Neelambuj Final Project

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REPORT ON

ANALYSIS OF INDIAN CAPITAL MARKET

By

)NEELAMBUJ K SHRIVASTAV(

)SHAREKHAN Ltd(.

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A REPORT ON

ANALYSIS OF INDIAN CAPITAL MARKET

BY

)NEELAMBUJ K SHRIVASTAV(

)MBA 2007-09(

A report submitted in partial fulfillment

The requirements of

MBA (2007-09(

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EXECUTIVE SYNOPSIS

STUDENTS NAME: Neelambuj Shrivastava

ORGANISATION: Sharekhan Ltd.

ADDRESS: Kan Chamber,

Civil Line, Kanpur

REPORTING OFFICER: Mr. Rishu Agrawal

Assistant Manager (Sales)

ShareKhan Ltd.

FACULTY GUIDE: Ms. Tarika

PROJECT TITLE: Analysis of Indian Capital Market

METHODOLOGY: Disguised Questionnaire Method

SAMPLE SIZE: 110 respondents in Kanpur city

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ACKNOWLEDGEMENT

During my project work, many helping hands came across my way and when and

how I have completed my half project; I would feel no less pride in expressing my

sincere and endless gratitude to them.

I am deeply indebted to Mr.Rishu Agrawal Asst Sales Manager & Ms TarikaFaculty guide, for their helping attitude and kind attention,

Last but no least, I would like to thanks all the faculty members of my Institute,

Kanpur for their inspiration and moral support in making my project.

It was the love and indispensable support of my parent, who despite all

inconvenience and my typically perceptual insolence provided me with the bestpossible of everything in my ascent to the present accomplishment. Lastly is should

not be deemed that those who are not mentioned have gone without my heartful

acknowledgement.

Neelambuj K Shrivastava

(Management Trainee)

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PREFACE

It naturally follows if the researchers want to make a special study of any subject

experience and studies research, they will in the end reveal at least to some extent

so called mysteries of one subject on which they have concentrated their efforts.

Sharekhan Ltd. holds an important place in stock market. It isalso Indias leading stockbroker company. This marketing strategy is survey for the

investor awareness and market penetration of the company in Kanpur city.

After the survey of the Kanpur researchers can find out the

investor awareness level and market penetration of the company.

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TABLE OF CONTENT

Sr. No CONTENTS PAGE NO

1 Introduction

2 Objectives

3 Research MethodologyLimitation

4 Company Profile

5 Data Analysis and Findings

6 Conclusion

7 Recommendation

8 Reference and Bibliography

9 Questionnaire

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CHAPTER 1

INTRODUCTION

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INTRODUCTI

ON

Evolution

Indian Stock Markets are one of the oldest in Asia. Its history dates back to nearly 200 years ago.

The earliest records of security dealings in India are meagre and obscure. The East India

Company was the dominant institution in those days and business in its loan securities used to betransacted towards the close of the eighteenth century.

By 1830's business on corporate stocks and shares in Bank and Cotton presses took place in

Bombay. Though the trading list was broader in 1839, there were only half a dozen brokers

recognized by banks and merchants during 1840 and 1850.

The 1850's witnessed a rapid development of commercial enterprise and brokerage business

attracted many men into the field and by 1860 the number of brokers increased into 60.

In 1860-61 the American Civil War broke out and cotton supply from United States of Europe

was stopped; thus, the 'Share Mania' in India begun. The number of brokers increased to about200 to 250. However, at the end of the American Civil War, in 1865, a disastrous slump began

(for example, Bank of Bombay Share which had touched Rs 2850 could only be sold at Rs. 87).

At the end of the American Civil War, the brokers who thrived out of Civil War in 1874, found a

place in a street (now appropriately called as Dalal Street) where they would convenientlyassemble and transact business. In 1887, they formally established in Bombay, the "Native Share

and Stock Brokers' Association" (which is alternatively known as " The Stock Exchange "). In

1895, the Stock Exchange acquired a premise in the same street and it was inaugurated in 1899.Thus, the Stock Exchange at Bombay was consolidated.

Other leading cities in stock market operations

Ahmedabad gained importance next to Bombay with respect to cotton textile industry. After

1880, many mills originated from Ahmedabad and rapidly forged ahead. As new mills werefloated, the need for a Stock Exchange at Ahmedabad was realised and in 1894 the brokers

formed "The Ahmedabad Share and Stock Brokers' Association".

In the beginning of the twentieth century, the industrial revolution was on the way in India with

the Swadeshi Movement; and with the inauguration of the Tata Iron and Steel Company Limitedin 1907, an important stage in industrial advancement under Indian enterprise was reached.

Indian cotton and jute textiles, steel, sugar, paper and flour mills and all companies generally

enjoyed phenomenal prosperity, due to the First World War.

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In 1920, the then demure city of Madras had the maiden thrill of a stock exchange

functioning in its midst, under the name and style of "The Madras Stock Exchange" with

100 members. However, when boom faded, the number of members stood reduced from 100

to 3, by 1923, and so it went out of existence.

In 1935, the stock market activity improved, especially in South India where there was a rapid

increase in the number of textile mills and many plantation companies were floated. In 1937, a

stock exchange was once again organized in Madras - Madras Stock Exchange Association (Pvt)Limited. (In 1957 the name was changed to Madras Stock Exchange Limited).

Lahore Stock Exchange was formed in 1934 and it had a brief life. It was merged with the Punjab

Stock Exchange Limited, which was incorporated in 1936.

Indian Stock Exchanges - An Umbrella Growth

The Second World War broke out in 1939. It gave a sharp boom which was followed by a slump.But, in 1943, the situation changed radically, when India was fully mobilized as a supply base.

On account of the restrictive controls on cotton, bullion, seeds and other commodities, thosedealing in them found in the stock market as the only outlet for their activities. They were anxious

to join the trade and their number was swelled by numerous others. Many new associations wereconstituted for the purpose and Stock Exchanges in all parts of the country were floated.

