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MAHATMA GANDHI UNIVERSITY

An Organistaion Study of India


Infoline Limited
by
Renjith R
Reg. No.31105

Submitted in partial
fulfillment for the award of the degree of
Master of Business Administration
(Marketing & HRM)
CC308

under the guidence of


Mrs. Jincy K C

Department of Management Studies


Sree Nikethan College
Chathanoor

December 2009
Declaration
I, Renjith R, declare that this study report titled, ‘An Organistaion Study of India
Infoline Limited’ submitted in partial fulfilment of requirements for the degree
of Master of Business Administration is the record of of original project study
conducted by me under the guidance of Ms. Jincy K J, Lecturer in Business
Administration, Sree Nikethan College.
This has not been submitted earlier for the award of any Degree/Diploma from M
G University or any other university.

Signature
Renjith R

Place:
Date:

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Acknowledgements
The satisfaction of the successful completion of any task wouldnt be complete
without the expression of gratitude to the people who made it possible.This task
would have been difficult for me if I had not received the support and encourage-
ment from the people who have helped me from the inception to the completion
of this project work.

I would also like to express my heart felt gratitude to Ms. Jincy K J, Head of
the Department and Mr. Radhakrishnan, Principal of Sreenikathan College, who
provided me with all help, guidance, co-operation and encouragement to complete
my study.

I wish to express my sincere gratitude to the authorities of India Infoline ltd who
has been kind enough to permit me to pursue this organization centered study at
their esteemed organization. I wish to express my heart felt thanks to all staff of
the organisation for their suggestions and guidance.

Then I would like to thank Mr. Ajesh Kumar, Branch Head of India Infoline Ltd,
Kadakkal, who guided me at all stages through this project with plenty of data.

Finally I would like to thank God Almighty for being the guiding light in all my
task and being with me through out this journey

RENJITH R

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Contents

1 Introduction 1
1.1 Objectives Of The Study . . . . . . . . . . . . . . . . . . . . . . . . 3
1.2 Scope of the study . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.3 Limitation Of The Study . . . . . . . . . . . . . . . . . . . . . . . . 4

2 Industry Profile 5
2.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.2 Profile of The Financial Services Industry . . . . . . . . . . . . . . 6
2.3 Stock Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

3 Company Profile 16
3.1 Milestones . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
3.2 Corporate Philosophy . . . . . . . . . . . . . . . . . . . . . . . . . . 19
3.3 Pillars Of The Organization . . . . . . . . . . . . . . . . . . . . . . 21
3.4 Company Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
3.5 Functioning Of Different Departments . . . . . . . . . . . . . . . . 29

4 Product Profile 35
4.1 Products & Sevices . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
4.2 Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
4.3 Commodities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
4.4 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
4.5 Portfolio Management . . . . . . . . . . . . . . . . . . . . . . . . . 40
4.6 Asset Management . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
4.7 Wealth Management . . . . . . . . . . . . . . . . . . . . . . . . . . 41

5 Analysis 43
5.1 SWOT Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

6 Findings, Suggestions & Conclusion 47


6.1 Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.2 Suggestions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
6.3 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

Bibliography 50

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Chapter 1

Introduction

Every modern economy is based on a sound financial system. A financial system is


a set of institutional arrangements through which financial surpluses are mobilized
from the units generating surplus income and transferring them to the others in
need of them. The activities which include production, distribution, exchange and
holding of financial assets/instruments of different kinds by financial institutions,
banks and other intermediaries of the market. Among these organizations are
banks, credit card companies, insurance companies, consumer finance companies,
stock brokerages, investment funds and some government sponsored enterprises.

The financial markets have two major components; they are money market and
capital market.

Money market

The Money Market refers to the market where borrowers and lenders exchange
short-term funds to solve their liquidity needs.

Capital Market

The Capital Market is a market for financial investments that are direct or indirect
claims to capital.

1
Chapter 1. Introduction 2

Securities Market

It refers to the markets for those financial instruments/claims/obligations that


are commonly and readily transferable by sale. It has two inter-dependent and
inseparable segments, the new issues (primary) market and the stock (secondary)
market.

The secondary market enables those who hold securities to adjust their holdings in
response to changes in their assessment of risk and return. The Primary Markets
provides the channel of sale of new securities.

India Infoline

India Infoline is one-stop financial services shop, most respected for quality of its
advice, personalized service and cutting-edge technology. Listed on Bombay and
National Stock Exchange with a net worth of INR 200 crore and a market cap
of over INR 1970 crore. The company has a network of 976 business locations
(branches and sub-brokers) spread across 365 cities and towns. It has more than
800,000 customers. It is registered with NSDL as well as CDSL as a depository
participant, providing a one-stop solution for clients trading in the equities mar-
ketFirst Company in India to foray into the online distribution of Mutual Funds.

Stock Market

A stock market, or equity market, is a private or public market for the trading of
company stock and derivatives at an agreed price; these are securities listed on a
stock exchange as well as those only traded privately. The size of the world stock
market is estimated at about $36.6 trillion US at the beginning of October 2008.
The total world derivatives market has been estimated at about $791 trillion face
or nominal value,11 times the size of

Forex Market

The foreign exchange market (currency, forex, or FX) market is where currency
trading takes place. It is where banks and other official institutions facilitate the
Chapter 1. Introduction 3

buying and selling of foreign currencies. The FX market is one of the largest and
most liquid financial markets in the world, and includes trading between large
banks, central banks, currency speculators, corporations, governments, and other
institutions.

Derivative Market

Derivatives are financial contracts, or financial instruments, whose values are de-
rived from the value of something else (known as the underlying). The underlying
on which a derivative is based can be an asset (e.g., commodities, equities (stocks),
residential mortgages, commercial real estate, loans, bonds), an index (e.g., inter-
est rates, exchange rates, stock market indices, consumer price index (CPI) see
inflation derivatives), or other items (e.g., weather conditions, or other derivatives).
Credit derivatives are based on loans, bonds or other forms of credit Derivative
is a product whose value is derived from the value of one or more basic variables.
Underlying Asset can be Equity, Forex, commodity or any other asset.

Forwards

A forward contract is a customized contract between two entities, where settlement


takes place on a specific date in the future at todays pre-agreed price.

Futures

A future is contract to buy or sell an underlying asset at a specified future date,


at a specified price. These contracts are traded and settled on exchanges. Future
contracts can be on individual scrip’s or indices.

1.1 Objectives Of The Study

• To understand the organizational structure or hierarchy of the company

• To enable us to gain an insight in to the corporate world.


Chapter 1. Introduction 4

• The study is aimed at understanding how an organization practically works


in the real situation.

• To study what kind of changes the organization has undergone in the recent
past or have initiated recently.

• To find out the competative position of India infoline

1.2 Scope of the study

• This report is based on the study conducted at the Kadakkal branch, Kollam

• 1.It aims at understanding the companys establishment organization struc-


ture, departments,marketing strategies and the advantages it is having over
the competitors.

• 1.It aims to understand the skills of the company in the areas like techno-
logical advancement, competitions and in management

1.3 Limitation Of The Study

• Time limit is a major constraint.

• As per the company rules many information was not disclosed.

