A

WINTER PROJECT REPORT

ON
INVESTORS BEHAVIOUR FOR INVESTING IN EQUITY MARKET IN
VARIOUS SECTORS IN SURAT CITY
(Conducted on behalf of Sharekhan Limited, Surat)
(From 4th January, 2010 to 4th March, 2010)
A Project Report
Submitted in partial Fulfillment of the requirements
For the award of the degree of

BACHELOR OF BUSINESS ADMINISTRATION

TO
VEER NARMAD SOUTH GUJARAT UNIVERSITY, SURAT

Submitted By:
ASHISH L. SORATHIYA
T.Y.B.B.A (Sem-VI) FINANCE
Roll No. 79
Under the guidance of
MISS KHUSHBU VORA

Submitted To:
THE CO-ORDINATOR
VIVEKANAND COLLEGE FOR B.B.A., NEAR JAHANGIRPURA,
VEER NARMAD SOUTH GUJARAT UNIVERSITY, SURAT

ACADEMIC YEAR
March 2010
 I ASHISH L. SORATHIYA, here by declare that the project report entitled
Investors Behaviour for Investing in Equity Market in
Various Sectors Conducted on behalf of SHAREKHAN LIMITED, Surat under
the guidance of Ms. Khushbu Vora submitted in partial fulfillment of the
requirements for the award of the degree of Bachelor of Business
Administration to Veer Narmad South Gujarat University, Surat is my original
Work-Research Study-carried out during 4th January, 2010 to 4th March,
2010 and not submitted for the award of any other degree/diploma/fellowship or
other similar titles or Prizes to any other Institutions/Organization or University by
any other person.

Place: ASHISH L. SORATHIYA

T.Y.B.B.A (Sem-VI)
Roll No. 79
Date:
 I express my deep sense of gratitude towards my guide, Ms.
Khushbu Vora without whose kind help this project study would have been
extremely difficult. She has helped me with her valuable suggestions right from the
beginning till the final draft of the report. The sheer mention of my project study
shall ever commemorate her kind guidance.

I am also grateful to Mrs. Varsha Patel, faculty of the

Vivekanand College for B.B.A. for his kind effort to make all the required facilities
available and gave his valuable suggestions in preparing this project report. The
library facility of the college has been of immense use to me for reference of books
and old project reports.

I am also thankful to Mr. Zubin Bhatporia (Associate Vice President) of

Sharekhan Ltd., Surat for giving me an opportunity for getting in valuable
experience in such reputed organization.

I am also thankful to Mr. Darwin Variava who is presently working with

Sharekhan Limited for providing me actual training and the required knowledge
& guidance in completing this training successfully.

Finally, I would like to record my special thanks to my parents, friends, and

colleagues help me directly or indirectly in preparation of project work.

ASHISH L. SORATHIYA

T.Y.B.B.A (Sem-VI)

Roll No. 79
 This is to certify that the Project Report entitled A STUDY ON INVESTORS
BEHAVIOUR FOR INVESTING IN EQUITY MARKET IN VARIOUS SECTORS IN
SURAT CITY (Conducted on behalf of Sharekhan Limited, Surat) submitted in
partial Fulfillment of the requirements for the award of the degree of BACHELOR
OF BUSINESS ADMINISTRATION to VEER NARMAD SOUTH GUJARAT
UNIVERSITY, SURAT is a record of bonafide research work carried out by
ASHISH L. SORATHIYA under my supervision and Guidance.

..
Ms. Khushbu Vora
Project Guide
 Myself Ashish L. Sorathiya, student of Vivekanand College for
B.B.A. who is presently undertaking education in the spare of Bachelor of
Business Administration which covers total business activities.

As students of management, I must be encouraged by the growth

and rapid developments taken place in Various Sectors, in India. Still
recently, management is growing baby. Keeping in mind the ever development field
of management and great demand for Finance in our country, our university
(VNSGU) has arranged specialization program in many field of management.
Thus, it is our moral and obligatory duty to take this part of our studies with great
enthusiasm and seriousness and give it the due importance.

My report gives information about the Behavior of Investors for

Investing in Various sectors regarding Equity market. The report contains
graphical representation & interpretation with each graphs and charts. For the
preparation of this report, I have used simple random sampling method for survey
purpose. This training proved to be an experience, which is required to become a
true student of management and administration.
 Days were gone when people only invest their money in Post offices or in
Banks and another safely fixed return investment. Today people have several
choices for the investment alternatives. Now a day, one of the most emerging
choices is to invest in equities shares. To get good return on investment, people
are ready to take risks. Law always says that investors get HIGHER RETURN if
they take HIGH RISK. For high risk there is one avenue to invest and that is Equity
Market.