The Uttar Pradesh Stock Exchange Limited (1940), Nagpur Stock Exchange Limited (1940) and

Hyderabad Stock Exchange Limited (1944) were incorporated.

In Delhi two stock exchanges - Delhi Stock and Share Brokers' Association Limited and the Delhi

Stocks and Shares Exchange Limited - were floated and later in June 1947, amalgamated into theDelhi Stock Exchnage Association Limited.

Post-independence Scenario

Most of the exchanges suffered almost a total eclipse during depression. Lahore Exchange was

closed during partition of the country and later migrated to Delhi and merged with Delhi StockExchange.

Bangalore Stock Exchange Limited was registered in 1957 and recognized in 1963.

Thus, during early sixties there were eight recognized stock exchanges in India (mentioned

above). The number virtually remained unchanged, for nearly two decades. During eighties,

however, many stock exchanges were established: Cochin Stock Exchange (1980), Uttar PradeshStock Exchange Association Limited (at Kanpur, 1982), and Pune Stock Exchange Limited

(1982), Ludhiana Stock Exchange Association Limited (1983), Gauhati Stock Exchange Limited

(1984), Kanara Stock Exchange Limited (at Mangalore, 1985), Magadh Stock ExchangeAssociation (at Patna, 1986), Jaipur Stock Exchange Limited (1989), Bhubaneswar Stock

Exchange Association Limited (1989), Saurashtra Kutch Stock Exchange Limited (at Rajkot,

1989), Vadodara Stock Exchange Limited (at Baroda, 1990) and recently established exchanges -Coimbatore and Meerut. Thus, at present, there are totally twenty one recognized stock exchanges

in India excluding the Over The Counter Exchange of India Limited (OTCEI) and the National

Stock Exchange of India Limited (NSEIL).

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Capital Market Reforms and DevelopmentsReforms in the Capital Market

Over the last few years, SEBI has announced several far-reaching reforms to promote the capital

Reforms in thesecondary market have focused on three main areas:

structure and functioning of stock exchanges, automation of trading and post trade systems, and the

introduction of surveillance and monitoring systems. (See Appendix 1 for a listing of reforms since 1992).

Computerized online trading of securities, and setting up of clearing houses or settlement guarantee funds

were made compulsory for stock exchanges. Stock exchanges were permitted to expand their trading to

locations outside their jurisdiction through computer terminals. Thus, major stock exchanges in India have

started locating computer terminalsin far-flung areas, while smaller regional exchangesare planning to

consolidate by using centralizedtrading under a federated structure. Onlinetrading systems have been

introduced in almost allstock exchanges. Trading is much more transparentand quicker than in the past.

Until the early 1990s, the trading and settlementinfrastructure of the Indian capital market was poor.

The Indian capital markethas experienced a process of structural transformationwith operations conductedto standards equivalentto those in the developed markets. It was openedup for investment by foreign

institutional investors(FIIs) in 1992 and Indian companies were allowedto raise resources abroad through

Global DepositoryReceipts (GDRs) and Foreign Currency ConvertibleBonds (FCCBs). The primary and

secondary segmentsof the capital market expanded rapidly, withgreater institutionalization and wider

participation ofindividual investors accompanying this growth. However,many problems, including lack

of confidence instock investments, institutional overlaps, and othergovernance issues, remain as obstacles

to the improvementof Indian capital market efficiency.

Stock Market

PRIMARY MARKETSince 1991/92, the primary market has grown fast as a result of the removal of investment restrictions in

the overall economy and a repeal of the restrictions imposed by the Capital Issues Control Act. In 1991/92,

Rs62.15 billion was raised in the primary market. This figure rose to Rs276.21 billion in 1994/ 95. Since

1995/1996, however, smaller amounts have been raised due to the overall downtrend in the market and

tighter entry barriers introduced by SEBI for investor protection (Table 1).

INDIAN CAPITAL MARKET: RECENT DEVELOPMENTS AND POLICY ISSUES

Total market capitalization as of 1997/98 was Rs5,898 billion (Table 2), equivalent to about half

of Indias annual gross domestic product (GDP) for the same fiscal year. India compares

favorably with other emerging markets in this respect. The market capitalization- GDP ratio at

end-1995 was 22.4 percent for Brazil; 12.6 percent for Hong Kong, China; 40 percent forIndonesia; 41 percent for Korea; and 37.1 percent for Mexico. 1 It was higher however, in Malaysia

(281.9 percent), Philippines (81.3), Singapore (233 percent), and Thailand (152.9 percent).

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Why this project was undertaken

In order to find out the Analysis of Indian Capital Market

The general purpose is to determine the key factors effecting customer

investment decision in shares

To see the awareness among customers of shareholders.

To check whether customers are satisfied with the facilities provided to

them.

To analyze that which media is bringing maximum business to the

company

What are the factors, which are mostly preferred by investors investing in

shares?

Whether they are satisfied with the services of share khan and if not what

are the reasons behind dissatisfaction

As I did my survey in the city of Kanpur mostly in banks, financial

institutions in few shops so most of the people were aware of the company(share khan), but if we see in general there are still many people who are

unaware of the company. So, also the effort was made to make the people

aware of it. And to make them well acquainted with the benefits of investing

in share khan.

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PROBLEM ENVIRONMENT

To tell them the benefits of investing in Share khan.

To make them aware of the prime factors, which they should consider

before investing in share khan, that would be beneficial.

To let them know that they can start getting return early with minimum

investment.

Non-investing habit of people due to risk and uncertainty.

PROBLEMS BEING FACED

People showed a lot of suspicion and were hesitating in giving the

answers.

Fixed deposits are considered more preferable rather than investing in the

shares, bonds, mutual funds etc.

Many of the respondents used to avoid us seeing the length of the

questionnaire.

They used to give ideal and glorified answers.

The working employees though willing to fill it up but due to time lack

and busy schedule they used to avoid.