• Finding and conclusions made are based on the superficial knowledge

• As the managers are busy in their duty schedules it is not possible for us to
spend more time in interaction and discussion with them.
Chapter 2

Industry Profile

2.1 Introduction

Financial services are vital tools of machinery for economy and they lubricate the
wheels of economic development. Indian economy has undergone a sea change in its
structure; policy and regulation, due to liberalization and globalization, since 1991.
The financial service sector is considered as the sunrise sector due to increasing
growth and contribution towards the GDP of India. Once the economy crosses
the subsistence level, financial services become more prominent and important
to that economy. Financial services in current days are emerging as a crucial
industry world over and are termed as a sun rise industry. The services offered
by this sector not only raise the required funds, but also lead to the efficient
management of funds. Today, the financial service products, as turned out to by
financial services industry are innovative and paving ways for vivid opportunities
for further economic development.

With market sentiment turning positive due to the formation of a stable newly
elected government, the ripple effect is likely to felt across all the financial services
in India. The sectors, including banking and insurance, and mutual funds are
all beginning to reap the benefits of a good closure for 2008-09. In 2008-09,
the Indian economy is estimated to have grown by 6.7 per cent. According to
the latest Central Statistical Organization (CSO) data, financial services and real
estate sector rose by 9.5 per cent in the first quarter of 2009-10.

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Chapter 2. Industry profile 6

2.2 Profile of The Financial Services Industry

A financial market is a market in which financial assets (securities) can be pur-


chased or sold. Financial markets facilitate financing and investing by house-
holds, firms, and government agencies Participants that provide funds are called
surplus units.And Participants that enter markets to obtain funds are deficit
units.Financial markets can be distinguished by the maturity structure and trading
structure of its securities.

Financial services like banking, merchant banking, factoring, Insurance, Venture


capital, act as vital machinery of an economy. These financial services that fa-
cilitate financial transactions of individuals and institutional services resulting in
their resources allocation activities through time. The sector that deals with such
financial services is known as financial services sector. The Three pillars of Finan-
cial System are:

• Banking

• Insurance and Mutual Funds

• Online Trading

Financial system acts as an intermediary

World Scenario

The first publicly issued security can be traced back to the fourteenth century in
Venice where the government made the first known issue of bonds. Merchants
and landowners as investments purchased these government securities. The need
for stock exchanges developed out of early trading activities in agricultural and
other commodities. In and around 1750s in England, traders in the shares of
early companies would commonly meet in Jonathans Coffee House to trade shares
and make business deals. Early share bids and offers were written on the Coffee
House walls and the trading process was highly unregulated, with insider trading
forming the basis for most investment decisions. By 1773, Trading Clubs had
formed, and in 1801 a group of traders raised 20,000 pounds to build the London
Stock Exchange in Capel Court. A similar process was occurring in America. By
Chapter 2. Industry profile 7

the early 1790s many merchants had begun trading shares. Just as in London,
these early traders often met at coffeehouses in an informal environment. In 1792,
24 Merchants and Brokers paid $400 each for a ”trading seat” and signed the
Buttonwood Tree Agreement, who decided to act as agents for other persons and
give preference to each other in their negotiations. They did much of their trading
under a tree at what is now 68 Wall Street. This agreement outlined the regulations
under which shares Could be bought and sold. These regulations formed the basis
for trading rules that still exist today and led to the formation in 1817 of the New
York Stock Exchange (NYSE). Today, nearly three thousand companies from all
over the world trade their stocks valued at trillions of dollars here. At that time,
many stocks that were deemed not well enough for the New York Stock Exchange
(NYSE) were traded outside on the curbs. This, so called curb trading has now
become the American Stock Exchange (AMEX). Today much water has passed
under the bridge since then and we forward all the way to late 1990s. By late
1990s, most of the stock exchanges had been automated, and the open outcry
method of trading was the thing of the past. Most stock exchanges began to use
computers to replace floor traders. Floor traders take phone and computer orders
from brokers, and negotiate a trade with stock specialists at trading stations on
the trading floor. The internet orders placed by clients are first processed and
authorized through the stock brokers computer system before being automatically
placed on the stock exchanges computer systems. This period saw the rise in
popularity and acceptance of online stock broking.

Financial Institutions

A financial institution is an institution that provides financial services for its clients
or members.Which transform financial assets acquired through the market and
constitute them into a different, and more widely preferable, type of asset-which
becomes their liability. This is the function performed by financial intermediaries,
the most important type of financial institution. Financial institutions are to
exchange financial assets on behalf of customers. These firms also assist in the
creation of financial assets for their customers, and then selling those financial
assets to other market participants. They provide investment advice to other
market participants and manage the portfolios of other market participants.
Chapter 2. Industry profile 8

Major players in the Industry

• Banks

• Stock Brokerage Firms

• Non Banking Financial Institutions

• Building Societies

• Asset Management Firms

• Credit Unions

• Insurance Companies

Functions Of Financial Institutions

Financial institutions offer various types of transformation services

Liability-Asset transformation

They issue claims to their customers that have characteristics different from those
of their own assets. For example, banks accept deposits as liability and convert
them into assets such as loans.

Size- transformation

They choose and manage portfolios whose risk and return they alter by applying
resources to acquire better information and to reduce or overcome transaction
costs. They provide large volumes of finance on the basis of small deposits or unit
capital.

Risk transformation

They distribute risk through diversification and thereby reduce it for savers as in
the case of mutual funds.
Chapter 2. Industry profile 9

Maturity transformation

They offer savers alternate forms of deposits according to their liquidity prefer-
ences, and provide borrowers with loans of requisite maturities.

Importance of Financial Institutions

Financial intermediaries convert the money given by savers to investment by bor-


rowers, such as banks, UTI, NBFIs, etc. Non-intermediaries give loans but do not
collect deposits or funds from savers. Regulators watch the markets, players and
modes of transactions. Regulators design the market system, create and enforce
regulations and rules for the market.

Figure 2.1: Classification of Financial Institutions-An Indian Perspective


Chapter 2. Industry profile 10

Financial intermediaries are a special group of financial institutions that obtain


funds by issuing claims to market participants and use these funds to purchase
financial assets. Intermediaries transform funds they acquire into assets that are
more attractive to the public. By doing so, financial intermediaries do one or more
of the following:

• Provide maturity intermediation

• Provide risk reduction via diversification at lower cost

• Reduce the cost of contracting and information processing

• Provide a payments mechanism.

2.3 Stock Market

A stock market or equity market is a public market (a loose network of economic


transactions, not a physical facility or discrete entity) for the trading of company
stock and derivatives at an agreed price; these are securities listed on a stock
exchange as well as those only traded privately.

The size of the world stock market was estimated at about $36.6 trillion US at
the beginning of October 2008. The total world derivatives market has been
estimated at about $791 trillion face or nominal value,11 times the size of the
entire world economy.The value of the derivatives market, because it is stated in
terms of notional values, cannot be directly compared to a stock or a fixed income
security, which traditionally refers to an actual value. Moreover, the vast majority
of derivatives ’cancel’ each other out (i.e., a derivative ’bet’ on an event occurring
is offset by a comparable derivative ’bet’ on the event not occurring). Many such
relatively illiquid securities are valued as marked to model, rather than an actual
market price.

