
PC’s and networking attempts to introduce banks of the tools and technologies
required for electronic commerce. The computers are either workstations of
individual office works or serves where large databases and information reside.
Network connects both categories of computers; the various operating systems are the
most basis program within a computer. It manages the resources of the computer
system in a fair and efficient manner.
Now we can enter in to the concept known as online trading.
In the past, investors had no option but to contact their broker to get real time access
to market data. The net brings data to the investor on-line and net broking enables
him to trade on a click of mouse. Now information has become easily accessible to
both retail as well as big investor.
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• Brokers (now e-brokers) will offer value management or services like initial
public offering online, on-line asset allocation, portfolio management,
financial planning, tax planning, insurance services, etc. and enables the
investors to take better and well considered decisions.
The actual definition of “Online Trading” is as explained below:
“Online trading is a service offered on the internet for purchase and sale of shares. In
the real world you place orders on your stockbroker either verbally (personally or
telephonically) or in a written form (fax).” In online trading, you will access a
stockbroker’s website through your internet enabled PC and place orders through the
broker’s internet based trading engine. These orders are routed to the stock exchange
without manual intervention and executed thereon in a matter of a few seconds.
The net is used as a mode of trading in internet trading. Orders are communicated to
the stock exchange through website.
In India:
Internet trading started in India on 1st April 2000 with 79 members seeking
permission for online trading. The SEBI committees on internet based securities
trading services has allowed the net to be used as an Order Routing System (ORS)
through registered stock brokers on behalf of their clients for execution of transaction.
Under the ORS the client enters his requirements (security, quantity, price buy/sell)
on broker’s site.
Objectives:
Internet trading is expected to
• Increase transparency in the markets,
• Enhance market quality through improved liquidity, by increasing quote
continuity and market depth,
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• Reduce settlement risks due to open trades, by elimination of mismatches,
• Provide management information system,
• Introduce flexibility in system, so as to handle growing volumes easily and to
support nationwide expansion of market activity.
Some of the brokers offering net trading include ICICI direct, kotakstreet, etc.
For investors:
The following should be produced to get a demat account and online trading
account:
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• Voter ID card
• Driving license
• PAN card( in case of to trade more than 50000)
• Ration card
• Bank pass book
• Telephone bill
• First page of the bank pass book and last 6 months statement.
• Bank manager’s signature along with bank’s seal, manager registration code on
photograph.
The net is used as a medium of trading in internet trading. Orders are communicated
to the stock exchange through website. Internet trading started in India on 1st April
2000 with 79 members seeking permission for online trading. The SEBI committees
on internet based securities trading services has allowed the net to be used as an
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Order Routing System (ORS) through registered stock brokers on behalf of their
clients for execution of transaction.
Under the Order Routing System the client enters his requirements (security, quantity,
price, and buy/sell) in broker's site. They are checked electronically against the clients
account and routed electronically to the appropriate exchange for execution by the
broker. The client receives a confirmation on execution of the order. The customer's
portfolio and ledger accounts get updated to reflect the transaction. The user should
have the user id and password to enter into the electronic ring. He should also have
demat account and bank account. The system permits only a registered client to log in
using user id and password. Order can be placed using place order window of the
website.
Step 1: Those investors, who are interested in doing the trading over internet system
i.e. NEAT-IXS, should approach the brokers and get them self registered with the
Stock Broker.
Step 2: After registration, the broker will provide to them a Login name, Password
and personal identification number (PIN).
Step 3: Actual placement of an order. An order can then be placed by using the place
order window as under:
(a) First by entering the symbol and series of stock and other parameters like
quantity and price of the scrip on the place order window.
(b) Second, fill in the symbol, series and the default quantity.
Step 4: It is the process of review. Thus, the investor has to review the order placed
by clicking the review option. He may also re-set to clear the values.
Step 5: After the review has been satisfactory, the order has to be sent by clicking on
the send option.
Step 6: The investor will receive an "Order Confirmation" message along with the
order number and the value of the order.
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Step 7: In case the order is rejected by the Broker or the Stock Exchange for certain
reasons such as invalid price limit, an appropriate message will appear at the bottom
of the screen. At present, a time lag of about 10 seconds is there in executing the
trade.