Due to lack of knowledge they find difficult to fill up.

Some people dont deliver the exact information in order to keep it secret

and personal.

People were not ready to disclose whether they invest or not

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CHAPTER 2

OBJECTIVES

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OBJECTIVE

Primary Objective-ANALYSIS OF INDIAN CAPITAL MARKET

Secondary Objective-

RESEARCH OBJECTIVE & RELATED SUB-OBJECTIVE

To assess the factor which govern the customer for investing in particular

company share khan.

To assess as to which company provides best services.

To find out the market share and opinion about Share Khan

To find out the investment criteria of customer.

To find out the most preferred company.

To find out the media that generates maximum business.

To find out which other investment companies are switching over

towards share khan.

To asses the awareness among customers about savings and investments.

Through this project I will find that market share of company, positioning of

the companies, and unknown people from the company and most preferable

company in the Kanpur market at the specified areas.

After collection of primary data I have compiled it and find out the result

base on the questionnaire and suggestion for the company.

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TARGET/TASKS

The target/tasks of OJT (On the Job Training) are as;

To find out the prospective clients and convince them to open there

demat account.

To open at least two demat accounts on weekly basis or 8 demat

accounts on monthly basis.

To motivate the people to trade in shares who have demat accounts.

To make CIS on the computer.

To create the database of those people who opened demat account with

the company.

STRATEGY

The strategies for OJT (On the Job Training) are as to;

Found the prospective customer database from different means.

First of all we made cold calls to people and took an appointment from them

to give the product knowledge of the company. This is a part of Direct

Marketing.

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Database Marketing - Direct marketers mine the database to identify

prospects that would have the most interest in an offer.

Tele prospecting - Generating and qualifying new leads for closure by

another sales channel.

If any customer is looks like more potential and more profitable for the

company then I have to fix an appointment of that customer with my

company guide.

Presentation - We tells the product story to the buyer. We use a FABV

(Features, Advantage, Benefits, and Value) approach. Features describe the

economic, technical, job and social benefits delivered by the offerings. Valuedescribes the worth of offerings (how much a person can achieve by

investing through our company).

To ensure the customer satisfaction and repeat the business we follow up

with them. We also deliver the details to the customer on the matter of

purchase and sales and other matters that are important and beneficial to the

customer.

ACHIEVEMENTS

As per my assigned target/task achievements are as;

I had opened 10 demat accounts by contacting approximately 100 people and

I had achieved the target.

We (the Sharekhan team) have got the appreciation letter from our company

guide as a team.

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LIMITATIONS

Limitations of OJT are as:

There are some documents needed to open demat account such as, PAN card,

address proof, bank proof etc.

To open a demat account and trading in shares MICR cheque is compulsory.

All the signatures of account opening form must be matched with the

signature of the pan card.

People are not interested in stock market.

CONCLUSION

Going through my OJT I concluded that;

I have to make aware people about the company.

I have to meet different type of people and convince them to be the client of

the company and also to invest in the share market.

I have to search potential client, if they want extra facility then I fix an

appointment with my immediate senior Mr. Abhishek Srivastava Assistant Manager(Sales) Sharekahn Ltd.

I had achieved my target till now, but some more training classes can

improve my performance level. The tasks and targets can be better achieved if

company gives some attention on the advertisement in the city.

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CHAPTER 3

RESEARCH

METHODOLOGY

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THE PROJECT BACKGROUND & METHODOLOGY

RESEARCH PROBLEM

In todays era where the customers are very much concerned about their

investment avenues, as they want the maximum returns with security and

satisfaction, the research problem was To Know the awareness &

penetration of share khan in Kanpur city

INFORMATION REQUIRNMENTS

For this study I required Secondary data as well as primary data.

SECONDARY DATA : those which someone else has already collected and

which have already passed through statistical process.

This data was collected from the Internet.

The companys broachers were of a great help.

PRIMARY DATA : those, which are collected afresh and for the first time.

The questionnaire method is used in this research, as it is more

objective and systematic.

The questionnaire used was a structured one.

RESEARCH CHOICE OF DESIGN

A research design is the arrangement of conditions for collection and

analysis of data in a manner that aims a combined relevance to the research

process with economy in procedure. The research design is the conceptualstructure within which research is conducted the blue print for the

collection, measurement and analysis of data.

There are two types of research design:

Exploratory research

Conclusive research

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Exploratory research emphasizes on the discovery of ideas & insight,

whereas the conclusive research are concerned with describing the

characteristics of the particular individual or of a group

The research design used in this project is exploratory as well as conclusive

research design because the company has to take decisions based on survey

carried out by me related to the research objective

RESEARCH INSTRUMENT USED DETAILS AND WHY?

The research instrument used was a questionnaire.

This was a structured one.

In this the questions were directly asked to the customers.

The close ended and open ended both the patterns were used here for a

detailed study of the problem.

A standardized form called questionnaire, being prepared to collect the data

in which a list of questions to be asked to the respondents are stated. The

language used is simple. The questions are understandable and in a proper

sequence. Space to record the answer is provided in the questionnaire. It

translates the research objective in to specific questions the respondents can

answer and it motivates the respondents to furnish the information correctly.

In the questionnaire there are two forms of questions:

Close ended

Open ended

In the close ended question multiple choices are being given and

respondents has to answer accordingly where as in the open ended question

the respondent has to give the answer on his own to a particular question.

The close-ended questions have been most over the open-ended questions.

As the close ended questions help in drawing a definite conclusion.

Construction of Questionnaire

There is no formal procedure of preparing a questionnaire; hence the

questionnaire is the result of general experience of the researcher. The steps

involved in the construction of Questionnaire are as follows:

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A list of information needed is determined, which is given in the

second step of this research process. This information needed is based

on the objective of the project and analysis to be done.

The first step during developing sample design is to define these universe

or population, being studied. The universe is the entire group of items which

the researcher wishes to study.

SAMPLE SIZE.