This Project Focused On INVESTORS BEHAVIOUR FOR INVESTING IN

EQUITY MARKET IN VARIOUS SECTORS IN SURAT CITY. Objectives behind
this project are to know investors behavior for investing in various sectors regarding
equity market, to know their preference of investment in equity market, and to know
whether potential growth of equity market is there or not.

I have used Descriptive Research Design because answers the questions

who, what, where, when and how. This study is complex and determines high
degree scientific skill to study the problem. Questionnaires are used for survey
purpose and before going to actual survey pilot testing were also done.

Sample size is of 175 respondents who are the actual and potential
investors from whole of the equity market of Surat city and also from Sharekhan
Securities Pvt. Ltd. Here, each sample has the chance to be selected on an equal
basis because I have used simple random sampling method for surveying
purpose.

From research I found that 68% of investors are investing in Equity

Market. While 36% of investors are not investing in Equity Market as per my
sample size 175.
 Means most of the customers are aware about Equity Market. There are
certain customers who are also aware about equity market but, they not want to
invest in equity market, Reasons for not investing in equity market is high risk
and there are no any fixed returns criteria and Investors age also affect in risk
factor. Means old persons risk bearing capacity is law so, investors also select
investment avenue as per his/her risk bearing capacity

Equity share holder is real owner of the company in spite of their priority
in getting dividend is comes last.

Major Investors are investing in equity market only due to earn

high return and hedge the risk by investing their 5%-10% of income in Equity
Market. 28% of investors invest in Equity market for the period of 1
to 3 Months and the same proportion of investors are invest for long
period more than year.

On the basis of research I found that, major investors have selected

Oil & gas sector as a 1st Rank, IT sector as a 2nd Rank, Banking sector as a
3nd Rank, Automobile sector as a 4th Rank and Infrastructure sector as a 5nd
Rank.

Most of investors have considered Market trend, Price Earning Ratio,

Dividend and Profitability as a most important factor while selecting the Sector
and company under the sector.

I have used SPSS software (Statistical Package for the Social Sciences)
for analysis purpose and in that I have used graphical representation &
interpretation with each graphs and charts and Microsoft Office is used for data
typing formatting and analyzing the data.
 COMPANY PROFILE

Company Name: SHAREKHAN LIMITED

Parental Company: SSKI Group

(Shripal Sevantilal Kantilal Ishwarlal Pvt. Ltd)

Establishment year: 1922

CEO of the
Mr. Tarun Shah
company:

Head Office: A-206, Phoenix House,

2nd Floor, Senapati Bapat Marg,

Lower Parel,

Mumbai- 400 013.

Surat Main Branch:

M- 1 to 6, Jolly Plaza,
(Where I have taken
Mezzanine Floor,
training)
Athwa Gate,

Surat - 395001

Telephone No: (022) 67482000

0261- 6560310-314

Online division as
Sharekhan 8th February 2000

Web Site: www.sharekhan.com

Email: surat@branch.sharekhan.com

Offices(Network): More than 640 outlets in 280 cities

 INTRODUCTION OF SHAREKHAN

Sharekhan is one of the leading share broking and retail brokerage firms in
the country. It is the retail broking arm of the Mumbai-basedSSKI Group (Shripal
Sevantilal Kantilal Ishwarlal Pvt. Ltd), which has more than 88 years of
experience in the stock broking business. SSKI is a veteran equities solutions
company with more than 8 decades of trust and credibility in the Indian stock
markets. It helps the customers/people to make informed decisions and simplifies
investing in stocks.

Sharekhan brings to you a user- friendly online trading facility, coupled with
a wealth of content that will help you stalk the right shares. SSKI named its online
division as a Sharekhan and it is into retail broking. The business of the company
overhauled 10 years ago on February 8, 2000. It acts as a discount brokerage
house to a full service investment solution provider. It has specialized research
product for the small investors and day traders.

Sharekhans online trading and investment site ww.sharekhan.com was

launched in 2000.

Though the www.sharekhan.com, have been providing investors a

powerful online trading platform, the latest news, research and other knowledge-
based tools and Sharekhan's equity related services include trade execution on
BSE, NSE, Derivatives, commodities, depository services, online trading and
investment advice.

Sharekhans ground network includes over 640 Share shops across 280
cities in India. With branches and outlets across the country, Sharekhans ground
network is one of the biggest in India!

