Introduction:

Company Profile
Reliance Capital is part of the Reliance Group and is one
of India's leading and amongst most valuable financial
services companies in the private sector. Reliance
Capital Limited (RCL) was incorporated in year 1986 at
Ahmedabad in Gujarat as Reliance Capital & Finance
Trust Limited. The name RCL came into effect from
January 5, 1995. In 2002, RCL shifted its registered
office to Jamnagar in Gujarat before it finally moved to
Mumbai in Maharashtra, in 2006.
RCL entered the Capital Market with a maiden public
issue in 1990 and in subsequent years further tapped
the capital market through rights issue and public
issues. The equity shares were initially listed on the
Ahmedabad Stock Exchange and The Stock Exchange
Mumbai Presently the shares are listed on The Stock
Exchange Mumbai and the National Stock Exchange of
India. In 2006, Reliance Capital Ventures Limited
merged with RCL and with this merger the shareholder
base of RCL rose from 0.15 million shareholders to 1.3
million.

Business of the company:

RCL in the initial years engaged itself in steady annuity
yielding businesses such as leasing, bill discounting,
and intercorporate deposits. Later, in 1993 diversified
its business in the areas of portfolio investment,
lending against securities, custodial services, money

market operations, project finance advisory services,

and investment banking.
Presently it is engaged in businesses like asset
management, mutual funds, life and general insurance,
private equity and proprietary investments, stock
broking, depository services, distribution of financial
products, consumer finance and other activities in the
financial services space. It has one of the largest
distribution channels with 9,700 outlets across 4,300
cities and towns.

Reliance Mutual Fund

RMF is India largest Mutual Fund, with Average Assets
Under Management (AAUM) of Rs 1,01,259 crore (US$
23 billion) for the quarter ended June 30, 2011.RMF
offers a wellrounded portfolio of products that meet
varying investor requirements. Reliance Mutual Fund
constantly endeavors to launch innovative products and
customer service initiatives to increase value to
investors.RMF has over seven million investor folios and
a wide distribution network with presence in over 265
branches across India. In addition it has offices in Dubai,
Singapore, Mauritius and UK.

Reliance Life Insurance Company

Limited
(RLIC) is amongst the leading private sector life
insurers with a private sector market share of over 5%
in terms of new business premium. RLIC has a strong
distribution network of 1,252 offices across India, with
over 1, 77,000 agents at the end of June 30, 2011.RLIC
offers wide range of innovative life insurance products,
2

targeted at individuals and groups. It offers need based

products that caters to three distinct segments namely
protection, retirement and investment plans. RLIC is
committed to emerge as a leading Life Insurer with
global scale and standards.

Reliance Commercial Finance

It aims to enable people fulfill all their ambitions by
creating assets for personal & business requirements. It
offers an exhaustive suite of financial solutions
Mortgages Loans, Loans against property, Loans for
Commercial Vehicles, Loans for Construction
Equipment, SME Loans, Auto Loans, business loans,
Loans against Securities and Infrastructure Financing
Reliance Commercial Finance has a loan book size of
Rs. 13,030 crore (US$ 2.9 billion), with a customer base
of over 1, 05,000 customers, as on June 30, 2011,
across the top 18 Indian metros. It prides itself in
creating customized financial solutions for its partners
and customers by offering great Turnaround Time.

Reliance Securities
The broking arm of Reliance Capital is the one of the
India leading retail broking houses in India, providing
customers with access to equities, equity options and
commodities futures, wealth management, wealth
management services, mutual funds, IPOs and
investment banking. Reliance Securities has more than
6.5 lakh retail broking accounts through its pan India
presence with over 6,600 outlets.

Reliance Money
3

The third party distribution business of Reliance Capital,

branded as Reliance Money is a comprehensive
financial services and solutions provider, providing
customers with access to life and general Insurance
products, money transfer, currency exchange, loans
and gold coins. Reliance General Insurance (RGI) offers
a range of products for the corporate and individual
customers. RGI currently offers insurance products
including Health, Home, Motor, Travel, Fire,
Engineering, Marine, Liability and Aviation.
RGI is amongst the leading general insurance
companies in India, with a private sector market share
of 9.4%.

Other business of the company:

Reliance Spot Exchange
RSX is a new initiative of Reliance Capital in the
exchange space by setting up modern exchanges, in
various segments.RSX aims to bring different markets
together on a national electronic platform thereby
creating transparency, efficiency and infrastructure for
spot markets across India.

Quant Capital
Focuses on the wholesale client segment of the capital
markets which includes foreign and domestic
institutions, corporations and ultra high net worth
individuals. Quant Capital has built and implemented
state of the art trading, risk and operational platforms.
The firm employs over 200 professionals with diverse
skills sets and has expanded its research and
quantitative teams to ensure complete sector coverage
across Indian equities.
4

Reliance Equity Advisors

Wholly owned by Reliance Capital Limited is the
Investment Manager of the Reliance Alternative
Investments Fund Private Equity Scheme I (a private
equity fund). The objective of the fund is to raise third
party funds and make portfolio investments.
The fund was launched with the aim of making
investments into sunrise industries in India, offering an
opportunity to participate in the growth of one of the
world's fastest growing economies. Reliance Equity
Advisors will focus on a range of investment
opportunities across growth and consolidation capital,
minority investment, buyin / buyout and acquisition
financing in India.