Step 8: It is regarding charging payment, for which there are different mode. Some
brokers will take some advance payment from the investor and will fix their trading
limits. When the trade is executed, the broker will ask the investor for transfer of
funds to his account.
Internet trading provides total transparency between a broker and an investor in the
secondary market. In the open outcry system, only the broker knew the actually
transacted price. Screen based trading provides more transparency. With online
trading investors can see themselves the price at which the deal takes place.
The time gap has narrowed in every stage of operation. Confirmation and execution
of trade reaches the investor within the least possible time, mostly within 30 seconds.
Instant feedback is available about the execution. Some of the websites also offer;
• News and research report
• BSE and NSE movements
• Stock analysis
• IPO and mutual fund centers
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Step by step procedure in online trading:
• Limit / stop orders: orders that can be go unfilled, but there is an extra Charge for
this leeway facility since one need to hold a price.
• Market orders: orders can be filled at unexpected prices, but this type is much
more risky, since you have to buy stock at the given price.
• Cash account: where funds have to be available prior to placing the order.
• Margin account: where orders can be placed against stocks, to increase
Purchasing power.
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ADVANTAGES OF ONLINE TRADING:
• Online trading has made it possible for anyone to have easy and efficient access to
more reports and charts than it was previously possible if one went to any brokers'
office. Thus we have access to a lot more information online.
• Online trading has let room for smaller organizations to compete with
multinational organizations since it is no longer a leg it issue. Being online does
not identify the size of any particular organization, therefore, this additional
power to the underdogs.
• Online trading has allowed companies to locate themselves where they want as
physical location is not an issue anymore. Companies can establish themselves
according to their gains and losses, for instance where tax (sales and value added
taxes) is best suited to them.
• Online trading gives control to individuals and they can exercise it over accounts
thus comprehend what is going on when they trade. It is like going back to school
and re-educating oneself on how to trade online.
• Individuals’ benefit by saving comparatively a lot more when trading online as
the cost per trade is less.
• Individuals can invest in a variety of products, unlike earlier when people bought
bonds, mutual funds, and stock for long-term basis and sat on them. Now they can
invest in stocks, stock and index options mutual funds, government, and even
insurance.
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INVESTORS REASONS TO TRADE ONLINE:
• They have control over their accounts, can make their own decisions and don’t
have to give reasons for their actions. They are independent.
• They have a reason to participate in the market and learn about it.
• It is interesting, cheap, easy, fast, and convenient.
• A lot of information is online so they can keep up-to-date with what is happening
in the trading world.
• It will give investors a greater choice and better realization.
• The immediate impact will be competition and benefits will accrue to the
investors.
• It will lead to brokerage commissions going down and brokers striving to increase
business afloat.
• Investors will now go to place, which have better trading conditions and also
members to offer them better facilities.
• They have access to numerous tools to invest, and can create their own portfolio.
• When network crashes, there will be problems and delays due to a large influx of
rapid online trading criteria.
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• Individuals are restricted to first-hand financial guidance. This simply means that
the individual is himself / herself alone to.
• A tax (sales tax and value added tax) evaluation becomes an issue, especially
when you are trading internationally.
• One has no idea with whom he is dealing with on the other end.
• According to a study conducted by Mary Rowland, careful investor: is online
trading bad for your portfolio, the more one trades the less returns one gets,
meaning that an addicted trader gets, carried away online and begins to trade for
too much which causes losses for him / her.
• Individuals think that they are trading with the market directly and know what
they are doing, but the truth is that even though technology has taken over, the
basic rules of trading are the same. It seems that the middleman has been
removed, but that is not so. When the individuals click on the mouse, his trade
goes through a broker. The commissions online pertain to the intermediary.
• There is a need for more effective communication links over the Internet and the
ability of the server to deal with a large volume of visitors.
The NSE first introduced online trading in India. The Online trading system imparted
a greater level of transparency and investors preferred exchanges that offered Online
trading because of the following factors:
• The ease of operation from the view of the both members and the investors.