The survey is being conducted in the city of Kanpur. The sample size of

hundred has been selected. The place being visited is banks, few market

places and corporate offices. According to my sample size, this was hundred

and that too mostly from banks, financial institutes. So most of the people

were aware of share khan but in general while carrying out my survey I

found that most of the people in Kanpur are still not aware of share khan.

FIELD WORK

The field work done was a survey made in the city of Kanpur

The survey was possible only through a structured questionnaire.

In this questionnaire the questions were directly asked to the customers.

The use of open ended as well as close ended questions were done here.

Thus this survey was undertaken to find solutions to the problems being faced by

the company.

QUESTIONNAIRE:

The contents, phrasing and the sequence of the questionnaire

should also be clear and unambiguous. The knowledge levels of the target

of respondents should be kept in the mind while drawing up the questions

ANALYTICAL TOOLS USED

The analytical tools used were the:

Graphs

Pie charts

Tables

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RESEARCH INSTRUMENT

MECHANICAL INSRUMENTS

Sampling:

A sample is a subset of a unit or populations, collected as a representation of

it. A sample is used to discover one or more properties of the population. Collected

of sample is called SAMPLING. Proper sampling design is essential in marketing

Research. The sample has to be collected in such a way that is represents the

populations.

Sampling Units:

In sampling researches, decide who will be surveyed. The portion of

population that researches need to target and that represents the entire population is

known as SAMPLING UNITS. The target population is should be selected in such

a way that everyone in the population has that equal chances of being included in

the sample.

Sample size:

The sample size is an important element in research process. As the size ofthe sample has the direct effect of a research. It is essential for researchers to select

an appropriate sample size. As the size of a sample increases, accuracy and

reliability of research also increases however, the cost of research also increases.

Therefore, research need to make a trade off between the accuracy and cost of

research.

Sampling procedure:

Sampling procedure is the way in while we selected a sample. The methodfor selecting samples includes stratified and un-stratified sampling. Probability and

non-probability sampling, single stage sampling and multistage sampling and single

unit sampling and clusters of unit samplings.

In my survey I have used QUESTIONNAIRE, as the research instrument sampling

size of the survey is 100.

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LIMITITATIONS

Sample size limitation

Size of the sample means the number of units of sampling units selected

from the population. The size of the sample is directly related to standard of

accuracy, time, cost and administration of the investigation.

If the size of the sample kept is small, it will not represent the universe and

the degree of accuracy in the result will be limited.

The time and cost were the two main constraints as these two factors arelimited.

There are some documents needed to open demat account such as, PAN card,

address proof, bank proof etc.

To open a demat account and trading in shares MICR cheque is compulsory.

All the signatures of account opening form must be matched with the

signature of the pan card.

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CHAPTER 4

COMPANY PROFILE

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SENSEX - Your Preferred Choice For Index Futures

Sharekhan is a Indias leading stock broker of the retail arm SSKI

(Sri Shantilal Kantiwal, Ishwarlal Pvt. Ltd.), an organization with over eightyYears of experience in the stock market, with more than 240 share shops in

110 cities and Indias premier online trading destination. Sharekhans customer enjoy multichannel access to the stock market, and it offers you trade execution facilities

For each as well as derivatives, on the BSE and the NSE, depository Services,

Commodities trading on the MCX and NCDEX and most importantly, It bring investment

advice tempered by eighty years of broking experience. It's choice - not chance - that

determines your destiny, said Jean Nidetch, the famous author. Indian investors have

several choices to manage their investments and personal wealth and so as the products. In

the futures markets, which are growing at a rapid pace, it is now the time for the investors

to realize the enormous gains they could make from trading in index futures and choosing

SENSEX Futures as their mainstream product.

SENSEX is the benchmark equity Index in India. A major alternative is the Nifty, which too

tracks the equity performance in India. On both these indices, Index

Futures are available. Though most of the trading in index futures is done on the Nifty Futures,

investors are not gaining from the unique advantages that the SENSEX Futures offers. Investors

stand to gain from trading in SENSEX Futures, for it is:

Not a me-too index has several distinct features.

More balanced and representative.

Constructed using international best practice of free float methodology.

Here we analyze the difference between SENSEX and Nifty, and compare them on basis of their

construction methodology, usefulness and relevance to see which Index serves Indian derivativesmarkets better.

1. Introduction to Index:

An Index is used to summarize the price movements of a unique set of goods in the financial,

commodity, forex or any other market place. Financial indices are created to measure pricemovements of stocks, bonds, T-bills and other type of financial securities. More specifically, a

stock index is created to provide investors with the information regarding the average share pricein the stock market. Broad indices are expected to capture the overall behavior of equity marketand need to represent the return obtained by typical portfolios in the country.

SENSEX:

SENSEX is India's first Index compiled in 1986. It is a basket of 30 constituent stocksrepresenting a sample of large, liquid and representative companies.

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The base year of BSE-SENSEX is 1978-79 and the base value is 100. The index is widely

reported in both domestic and international markets through print as well as electronic

media. Due to its wide acceptance amongst the investors, SENSEX is regarded to be the

pulse of the Indian stock market. All leading business newspapers and the business channelsreport SENSEX, as it is the language that all investors understand.

As the oldest index in the country, it provides the time series data over a fairly long period of time

(from 1979 onwards) to be used for various research purposes. The Index Cell of the exchange isresponsible for the day-to-day maintenance of the index within the broad index policy set by the

Index Committee. The Index Cell ensures that the SENSEX and all other BSE indices maintaintheir benchmark properties by striking a delicate balance between frequent replacements in index

and maintaining its historical continuity.

NIFTY:

The Nifty is relatively a new comer in the Indian market. S&P CNX Nifty is a 50 stock index

accounting for 23 sectors of the economy. It is used for purposes such as benchmarking fund

portfolios; index based derivatives and index funds.The base period selected for Nifty is the close of prices on November 3, 1995, which marked thecompletion of one-year of operations of NSE's capital market segment. The base value of index

was set at 1000.