Reliance Asset Reconstruction

Company
RARC is a premier asset reconstruction company, the
principal sponsor / shareholder of which is the Reliance
Group (through Reliance Capital Limited). The other
sponsors / shareholders are Corporation Bank, Indian
Bank, GIC of India, Dacecroft and Blue Ridge. RARC is s
in the business of acquisition, management and
resolution of distressed debt/assets, formally
commenced business operations in 2009.RARC has an
asset base of over Rs 164 crore (US$ 37 million)

Reliance Venture Asset

Management
Wholly owned subsidiary of Reliance Capital, is the
venture capital arm of the Reliance Group with an
investment mandate to incubate or invest into high
5

growth, new business ideas and is stage, sector and

geography agnostic.
Ranked 30th in the reputed list of USbased, Red
Herring Top 100 Global Venture Capital firms in 2009
out of 1,800 global VC firms, from 32 countries, and
across 12 benchmarks, Reliance Venture is the only
Indian Corporate Venture Capital firm to feature in the
ranking.

International Business:
Reliance Capital Limited intends to be a wellrespected
global player in the international financial services
sector. It is present in Singapore, Malaysia, United
Kingdom and United Arab Emirates.

Achievements:

Reliance Mutual Fund was awarded Fund House of

the Year in equity category by ICRA Online.

Reliance Capital Asset Management received Social

& Corporate Governance Award 2007 by Bombay
Stock Exchange and Nasscom.

Reliance Money was ranked no.1 broking house by

Starcom one of the largest media communication
agencies in the world.

2010 Reliance Money launched new gold coins

with India Post logo

2011 Reliance Commercial Finance launches loan

against Gold Units. Reliance launched Gold Savings
Fund

2012 Reliance Capital arm launched daily gold

accumulation plan

Our Strength
1. CNC Cash & Carry
A trading strategy in which an investor holds a long
position in a security or commodity while
simultaneously holding a short position in a futures
contract on the same security or commodity. In a cashand-carry trade, the security is held until the contract
delivery date, and is used to cover the short positions
obligation.
2. NRML Normal ( Stock Purchase )

NRML stands for Normal. These are delivery buy

transactions in which pre- specified margin
(ranging 20% to 60%) is blocked by Reliance
Securities during trading hours.
Pre-specified margin can be in the form of free
cash in ledger + Post hair cut value of Reliance
Securities Specified Demat holdings + same days
sale proceeds.
Client has to pay the balance within T+2 day but
not later than T+6 day.
If debits are not cleared by T+6 day, RSL will
liquidate the positions anytime on or after T+7
day.
7

 NRML position can be converted to other product

(CNC / MIS) during market hours subject to
availability of required margin.
3. MIS Marginal Intraday / Square off
MIS trading is leveraged intraday trading in
cash and derivative segments.
Clients can buy and sell Reliance Securities
specified stocks only during the day. It only
blocks a pre-specified percentage (ranging from
12% to 40%) as margin.
Pre-specified margin can be in the form of free
cash in ledger + Post hair cut value of RSL
Specified Demat holdings + same days sale
proceeds.
You need to square off the Margin Intraday
Positions (MIS) during the day before 3.20 p.m.
In case you fail to square off the position (Cash
market and F & O) then on a best effort basis,
Reliance Securities Limited (RSL) may squareoff all the open positions under MIS. However, If
the Open positions under MIS are not squared
off during the day for any reasons and are
carried over for the next trading day, then
those trades shall be treated as NRML/ CNC
trade as the case may be and you shall be
responsible and liable for the trading
obligations as any other normal trade and shall
pay the requisite margin or the purchase
consideration as the case may be. You shall
ensure and take all steps to monitor such

trades and comply with its obligations for such

trades.
MIS position can be converted to other product
(CNC / NRML) during market hours subject to
availability of required margin
4. CO Cover Order
Max Multiplier is another variant of current
Margin intraday square-off (MIS) product. This is
also known as Cover order (CO).
This cover order allows you to take leverage as
per your risk appetite along with the power to
limit your downside.
One can take an intra-day position with such
orders which blocks lesser margin than MIS
product.
It is a two leg order where you place 1st leg
buy/sell order along with 2nd leg corresponding
stop loss order.
If 2nd leg is neither executed (i.e. trigger price
not reached) nor exited by you till 3:10 PM then
such open positions (Cash market and F & O)
will be squared off on a best effort basis by
Reliance Securities Limited (RSL).
Trigger Price: A range will be specified on the
screen within which you can input your trigger
price. For example if scrip is trading at Rs. 100
& range is specified as 3%, i.e. client can
specify any price between 97 to 100 as trigger
price.
5. After Market Orders
9

 Trading after market hours

After Market Order allows you to place an order for
a stock beyond market hours.
For example, let us suppose that after the close of
regular trading hours, there is news announced
about a company which induces people to invest in
the company. You wish to be amongst the first to
invest and not lose out on this opportunity. In such
a case, you can immediately place an AMO order
for the following trading day
Time Between 6:30pm 8:00am

Our Platform
1. Insta Plus
Insta Plus is the advanced online trading platform
that provides best-in- class internet trading
features and delivers a seamless and rich online
trading experience to retail investors.
Integrated market watch for Equities and
Derivatives
Live Streaming Quotes
Real-time news and market coverage
Know your margins before order entry
10

 Multiple payment gateways

Integrated research with fundamental and
technical analysis
Seamless investments in Mutual funds, IPOs,
Bonds, etc.
2. RMobile Xpress
Now you can trade on the go with the Reliance
Mobile Trading App available for your android
phone.
This app is free and can help you trade anywhere.
This app can help you
Place market orders from anywhere
Trade in stocks, derivatives & currencies
Get stock quotes & streaming Market Watch
Track live market movements by Intraday charts
View your order status & days position real-time.
View balances & holdings
3. Insta Xpress
Insta Xpress provides superfast trading experience
in equity and derivatives.
Multiple and customizable market watch
Streaming quotes
Low risk strategies
Dynamic charts and indicators
Online fund transfer and withdrawal facilities
News and price analytics tool
Get access to historical trade data
4. Branch Dealing Desk
Clients can get assistance with market information
and interpretation of market movements and
11

empowered to capitalize on the opportunity offered

by the fast moving Indian stock markets.
They can get in touch with your Relationship
Manager for all your trading related activities now.
5. Call and Trade
Our operational timing : 8.30 am to 4.30 pm,
Monday to Friday.
Call us on :
022 39886000 | 022 25816000
Partner Desk : 022 39896789
*At the time of contacting us, please keep your
account details ready for our customer service
executive to assist you promptly.