The stocks are listed and traded on stock exchanges which are entities of a corpo-
ration or mutual organization specialized in the business of bringing buyers and
sellers of the organizations to a listing of stocks and securities together. The largest
stock market in the United States, by market cap is the New York Stock Exchange,
NYSE, while in Canada, it is the Toronto Stock Exchange. Major European ex-
amples of stock exchanges include the London Stock Exchange, Paris Bourse, and
Chapter 2. Industry profile 11

the Deutsche Brse. Asian examples include the Tokyo Stock Exchange, the Hong
Kong Stock Exchange, the Shanghai Stock Exchange, and the Bombay Stock Ex-
change. In Latin America, there are such exchanges as the BM&F Bovespa and
the BMV.

Function and purpose of Stock Market

The stock market is one of the most important sources for companies to raise
money. This allows businesses to be publicly traded, or raise additional capital
for expansion by selling shares of ownership of the company in a public market.
The liquidity that an exchange provides affords investors the ability to quickly and
easily sell securities. This is an attractive feature of investing in stocks, compared
to other less liquid investments such as real estate.

History has shown that the price of shares and other assets is an important part
of the dynamics of economic activity, and can influence or be an indicator of so-
cial mood. An economy where the stock market is on the rise is considered to
be an up-and-coming economy. In fact, the stock market is often considered the
primary indicator of a country’s economic strength and development. Rising share
prices, for instance, tend to be associated with increased business investment and
vice versa. Share prices also affect the wealth of households and their consump-
tion. Therefore, central banks tend to keep an eye on the control and behavior
of the stock market and, in general, on the smooth operation of financial system
functions. Financial stability is the raison d’tre of central banks.

Exchanges also act as the clearinghouse for each transaction, meaning that they
collect and deliver the shares, and guarantee payment to the seller of a security.
This eliminates the risk to an individual buyer or seller that the counterparty
could default on the transaction.

The smooth functioning of all these activities facilitates economic growth in that
lower costs and enterprise risks promote the production of goods and services as
well as employment. In this way the financial system contributes to increased
prosperity. An important aspect of modern financial markets, however, including
the stock markets, is absolute discretion. For example, American stock markets
see more unrestrained acceptance of any firm than in smaller markets. For exam-
ple, Chinese firms that possess little or no perceived value to American society
Chapter 2. Industry profile 12

profit American bankers on Wall Street, as they reap large commissions from the
placement, as well as the Chinese company which yields funds to invest in China.
However, these companies accrue no intrinsic value to the long-term stability of
the American economy, but rather only short-term profits to American business
men and the Chinese; although, when the foreign company has a presence in the
new market, this can benefit the market’s citizens. Conversely, there are very few
large foreign corporations listed on the Toronto Stock Exchange TSX, Canada’s
largest stock exchange. This discretion has insulated Canada to some degree to
worldwide financial conditions. In order for the stock markets to truly facilitate
economic growth via lower costs and better employment, great attention must be
given to the foreign participants being allowed in.

Stock Broking

A stock broker is a professional who buys and sells stocks and other securities
in the stock market through the book makers from the stock investors. As per
the law in United States one needs to pass the General Securities Representative
Examination or the Series 7 exam for working as a stock broker. Brokers provide
different types of services to their clients.

Basic services provided by the stock market brokers are,

Execution only

In this service the broker only carries out the trading according to the direction of
the investor. This is the basic and the most commonly used service of the brokers.

Advisory dealing

In this service the broker not only performs the buying and selling instructions of
the client but also advises the investor about which stock to buy and which stock
to sell.
Chapter 2. Industry profile 13

Discretionary dealing

This is the most comprehensive service that a broker provides. In this case the
broker has the discretionary power to take the investment decisions on behalf of
the investor.

Indian Brokerage Industry

The Indian broking industry is one of the oldest trading industries that have been
around even before the establishment of the BSE in 1875. Despite passing through
a number of changes in the post liberalization period, the industry has found its
way towards sustainable growth.

Figure 2.2: Income of stock market Industry in India

Share trading in India is undergoing a transition and consolidation phase witnessed


never before. The competition is likely to become so severe after the entry of many
players, retaining a customer is most difficult practice for any service provider.

Though India has a very big untapped market but the players will not flourish
unless they change the way the customers are being served. Given the awareness
level of today customers every player has to treat with care and make the customer
feel that he is the king. Number of Online Share trader in India has crossed the
Chapter 2. Industry profile 14

line. More and more customers are coming under this umbrella and many of the
existing one are changing pavilion. So customer retention and satisfaction is now
more important as it was never before. Players keep coming with new schemes
in order to attract new customers and retain the existing one. This is being
supplemented with increased advertising and brand building efforts. Success of
any organization depends upon its being proactive. An often quoted marketing
adage is to manage a business well is to manage its future and to manage its future
is to manage information.

The securities market has essentially three categories of participants, viz., the
issuer of securities, the investors in the securities and the intermediaries. The
issuers are the borrowers or deficit savers, who issue securities to raise funds. The
investors, who are surplus savers, deploy their savings by subscribing to these
securities. The intermediaries are the agents who match the needs of users and
suppliers of funds for a commission. These intermediaries function to help both
the issuers and investors to achieve their respective goals. There are large variety
and number of intermediaries providing various services in the Indian securities
market. Need for a broker

As per SEBI (Securities and Exchange Board of India.) regulations, only registered
members can operate in the stock market. One can trade by executing a deal
only through a registered broker of a recognised Stock Exchange or through a
SEBI- registered sub-broker. The financials and investment industry is a highly
competitive in nature with almost well established firms diversifying and entering
into this industry. As of today there are Over 2000 brokers, 10000 sub brokers and
1 core investors. It is highly Competitive with entry of new aggressive players.
Retail broking is highly fragmented industry with falling brokerages value added
services and online trading, the new fad

Main players in the Indian brokerage industry

• India Infoline

• ICICI Direct

• Angel Broking

• Can Money
Chapter 2. Industry profile 15

• Geojit

• HDFC Securities

• Kotak Securities

• Relaince Money

• Religare

• Share Khan

• Artha Money

• Way to Wealth

• SBI Demat

• Bridge securities Ltd.

• Mothilal Oswal

• Anand Rati

• Citi Bank Demat

• Dautche Bank

• Frankfin

• Karvy securities

• Appolo sindhuri

• Bangalore stock excgange


Chapter 3

Company Profile

Introduction

The India Infoline group, comprising the holding company, india infoline lim-
ited and its wholly-owned subsidiaries, straddle the entire financial services space
with offerings ranging from equity research, equities and derivatives trading, com-
modities trading, portfolio management services, mutual funds, life insurance,
fixed deposits, goi bonds and other small savings instruments to loan products
and investment banking. India Infoline also owns and manages the websites
www.indiainfoline.com and www.5paisa.com the company has a network of over
2100 business locations (branches and sub-brokers) spread across more than 450
cities and towns. the group caters to approximately a million customers.