They have talent pool of experienced professionals specially designated

to guide you when you need assistance, which is hy investigating with us is
bound to be a hassle-free experience for you!
 The Sharekhan provides its Customers First Step program, built specifically
for all investors, so testament is

YOUR GUIDE TO THE FINANCIAL JUNGLE means

Our commitment to being your guide throughout your investing lifecycle

The institutional broking arm of SSKI was also awarded Indias best
broking house for 2004 by Asia Money brokers poll recently & It has also won the
prestigious Awaaz Consumer Vote Awards 2005 for the Most Preferred Stock
Broking Brand in India, in the Investment Advisors category.

They have 640 share shops across 280 cities in India to get a host of trading
related services our friendly customer service staff will also help you with any
account related queries you may have.

Sharekhan won the award by the vote of consumers around the country,
as part of Indias largest consumer study cover 7000 respondents 21 products
and services across 21 major cities. The study, initiated by Awaaz Indias first
dedicated Consumer Channel and member of the worldwide CNBC Network, & AC
NielsenORG Marg, was aimed at understanding the brand preferences of the
consumers & to decipher what are the most important loyalty criteria for the
consumer in each vertical.

The reasons behind the preferences for brands were unveiled by examining
the following:

Tangible features of product / service.

Softer, intangible features like imagery, equity driving preference.
Tactical measures such as promotional / pricing schemes.
 Sharekhan completes 10 years in Retail Broking Business:
Sharekhan Ltd, Indias leading online retail broking house with a strong
online trading platform, has completed a decade in the business offering services
such as portfolio management, trade execution in equities, futures & options,
commodities and distribution of mutual funds, insurance and structured products.

In a short span of 10 years, the company has scripted a remarkable growth

story. Starting from beginnings in 8th February 2000 as an online trading portal,
Sharekhan today has a pan-India presence as well as global footprint in UAE and
Oman with over 1,200 outlets serving 9,50,0000 customers across 400 cities.

Mr. Tarun Shah, CEO, Sharekhan, Says

- We are proud to be completing a
decade of setting new standards in the
industry. This journey has been
eventful. And the journey couldnt
have been such a rewarding one
without the support of our patrons
who infused immense faith in our
services in the last 10 years. We
profusely thank our patrons for the
same.

Sharekhan in its decade-old journey has set category leadership through

pioneering initiatives like Trade Tiger; a net based executable application that
emulates a broker terminal besides providing information and tools relevant to
traders. Through its First Step program Sharekhan has been guiding first-time
investors and helping them makes informed decisions.
 ABOUT SHAREKHAN

SSKI named its online division as SHAREKHAN and it is into retail broking.
The business of the company overhauled 10 years ago on February 8, 2000.
It acts as a discount brokerage house to a full service investment solutions
provider.
It has specialized research product for the small investors and day traders.
Largest chain of 640 shares shops in 280 cities across India.
The site was also launched on February 8, 2000 and named it as
www.sharekhan.com.
The Speed Trade account of Sharekhan is the next generation technology
product launched on April 17, 2002.
It offers its customers with the trade execution facilities on the NSE and BSE,
for cash as well as derivatives, depository services.
Ensures convenience in Trading Experience: Sharekhans trading services are
designed to offer an easy, hassle free trading experience, whether trading is
done daily or occasionally. Sharekhan providing the customers with a multi-
channel access to the stock markets.
It gives advice based on extensive research to its customers and provides them
with relevant and updated information to help him make informed about his
investment decisions.
Sharekhan offers its customers the convenience of a broker-DP.
It helps the customers meet his pay in obligations on time thereby reducing the
possibility of auctions. And execute the instruction immediately on receiving it
and thereafter the customer can view his updated account statement on Internet.
Sharekhan depository services offer Demat services to individual and corporate
investors. A customer can avail of Demat, repurchase and transmission facilities
at any of the Sharekhan branches and business partners outlets.

BRAND NAME:
 The company as a whole in its offline business has named itself as SSKI
Securities Private Limited Shripal Sevantilal Kantilal Ishwarlal Securities
Private Limited. The company has preferred to name themselves under a blanket
family name.

But, in its online division started since 1997, the company preferred to name
itself as SHAREKHAN. The Brand name SHAREKHAN itself suggests the
business in which the company is dealing so that the customer could easily identify
the product or service category.

SHAREKHANS MISSION & VISION:

MISSION

To educate and empower the retail investor

to help him/her take better investment decisions.

VISION

To be the best retail broking brand in the Indian equities market.

ROLE OF SHAREKHAN:

Interface between the stock exchange and the investor.

Assistance to investors in precise allocation of funds.
Building awareness amongst general public about stock market.