Brokerage Structure
1. Brokerage
It is one of the Best in the Industry
You can choose your Brokerage based on the Plans
we provide
2. Default Brokerage Slub

Delivery .5%
Intraday .05%
Futures .05%
Options 75/-

12

History of Stock Market

Market oriented economic reforms in India began in

1991. With the removal of administrative control on
bank credit and primary market for securities, the
capital market came to occupy a larger role in shaping
resource allocation in the country. This led to a
heightened interest amongst policy makers in the
institutional development of securities market. The
efforts towards empowering the securities markets
regulator (SEBI) and the first efforts toward attracting
foreign portfolio investment early began in reforms
process. Almost immediately after the reforms began,
there was a prominent scandal on fixed income and
equity markets, which was exposed in April 1992. This
set the stage for unusual policy intervention: the
establishment of a securities exchange, the National
Stock Exchange (NSE), by the government.
From 1996 onwards, debates about policy issues on the
equity markets were dominated by questions about the
role of leveraged trading. There was a proposal to have
13

a spot market based on Rolling Statement (where

leverage is limited to intraday position only).
In 2001, a major crisis broke on the equity market. It
involved numerous elements: large leverage position
which went wrong, accusation of market manipulation,
a payment crisis at Calcutta exchange, fraud in the
banking system, ethics violation at the Bombay stock
exchange. This crisis was valuable in breaking deadlock
and moving on with reforms. In June 2001, trading in
index option commenced and within a matter of weeks,
liquidity improved sharply. Over the 1990s, the Equity
markets became a nationwide platform with real time
capability for trading and settling stock transaction.
However comparable improvement in the infrastructure
for of both exchange institution and SEBI is highly
limited.

Feature of the Stock Exchange

It is a place where listed securities are bought and
sold.
It is an association of persons known as members.
Trading in securities is allowed under rules and
regulation of stock exchange.
Membership is must for transacting business.
Inventors and speculators who want to buy and sell
securities, can do so through member of stock
exchange i.e. brokers.
There are mainly three participants in stock
exchange i.e.
Issuer of security (Company)
Investors of security (Individual, HUF)

14

 Intermediaries and products (Broker, Merchant

Bankers and Shares, Bonds, Warrants, Derivatives
products etc.)

Role Of Stock Exchange

1. Raising Capital For Businesses
The Stock Exchange provide companies with the
facility to raise capital for expansion through
selling shares to the investing public.
2. Mobilizing Savings For Investment
When people draw their savings and invest in
shares, it leads to a more rational allocation of
resources because funds, which could have been
consumed, or kept in idle deposits with banks, are
mobilized and redirected to promote business
activity with benefits for several economic sectors
such as agriculture, commerce and industry,
resulting in stronger economic growth and higher
productivity levels of firms.
3. Facilitating Company Growth
Companies view acquisitions as an opportunity to
expand product lines, increase distribution
channels, hedge against volatility, increase its
market share, or acquire other necessary business
assets. A takeover bid or a merger agreement
15

through the stock market is one of the simplest

and most common ways for a company to grow by
acquisition or fusion
4. Profit Sharing
Both casual and professional stock investors,
through dividends and stock price increases that
may result in capital gains, will share in the wealth
of profitable businesses
5. Government capital-raising for development
projects
Governments at various levels may decide to
borrow money in order to finance infrastructure
projects such as sewage and water treatment
works or housing estates by selling another
category of securities known as bonds. These
bonds can be raised through the Stock Exchange
whereby members of the public buy them, thus
loaning money to the government.

The National Stock Exchange (NSE) located in Bombay,

in Indias first debt market. It was set up in 1993 to
encourage stock exchange uniform through system
16

modernization and competition ii opened for trading in

mid-1994.It was recently accorded recognition as stock
exchange by the department of company affairs. The
instruments traded are Treasury bill, government
securities and bonds issued by public sector companies .
The National Stock Exchange (NSE) is India's leading
stock exchange covering various cities and towns
across the country. NSE was set up by leading
institutions to provide a modern, fully automated
screen-based trading system with national reach. The
Exchange has brought about unparalleled
transparency, speed & efficiency, safety and market
integrity.
It has set up It has set up facilities that serve as a
model for the securities industry in terms of systems,
practices and procedures.
NSE has played a catalytic role in reforming the Indian
securities market in terms of microstructure, market
practices and trading volumes. The market today uses
state-of-art information technology to provide an
efficient and transparent trading, clearing and
settlement mechanism, and has witnessed several
innovations in products & services viz. demutualization
of stock exchange governance, screen based trading,
compression of settlement cycles, dematerialization
and electronic transfer of securities, securities lending
and borrowing, professionalization of trading members,
fine-tuned risk management systems, emergence of
clearing corporations to assume counterparty risks,
market of debt and derivative instruments and
intensive use of information technology.
17