The India Infoline group were founded in 1995 by Mr. Nirmal Jain (Chairman and
Managing Director) as an independent business research and information provider.
Then gradually evolved into a one-stop financial services solutions provider. The
strong management team comprises competent and dedicated professionals

Now they are a pan-India financial services organization across 1,361 business
locations and a presence in 428 cities.Their global footprint extends across ge-
ographies with offices in New York, Singapore and Dubai. We are listed on the
Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

They now offer a wide range of services and products comprising broking (retail
and institutional equities and commodities), wealth management, credit and fi-
nance, insurance, asset management and investment banking. The India Infoline
16
Chapter 3. Company profile 17

group registered with the BSE and the NSE for securities trading, MCX, NCDEX
and DGCX for commodities trading, CDSL and NSDL as depository participants.
We are registered as a Category I merchant banker and are a SEBI registered
portfolio manager. We also received the FII license in IIFL Inc. IIFL Securities
Pte Ltd received approval from the Monetary Authority of Singapore to carry out
corporate advisory and dealing in securities operations. Two subsidiaries India
Infoline Investment Services and Moneyline Credit Limited are registered with
RBI as non-deposit taking non-banking financial services companies. India info-
line Housing Finance Ltd, the housing finance arm, is registered with the National
Housing Bank.

India Infoline originally incorporated on October 18, 1995 as PROBITY RE-


SEARCH AND SERVICES PVT LTD. at Mumbai under the Companies Act,1956
with Registration No. 1193797.and became a public limited company on April 28,
2000. The name of the Company was changed to India Infoline.com Limited on
May 23, 2000 and later to India Infoline Limited on March 23, 2001. It is the first
Company in India to foray into the online distribution of Mutual Funds

3.1 Milestones

It is a one-stop financial services shop, most respected for quality of its advice,
personalized service and cutting-edge technology. The No.1Corporate agent for
ICICI Prudential Life Insurance Company. Research acknowledged by Forbes
as Must Read for investor in South AsiaListed on Bombay and National Stock
Exchange with a net worth of INR 200 crore and a market cap of over INR 1970
crore.

1995

Incorporated as an equity research and consulting firm with a client base that
included leading FIIs, banks, consulting firms and corporates.
Chapter 3. Company profile 18

1999

Restructured the business model to embrace the internet; launched archives.indiainfoline.com


mobilised capital from reputed private equity investors.

2000

Commenced the distribution of personal financial products; launched online equity


trading; entered life insurance distribution as a corporate agent. Acknowledged
by Forbes as Best of the Web and ...must read for investors.

2004

Acquired commodities broking license; launched Portfolio Management Service.


2005 Listed on the Indian stock markets.

2006

Acquired membership of DGCX; launched investment banking services.

2007

Launched a proprietary trading platform; inducted an institutional equities team;


formed a Singapore subsidiary; raised over USD 300 mn in the group; launched
consumer finance business under the Moneyline brand.

2008

Launched wealth management services under the IIFL Wealth brand; set up India
Infoline Private Equity fund; received the Insurance broking license from IRDA;
received the venture capital license; received inprinciple approval to sponsor a
mutual fund; received Best broker- India award from FinanceAsia; Most Improved
Brokerage- India award from Asiamoney.
Chapter 3. Company profile 19

2009

Received registration for a housing finance company from the National Housing
Bank; received Fastest growing Equity Broking House - Large firms in India by
Dun & Bradstreet.

3.2 Corporate Philosophy

People Organization

It is rightly said about the services sector that our most prized assets go down
the elevator at the end of every day. Being in the services industry, people are
their biggest and most important assets. They believe that people make all the
difference.

Unique Approach of India Infoline Ltd.

India Infoline Ltd. is a one-stop financial centre. They follow a unique approach;
incorporating innovation, finance, growth, thought leadership, partnership and
diversification. This approach is diagramatically represented in Figure 3.1.

Owner Mindset

What distinguishes India Infoline from other organizations is the fact that all em-
ployees are driven by Owner Mindset. This is a privilege as well as a responsibility.
They think and behave like one. While there is no the way of doing things, there
are millions of things which an owner would do differently as compared to a typi-
cal person with an employee mindset. We believe in the Olympic motto and have
made it our principle for the coming year. We have been preparing to move into
a new orbit of growth for several years now. We believe that the real growth has
yet not happened. Each member of Team India Infoline has been putting up an
Olympian fight and is capable, confident, and certain and ready to deliver faster,
higher and stronger performance.
Chapter 3. Company profile 20

Figure 3.1: Unique Approach of India Infoline Ltd

Vision Statement

“Our vision is to be the most respected company in the financial services space”

Mission

“To become a full-fledged financial services company known for its quality of ad-
vice, personalized services and cutting edge technology”
Chapter 3. Company profile 21

3.3 Pillars Of The Organization

Figure 3.2: Organisational structure of India infoline Ltd


Chapter 3. Company profile 22

Mr. Nirmal Jain


Chairman & Managing Director

Nirmal Jain, MBA (IIM, Ahmedabad) and a Chartered and Cost Accountant,
founded Indias leading financial services company India Infoline Ltd. in 1995, pro-
viding globally acclaimed financial services in equities and commodities broking,
life insurance and mutual funds distribution, among others. Mr. Jain began his
career in 1989 with Hindustan Levers commodity export business, contributing
tremendously to its growth. He was also associated with Inquire-Indian Equity
Research, which he co-founded in 1994 to set new standards in equity research in
India.

Mr. R Venkataraman
Executive Director

R Venkataraman, co-promoter and Executive Director of India Infoline Ltd., is a


B. Tech (Electronics and Electrical Communications Engineering, IIT Kharagpur)
and an MBA (IIM Bangalore). He joined the India Infoline board in July 1999.
He previously held senior managerial positions in ICICI Limited, including ICICI
Securities Limited, their investment banking joint venture with J P Morgan of USA
and with BZW and Taib Capital Corporation Limited. He was also Assistant Vice
President with G E Capital Services India Limited in their private equity division,
possessing a varied experience of more than 16 years in the financial services sector.

The Board of Directors

Mr Nilesh Vikamsey
Independent Director

Mr. Vikamsey, Board member since February 2005 - a practising Chartered Ac-
countant and partner (Khimji Kunverji & Co., Chartered Accountants), a member
firm of HLB International, headed the audit department till 1990 and thereafter
also handles financial services, consultancy, investigations, mergers and acqui-
sitions, valuations etc; an ICAI study group member for Proposed Accounting
Standard 30 on Financial Instruments Recognition and Management, Finance
Chapter 3. Company profile 23

Committee of The Chamber of Tax Consultants (CTC), Law Review, Reforms


and Rationalization Committee and Infotainment and Media Committee of Indian
Merchants Chamber (IMC) and Insurance Committee and Legal Affairs Commit-
tee of Bombay Chamber of Commerce and Industry (BCCI). Mr. Vikamsey is
a director of Miloni Consultants Private Limited, HLB Technologies (Mumbai)
Private Limited and Chairman of HLB India.

Mr Sat Pal Khattar


Non Executive Director

Mr Sat Pal Khattar, - Board member since April 2001 - Presidential Council of
Minority Rights member, Chairman of the Board of Trustee of Singapore Business
Federation, is also a life trustee of SINDA, a non profit body, helping the under-
privileged Indians in Singapore. He joined the India Infoline board in April 2001.
Mr Khattar is a Director of public and private companies in Singapore, India and
Hong Kong; Chairman of Guocoland Limited listed in Singapore and its parent
Guoco Group Ltd listed in Hong Kong, a leading property company of Singapore,
China and Malaysia. A Board member of India Infoline Ltd, Gateway Distriparks
Ltd both listed and a number of other companies he is also the Chairman of the
Khattar Holding Group of Companies with investments in Singapore, India, UK
and across the world.