S&P CNX Nifty is owned and managed by India Index Services and Products Ltd. (IISL), which

is a joint venture between NSE and CRISIL. IISL is a specialized company focused upon the

index as a core product. IISL have a consulting and licensing agreement with Standard & Poor's

(S&P), who are world leaders in index services.

2. Index size

While constructing an index, one of the important considerations is its size. Internationally, an

index can use any number of stocks ranging from 10 to 5000. The index is strictly a sample of

stocks that represents the universe of stocks in the market. Some studies support the notion that asample with a minimum of 30 observations is statistically proven to be representative of the

underlying population. Any number less than 30 is too less to represent a large population of

observations.

SENSEX has 30 stocks while Nifty has 50 stocks. It is seen that due to the manner in which Nifty

is constructed and with an obvious bias for PSU Oil companies, the index has been rendered

rather vulnerable to the fortunes of the PSU Oil companies. More specifically the inclusion of

ONGC Ltd. in Nifty has literally made it prone to the fluctuations in the Oil companies as evidentin the month of May, 2004. The Table below logically supports the above argument.

3. Index construction:

Nifty is calculated on the "Full Market Capitalization" methodology.

SENSEX is the only Broad market index in India that is constructed on the "Free-Float

Market Cap methodology. This is the globally accepted methodology that is followed bymost of the leading index providers.

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SENSEX was initially calculated based on the "full market capitalization"

methodology but was shifted to the free-float methodology with effect

4. Industry representation

The index should be fairly representative of the entire market. All or at least most sectors should

be represented in the index in the same weight as they are in the market cap of entire market.

SECTOR SENSEX Nifty

Oil & Gas 19.5 29.2

IT 14.9 13.4

Finance 18.6 12.6

FMCG 10.8 8.9

Transport Equipment 8.6 7.6

The analysis of above table shows interesting results:

The largest sector in SENSEX, Oil & Gas, represents 19.5% of the index.

The largest sector represented in Nifty is Oil & Gas which covers nearly 29.2% of index.

ONGC alone accounts for 50% of this weight, as ONGC enjoys a weight of around 14%in Nifty.

It is interesting to note here that in the investable universe of listed stocks, the Oil & Gas sector

enjoys a weight of around 17%, which is reasonably reflected by SENSEX.

5. Volatility

Volatility is a measure of deviation of current price of an asset from its average past prices.Greater this deviation, greater is the volatility. Since volatility is a standard measure of financialvulnerability, it plays a key role in assessing the risk & return trade-offs.

Comparative Volatility (1 std.dev.):

3 Months 6 Months 1 Year

SENSEX 1.66 1.48 1.35

Nifty 1.78 1.56 1.43

The volatility of SENSEX is lower as compared to the volatility of Nifty for all the calculated

periods of 3 months, six months and one year.

Intra-day Volatility:

Intra day volatility nowadays has assumed considerable significance because of its influence onthe decision of the market participants and its impact on other instruments such as Derivatives.

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High- Low volatility is a measure of intra- day volatility.

6. Comparative Impact cost :

The comparative Impact cost of executing a basket of SENSEX and Nifty for a portfolio size ofRs. 5 Million is as follows.

SENSEX Nifty

BSE 0.88% 1.01%

NSE 0.08% 0.09%

Although the above table shows that there is comparatively lower liquidity at BSE, a quick

comparison reveals that whether it is at BSE or NSE, the impact cost of the SENSEX is alwayslower than that of Nifty. The impact cost in BSE can come down drastically if the investors begin

more of trading in SENSEX Futures.

7. Conclusion:

There are many reasons why SENSEX futures should ideally be a good choice, yielding desirablefruit and should enjoy better trading interest than Nifty: The same is summarized below:

SENSEX is widely used to describe the mood in Indian stock market, and because of its

long history and wide acceptance, no other index matches the BSE SENSEX in reflecting

market movements and sentiments.

SENSEX is truly investable as it is the only broad based index in India that is "free float

market capitalization weighted", which reflects the market trends more rationally and

takes into consideration only those shares that are available for trading in the market. SENSEX is in effect the proxy for the Indian stock markets. Since SENSEX comprises of

leading companies in all the significant sectors in the economy, it makes an attractive

underlying for index based products like Index funds, future & option and Exchange

traded fund.

SENSEX provides the time series data over a fairly long period of time (from 1979

onwards) to be used for various research purposes, as the oldest index in the country.

SENSEX neatly avoids sector bias and includes blue chip companies. Thus the wide andbalanced industry representation in the SENSEX makes it the ideal index to effectively

hedge the portfolios of fund managers and institutions.

SENSEX is less volatile as compared to Nifty thereby reducing the volatility in the Index

futures and attracting lesser margins. SENSEX has provided with more returns in last one year as compared to the returns

provided by Nifty, thereby making it a more attractive portfolio.

SENSEX as compared with international indices of other emerging markets shows less volatilityand at the same time gives returns equivalent to the returns given by the indices of developed

markets of USA and UK.

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COMPETITIVE SITUATION

KARVY

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

top five in the country in all its business segments, services over 16 million

individual investors in various capacities, and provides investor services to over

300 corporate, comprising the one, who is Corporate India. KARVY covers the

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

Distribution of financial products - mutual funds, bonds, fixed deposit, equities,

Insurance Broking, Commodities Broking, Personal Finance Advisory Services,

Merchant Banking & Corporate Finance, placement of equity, IPO`s, among others.

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

technology, operations and research of various industrial segments.

KOTAK SECURITIES

Kotak Mahindra is one of India's leading financial institutions, offering complete

financial solutions that encompass every sphere of life. From commercial banking,

to stock broking, to mutual funds, to life insurance, to investment banking, the

Group caters to the financial needs of individuals and corporate.