Bombay Stock Exchange Limited is the oldest stock

exchange in Asia with a rich heritage popularly known
as BSE. It was established as The Native Shares &
Stock Brokers Association in 1875. It is the first stock
exchange in the country to obtain permanent
recognition in1956. From the Government of India
under the securities contracts (regulation) act 1956.The
exchanges pivotal and pre-eminent role in the
development of the capital market is widely recognized
and its index, Sensex is tracked worldwide. The
Exchange has a nationwide reach with reach in
presence in 417 cities and town of India. The system
and process of the Exchange are designed to safeguard
market integrity and enhance transparency in
operations. During the year 2004-05 the trading
volumes on the exchange showed robust growth.
More than 5000companies are listed on BSE making it
world's No. 1 exchange in terms of listed members. The
companies listed on BSE Ltd command a total market
capitalization of USD 1.32 Trillion as of January 2013. It
18

is also one of the worlds leading exchanges (3rd

largest in December 2012) for Index options trading
(Source: World Federation of Exchanges).
BSE also provides a host of other services to capital
market participants including risk management,
clearing, settlement, market data services and
education. It has a global reach with customers around
the world and a nation-wide presence. BSE systems and
processes are designed to safeguard market integrity,
drive the growth of the Indian capital market and
stimulate innovation and competition across all market
segments. BSE is the first exchange in India and second
in the world to obtain an ISO 9001:2000 certifications. It
is also the first Exchange in the country and second in
the world to receive Information Security Management
System Standard BS 7799-2-2002 certification for its
On-Line trading System (BOLT).
It operates one of the most respected capital market
educational institutes in the country (the BSE Institute
Ltd.). BSE also provides depository services through its
Central Depository Services Ltd. (CDSL) arm. BSEs
popular equity index - the S&P BSE SENSEX - is India's
most widely tracked stock market benchmark index. It
is traded internationally on the EUREX as well as
leading exchanges of the BRCS nations (Brazil, Russia,
China and South Africa).

Sensex

19

S&P BSE SENSEX, first compiled in 1986, was calculated

on a 'Market Capitalization-Weighted' methodology of
30 component stocks representing large, wellestablished and financially sound companies across key
sectors. The base year of S&P BSE SENSEX was taken
as 1978-79. S&P BSE SENSEX today is widely reported
in both domestic and international markets through
print as well as electronic media. It is scientifically
designed and is based on globally accepted
construction and review methodology. Since September
1, 2003, S&P BSE SENSEX is being calculated on a freefloat market capitalization methodology. The 'free-float
market capitalization-weighted' methodology is a
widely followed index construction methodology on
which majority of global equity indices are based; all
major index providers like MSCI, FTSE, STOXX, and Dow
Jones use the free-float methodology.

The growth of the equity market in India has been

phenomenal in the present decade. Right from early
nineties, the stock market witnessed heightened
activity in terms of various bull and bear runs. In the
late nineties, the Indian market witnessed a huge
frenzy in the 'TMT' sectors. More recently, real estate
caught the fancy of the investors. S&P BSE SENSEX has
captured all these happenings in the most judicious
manner. One can identify the booms and busts of the
Indian equity market through S&P BSE SENSEX. As the
oldest index in the country, it provides the time series
data over a fairly long period of time (from 1979
onwards). Small wonder, the S&P BSE SENSEX has
become one of the most prominent brands in the
country.

20

Sensex 30

Sr.No

Security Name

Weightag
e
6.86%

1. Reliance
2. ONGC

5.81%

3.

HDFC Bank

5.62%

4.

Coal India

5.59%

5.

ITC

5.37%

6.

Infosys

4.90%

7.

Sun Pharma

4.40%

8.

SBI

4.31%

9.

HDFC

4.31%

10.

HUL

4.03%

11.

ICICI Bank

3.88%

12.

Bharti Airtel

3.66%

13.

Larsen

3.50%

14.

Tata Motors

3.15%

15.

Wipro

2.93%

16.

Axis Bank

2.89%

17.

Maruti Suzuki

2.59%

18.

NTPC

2.44%

19.

M&M

1.76%
21

20.

Lupin

1.70%

21.

Bajaj Auto

1.49%

22.

BHEL

1.27%

23.

Dr Reddys Labs

1.25%

24.

Vedanta

1.11%

25.

GAIL

1.09%

26.

Cipla

1.08%

27.

Hero Motocorp

1.07%

28.

Tata Steel

0.65%

29.

Hindalco

0.54%
0.54

30.

NMDC Ltd

Nifty
Nifty is a well diversified 50 stock index accounting for
21 sectors of the economy. It is used for a variety of
purposes such as benchmarking fund portfolios, index
based derivatives and index funds. 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 India's first specialised company
focused upon the index as a core product. IISL has a
Marketing and licensing agreement with Standard &
Poor's (S&P), who are world leaders in index services.
22

The traded value for the last six months of all Nifty
stocks is approximately 44.89% of the traded value of
all stocks on the NSE Nifty stocks represent about
58.64% of the total market capitalization as on March
31, 2008. Impact cost of the S&P CNX Nifty for a
portfolio size of Rs.2 crore is 0.15% S&P CNX Nifty is
professionally maintained and is ideal for derivatives
trading .

Constituents Of Nifty 50
Sr.No.

1.
2.
3.
4.
5.
6.
7.
8.
9.

Security Name

10.

Tata Consultancy Services Ltd

Reliance Industries Ltd
HDFC Bank Ltd
Infosys Ltd
ITC Ltd
Coal India Ltd
Oil & Natural Gas Corpn Ltd
Sun Pharmaceuticals Industries Ltd
Housing Development Finance
Corporation Ltd
State Bank of India

11.
12.
13.
14.
15.

Hindustan Unilever Ltd

ICICI Bank Ltd
Larsen & Toubro Ltd
Bharti Airtel Ltd
Wipro Ltd
23

Weightag
e
7.37
4.27
3.87
3.68
3.56
3.33
3.23
3.02
2.86
2.84
2.63
2.45
2.34
2.20
1.98

16.
17.
18.
19.
20.