Core Services of Sharekhan:

 As a Sharekhan customer you can decide the channel through which you
want to receive different Services.
 OTHER SERVICES PROVIDED BY SHAREKHAN

1. Online Services
2. Offline Services
3. Depository Services: Demat & Remat Transactions
4. Derivatives Trading (Futures and Options)
5. Commodities Trading
6. IPOs & Mutual Funds Distribution
7. Fundamental Research
8. Technical Research
9. Portfolio Management
10. Free access to investment advice from Sharekhan's Research team
11. Sharekhan Value Line (a monthly publication with reviews of
recommendations, stocks to watch out for etc)
12. Daily research reports and market review (High Noon & Eagle Eye)
13. Pre-market Report (Morning Cuppa)
14. Daily trading calls based on Technical Analysis
15. Cool trading products (Daring Derivatives and Market Strategy)
16. Personalised Advice
17. Live Market Information
18. Internet-based Online Trading: SpeedTrade

1. Online Services:
Online BSE and NSE executions (through BOLT & NEAT terminals
Mutual Funds
Commodity Futures
PMS (Portfolio Management Services)
Technical PMS
Demat Services
Share shops
 2. Offline Services:

Trading with the help of Dealer

Trading without credit
By calling to the Share shops
Credit facility (Only in Delivery-based)
Special website for Offline Clients: www.mysharekhan.com
Physical contract notes

It provides various On-line trading services through various account:

TYPES OF DEMAT
ACCOUNT

Online Account Offline Account

Classic Trade Tiger

Dial N Trade
Accounts Account

The company provided mainly two types of services to their customers for
the Demate Accounts.

(1) Online Account and

(2) Offline Account

1. Online Account: -

In the Online account, the company simply provides the terminal to the
customers or clients and the clients can do trading himself/herself when he/she
wants. The charges of online account is Rs. 750 /-, which is varies from company
to company. Online accounts are most popular than the Offline accounts.

In the Online A/C, the company provides 3 types of facilities to their clients
as per the requirements.

A. Classic Accounts

B. Trade Tiger Accounts

C. Dial n Trade

A. Classic Accounts:

Investing Online is so much easier!

In Classic accounts, it is very simple to do trading. Here customer has first

to open a Demat account with Sharekhan and after opening an account he can get
the login ID and password. With the help of login ID and password, the client can
login to the Sharekhan.com and in the classic a/c whatever companys information
the clients wants, he has to type the companys name or code and he will get all
the necessary information about that company and he can buy or sell the that
companys stock or shares. But, here in the classical account the client can access
only one scrip at a time.
 Features of Classic Account:

Classic account enables you to buy and sell shares through our website. You
get features like

Online trading account for investing in Equities and Derivatives via

sharekhan.com
Integration of: Online trading + Bank + Demat account
Instant cash transfer facility against purchase & sale of shares
Make IPO bookings
You get Instant order and trade confirmations by e-mail
Streaming Quotes
Personalised Market Scan with your own customized stock ticker!
Single screen interface for cash and derivatives
Your very own Portfolio Tracker!

B. Trade Tiger Account: -

Earlier it was known as Speed Trade and now it is known as Tiger Trade.

This account is same as fast trade account. But, difference between these
two accounts is that in the Tiger Trade Account the client can access more than 25
scripts at a time and buy and sell the share from wherever they wants. This account
also provides the charts and graphs, so that the clients can easily understand about
the stock of the company. This is only for big clients and dealer kind of customers.
This account is mainly for active traders who trade frequently during the trading
session.
 Features of Trade Tiger Account: -
A single platform for multiple exchange BSE & NSE (Cash & F&O), MCX,
NCDEX, Mutual Funds, IPOs
Multiple Market Watch available on Single Screen
Multiple Charts with Tick by Tick Intraday and End of Day Charting powered
with various Studies
Graph Studies include Average, Band- Bollinger, Know Sure Thing, MACD,
RSI, etc
Apply studies such as Vertical, Horizontal, Trend, Retracement & Free lines
User can save his own defined screen as well as graph template, that is, saving
the layout for future use
User-defined alert settings on an input Stock Price trigger
Tools available to gauge market such as Tick Query, Ticker, Market Summary,
Action Watch, Option Premium Calculator, Span Calculator
Shortcut key for FAST access to order placements & reports
Online fund transfer activated with 12 Banks
 C. Dial-n-trade:

Features of Dial-n-trade:

TWO dedicated numbers for placing your orders with your cell phone or
landline. Toll free number: 1-800-22-7050. For people with difficulty in
accessing the toll-free number, we also have a Reliance number (Your Local
STD Code) 30307600 which is charged at as a local call.
Simple and Secure Interactive Voice Response based system for
authentication
No waiting time. Enter your TPIN to be transferred to our telebrokers
You also get the trusted, professional advice of our telebrokers
After hours order placement facility between 9.00 am and 9.30 am (timings
to be extended soon)

2. Offline Account: -

This is simple way to do trading. In the offline account, the client can
place the order by telephone or through personal visit in the office. The client
who is very busy in their jobs or business, they can directly place the order
by the telephone or the client who are not much busy; they can come to the
office of Sharekhan.