ICICI direct .com

ICICI Bank Demat Services boasts of an ever-growing customer base of over 11.5

lacs account holders. In our continuous endeavor to offer best of the class services

to our customers we offer the following features:

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INDIA INFOLINE

The India Infoline Group comprises the holding company, India Infoline Ltd,

which has 4 wholly-owned subsidiaries engaged in distinct yet complementary

businesses which together offer a whole bouquet of products and services to makeyour money grow. As on date, the Group employs 4000 plus employees, in over 60

locations, across India.

Sharekhan

Sharekhan is a Indias leading stock broker of the retail arm SSKI (Sri Shantilal

Kantiwal, Ishwarlal Pvt. Ltd.), an organization with over eighty years of experience

in the stock market, With more than 240 share shops in 110 cities, and Indias

premier online trading destination. Sharekhans customer enjoy multi channel

access to the stock market, and it offers you trade execution facilities for each as

well as derivatives, on the BSE and the NSE, depository services, commodities

trading on the MCX and NCDEX and most importantly, It bring investment advice

tempered by eighty years of broking experience.

Services of Sharekhan

1. Equity and derivatives trading

2. Technical research

3. Fundamental research

4. Share shops

5. Commodities trading

6. Online trading7. Depository services

8. Portfolio management

9. Dial-n-trade

. Mutual Fund

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SECTION 5

DATA ANALYSIS &FINDINGS

A

NALYSIS

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SAMPLE PROFILE

The study used primary data gathered through self-administered

questionnaire.

Descriptive research design methods are used to examine the survey

result for numerical comparisons.

The study employed non-probability quota sampling.

It was a multi-stage sampling

Convenience sampling

Census

The study was made with the help of survey.

The survey was done in the city of Kanpur.

The customer of both the gender filled the questionnaire.

The sample size was fifty.

PRIMARY DATA TABULATION AND INTERPRETATION

The response of hundred customers is collected by means of questionnaire

that are either employees of distribution houses, banking sectors and

businessmen.

After collection of data, it becomes necessary to classify and tabulate the

data for further analysis, so as to enable on to appropriate the findings in the

study.

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DATA ANALYSIS1. Composition of SENSEX (BSE)

SENSEX Companies

BSE 100 500BSE 200 200

BSE 500 500

BSE TEK 38

BSE PSU 48

SECTORAL 149

BANKEX 19

BSE MIDCAP 276

BSE SMALL

CAP 488

2218

0

50

100

150

200

250

300

350

400

450

500

BSE 100 BSE 200 BSE 500 BSE TEK BSE PSU SECTORAL BANKEX BSE

MIDCAP

BSE SMALL

CAP

Series1

INTERPRETATION

In total SENSEX, It is influenced by different composition of companies.Major composition of companies is under BSE100 & BSE500

Bankex include all major Banks e.g HDFC, AXIS, SBI, CANARA Bank

BSETECK include all Telecom, IT and Media Companies

BSUPSU includes all Public Sector cos e.g ONGC, Finance, Transport Cos

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3. S&P CNX NIFTY (1-06-2008 TO 1-08-2008)

Market Fluctuation of CNX NIFTY

0

1000

2000

3000

4000

5000

6000

7000

6/2/2008

6/9/2008

6/16/2008

6/23/2008

6/30/2008

7/7/2008

7/14/2008

7/21/2008

7/28/2008

Date

Index

Series1

INTERPRETATION

Market of NIFTY moved on average basis during this two month it declined due to many factors

in global scenario eg the USA recession but it made less impact in INDIAN Market therefore it

maintained average movement of 5500

Date

Total Returns

Index

2-Jun-08 5778.7

10-Jun-08 5425.3916-Jun-08 5575.95

24-Jun-08 5111.57

30-Jun-08 4929.98

8-Jul-08 4867.38

15-Jul-08 4713.68

22-Jul-08 5181.77

31-Jul-08 5297.47

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4. PROFIT EARNING/PAYBACK PERIOD/DIVIDEND YIELD

(1-06-08 TO 1-08-08)

Date P/E P/B Div Yield

2-Jun-08 20.17 4.87 1.1210-Jun-08 18.94 4.4 1.22

16-Jun-08 19.46 4.53 1.19

20-Jun-08 18.59 4.3 1.25

25-Jun-08 18.18 4.21 1.28

30-Jun-08 17.28 4 1.35

8-Jul-08 17.11 3.78 1.38

15-Jul-08 16.53 3.66 1.42

21-Jul-08 17.72 3.94 1.32

25-Jul-08 18.19 3.97 1.28

31-Jul-08 18.22 3.99 1.28

P/E, P/B, Div Yield (S&P CNX NIFTY) 1/6/08 to 01/08/08

0

5

10

15

20

25

6/2/08

6/9/08

6/16

/08

6/23

/08

6/30

/08

7/7/

08

7/14

/08

7/21

/08

7/28

/08

Period

%age

Series1 Series2 Series3

NSE

INTERPRETATION

Profit Earning Ratio remained stable its the profit earning per share

Pay back period for interest is stable

Dividend yield also remained stable which result the secured return in NIFTY

36

PROFIT EARNING

PAY/BACK PERIOD

DIVIDENT YEILD


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5. BANKNIFTY MC

Daily Mcap Report

TILL To Date : 29-08-2008

Index/Exchange Company Name Weightage Mkt. Cap. in Rs Mn

CNX BANK INDEX Axis Bank Ltd. 7.84% 259489.1415

CNX BANK INDEX Bank of Baroda 3.12% 103269.5244

CNX BANK INDEX Bank of India 4.25% 140536.2413

CNX BANK INDEX Canara Bank 2.67% 88314

CNX BANK INDEX HDFC Bank Ltd. 16.40% 542491.8863

CNX BANK INDEX ICICI Bank Ltd. 22.60% 747558.2782

CNX BANK INDEX IDBI Bank Ltd. 1.83% 60694.7831

CNX BANK INDEX Kotak Mahindra Bank Ltd. 6.32% 208958.996

CNX BANK INDEX Oriental Bank of Commerce 1.25% 41426.7394

CNX BANK INDEX Punjab National Bank 4.58% 151565.9118CNX BANK INDEX State Bank of India 26.94% 891276.5997

CNX BANK INDEX Union Bank of India 2.19% 72282.37149

100.00% 3307864.473

MARKET CAP REPORT TILL 29-08-2008

8%3%

4%3%

16%

23%2%6%

1%

5%

27%

2%Axis Bank Ltd.