Maruti Suzuki India Ltd

HCL Technologies Ltd
Axis Bank Ltd
Kotak Mahindra Bank Ltd
Tata Motors Ltd

1.93
1.91
1.89
1.89
1.83

21.
22.
23.
24.
25.
26.
27.
28.

NTPC Ltd
Indian Oil Corporation Ltd
Asian Paints Ltd
Mahindra & Mahindra Ltd
UltraTech Cement Ltd
Lupin Ltd
Bosch Ltd
Adani Ports & Special Economic Zone
Ltd

1.61
1.32
1.20
1.19
1.19
1.13
1.11
1.05

29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.
42.
43.
44.
45.
46.
47.

Bajaj Auto Ltd

Dr Reddys Laboratories Ltd
Power Grid Corporation of India Ltd
Bharat Heavy Electricals Ltd
Bharat Petroleum Corporation Ltd
Hindustan Zinc Ltd
Nestle India Ltd
Cipla Ltd
Idea Cellular Ltd
IndusInd Bank Ltd
Eicher Motors Ltd
Hero MotoCorp Ltd
Tech Mahindra Ltd
Dabur India Ltd
Siemens Ltd
United Spirits Ltd
Aurobindo Pharma Ltd
Godrej Consumer Products Ltd
GAIL (India) Ltd

1.03
1.01
1.01
0.89
0.88
0.86
0.85
0.83
0.81
0.79
0.78
0.76
0.75
0.72
0.72
0.71
0.62
0.61
0.60

24

48.
49.
50.

Bank of Baroda
Zee Entertainment Enterprises Ltd
NMDC Ltd

0.57
0.56
0.54

Financial Market
A market is a place where buyers and sellers come
together to execute trades and satisfy their needs. In
simple terms "a financial market is a market where
financial instruments are bought and sold
The financial instruments can be in the form of cash or
other assets that represent a form of cash. For e.g.,
fixed deposits, shares, bonds, etc.
These markets are further categorized into:

Primary Market
The primary market is also known as new issues
market . Here, the transaction is conducted between
the issuer and the buyer. In short, the primary market
creates new securities and offers them to the public.
For instance, Initial Public Offering (IPO) is an offering of
the primary market where a private company decides
to sell stocks to the public for the first time. An
important point to remember here is that in the primary

25

market, securities are directly purchased from the

issuer.
Equity can be raised in primary market by any of the
following four ways
1. Public Issue
2. Rights Issue
3. Private Placement
4. Preferential Allotment

Secondary Market
In secondary market, the securities issued in the
primary market are bought and sold. Here, you can buy
a share directly from a seller and the stock exchange or
broker acts as an intermediary between two parties.
The secondary market is actually formed by another
layer of investors who deal with primary market
investor to buy and sell financial securities such as
bonds, futures and stocks. These dealings happen in
the proverbial stock exchange.
National Stock Exchange (NSE) and New York Stock
Exchange (NYSE) are some popular stock exchanges.
Majorly, the trade happens between investors without
any involvement with the company that issued the
securities in the primary market.
26

The secondary market is further divided into two kinds

of market
1. Auction Market
2. Dealer Market

Types of Share
1. Preference Share
Those shares which carry certain special or priority
rights Firstly, dividend at a fixed rate is payable on
these shares before any dividend is paid on equity
shares.
Secondly, at the time of winding up of the company,
capital is repaid to preference shareholders prior to the
return of equity capital. Preference shares do not carry
voting rights. However, holders of preference shares
may claim voting rights if the dividends are not paid for
two years or more on cumulative preference shares and
three years or more on non-cumulative preference
shares.
Preference shares have the characteristics of both
equity shares and debentures. Like equity shares,
dividend on preference shares is payable only when
27

there are profits and at the discretion of the Board of

Directors.
Preference shares are similar to debentures in the
sense that the rate of dividend is fixed and preference
shareholders do not generally enjoy voting rights.
Therefore, preference shares are a hybrid form of
financing.
1. Equity Share
Equity shares were earlier known as ordinary shares.
The holders of these shares are the real owners of
the company. They have a voting right in the
meetings of holders of the company. They have a
control over the working of the company. Equity
shareholders are paid dividend after paying it to the
preference shareholders.
The rate of dividend on these shares depends upon the
profits of the company. They may be paid a higher rate
of dividend or they may not get anything. These
shareholders take more risk as compared to preference
shareholders.
Equity capital is paid after meeting all other claims
including that of preference shareholders. They take
28

risk both regarding dividend and return of capital.

Equity share capital cannot be redeemed during the life
time of the company.

1.

The Bull

A bull market is a term often used to refer to a

positive stock market trend, but it could mean the
status of the economy in general. This trend is
characterized when everything in the economy is
great, lots of jobs available, gross domestic product
(GDP) is growing and investor confidence in the stock
market is up. In a bull market, there is an overall
increase in investing in anticipation of the increase in
the prices of stocks.
A bull is also frequently used to describe the
optimistic attitude of an investor towards stocks. An
investor is said to have a bullish outlook in this
case.

2.

The Bears

A bear market is the opposite of a bull. Economy is

bad, unemployment is up, recession is looming and
29

stock prices are going down. Investing is at a low in a

bear market since it is tough to select profitable
stocks.
This market trend doesnt stop investors from making
money. One technique to make money when stock
prices are falling is called short selling . Another
strategy is to wait until when the market is going on
an upswing. This indicates that the bear market is
nearing an end, and investors will want to buy in
anticipation of a bull market.
A person who looks at stocks negatively is called a
bear and is said to have a bearish outlook.