Mr Kranti Sinha
Independent Director

Mr. Kranti Sinha Board member since January 2005 completed his masters from
the Agra University and started his career as a Class I officer with Life Insurance
Corporation of India. He served as the Director and Chief Executive of LIC Hous-
ing Finance Limited from August 1998 to December 2002 and concurrently as the
Managing Director of LICHFL Care Homes (a wholly owned subsidiary of LIC
Housing Finance Limited). He retired from the permanent cadre of the Executive
Director of LIC; served as the Deputy President of the Governing Council of In-
surance Institute of India and as a member of the Governing Council of National
Insurance Academy, Pune apart from various other such bodies. Mr. Sinha is
also on the Board of Directors of Hindustan Motors Limited, Larsen & Toubro
Chapter 3. Company profile 24

Limited, LICHFL Care Homes Limited, Gremach Infrastructure Equipments and


Projects Limited and Cinemax (India) Limited.

Mr Arun K. Purvar
Independent Director

Mr. A.K. Purvar Board member since March 2008 completed his Masters de-
gree in commerce from Allahabad University in 1966 and a diploma in Business
Administration in 1967. Mr. Purwar joined the State Bank of India as a pro-
bationary officer in 1968, where he held several important and critical positions
in retail, corporate and international banking, covering almost the entire range of
commercial banking operations in his illustrious career. He also played a key role
in co-coordinating the work for the Bank’s entry into the field of insurance. After
retiring from the Bank at end May 2006, Mr. Purwar is now working as Member
of Board of Governors of IIM-Lucknow, joined IIMIndore as a visiting professor,
joined as a Hon.-Professor in NMIMS and he is also a member of Advisory Board
for Institute of Indian Economic Studies (IIES), Waseda University, Tokyo, Japan.
He has now taken over as Chairman of IndiaVenture Advisors Pvt. Ltd., as well
as IL & FS Renewable Energy Limited. He is also working as Independent Direc-
tor in leading companies in Telecom, Steel, Textiles, Autoparts, Engineering and
Consultancy.

Committee

Audit Committee

The Audit committee comprises Mr Nilesh Vikamsey, Chairman of the Committee,


Mr Sat Pal Khattar, Mr Sanjiv Ahuja and Mr Kranti Sinha, three of whom are
independent Directors. The Managing Director, the Executive Director along with
the Statutory and Internal Auditors are invitees to the Meeting. The Terms of
reference of this committee are as under: - To investigate into any matter that may
be prescribed under the provisions of Section 292A of The Companies Act, 1956 -
Recommendation and removal of External Auditor and fixation of the Audit Fees.
- Reviewing with the management the financial statements before submission of
the same to the Board. - Overseeing of Companys financial reporting process and
Chapter 3. Company profile 25

disclosure of its financial information. - Reviewing the Adequacy of the Internal


Audit Function.

Compensation/ Remuneration Committee

The Compensation / Remuneration Committee comprises Mr Sanjiv Ahuja, Chair-


man of the Committee, Mr Nilesh Vikamsey and Mr Kranti Sinha, all of whom
are independent Directors. The Terms of reference of this committee are as un-
der: - To fix suitable remuneration package of all the Executive Directors and
Non Executive Directors, Senior Employees and officers i.e. Salary, perquisites,
bonuses, stock options, pensions etc. - Determination of the fixed component and
performance linked incentives alongwith the performance criteria to all employees
of the company - Service Contracts, Notice Period, Severance Fees of Directors
and employees. - Stock Option details: whether to be issued at discount as well
as the period over which to be accrued and over which exercisable. - To conduct
discussions with the HR department and form suitable remuneration policies.

Share Transfer and Investor Grievance Committee

Details of the Members, Compliance Officer, No of Complaints received and pend-


ing and pending transfers as on close of the financial year. The committee func-
tions under the Chairmanship of Mr Kranti Sinha, a Non-executive independent
Director. The other Members of the committee are Mr Sanjiv Ahuja, Indepen-
dent Director and Mr R Venkataraman, Executive Director. Ms Komal Parikh,
Company Secretary is the Compliance Officer of the Company.

3.4 Company Structure

India Infoline Limited is listed on both the leading stock exchanges in India, viz.
the Stock Exchange, Mumbai (BSE) and the National Stock Exchange (NSE)
and is also a member of both the exchanges. It is engaged in the businesses of
Equities broking, Wealth Advisory Services and Portfolio Management Services.
It offers broking services in the Cash and Derivatives segments of the NSE as well
as the Cash segment of the BSE. It is registered with NSDL as well as CDSL as
Chapter 3. Company profile 26

a depository participant, providing a one-stop solution for clients trading in the


equities market. It has recently launched its Investment banking and Institutional
Broking business.

A SEBI authorized Portfolio Manager; it offers Portfolio Management Services to


clients. These services are offered to clients as different schemes, which are based
on differing investment strategies made to reflect the varied risk-return preferences
of clients.

Figure 3.3: Corporate structure of India Infoline Ltd

India Infoline Media and Research Services Limited

The content services represent a strong support that drives the broking, com-
modities, mutual fund and portfolio management services businesses. Revenue
generation is through the sale of content to financial and media houses, Indian
as well as global. It undertakes equities research which is acknowledged by none
other than Forbes as ’Best of the Web’ and ’a must read for investors in Asia’.
India Infoline’s research is available not just over the internet but also on interna-
tional wire services like Bloomberg (Code: IILL), Thomson First Call and Internet
Securities where India Infoline is amongst the most read Indian brokers.
Chapter 3. Company profile 27

India Infoline Commodities Limited

India Infoline Commodities Pvt Limited is engaged in the business of commodi-


ties broking. Our experience in securities broking empowered us with the requisite
skills and technologies to allow us offer commodities broking as a contra-cyclical al-
ternative to equities broking. We enjoy memberships with the MCX and NCDEX,
two leading Indian commodities exchanges, and recently acquired membership of
DGCX. We have a multi-channel delivery model, making it among the select few
to offer online as well as offline trading facilities.

India Infoline Marketing & Services

India Infoline Marketing and Services Limited is the holding company of India
Infoline Insurance Services Limited and India

India Infoline Insurance Services

India Infoline Insurance Services Limited is a registered Corporate Agent with


the Insurance Regulatory and Development Authority (IRDA). It is the largest
Corporate Agent for ICICI Prudential Life Insurance Co Limited, which is India’s
largest private Life Insurance Company. India Infoline was the first corporate
agent to get licensed by IRDA in early 2001.

India Infoline Insurance Brokers Limited

India Infoline Insurance Brokers Limited is a newly formed subsidiary which will
carry out the business of Insurance broking. We have applied to IRDA for the
insurance broking licence and the clearance for the same is awaited. Post the
grant of license, we propose to also commence the general insurance distribution
business.
Chapter 3. Company profile 28

India Infoline Investment Services Limited

Consolidated shareholdings of all the subsidiary companies engaged in loans and


financing activities under one subsidiary. Recently, Orient Global, a Singapore-
based investment institution invested USD 76.7 million for a 22.5% stake in India
Infoline Investment Services. This will help focused expansion and capital raising
in the said subsidiaries for various lending businesses like loans against securities,
SME financing, distribution of retail loan products, consumer finance business
and housing finance business. India Infoline Investment Services Private Limited
consists of the following step-down subsidiaries.