• Increase in the confidence of the investors because of higher level of
transparency.
• Facilities better monitoring of the market by the exchange.
• The best price achieved in buying and selling.
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All these resulted in ever-increasing volumes on the exchanges offering the online
trading.
India bulls deals in buying and selling equity shares and debentures on the National
Stock Exchange (NSE), the Bombay Stock Exchange (BSE) and the Over-The-
Counter Exchange of India (OTCEI).
India bulls is provided with a computer and required software from their registered
stock exchanges. These centers are called “Broker Work Stations”. These computers
are connected to the server at the stock exchanges through cable.
The member or broker sitting in his office can send the quotations, orders,
negotiations, deals, in-house deals, auction orders etc., through the computer. The
Central trading system (CTS) will accept these orders and send it for match. If there is
any mistake in the order, CTS will reject the orders and send respective error message
to the member concern. All these operations are in built. The main objective of CTS
is to monitor the Stock Exchanges operations.
Order placed by the broker will be sent for a match and if the match is found suitable,
the transaction will be executed. Otherwise, the order will be deleted automatically
after completion of trading time. The carry forward transactions (Good Till
cancellation) are forwarded to the next day. Even if the match is not found with in the
prescribed period, the order will not cancel.
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TRADING SESSION
Trading timings are from 9:55 A.M. to 3:30 P.M. on all 5 days of the trading period.
Monday to Friday is the trading period in all the stock exchanges. SEBI has stipulated
that all the stock exchanges in India must have same trading period.
At the broker workstation the BBO’s, the last traded price, the day‘s opening price,
previous day’s closing price, highest and lowest prices, the weighted average price
and total trade value will be available continuously, as the BBO for each scrip.
Other information will be available on query from the BWS. These include top
gainers /losers of the day. Trader-wise, scrip wise net position, client wise net
position, top scrip by the volume/value, market summary etc.
Brokers are also provided with information relating to the companies in the matter of
Book closure, Dividend declarations, resolutions in board meeting, information about
liquidated companies, company report etc.
ORDERS:
The submitted order will be accepted at the CTS, after validation if it finds any
invalid reason the order is return back to the BWS, with the appropriate error
message. If
Accepted at the CTS it will be added to the local pending order book.
The order will then be taken up for matching, if it is a buy order the system tries to
find a sell order, which fits the requirement of the buy order, when such match is
found a trade gets executed. Each trade involves two brokers and respective traders
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who sent the order. Both these traders are informed of the trade being executed at
their respective BWS.
At the BWS the trade is added to the local trade book.
Orders sent by the brokers are two types:
This is also called as “market order”. For an order if the member selects the deal as
good for the day, the order is treated as market order. If a “best bid” founds match
with “best order” then the transaction gets executed. If the match is not found then
after trade time the order gets cancelled that day. Next day he has to place a new
order.
For example if a member wants to purchase 1000 shares of satyam info @ 400 each
through Good for Day order. If the correct match is not found, order gets cancelled
automatically and new quotation has to be placed the next day.
This order is forwarded to the last trading day of that settlement period. This is also
called as carry forward order like GFD; broker has to select the option of GTC for the
order. If the order finds match with in the trading settlement period, the order is
executed. If no match is found, the order is cancelled on the last day of settlement
period. This order is not carried forward to the next settlement period.
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For example, if a member a place purchase order of 500 shares of SBI @ 690 per
share and selects the order as GTC and place an order. If the match is not found on
that day it will be forwarded to the next day until trading settlement period day.
SETTLEMENT OF TRANSACTIONS:
Clearing of transaction in the form of shares and cash is called settlement. Buyers will
take the delivery of shares through the depository participants like INDIA BULLS
and others.
Finally, the settlement is made by means of delivering the share certificates along
with the transfer deeds. The transferor (or the seller) duly signed transfer deed. It
bears a stamp of the selling broker. The buyer then fills up the certificates fills up the
particulars in the transfer deed. Settlement can be done in the following way.
Spot settlement: under this method, the delivery of securities and payment for them
are affected on the day of the contract itself.