Bull & Bear

30

Demat Account
DEMAT Account Meaning
In Indias banking terminology, the term DEMAT
Account refer to deposit made at an Indian financial
institution that can be used for investing in shares of
stocks and other financial assets. Securities are held
electronically in a DEMAT Account, thereby eliminating
the need for physical paper certificates.
DEMT Account Example:
For example, A DEMAT Account become available after
India adopted the DEMAT system for the electronic
storing of stock share and other securities in 1996.
DEMAT is short for Dematerialized and such account
require that an investor open an account an investing
broker linked to a savings or other founded account
.Access to a DEMAT Account require both an Internet
and transaction password, and such accounts allow for
the transfer of securities without any physical
certificates changing hands. This feature helps prevent
problem such as: loss, forgery or theft of the
certificates and makes the process of buying and
selling securities much more efficient.

The 2 types of Players

1. Investors

31

"Investors" put their money into stocks, real estate,

etc., under the assumption that over time, the
underlying investment will increase in value, and the
investment will be profitable. This buy-and-hold long
term strategy is passive in nature
2. Traders
Traders" take a proactive approach to their investing.
Traders have a defined plan and invest with one goal, to
put their capital into the markets and "profit."

32

The evolution of State Bank of India can be traced back

to the first decade of the 19th century. It began with
the establishment of the Bank of Calcutta in Calcutta,
on 2 June 1806. The bank was redesigned as the Bank
of Bengal, three years later, on 2 January 1809. It was
the first ever joint-stock bank of the British India,
established under the sponsorship of the Government
of Bengal. Subsequently, the Bank of Bombay
(established on 15 April 1840) and the Bank of Madras
(established on 1 July 1843) followed the Bank of
Bengal. These three banks dominated the modern
banking scenario in India, until when they were
amalgamated to form the Imperial Bank of India, on 27
January 1921.
An important turning point in the history of State Bank
of India is the launch of the first Five Year Plan of
independent India, in 1951. The Plan aimed at serving
the Indian economy in general and the rural sector of
the country, in particular. Until the Plan, the commercial
banks of the country, including the Imperial Bank of
India, confined their services to the urban sector.
Moreover, they were not equipped to respond to the
growing needs of the economic revival taking shape in
the rural areas of the country. Therefore, in order to
serve the economy as a whole and rural sector in
33

particular, the All India Rural Credit Survey Committee

recommended the formation of a state-partnered and
state-sponsored bank.

Branches
The corporate center of SBI is located in Mumbai. In
order to cater to different functions, there are several
other establishments in and outside Mumbai, apart
from the corporate center. The bank boasts of having
as many as 14 local head offices and 57 Zonal Offices,
located at major cities throughout India. It is recorded
that SBI has about 10000 branches, well networked to
cater to its customers throughout India.

ATM Services
SBI provides easy access to money to its customers
through more than 8500 ATMs in India. The Bank also
facilitates the free transaction of money at the ATMs of
State Bank Group, which includes the ATMs of State
Bank of India as well as the Associate Banks State
Bank of Bikaner & Jaipur, State Bank of Hyderabad,
State Bank of Indore, etc. You may also transact money
through SBI Commercial and International Bank Ltd by
using the State Bank ATM-cum-Debit (Cash Plus) card.

The five associate banks of SBI:

State
State
State
State

Bank
Bank
Bank
Bank

of
of
of
of

Hyderabad (SBH)
Bikaner & Jaipur (SBBJ)
Mysore (SBM)
Patiala (SBP)
34

State Bank of Travancore (SBT)

Data Presentation
Date

Open

High

Low

Close

1 Dec, 2014

322.80

326.95

287.00

311.85

3 Nov, 2014

270.60

322.50

269.43

321.40

1 Oct, 2014

2,445.00

2,679.00

264.60

270.28

1 Sep, 2014

2,477.00

2,644.00

2,350.05

2,445.70

1 Aug, 2014

2,415.00

2,577.40

2,350.10

2,460.70

1 Jul, 2014

2,699.00

2,729.00

2,366.40

2,439.25

2 Jun, 2014

2,549.00

2,761.50

2,526.70

2,686.25

1 May, 2014

2,078.60

2,834.90

2,035.00

2,542.25

1 Apr, 2014

1,928.00

2,124.90

1,867.50

2,078.60

3 Mar, 2014

1,530.00

1,938.80

1,515.00

1,917.70

3 Feb, 2014

1,525.00

1,540.00

1,455.10

1,533.25

1 Jan, 2014

1,772.00

1,806.00

1,510.05

1,523.85

35

3000

2500

2000

1500

Open
Column1

1000

500

36

ICICI Bank started as a wholly owned subsidiary of ICICI

Limited, an Indian financial institution, in 1994. Four
years later, when the company offered ICICI Bank's
shares to the public, ICICI's shareholding was reduced
to 46%. In the year 2000, ICICI Bank offered made an
equity offering in the form of ADRs on the New York
Stock Exchange (NYSE), thereby becoming the first
Indian company and the first bank or financial
institution from non-Japan Asia to be listed on the
NYSE. In the next year, it acquired the Bank of Madura
Limited in an all-stock amalgamation. Later in the year
and the next fiscal year, the bank made secondary
market sales to institutional investors.
With a change in the corporate structure and the
budding competition in the Indian Banking industry, the
management of both ICICI and ICICI Bank were of the
opinion that a merger between the two entities would
prove to be an essential step. It was in 2001 that the
Boards of Directors of ICICI and ICICI Bank sanctioned
the amalgamation of ICICI and two of its wholly-owned
retail finance subsidiaries, ICICI Personal Financial
Services Limited and ICICI Capital Services Limited,
with ICICI Bank. In the following year, the merger was
approved by its shareholders, the High Court of Gujarat
at Ahmedabad as well as the High Court of Judicature at
Mumbai and the Reserve Bank of India.