• India Infoline Distribution Company Limited (distribution of retail loan


products)

• Moneyline Credit Limited (consumer finance)

• India Infoline Housing Finance Limited (housing finance)

IIFL (Asia) Pte Limited

IIFL (Asia) Pte Limited is wholly owned subsidiary which has been incorporated
in Singapore to pursue financial sector activities in other Asian markets. Further
to obtaining the necessary regulatory approvals, the company has been initially
capitalized at 1 million Singapore dollars. IIFL (Asia) Pte Limited is wholly owned
subsidiary which has been incorporated in Singapore to pursue financial sector
activities in other Asian markets. Further to obtaining the necessary regulatory
approvals, the company has been initially capitalized at 1 million Singapore dollars.

India Infoline.com Distribution Services Ltd

They have developed a retail distribution infrastructure (Investor Points) to sup-


port our online presence. This network, spread over 60 locations, is engaged in
the distribution of financial products including fixed deposits, GoI Relief bonds,
insurance, mutual funds and IPO’s. These Investor Points help us service our
broking customers also.
Chapter 3. Company profile 29

Money Tree Consultancy Services

(MTCS) Is a group company of India Infoline Ltd., focusing distribution on Home


Loans, Personal Loans, Credit Cards and Non Life Insurance. MTCS extends the
distribution reach of financial services providers by using alternate channels like
the Internet, telephone, wireless, sales force and events.

3.5 Functioning Of Different Departments

India Infoline has a various functional departments like other service and manu-
facturing companies there are some basic and very important departments in this
company also which functions with high degree of accuracy and efficiency. The
main departments are,

• Finance & Operations

• Marketing & Sales

• Human Resource Management (HRM)

• Advisory Departments

• Collection and Verification Department

Finance & Operations

Finance & Operation department is one of the most important departments in


the organization from which overall performance of the company can be measured
and changed. In India Infoline Ltd, this important department is headed by a
dynamic Executive Director (shown in the Figure 3.1) A SEBI authorized Portfolio
Manager; it offers Portfolio Management Services to clients. These services are
offered to clients as different schemes, which are based on differing investment
strategies made to reflect the varied risk-return preferences of clients.

Sourcing of finance:

This has been done by issuing shares to the institutional as well as retail investors.
Chapter 3. Company profile 30

Figure 3.4: Structure of Finance and Operation Department

Tax planning:

Even though tax planning was good by the company experts, the payment of tax
has considerably increased due to increased net profit before tax.

Records

Maintaining all the financial records of the transactions

Reporting to management about financial performance:

Every quarter the financial reports which include mainly Balance Sheet and Profit
& Loss accounts are submitted to top management for various decision making
purpose.

Dividend decision making:

As the financial performance of the company was very good, high amount of
dividend per share was given to the shareholders.
Chapter 3. Company profile 31

Communication with regulatory bodys:

Reporting to SEBI, RBI and other regulatory bodies about the financial condition
of the company. All the financial institutions & NBFCs should report to the
SEBI about the financial condition and performance of the company for various
regulatory compliances.

Maintaining the relationship with all the shareholders.

This is also one of the main functions as keeping all shareholders happy is very
important for long term support in the form of finance and ownership.

Financial results are very good as observed since its inception. This is done through
effective cost cutting measures, good financial planning and budgeting.

Operations:

This is one of the most critical sub-department which decides all policies and
procedures for the company. It also sets the objectives and goals for the company.
It measures the overall performance of the company with the set standards. It
is in this department overall strategic policies are made. It sets the rules and
regulations to control the operations of all the branches all over India.

Marketing Strategy Of India Infoline

India Infoline focus on the consumers who prefer almost all investment activities
at same place by providing number of various financial services. At India Infoline
a person can purchase or sell shares, debentures etc. and at the same place also
demat it. India Infoline also provides other investment option to the same person
at same place like Mutual Fund, Insurance, Fixed Deposit, and Bonds etc. and
help the person in designing his portfolio. By this way India Infoline provides
comfort to its customers.
Chapter 3. Company profile 32

Market Share

From the study of CMIE database it can be seen that second highest market share

Figure 3.5: Perecntage Market share of India infoline Ltd

is carried by India Infoline Ltd. India Infoline uses demographic segmentation


strategy and segment people based on their occupation. India Infoline uses se-
lective specialization strategy for market targeting. Target person for the India
Infoline Stock Broking and India Infoline Investment Service are persons who can
work as sub-broker for the companies. Companies focus on Advisors of Insurance
and post office, Tax consultants and CAs for making sub-broker.

India Infoline uses one level marketing channel for investment product distribution.
Sub-brokers work as intermediary between consumer and company. Company has
both forward and backward flow of activity through channel. Company distributes
stationery, brokerage, and information forward to its sub-broker. The sub-brokers
send filled forms, queries, amount of investment etc. back to the company.

India Infoline provides training to the sub-brokers because they will be viewed as
the company by the investors. The executives of India Infoline explain various
new schemes of investment to the sub-brokers with its objective, risk factors and
expected return. Company also periodically arrange seminar to guide sub-brokers.

The objective of advertising of India Infoline is to create awareness about services


of India Infoline among investors and sub-brokers. India Infoline also publishes its
weekly Stock Market Newsletter Market Mantra.
Chapter 3. Company profile 33

Human Resource Management

HRM is the planning, organizing, directing, and controlling of the procurement,


development, compensation, integration and maintenance of people for the purpose
of contributing to organizational, individual and social goals. This department has
played a vital role directly and indirectly in contributing for the good performance
of the company since its inception. Some of the main functions of this department
which played vital role in India Infoline Ltd are:

• Selecting high quality people with great ability and proper attitude

• Training & development of people in various areas.

• Motivating by announcing various incentives for performance

• Recruiting large number of self-motivated sales people

Advisory Department

Basically India Infoline Ltd have following types of services division. They are:

• Mutual Fund Advisory Services Division.

• Portfolio Management Services (PMS) Division.

• IPO Advisory & Distribution Services Division.

• Insurance Services Division.

• NRI Service Division.

Collection & Verification

This department plays a good role in verifying all the documents of the customers
to avail the products and services in this company. There are many documents
which are franked due to the regulations of SEBI and there are other documents
Chapter 3. Company profile 34

like PAN card, address proof, bank statements etc which should be properly ver-
ified and documented for mistakes and duplicity of the documents. If the docu-
ments are found to be with mistakes they are immediately sent back to sales office
to get all the correct documents from the customers. If the documents are found
to be correct with all respects, the customers are given relevant ID, passwords and
other things which are required to access the products and services of the company
according to the regulations of SEBI.
Chapter 4

Product Profile

4.1 Products & Sevices

India Infoline Ltd. is a one-stop financial services shop, most respected for quality
of its advice, personalised service and cutting-edge technology.They provide a wide
range of financial products and services like equities, Insurances, commodities,
Investments etc. They can be broadly catagorised into,

• EQUITY

• MUTUAL FUND

• INSURANCE

• COMMODITIES

• PMS

• DERIVATIVES

4.2 Equities

India Infoline provided the prospect of researched investing to its clients, which
was hitherto restricted only to the institutions. Research for the retail investor did
not exist prior to India Infoline. India Infoline leveraged technology to bring the

35
Chapter 4. Product Profile 36

convenience of trading to the investors location of preference (residence or office)


through computerized access. India Infoline made it possible for clients to view
transaction costs and ledger updates in real time.