Rolling settlement: Under this rolling settlement the trading is on “T+2”,basis i.e. if
Monday is trading day then Wednesday is the paying day . In case on non-delivery,
the securities will go for auction.
DETAILS OF PROCEDURES:
Delivery in : The members who are in pay-out position delivers share certificates in
to clearing house within the settlement period along with the delivery Chelan filled in
with the details of share certificates which has folio numbers or distinctive numbers
etc.
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Delivery out: The buyer of shares who made pay in position will take delivery of
shares from the clearing house.
Pay-in: The member who is in paying position shall pay for value of shares with in
the trading settlement period (T+2).
Payout: The cheques paid in the clearinghouse will be paid to members who are in
paying position.
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The given flow chart clearly explains the process of online trading:
L o g i n
B u y t r a n s c a t i o S n e l l t r a n s c a t i o
T h e s y s t e m w i l l
T h e s y s t e m w i l l c h e c dk p b au cy ci n o g u n t q u a
l i m i t s
O r d e r s a c c e p t e d R e j e c t e d o r d e r s o w r do ue l r d s b ae c
c o m m u n i c a t e d a l o n g w i t h r e
y o u r o r d e r i s t r a n s m i t t e d t o
p e n d i n g b u y o rn d ee xr s e c u t i o p n e n d i n g s e l l
w o u l d b e d i s op fl a yy oe du r o r d w e r o s u l d b e d i s
o n y o u r s c r e e n o n y o u r s c r
y o u m a y y e o d u i t m y a o y u dr e l e t e y o u m a y e d i t y o u y r o u m a y d
p e n d i n g y oo ur d r e p r e n d i n g o r d p e er n d i n g o r d e r p e n d i n g
f l a s h e d o n cy oo nu fr o r m a t i o c no c n o t rua lc t n o t e
s c r e e n i m m ed d bi a e t s
e l ye n d t o b ey o s ue nr t t o b y
o n e x e c u t i oe -n m a i l a n d m o or b h i al e n d d e l i v
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COMPARATIVE ANALYSIS
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THE MAJOR PLAYERS IN ONLINE TRADING
• SHAREKHAN.COM
• 5PAISA.COM
• KOTAKSTREET.COM
• ICICIDIRECT.COM
• HDFCSEC.COM
HDFC SECURITIES:
Company Background:
HDFC Securities Ltd is promoted by the HDFC Bank, HDFC and Chase Capital
Partners and their associates. Pioneers in setting up Dial-a-share service with the
largest team of Tele-brokers.
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• Account Opening: Rs 750
• Brokerage:
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ICICI Direct:
• Demat: NIL, 1st year charges included in Account Opening Plus a facility to open
additional 4 DP’s without 1st yr AMC. Only Rs 100 as linking charges per DP
• Brokerage: ICICI’s brokerage rates are inclusive of Stamp duty (0.002%) for
trading and 0.010% for delivery while service tax (10.2%) on BROKERAGE land
turnover tax is EXTRA.
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Kotakstreet:
Company Background:
Kotakstreet is the retail arm of Kotak Securities. Kotak Securities limited is a joint
venture between Kotak Mahindra Bank and Goldman Sachs.
• Free Way: Flat Rs 999 Cover Charge p.m, 0.03% per transaction
• High Trader : 6 Times Exposure Cash & Derivatives, Auto sq off 2:55
For Kotak FastLane / Keat Lite / Keat Desktop are trading interfaces.
Keat Desktop with advanced tools comes at a charge of Rs 500 p.m, Non refundable.