37

Present Scenario
ICICI Bank has its equity shares listed in India on
Bombay Stock Exchange and the National Stock
Exchange of India Limited. Overseas, its American
Depositary Receipts (ADRs) are listed on the New York
Stock Exchange (NYSE). As of December 31, 2008, ICICI
is India's second-largest bank, boasting an asset value
of Rs. 3,744.10 billion and profit after tax Rs. 30.14
billion, for the nine months, that ended on December
31, 2008.

Branches & ATMs

ICICI Bank has a wide network both in Indian and
abroad. In India alone, the bank has 1,420 branches
and about 4,644 ATMs. Talking about foreign countries,
ICICI Bank has made its presence felt in 18 countries United States, Singapore, Bahrain, Hong Kong, Sri
Lanka, Qatar and Dubai International Finance Centre
and representative offices in United Arab Emirates,
China, South Africa, Bangladesh, Thailand, Malaysia and
Indonesia. The Bank proudly holds its subsidiaries in the
United Kingdom, Russia and Canada out of which, the
UK subsidiary has established branches in Belgium and
Germany.

38

Data Presentation

Date

Open

High

1 Dec, 2014

353.20

366.05

319.20

353.10

3 Nov, 2014

1,626.00

1,779.00

341.00

350.88

1 Oct, 2014

1,443.00

1,633.20

1,415.00

1,626.65

1 Sep, 2014

1,558.00

1,618.85

1,427.50

1,433.55

1 Aug, 2014

1,462.30

1,564.00

1,411.80

1,556.80

1 Jul, 2014

1,420.55

1,512.40

1,333.30

1,471.25

2 Jun, 2014

1,411.25

1,511.70

1,376.50

1,418.15

1 May, 2014

1,243.40

1,593.20

1,238.00

1,418.05

1 Apr, 2014

1,252.30

1,318.50

1,202.40

1,243.40

3 Mar, 2014

1,037.20

1,276.00

1,021.40

1,245.05

3 Feb, 2014

981.00

1,048.85

943.60

1,043.85

1 Jan, 2014

1,100.90

1,118.00

963.50

987.70

39

Low

Close

1800
1600
1400
1200
1000
Open

800

close

600
400
200
0

40

Housing Development Finance Corporation Limited, more

popularly known as HDFC Bank Ltd, was established in the
year 1994, as a part of the liberalization of the Indian
Banking Industry by Reserve Bank of India (RBI). It was one
of the first banks to receive an 'in principle' approval from
RBI, for setting up a bank in the private sector. The bank
was incorporated with the name 'HDFC Bank Limited', with
its registered office in Mumbai. The following year, it
started its operations as a Scheduled Commercial Bank.
Today, the bank boasts of as many as 1412 branches and
over 3275 ATMs across India.

Amalgamations
In 2002, HDFC Bank witnessed its merger with Times
Bank Limited (a private sector bank promoted by
Bennett, Coleman & Co. / Times Group). With this,
HDFC and Times became the first two private banks in
the New Generation Private Sector Banks to have gone
through a merger. In 2008, RBI approved the
amalgamation of Centurion Bank of Punjab with HDFC
Bank. With this, the Deposits of the merged entity
became Rs. 1,22,000 crore, while the Advances were
Rs. 89,000 crore and Balance Sheet size was Rs.
1,63,000 crore

Tech-Savvy
41

HDFC Bank has always prided itself on a highly

automated environment, be it in terms of information
technology or communication systems. All the braches
of the bank boast of online connectivity with the other,
ensuring speedy funds transfer for the clients. At the
same time, the bank's branch network and Automated
Teller Machines (ATMs) allow multi-branch access to
retail clients. The bank makes use of its up-to-date
technology, along with market position and expertise,
to create a competitive advantage and build market
share.

Capital Structure
At present, HDFC Bank boasts of an authorized capital
of Rs 550 crore (Rs5.5 billion), of this the paid-up
amount is Rs 424.6 crore (Rs.4.2 billion). In terms of
equity share, the HDFC Group holds 19.4%. Foreign
Institutional Investors (FIIs) have around 28% of the
equity and about 17.6% is held by the ADS Depository
(in respect of the bank's American Depository Shares
(ADS) Issue). The bank has about 570,000
shareholders. Its shares find a listing on the Stock
Exchange, Mumbai and National Stock Exchange, while
its American Depository Shares are listed on the New
York Stock Exchange (NYSE), under the symbol 'HDB'

42

Data Presentation
Date

Open

High

Low

Close

1 Dec, 2014

958.30

973.95

916.00

951.60

3 Nov, 2014

915.20

965.90

893.00

957.15

1 Oct, 2014

866.00

914.60

854.10

911.85

1 Sep, 2014

845.90

879.80

838.60

872.65

1 Aug, 2014

826.05

852.80

791.40

843.55

1 Jul, 2014

823.00

860.70

807.15

834.00

2 Jun, 2014

793.50

856.00

793.50

871.55

1 May, 2014

721.30

854.00

711.45

792.75

1 Apr, 2014

751.50

753.55

707.30

721.30

3 Mar, 2014

665.20

760.75

662.50

748.80

3 Feb, 2014

629.95

682.90

616.80

669.60

1 Jan, 2014

668.00

685.00

625.10

628.50

43

1200
1000
800
600

Open
Close

400
200
0

44

Established in 1895 in Lahore, Punjab National Bank is

one of the oldest banks in India having a virtual
presence in every Simportant center of the country. The
bank has over 35 million customers through 4540
offices including 421 extension counters, out of which
2/3 of its branches in rural and semi rural areasthe
largest among nationalized banks, which makes it enjoy
one of the highest penetration rate of banking activities
in the country.