Over the last five years, India Infoline sharpened its competitive edge through the
following initiatives:

Multi-channel delivery model

The Company is among the few financial intermediaries in India to offer a com-
plement of online and offline broking. The Companies network of branches also
allows customers to place orders on phone or visit our branches for trading.

Integrated middle and back office

The customer can trade on the BSE and NSE, in the cash as well as the derivatives
segment all through the available multiple options of Internet, phone or branch
presence.

Multiple-trading options

The Company harnessed technology to offer services at among the lowest rates in
the business.

Membership

The Company widened client reach in trading on the domestic and international
exchanges.

Technology

The Company provides a prudent mix of proprietary and outsourced technologies,


which facilitate business growth without a corresponding increase in costs.
Chapter 4. Product Profile 37

Content

The Company has leveraged its research capability to provide regular updates and
investment picks across the short and long-term.

Service

Clients can access the customer service team through various media like toll-free
lines, emails and Internet- messenger chat for instant query resolution. The Com-
panies customer service executives proactively contact customers to inform them
of key changes and initiatives taken by the Company. Business World rated the
Companies customer service as Best in their survey of online trading sites carried
out in December 2003.

Key features

• Membership on the Bombay Stock Exchange Limited and the National Stock
Exchange

• Registered with the NSDL as well as CDSL as a depository participant,


providing a one-stop solution for clients trading in the equities market

• Broking services in cash and derivative segments, online as well as offline.

• Presence across 350 cities and towns with a network of over 850 business
locations Equity client base of over 500,000 clients

• Provision of free and world-class research to all clients.

4.3 Commodities

India Infolines extension into commodities trading reconciles its strategic intent
to emerge as a one stop solutions financial intermediary. Its experience in secu-
rities broking has empowered it with requisite skills and technologies. Increased
offering: The Companies commodities business provides a contra-cyclical alterna-
tive to equities broking. The Company was among the first to offer the facility of
commodities trading in Indias young commodities market (the MCX commenced
Chapter 4. Product Profile 38

operations only in 2003). Average monthly turnover on the commodity exchanges


increased from Rs 0.34 bn to Rs 20.02 bn. The commodities market has several
products with different and non-correlated cycles. On the whole, the business is
fairly insulated against cyclical gyrations in the business.

India Infoline distinguished its business through the interplay of knowledge and
technology:

Complete solution

The Company provides a complete - advice to execution solution facilitated by


information and advice on likely commodity trends in the Indian and international
environment.

Technology

The Company has extended the trading terminal to the investors home/workplace
reinforced with real-time commodity information and ledger position.

Rates

The Company harnessed technology to offer services at among the lowest rates in
the business. Membership: The Company widened client reach in trading on the
domestic and international exchanges.

Key features

• Enjoys memberships with the MCX and NCDEX, two leading Indian com-
modities exchanges

• Recently acquired membership of the DGCX

• Multi-channel delivery model, making it among the select few to offer online
as well as offline trading facilities

• Extended commodity trading to retail investors, among the few Indian fi-
nancial intermediaries to do so
Chapter 4. Product Profile 39

• Online business at 80

• Provides regular commodity updates pertaining to the Indian and interna-


tional environment

4.4 Insurance

An entry into this segment helped complete the client’s product basket; concur-
rently, it graduated the Company into a one stop retail financial solutions provider.
To ensure maximum reach to customers across India, we have employed a multi
pronged approach and reach out to customers via our Network, Direct and Affiliate
channels. Following the opening of the sector in 1999-2000, a number of private
sector insurance service providers commenced operations aggressively and helped
grow the market.

The Companies entry into the insurance sector derisked the Company from a
predominant dependence on broking and equity-linked revenues. The annuity
based income generated from insurance intermediation result in solid core revenues
across the tenure of the policy.

Over the last five years, India Infoline sharpened its competitive edge in this
business segment through the following initiatives:

Client base

Grew its 40,000 strong client base through knowledge-led analysis, translating into
an attractive opportunity to cross-sell products and generate referral business.

Distribution network

Invested in a distribution network of 177 branches across 19 states, which provided


it with an unmatched reach within its segment.
Chapter 4. Product Profile 40

Hands-on training

Invested aggressively in training its field force more than 100 hours a year in
product attributes across the insurance sector - highlighting various product details
and marketing skills apart from regular meets where best practices are shared.

Technology

The Company provides a prudent mix of proprietary and outsourced technologies,


which facilitate business growth without a corresponding increase in costs.

Research and advice

Provided clients with advice on diverse investment products based on the cus-
tomers existing and prospective financial profile.

Key features

• India Infoline was the first corporate in India to get the agency licence in
early 2001

• The Company is the biggest corporate agency in India for life insurance
products

• The Company operates multiple channels, namely branch network, preferred


client group, direct marketing, corporate tax advisory, walk-ins and semi-
nars, to reach out to customers.

4.5 Portfolio Management

India Iinfolines Portfolio Management Service is a product wherein an equity in-


vestment portfolio is created to suit the investment objectives of a client. We at
India Infoline invest your resources into stocks from different sectors, depending
on your risk-return profile. This service is particularly advisable for investors who
cannot afford to give time or don’t have that expertise for day-to-day management
Chapter 4. Product Profile 41

of their equity portfolio. It is all about your money, being managed by the experts,
while you continue with your routine life. Isn’t it simple and totally hassle free.
What’s more, you can keep track of your dividends / bonus / rights issues with
paperless tracking. So you always know how fast your investment is growing. It
basically means assigning the right job to the right person.

Salient Features of India Infoline PMS

• Expert team of Research Analysts

• Stock Picking done by the Investment Committee

• Dedicated Relationship Manager

• Technology and Service driven Back-Office

4.6 Asset Management

India Infoline is a leading pan-India mutual fund distribution house associated with
leading asset management companies. It operates primarily in the retail segment
leveraging its existing distribution network to reach prospective clients. It has
received the in-principle approval to set up a mutual fund. The group recently
commenced its offshore asset management business under the IIFL Capital brand.
Also, IIFL Securities Pte Ltd received approval from the Monetary Authority of
Singapore to carry out global asset management operations. The Singapore arm
can now offer broking, asset management and investment banking services. IIFL
Inc received an FII license, thereby facilitating the investment of dedicated funds
in India. With offices in New York, Singapore and Dubai, IIFL Capital aims to
offer India-focused equity products, fund management and advisory services for
offshore and domestic wealth management customers.

4.7 Wealth Management

The key to achieving a successful Investment Portfolio is to have a carefully


planned financial strategy based on a thorough understanding of the client’s in-
vestment needs and risk appetite. The IIFL Private Wealth Management Team of
Chapter 4. Product Profile 42

financial experts will recommend an appropriate financial strategy to effectively


meet your investment requirements. Financial Advisor will analyze:

• cash-flow requirements

• Your risk appetite

• Desired investment horizon

• Long-term goals
Chapter 5

Analysis

5.1 SWOT Analysis

Introduction

SWOT Analysis is a strategic planning tool used to evaluate the strengths, weak-
nesses, opportunities, and threats for a business entity. It involves specifying the
objective of the business venture or project and identifying the internal and exter-
nal factors that are favourable and unfavourable to achieving that objective. The
technique is credited to Albert Humphrey, who led a research project at Stanford
University in the 1960s and 1970s using data from fortune 500companies

Strengths: Attributes of the organisation which are helpful to achieving the ob-
jective.