Bank of Baroda

Bank of India

Canara Bank

HDFC Bank Ltd.

ICICI Bank Ltd.

IDBI Bank Ltd.

Kotak Mahindra Bank Ltd.

Oriental Bank of Commerce

Punjab National Bank

State Bank of India

Union Bank of India

INTERPRETATION

SBI & ICICI Bank compose the maximum weightage in NIFTY so any change inthe bank will have direct effect in the fluctuation of market

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6. S&P CNX NIFTY MOVEMENT:

Date Open High Low Close

2-Jun-08 4869.25 4908.8 4713 4739.6

5-Jun-08 4586.95 4690.6 4536.25 4676.95

10-Jun-08 4522 4522.55 4369.8 4449.8

16-Jun-08 4536.3 4617.7 4536.3 4572.5

20-Jun-08 4504.2 4532 4333.6 4347.55

25-Jun-08 4189.6 4264.55 4093.2 4252.65

30-Jun-08 4136.25 4163 4021.7 4040.55

4-Jul-08 3926.65 4033.5 3896.4 4016

10-Jul-08 4155.65 4187.95 4110.4 4162.2

15-Jul-08 4039.3 4040.7 3835.5 3861.1

21-Jul-08 4092.2 4168.15 4072.75 4159.5

25-Jul-08 4440.85 4440.85 4297.15 4311.85

31-Jul-08 4314.35 4342 4285.55 4332.95

1-Aug-08 4331.6 4422.95 4235.7 4413.55

S&P CNX NIFTY (1-06-08 TO 01-08-8)

0

1000

2000

3000

4000

5000

6000

6/2/08

6/9/08

6/16/08

6/23/08

6/30/08

7/7/08

7/14/08

7/21/08

7/28/08

Period

Index Series1

Series2

Series3

INTERPRETATION

Market in CNX NIFTY remained stable due to economic growth and stability in

INDIAN market

7. Performance of various indices as of end August 2008 (in %)

1 month 3 month 6 month 1 year

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S&P CNX Nifty 0.62 -10.47 -16.53 -2.33

S&P CNX 500 0.94 -11.88 -19.99 -5.99

S&P CNX Defty -2.27 -13.15 -23.85 -8.68

CNX Nifty junior 2.9 -13.17 -25.92 -17.31

CNX Midcap 2.93 -13.16 -21.35 -5.71

CNX IT Index 4.64 -16.24 -1.45 -18.42

S&P CNX Banks 6.71 -8.48 -30.24 -9.94

Performance of various indices in NSE at end of

AUG08(%)

-40

-20

0

20

1 month 3 month 6 month 1 year

1 month 0.62 0.94 -2.27 2.9 2.93 4.64 6.71

3 month -10.47 -11.88 -13.15 -13.17 -13.16 -16.24 -8.48

6 month -16.53 -19.99 -23.85 -25.92 -21.35 -1.45 -30.24

S&P S&P S&P CNX CNX CNX IT S&P

INTERPRETATION

1st monthCNX BANKX resulted in maximum gain while CNX DIFTY showed decline

3 month

Largest decline in IT sector and fewer declines in BANKX6 month

IT Sector results in slowest decline while NIFTY Junior shows the major decline

Overall

Largest composition of NSE is due to IT Sector and there was major decline due tobanking sector

8. Change in NIFTY value compared to previous close:-

Expiry Date

NIFTY Index

Value

Change in NIFTY value

compared to previous close

% change in NIFTY value compared to

previous close

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25-

Oct-07 5568.95 72.8 1.32%

29-

Nov-07 5634.6 17.05 0.30%

27-Dec-076081.5 10.75 0.18%

31-Jan-08

5137.45 -30.15 -0.58%28-Feb-08

5285.1 16.7 0.32%

27-Mar-08 4830.25 1.4 0.03%

24-Apr-08 4999.85 -22.95 -0.46%

29-May-08 4835.3 -83.05 -1.69%

26-Jun-08 4315.85 63.2 1.49%

31-Jul-08 4332.95 19.4 0.45%

28-Aug-08 4214 -78.1 -1.82%

25-Sep-08 4110.55 -50.7 -1.22%

% CHANGE NIFTY VALUE AS COMPARED TO

PREVIOUS CLOSE

5568.95

5634.6

6081.5

5137.45

5285.1

4830.25

4999.85

4835.3

4315.85

4332.95

4214

4110.55

1.32%

0.30%

0.18%

0.58%-

0.32%

0.03%

0.46%-

1.69%-

1.49%

0.45%

1.82%-

1.22%-

-1000 0 1000 2000 3000 4000 5000 6000 7000

25-Oct-07

29-Nov-07

27-Dec-07

31-J an-08

28-Feb-08

27-Mar-08

24-Apr-08

29-May-08

26-J un-08

31-J ul-08

28-Aug-08

25-Sep-08

PERIO

NIFTY INDEX VALUE

NIFTY Index Value % change in NIFTY value compared to previous close

INTERPRETATION

Overall market showed the stable market due to less impact due to recession

Indian market showed no effect due to foreign market

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SURVEY REPORT ON INTERPRETATION OF INVESTMENT

BEHAVIOR ACCORDING TO OCCUPATION, KNOWLEDGE,

AWARENESS & INVESTMENT STRUCTURE

Awareness level about Stock Market

Yes

No

East

Yes, 67

No, 33

0

10

20

30

40

50

60

70

INTERPRETATION

Among of 100 people 67 people are aware about stock market and 33 people are not aware.