Punjab National Bank caters to a wide variety of

audience through spectrum of services including
corporate and personal banking, industrial finance,
agricultural finance and international finance. Sitting on
a vast banking resources and significant presence in
almost every lending sphere, the bank has a capital
adequacy ratio (CAR), well above the Basel2
regulatory requirement, at 12.96% as on June 2008,
despite being exposed to numerous market and credit
risk elements.

Constantly strengthening the capital adequacy ratio

through internal accruals and a regular increase in Tier
1 capital has put the bank on a very comfortable and
formidable position. Punjab National Bank has a net
interest margin (NIM) higher than the industry average
45

due to a mix of improving yields and low cost funding

base and has one of the healthiest low cost current
account saving account (CASA) ratio of 41.31%. It also
enjoys the highest rating by all four domestic rating
agencies and one of the few banks to boast a AAA
rating on its perpetual debt issue.

In July 2011, Punjab National Bank agreed to pick up a

30% stake in MetLife India which will make it the single
largest shareholder in the private insurance company.
The two parties have agreed that once the deal is
finalized the company will be renamed PNB MetLife
India.

Awards:
National Award for Excellence in SSI Lending Ranked
2nd for four consecutive years from 2002 to 2005

The Banker's Almanac Ranked 3rd amongst banking

sector in India and 323rd rank in the world in 2006

The Banker, London Ranked 386 amongst Top 1000

Global Banks in July 2005

46

AC Nielson Survey 9th amongst Top 50 Most Trusted

Services Brands in India

Golden Peacock Award for excellence in corporate

governance
in 2005

Data Presentation

Date

Open

High

Low

Close

1 Dec, 2014

216.00

230.95

208.40

219.10

3 Nov, 2014

926.00

1,004.90

201.40

214.46

1 Oct, 2014

887.30

976.00

866.40

930.85

1 Sep, 2014

951.95

1,009.85

837.25

887.30

1 Aug, 2014

944.00

996.00

886.20

948.15

1 Jul, 2014

995.65

1,013.70

863.00

956.75

47

2 Jun, 2014

948.00

1,039.20

922.30

992.20

1 May, 2014

783.40

1,067.95

771.30

943.80

1 Apr, 2014

749.00

816.65

720.20

783.40

3 Mar, 2014

546.50

778.60

538.00

743.90

3 Feb, 2014

547.55

569.40

524.00

552.20

1 Jan, 2014

627.55

654.55

509.15

547.55

1200
1000
800
600

Open
Close

400
200
0

48

The idea behind IndusInd Bank, named after the Indus

Valley civilization, was conceived by Mr. Srichand P.
Hinduja, the head of the Hinduja Group. One of the first
new-generation private banks in India, IndusInd Bank
was inaugurated in April 1994, Dr. Manmohan Singh,
the present Prime Minister of India, who was then the
Finance Minister of the country. It was established with
the help of collective contributions from the NRI
community, towards the economic and social
development of India.

49

The operations of IndusInd Bank were started with a

capital base of Rs. 1,000 million. Of the total 1,000
million, Rs. 600 million was raised through private
placements by Indian Residents and Rs. 400 million was
contributed by Non-Resident Indians (NRIs). A decade
after its establishment i.e. in June 2004, IndusInd Bank
was merged with Ashok Leyland Finance Ltd, which was
one of the largest leasing finance and hire purchase
companies in India, at that time. With this, the bank
increased its customer base and geographical
penetration

Branches & ATMs

Within a few years of its foundation, IndusInd Bank
started climbing the ladder of success and became one
of the fastest-growing banks in the Indian banking
sector. By 2006, it had expanded its branch network,
from 61 in 2004, to 137. Apart from setting up 150 ATM
centers of its own, the bank also concluded multilateral
arrangements with other banks, taking the total
number of authorized ATM outlets to 15,000. All the
branches as well as ATMs of IndusInd Bank are
connected to its central database, via a satellite that
operates on the latest version of IBMs AS400-720
hardware & Midas Kapiti (now Misys) software

Businesses
IndusInd Bank operates in a diverse range of
businesses, which include Corporate Banking, Retail
Banking, Treasury and Foreign Exchange, Investment
50

Banking, Capital Markets, Non-Resident Indian (NRI) /

High Networth Individual (HNI) Banking and Information
Technology (through a subsidiary). It also claims the
distinction of being the first bank in India that received
ISO 9001:2000 certification for its Corporate Office and
its entire network of branches.

Products & Services

IndusInd Bank provides multi-channel facilities, which
comprise of ATMs, Net Banking, Mobile Banking, Phone
Banking, Multi-city Banking and International Debit
Cards. It is also credited for being one of the first banks
to become a part of RBIs Real Time Gross Settlement
(RTGS) system. Enlisting the help of KPMG, IndusInd
Bank has adopted an enterprise-wide risk management
system, including global best practices in the area of
Risk Management. The other products and services
offered by the bank include:

Data Presentation
Date

Open

High

Low

Close

1 Dec, 2014

751.95

809.50

745.60

802.45

3 Nov, 2014

724.90

759.80

700.10

750.45

1 Oct, 2014

621.50

722.00

594.50

720.10

1 Sep, 2014

586.55

646.95

586.55

621.55

1 Aug, 2014

556.00

587.90

535.30

585.45

51

1 Jul, 2014

574.15

587.00

527.10

559.50

2 Jun, 2014

532.10

582.00

520.65

571.70

1 May, 2014

478.35

587.00

471.00

533.95

1 Apr, 2014

502.95

520.50

473.70

478.35

3 Mar, 2014

397.00

509.50

390.35

501.85

3 Feb, 2014

380.45

406.75

371.75

397.50

1 Jan, 2014

422.60

440.00

369.50

383.80

800
700
600
500
400

Open
Close

300
200
100
0

52

53

54

55