Weaknesses: Attributes of the organisation which are harmful to achieving the


objective.

Opportunities: External conditions which are helpful to achieving the objective.

Threats: External conditions which could damage the businesss performance.

43
Chapter 5. Analysis 44

SWOT Analysis Of India Infoline Ltd

Strengths

• Customization
It understands the dreams, needs, aspirations, concerns and resources are
unique and this is reflected in every move they do for the sake of individual
customer. This is the greatest value it provide online trading products like
Smart Invest and Smart Trade.

• Expertise
India Infoline Ltd brings within the customers reach their institutional ex-
pertise and the ability to effectively combine an invaluable understanding of
the financial markets, with an intention of building a long-term partnership.

• One-stop-shop for all the investment needs


India Infoline Ltd gives all the types of services and products an individual
investor can dream and think off. All the financial products and services are
under one-roof.

• Unbiased and objective advice


The teams of expert investment advisors customize plans to suit the needs
of investors.

• Extensive research
India Infoline Ltd make sure that they are always accessible to customers
through a host of mediums. A customer can contact them either through
website or through their branches and channel partners of more than 300
offices across India.
Chapter 5. Analysis 45

• Brand image
India Infoline Ltd as such is a well known brand in industry.

• Competitive pricing
It charges less brokerage compared to its competitors.

Weaknesses

• Expensive products
Some of the products like SmartTrade are quite expensive. An annual charge
for SmartTrade is Rs. 3000.

• Tedious procedures
Tedious procedures and delays in processing the data and documents of new
customers.

• Fund transfer
It has tie-ups with only 5 banks for online fund transfer, where as other
competitors have more tie-ups.

• Attrition
High attrition rates in trainees category.

• Unattractive offers
Some offers of the company like Advance Subscription Plan with a deposit
of Rs.50,000 to avail low brokerage charges. The low brokerage charges will
be effective for the clients for a minimum turnover of Rs. 50 Crore p.a.
Chapter 5. Analysis 46

Opportunities

• Indian economy seems to be out of recession. This is the right time for
inventers to re-enter the market. The company should adopt some strategies
to increase the business through existing clients.

• The increasing number of management graduates helps to get sales force at


trainee levels at less salaries or commission basis. It reduces the salaries
and commissions expenses of the company. The company can tie up with
reputed B Schools for trainees.

• Huge untapped market in rural areas, Tier2 and Tier 3 cities and towns of
India can be concentrated to increase the business.

• Many a banks are offering fund transfer services. The company can increase
the tie-ups for fund transfers at attract customers of different banks.

Threats

• Stiff competition from existing players in the market and there is also a
threat of new entrants. It has lead to cut throat competition in terms of
brokerage charges and exposure.

• Increasing awareness of mutual funds and ULIPs created by Domestic Insti-


tutional Investors has reduced the direct investment in to stock market to
some extent. This automatically reduces the business of stock brokers.

• Changing economic scenario in India and changes in government policies will


have great impact on the revenue of this company

• Many a investors burnt their figures during the bearish market conditions.
It has turned many a trading accounts inoperative.
Chapter 6

Findings, Suggestions &


Conclusion

6.1 Findings

1. India Infoline Ltd understands the dreams, needs, aspirations, concerns and
resources are unique and this is reflected in every move they do for the sake
of individual customer. This is the greatest value it provide online trading
products like Smart Invest and Smart Trade

2. India Infoline Ltd brings within the customers reach their institutional ex-
pertise and the ability to effectively combine an invaluable understanding of
the financial markets, with an intention of building a long-term partnership

3. India Infoline Ltd gives all the types of services and products an individual
investor can dream and think off. All the financial products and services are
under one-roof.

4. It charges less brokerage compared to its competitors.

5. Some of the products like SmartTrade are quite expensive. An annual charge
for SmartTrade is Rs. 3000.

6. Tedious procedures and delays in processing the data and documents of new
customers.

7. Due to the presence of top players in the capital market, the revenues of the
company declines from financial year 2008-09 to 2009.
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Chapter 6. Findings, Suggestions & Conclusion 48

8. According to the company research report 2008-It is clear that people are
ready to bear medium risk in anticipation of average returns.

9. Most investors prefer short term investments they regularly prefer to change
their investment patterns according to the changes and updations.

10. Investors study the past performance carefully before they invest into any of
the investments.

6.2 Suggestions

1. Indian economy seems to be out of recession. This is the right time for
inventers to re-enter the market. The company should adopt some strategies
to increase the business through existing clients

2. Many a banks are offering fund transfer services. The company can increase
the tie-ups for fund transfers at attract customers of different banks

3. India Infoline Ltd Investsmart can tie up with retail malls and take franchisee
of the company in their malls.

4. Company should create the awareness about investment in securities among


the investors. They should visit the general public, businessmen, government
offices and other work places and guide them about the stock market. This
will help the company to large customer base.

5. The company can conduct seminars, workshops on capital markets, so that


customers will come to know about the risk and return involved in investing
equity market.

6. The company has to provide proper training to new investors to avoid losses.

7. Even the investors should take initiative and form as forums to develop
their knowledge towards investments as now days there are several types of
financial products available for the profitability of the investors.
Chapter 6. Findings, Suggestions & Conclusion 49

6.3 Conclusion

Most of the financial products in India are still at a growth stage and hence there
are ample of opportunities for all the financial services offered companies to tap
investments. The perception of investors is yet to be changed because still they feel
comfortable in traditional style of investment i.e., investing in Mutual funds rather
than investing in Derivatives or Equity. Hence, there is a lot amount of education
has to be provided to make people aware of various investment opportunities. In
a growing economy as ours every investor if wisely takes decision to invest can
expect a lot of returns. But knowledge of investing in Stock market is only limited
to young urban population and does not have enough penetration in tier 2 and tier
3 cities and almost nil in rural areas. To excel and achieve a sustainable growth
under current market situation with lots of completion in financial sector, India
Infoline Ltd Investsmart needs to endeavor with maximum efforts. The company
can achieve several more major milestones in future by maintaining the existing
customer relationship [CRM]. Overall, India Infoline Ltd is able to give more than
satisfactory services to its customers all over India. With state of art infrastructure
and well established network of branches all over India will no doubt will make
it to climb the ladder of leadership in the brokerage industry and truly become
Indias financial multiplex. The companys claim of being Indias financial multiplex
is very true as it continues to provide high quality financial products and services
to lacks of customers by understanding their investment needs individually and
satisfying them with all the financial products and services they can imagine.
Bibliography

Books

• Kotler Philip, Marketing Management: 13th Edition, 2006, Prentice Hall of


India Ltd., New Delhi.

• Krishna Swamy O.R, 2003, Methodology of Research in Social Science, Hi-


malaya publishing House, Bombay ,ISBN: 81-8318-740-4

Websites

• www.indiainfoline.com

• www.5paisa.com

• www.scribd.com

• www.sharekhan.com

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