Sharekhan also provide the Dial-n-trade service to their customers.

So that customers can directly place the order by the telephone.
 Demat Account Opening & Brokerage Charges: -

Fee structure for General Individual:

Charges Classic Account Trade Tiger Account

Account Opening Charges Rs. 750/- Rs. 1000/-

Brokerage Intra-day : 0.10 % Intra-day : 0.10 %

Delivery : 0.50 % Delivery : 0.50 %

Annual Maintenance Charges Rs. NIL first year

Rs. 300/= p.a. from second year onwards

For Intra-day Trades:-

This is subject to a minimum brokerage of 5 paisa per share. This means

that if the share price you trade in is Rs 50/- or less, a minimum brokerage
of 5 paisa per share will be charged.

For Delivery Based Trades :-

This is subject to a minimum brokerage of 10 paisa per share. Minimum

brokerage of 10 paisa per share will be applicable when the share price is
Rs 20/- or less.
 Sharekhan launchs ShareMobile, an exclusive
live streaming quotes and trading facility for its
online trading customers

Next time when you are on move, you need not

worry about your favorite stocks price
movement. You can carry stock market
terminal with you anywhere anytime.
Have you ever missed an investment or an
opportunity to book profit / loss, just because
you were on move?
Sharekhan brings your freedom of being
Mobile. Yes, its so easy with ShareMobile to
track your favorite stocks price movement tick-by-tick.

How ShareMobile does empower you?

Live tick by tick stock price.
Latest News Headlines
Track your My Trade Portfolio investments
 Live Research Fundamental & Trading Calls

Sharekhan Depository Services:

Sharekhan Depository Services offers dematerialization services to

individual and corporate investors.

Sharekhan has a team of professionals and the latest technological

expertise dedicated exclusively to our Demat department, apart from a national
network of franchisee, making the services quick, convenient and efficient.

Trading in Commodity Futures:

It provides with facility to trade in commodities (Bullion: Gold, silver and

agricultural commodities) through a wholly owned subsidiary of its Parent
SSKI.

Sharekhan is a member of 2 Commodity Exchanges and offers trading

facility at both these exchanges:

1. Multi Commodity Exchange Of India (MCX)

2. National Commodity And Derivative Exchange, Mumbai (NCDEX)

Software (Technology) Used In Sharekhan: -

 Sharekhan is using different technology for the running of their daily
transactions.

Mainly for the trading, the company using three software.

1. ODIN (VSAT Based)

2. Trade Tiger (WEB Based)
3. Classic/Fast Trade (WEB Based)

And also NEAT System Used for making transaction in NSE listed company
& same way BOLT System Used for making transaction BSE listed company.
And for the client information or customer service, the company using two
software.

1. CIS Client Information System.

2. BOC Back Office.

Some Information about Sharekhan:

Turnover Rs. 15 corers daily

Employees Strength 35

Offices More than 640 outlets in 280 cities

Clients : Demat A/c 5000

Trading A/c 3000

Head office Mumbai

Working Capital More than 400 corers

Sharekhan Classic Account

Sharekhan Trade Tiger Account
Special Features
Dial n - Trade
Sharekhan provide right investment decision to
Investors according to their needs

Seven Reasons
 Why Customers first choice is SHARAKHAN?

1. EXPERIENCE:

SSKI has more than eight decades of trust and Credibility in the Indian stock
market. In the Asia Money brokers poll held recently, Sharekhan won the India
best broking house for 2004 award. Ever since it launched Sharekhan as its
retail broking division in February 2000, it has been providing institutional-level
research & broking services to investors.

2. TECHNOLOGY:

With Sharekhan online trading account you can buy and sell shares in an
instant from any PC with an internet connection. You will get access to our powerful
online trading tools that will help you take complete control over your investment in
shares.

3. KNOWLEDGE:

In a business where the right information at the right time can translate into
direct profits, you get access to a wide range of information on Sharekhans
website www.sharekhan.com. You will also get a useful set of Knowledge-based
tools that will empower you to take informed decisions.
4. ACCESSIBILITY:

In addition to Sharekhan online and phone trading services also very useful.
Sharekhan also have a ground network of 640 share shops across 280 Cities in
India where you can get personalize Services.