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Type of different investment in the stock market

No. of people

0

2

4

6

8

10

12

14

16

18

Equity

Trading

Mutual

Fund

Debenture Others

Sources of investment

INTERPRETATION

Among 100 people 41 people all are invested in the stock market in different

means, which are as;

Means of investment No. of people

Equity trading 18

Mutual Fund 14

Debenture 04

Others 05

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Experience of investment in the stock market

No. of people

0

24

6

8

10

12

14

16

18

5 11

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Selection of company for investment

No. of people

4

7

11

56

8

0

2

4

6

8

10

12

%AGE OF PEOPLE

Sharekha

n

Indiainfolin

e

Karvy

ICICId

irect

.com

KotakSe

curitie

s

otherlocalc

ompa

nies

East

SECURITIES

INVESTMENT IN DIFFERENT SECURITIES

Companies

INTERPRETATION

Among 41 people different numbers of people invested in different stock broking

companies. All of them are described below:

Company Name No. of people

Sharekhan 4

India Infoline 7

Karvy 11

ICICI direct.com 5

Kotak Securities 6

Otherlocal co'S 8

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1. Market share of companies

10%

17%

26%12%

15%

20%

sharekhan

indiainfoline

karvy

ICICI direct.com

Kotak Securities

Other localcompanies

INTERPRETATION

The above pie chart shows that the market shares gained by the different companies

in the Kanpur city, which is given as:

Company Name

Market Share

(%)

Sharekhan 10

India Infoline 17

Karvy 26

ICICI direct.com 12

Kotak Securities 15

Otherlocal co'S 20

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2. People having monthly transaction in shares (in Rs.)

No. of people

119

76

42 2

02468

1012

1000

-50

00

5000

-10

,000

10,000

-25

,000

25,000

-50

,000

50,000

-1,00

,000

1,00

,000

-5,

00,000

>5,

00,000

Series1

Monthly transaction range (in Rs.)INTERPRETATION

Among 41 people different no. of people belonging from different range of monthly

transaction.

Range of monthly transaction (in Rs.) No. of people

1000 5000 11

5000 10,000 09

10,000 25,000 07

25,000 50,000 06

50,000 1, 00,000 04

1, 00, 000 5, 00, 000 02

> 5, 00,000 02

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3. People distribution on the basis of monthly brokerage paid by

him.

No. of people

6

9

78

56

0

2

4

6

8

10

10 -

100

100 -

500

500 -

1000

1000 -

2500

2500 -

5000

> 5000

Series1

Monthly brokerage (in Rs.)

INTERPRETATION

Among 41 people 6 people are paying brokerage 10 100Rs. 9 people are paying

brokerage 100 500Rs. 7 people are paying brokerage 500 1000Rs. 8 people are

paying 1000 2500Rs 5 people are paying 2500 -5000Rs. And 0nly 6 people are

paying > 5000Rs. On monthly basis.

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INTERPRETATION & FINDINGS

It was found that most of the people were aware of the company share

khan.

It was noticed that investors are very conscious about their money, they

need more return with less risk

It was found that most of them believe that changes in security market

affect the net asset value of the shares.

Most of the people are satisfied with there mode of investment

It was found that maximum numbers of investors are male in comparison

to females.

Around 45 people out of 100 investing their money are businessmen.

People of age group between 18-35 preferred to invest in shares.

Around 67% of people were aware of stock market.

People get aware of stock market through investors, televisions etc.

Among 100 around 41% of people invest in stock market in different

mean

People experience of investment in years in stock market is between 3-5

years.

People mostly prefer karvy for investment

The main reason behind investment in a particular Company is the past

performance, dividend history, with Good Portfolio Management.

Karvy holds maximum % of shares in Kanpur city.

Mostly people go through references.

Most of them were satisfied with the service provided to them.

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CHAPTER 6

CONCLUSION

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CONCLUSION

A single rupee today is worth more than a single rupee a few years down

the line. Given this, households that have surplus funds in the form of savings

want to invest those funds so that the value of the funds over the years does not

go down.

After analyzing the data according to my sample survey (sample size 100) I

found out that among 100 people 67 % are aware about stock market and 33% are

not aware about this market. Only 41% people are interested to invest in the stock

market and rest 26 % are not interested to invest due to different reasons such as;

financial problem, unsafe market etc. Among 41% people only 10% are the client of

sharekhan and they trade in shares with the help of it.

To find out the prospective clients and convince them to open there

demat account.

To motivate the people to trade in shares who have demat accounts.

To make CIS on the computer.

To create the database of those people who opened demat account with

the company.

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CHAPTER 7

RECOMMENDATION

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SUGGESTIONS:

Special care should be given to advertising, as there was lack of

awareness among the people.

The company should attract the market more vigorously and go in for

trapping more and new customers.

The company should provide special schemes for customers with more

information to motivate them.

The company should also try their best to make the customer aware of the

technical aspect of the schemes so that the customers do not feel that they are

ignorant of any fact.

More advertisement at local level is required.

Since most of the people are unaware about the share khan the broking

company. The company can make them aware by educating them about it with

the help of road shows and canopies.

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CHAPTER 8

BIBLIOGRAPHY

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BIBLIOGRAPHY

WWW.SHAREKHAN.COMK

WWW.5PAISA.COMK

WWW.ICICIDIRECT.COM

WWW.KARVY.COM

WWW.KOTAK.COM

ECONOMICS TIMES

BUSSINESS MAGZINES

REFERENCE

BOOKS NAME AUTHORS NAME

Marketing Management Philip Kotler

Marketing Research Donald S. Tull

Deli. Hawkins
http://www.sharekhan.comk/http://www.5paisa.comk/http://www.icicidirect.com/http://www.karvy.com/http://www.kotak.com/http://www.sharekhan.comk/http://www.5paisa.comk/http://www.icicidirect.com/http://www.karvy.com/http://www.kotak.com/

Neelambuj Final Project

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