PRICING OF KOTAK
Even older customers (on 0.25% & 0.40%) have been moved to the slab wise
structure w.e.f 1/4/2004
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Slab structure of Kotak
* DP Charges Extra
* Min Brokerage of Rs 0.05 per share * Min Brokerage of Rs 0.01 per share
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5paisa
Company Background
Apart from offering online trading in stock market the company offers
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• Brokerage :
Trading 0.10% each side + ST
Delivery 0.50% each side + ST
Company Background
• Sharekhan is the retail broking arm of SSKI Securities Pvt Ltd. SSKI owns 56%
in Sharekhan, balance ownership is HSBC, First Caryle, and Intel Pacific
• Into broking since 80 years
• Focused on providing equity solutions to every segment
• Largest ground network of 210 Branded Share shops in 90 cities
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• Speed Trade : Trader in equities & derivatives
Speed Trade
Classic / Applet
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Trading 0.10% each side + All Taxes
Delivery 0.50% each side + All Taxes
The customer can choose the online trading interface that meets his requirement
based on his trading habits and preferences
CLASSIC / APPLET
The website is meant for customers who Invests in Equities
SPEEDTRADE
The speed trade is meant for customers who trade in Equities
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** Between 9 a.m to 9.55 am and 3.30p.m to 6 p.m
CLASSIC/WEBSITE FEATURES
CLASSIC/WEBSITE FEATURES
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• E-mail confirmations for all transactions
• Choice of electronic/Physical contracts
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SWOT ANALYSIS
Strengths
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Weaknesses
• Limited customer appeal as the company product line does not include mutual
funds which is increasingly becoming a preferred customer investment option.
• Inadequate product awareness among the retail investors.
• Limited customer appeal as the company does not have access to the BSE online
space.
• Brand awareness is low in the financial market.
• Promotional activities conducted by the company are not at par with the other
firms.
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Opportunities
• Hyderabad covers only 2% of investors which gives huge potential for the market
penetration.
• Bullish phase of the market attracts investing public.
• Access to the BSE online space for the retail investors creates opportunity to
increase clientele base.
• Awareness campaigns about online trading creates new market.
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Threats
• Availability of Unit Linked Insurance Policies (ULIP’s) and mutual funds in the
market.
• Threat of entry is high in this industry as the manpower required is less and
capital requirement is medium.
OBSERVATIONS:
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• Previously rolling settlement is T+5 days, now it changed to T+2 days and
further it will be changing to T+1 day.
• It was also observed that many broking houses offering internet trading allow
clients to use their conventional system as well just ensure that they do not
loose them and this instead of offering e-broking services they becomes
service providers.
• The number of players is increasing at a steady rate and today there are over a
dozen of brokerage houses who have opted to offer net trading to their
customers and prominent among them are SHARE KHAN, India bulls,
kotakstreet, ICICI direct and geojit.
• The Bombay stock exchange sensex zoomed past the 7700 barrier for the first
time in history to achieve new all time high of 7800 intra day trade and ended
at a historic close of 7732 points.
CONCLUSION:
• Things have changed for the better with the SHAREKHAN going on-line coupled
with endeavor to stream line the whole trading system, things have changed
dramatically over the last 3 to 4 years. New and advanced technologies have
breached geographical and cultural barriers, and have brought the countrywide
market to doorstep.
• In the present scenario to compete with the Broker’s would require sound
infrastructure and trading as per international standards.
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• The introduction of on-line trading would influence the investors resulting in an
increase in the business of the exchange. It has helped the brokers handling a vast
amount of transactions and this can be an efficient trading, delivering, settlement
system with adequate protection to investors. The trading of SHAREKHAN of the
first day was Rs. 1.8 crores.
• Due to invention of online trading there has been greater benefit to the investors
as they could sell / buy shares as and when required and that to with online
trading.
• The broker’s has a greater scope than compared to the earlier times because of
invention of online trading.
• The concept of business has changed today, this is a service oriented industry
hence the survival would require them to provide the best possible service to the
clients.
RECOMMENDATIONS:
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• Genuine investors are not at all interested in the speculative gain as their
investment is based on the future profits, therefore the authorities of the exchange
should be more vigilant to curb the speculation.
• Necessary steps should be taken by the exchange to deal with the situations
arising due to break down in online trading.
BIBILOGRAPHY
BOOKS:
• Investment management
-V.K.Bhalla
• Investment management
-Preethi Singh
• Security Analysis And Portfolio Management
-V.A.Avadhani
• Marketing of Financial Services
-V.A.Avadhani
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• Indian Financial System
-M.Y.Khan
WEBSITES:
• www.Share Khan.com
• www.bseindia.com
• www.sebi.com
• www.moneycontrol.com
• www.economictimes.com
• www.nseindia.com
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