5. CONVENIENCE:

You can call Sharekhans Dial-n-Trade number to get investment advice and
execute your transactions. Sharekhan have a dedicated Call Center to provide this
service via a toll-free number from anywhere in India.

6. CUSTOMER SERVICE:

Sharekhans customer service team will assist you for any help that you
need relating to transactions, billing, demat and other queries. Sharekhans
customer service can be contacted via a toll-free number-mail or live chat on
Sharekhan.com.

7. INVESTMENT ADVICE:

Sharekhan has dedicated research teams for fundamental and technical

research. Sharekhans analysts constantly track the pulse of the market and
provide timely investment advice to you in form of daily research e-mail, online
chat, printed reports and SMS on your phone.
 SWOT ANALYSIS of Sharekhan
STRENGTHS:

Online Trading Facility

Largest Chain of Retail Share Shops in India
88 years of Experience in securities market
Dedicated and responsive workforce/staff
Value added service for HNI client
Research Center
Membership of NSE & BSE
Trading option like Future & Option and Commodities
Volume based differentiated product.

WEAKNESSES:

Less informative website

Does not have slab rate brokerage which is provided by competitors
Problems due to network crash
Unawareness Among Investors

OPPORTUNITY:

Collaboration with international financial institution

To tap the Untapped market
To capture the market lost to its Competitors.
To focus on developing a superior and powerful portal
To spread awareness of its Brand Name.

THREATS:

Follow government laws

Competitors develops
Prolonged depression and high volatility in the market
New Entrants.
 Awards & Achievements of SHAREKHAN:

2001 - Web Award winner of Chip

magazines Best Financial Website
Award.

2004 - Best Local Brokerage by Advisory

Poll of Poll 2004.

2005 - Awaaz Consumer Awards Best

Broking House by CNBC channel.

Sharekhan is amongst top 3 online

Brokers in India.
 OF BROKING
FIRMS

INDUSTRY

PROFILE OF
BROKING FIRMS

The Indian retail

brokerage industry consists of
companies that primarily act as
agents for the buying and
selling of securities (e.g.
stocks, shares, and similar
financial instruments) on a commission or transaction fee or Brokerage basis.

An agent that charges a fee or commission for executing buys and sell
orders submitted by an investor. The firm that acts as an agent for a customer,
charge the customer the commission for its service. Roles similar to that of a
stockbroker include investment advisor, financial advisor and probably many
others. A stockbroker may or may not be also an investment advisor.

A stockbroker is a regulated professional broker who buys and sells shares

and other securities through market makers or Agency Only Firms on behalf of
investors.

Typically, a broker who receives an order from a customer will communicate

with a company employee located at a particular exchange, who will execute the
order at the exchange and report details of the transaction to the broker.
Customers typically keep their securities in an account with the broker. Brokers
charge customers commissions for conducting transactions and fees for maintaining
their accounts.

Some of the main characteristics of the brokerage industry include growth in

e-broking, decline in brokerage fees and growing derivative market and many
more.

There are several national as well as local players in stock trading services
which are providing various services to their customers like online trading, portfolio
management system, stock broking etc.

They are helping the investors to take decision about where to invest because
there is lots of Investment Avenue available with investors. Some of them are as
follows working at the national level.

5Paisa.com - Online trading, live stock quotes and market research

Anagram Capital - Stock broking, portfolio management and investment

banking services

Angel Broking -Stock-Broking and Wealth Management services

Advani Share Brokers - Share broking and market research services

 Anand Rathi Securities - Portfolio management, corporate finance, equity &
fixed income brokerage services

Brescon Group - Advisory and broking services

CIL Securities - Stock broking & merchant banking services

CRN India - Trends of stock market, trading tips, chat etc

Churiwala Securities - Stock trading, quotes and market analysis

DSP Merrill Lynch - Investment banking and brokerage services

Dalmia Securities - Stock broking & depository services

Equity Trade - Stock trading, company news & market research

Gandhi Securities - Stock broking and investment services

Gogia Capital Services - Stock broking and market analysis

Hasmukh Lalbhai - Stock trading services

Idafa Investments - Stock broking services

India Info line Securities - Stock broking, portfolio management and

investment banking services

India Market Access - Offers stock broking, portfolio management and

investment banking services

Investsmart India - Personal finance advisory & online brokerage services

Kisan Ratilal Choksey Shares - Stock broking and e-trading services

Kotak Securities - Brokerage services & retail distributor of financial securities

Manubhai Mangaldas Securities - Stock broking and market analysis

Moneypore - Investment and broking services

Motilal Oswal Securities - Online trading, live BSE and NSE quotes

Navia Markets - Stock broking, IPO and mutual funds services

Parag Parikh - Stock broking and portfolio management

Parsoli Corporation - Investment management & stock trading services

Pratibhuti Viniyog - Stock broking services

 Prudential - Investment management services

Quantum Securities - Offers broking and portfolio management services.

Religare Enterprises Limited - Stock broking services and diversified financial

services group with in multiple international locations

Sivan Securities - offers services related investment banking & stock broking
with a focus on South India.

Etc..etc..

Lots of brokerage companies are moving towards consolidation with the

smaller ones becoming either franchisee for the larger brokers or closing
operations. There is an increasing demand for online trading due to consumers
growing preference for Internet as compared to approaching the brokers.

New forms of trading including T+2 settlement system, dematerialization

etc. are strengthening the retail brokerage market and attracting foreign companies
to enter the Indian industry Various alternative forms of investment including fixed
deposits with banks and post offices etc act as substitutes to retail broking products
and services.

Stock Market

Stock markets refer to a market place where investors can buy and sell
stocks. The price at which each buying and selling transaction takes is determined
by the market forces (i.e. demand and supply for a particular stock).
A stock market is a 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 was estimated at about $36.6 trillion
USD at the beginning of October 2008.

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.

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.

In this way, investing in stock market, the stock exchanges also play
importance role. 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. So, here we also understand about
Stock Exchanges as follows.

Stock exchange

A stock exchange is an entity which provides "trading" facilities for stock

brokers and traders, to trade stocks and other securities.

Stock Exchanges are an organised marketplace, either corporation or

mutual organisation, where members of the organisation gather to trade company
stocks or other securities.
 Stock exchanges also provide facilities for the issue and redemption of
securities as well as other financial instruments and capital events including the
payment of income and dividends.

The securities traded on a stock exchange include: shares issued by

companies, unit trusts, derivatives, pooled investment products and bonds. To be
able to trade a security on a certain stock exchange, it has to be listed there.
Usually there is a central location at least for recordkeeping, but trade is less and
less linked to such a physical place, as modern markets are electronic networks,
which gives them advantages of speed and cost of transactions. Trade on an
exchange is by members only. The initial offering of stocks and bonds to investors
is by definition done in the primary market and subsequent trading is done in the
secondary market.

A stock exchange is often the most important component of a stock market.

Supply and demand in stock markets is driven by various factors which, as in all
free markets, affect the price of stocks.

There is usually no compulsion to issue stock via the stock exchange itself,
nor must stock be subsequently traded on the exchange. Such trading is said to
be off exchange or over-the-counter. This is the usual way that derivatives and
bonds are traded. Increasingly, stock exchanges are part of a global market for
securities.
 Major stock exchanges in the world

Twenty Major Stock Exchanges in The World: Market Capitalization &

Year-to-date Total Turnover at the end of August 2009

Where, Two major Stock Exchanges from India, which is

1. Bombay Stock Exchange

2. National Stock Exchange

List of Stock Exchanges In India

 1. Bombay Stock Exchange(BSE)
2. National Stock Exchange(NSE)
3. Regional Stock Exchanges (21)
There are 21 other regional stock exchanges, which are
AhmedabadBangalore Bhubaneshwar Calcutta
CochinCoimbatore Delhi Guwahati Hyderabad Jaipur
Ludhiana Madhya Pradesh Madras Magadh Mangalore
Meerut OTC Exchange Of India Pune Saurashtra Kutch Uttar
Pradesh Vadodara etc.

Bombay Stock Exchange (BSE)

The Bombay Stock Exchange Limited is the oldest stock exchange not
only in the country, but also in Asia with a rich heritage of over 133 years of
existence. In the early days, BSE was established as "The Native Share & Stock
Brokers Association."

It was established in the year 1875 and became the first stock exchange in
the country to be recognised by the government. In 1956, BSE obtained a
permanent recognition from the Government of India under the Securities
Contracts (Regulation) Act, 1956.

Today, BSE is the world's number 1 exchange in terms of the number of

listed companies and the world's 5th in handling of transactions through its
electronic trading system.
The companies listed on BSE command a total market capitalization of USD
Trillion 1.06 as of July, 2009.
BSE reaches to over 400 cities and town nation-wide and has around 4,937
listed companies, with over 7745 scripts being traded as on 31st
July 09.
 The BSE Index, SENSEX, is India's first and most popular stock market
benchmark index. The BSE SENSEX (SENSitive indEX), also called the "BSE 30",
is a widely used market index in India and Asia. Sensex is tracked worldwide. It
constitutes 30 stocks representing 12 major sectors. The SENSEX is constructed
on a 'free-float' methodology, and is sensitive to market movements and market
realities. Apart from the SENSEX, BSE offers 23 indices, including 13 sectoral
indices.

BSE provides an efficient and transparent market for trading in equity, debt
instruments and derivatives.

BSE is the first exchange in India and the 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 BSE On-line Trading System (BOLT).
BSE continues to innovate. In 2006, it became the first national level stock
exchange to launch its website in Gujarati and Hindi and now Marathi to reach out
to a larger number of investors.

The BSE On-line Trading (BOLT):

BSE On-line Trading (BOLT) facilitates on-line screen based trading in
securities. BOLT is currently operating in 25,000 Trader Workstations
located across over 359 cities in India.

BSE Vision
The vision of the Bombay Stock Exchange is -

"To Emerge as the premier Indian stock exchange by

establishing global benchmarks."
 BSE Profile

Address :- Phiroze Jeejeebhoy Towers, Dalal Street

Mumbai-400001, India

Telephone :-91-22-227212334
Website :-www.bseindia.com
Trading hours :-Monday-Friday, 9:00am to 3:30pm
Securities :-Stocks, derivatives, debt
Trading System :-Electronic
MD & CEO :-Mr.Madhu Kannan

History of BSE
The Bombay Stock Exchange is known as the oldest exchange in Asia. It
traces its history to the 1850s, when stockbrokers would gather under banyan trees
in front of Mumbai's Town Hall. The location of these meetings changed many
times, as the number of brokers constantly increased. The group eventually moved
to Dalal Street in 1874 and in 1875 became an official organization known as 'The
Native Share & Stock Brokers Association'. In 1956, the BSE became the first stock
exchange to be recognized by the Indian Government under the Securities
Contracts Regulation Act.

The Bombay Stock Exchange developed the BSE Sensex in 1986, giving
the BSE a means to measure overall performance of the exchange. In 2000 the
BSE used this index to open its derivatives market, trading Sensex futures
contracts. The development of Sensex options along with equity derivatives
followed in 2001 and 2002, expanding the BSE's trading platform.

Historically an open-cry floor trading exchange, the Bombay Stock

Exchange switched to an electronic trading system in 1995. It took the exchange
only fifty days to make this transition.
 Indices of BSE:

Sensex
BSE 100(This covers Banking Sector)
BSE 200(This covers Capital goods)
BSE 500(This covers Consumer goods)
BSE mid-cap index
BSE small-cap index

BSE mid-cap index covers the FMCG sector and BSE small-cap index
covers the IT, Metal, Oil & gas, Power industry, PSUs, etc. BSE
disseminates information on the Price-Earnings Ratio, the Price to Book Value
Ratio and the Dividend Yield Percentage on day-to-day basis of all its major
indices.

The values of all BSE indices are updated every 15 seconds during market
hours and displayed through the BOLT system, BSE website and news wire
agencies.

All BSE Indices are reviewed periodically by the BSE Index Committee. This
Committee which comprises eminent independent finance professionals frames
the broad policy guidelines for the development and maintenance of all BSE
indices. The BSE Index Cell carries out the day-to-day maintenance of all indices
and conducts research on development of new indices.

Awards achieved by BSE

The World Council of Corporate Governance has awarded the Golden Peacock
Global CSR Award for BSE's initiatives in Corporate Social Responsibility
(CSR).

ICAI award for excellence in financial reporting for the year 2006-07

BSE has won the Asia - Pacific HRM awards for its efforts in employer branding
through talent management at work, health management at work and
excellence in HR through technology.
 National Stock Exchange (NSE)

The National Stock Exchange of India Limited (NSE), is a Mumbai-based

stock exchange. It is the largest stock exchange in India in terms of daily turnover
and number of trades, for both equities and derivative trading.
NSE has a market capitalization of around Rs 47,01,923 crore
(7 August 2009) and is expected to become the biggest stock exchange in India in
terms of market capitalization by 2009 end. Though a number of other exchanges
exist, NSE and the Bombay Stock Exchange are the two most significant stock
exchanges in India, and between them are responsible for the vast majority of
share transactions.
NSE is mutually-owned by a set of leading financial institutions, banks,
insurance companies and other financial intermediaries in India but its ownership
and management operate as separate entities.
There are at least 2 foreign investors NYSE Euro next and Goldman Sachs
who have taken a stake in the NSE. As of 2006, the NSE VSAT terminals, 2799 in
total, cover more than 1500 cities across India.
In October 2007, the equity market capitalization of the companies listed
on the NSE was US$ 1.46 trillion, making it the second largest stock exchange in
South Asia.
NSE is the third largest Stock Exchange in the world in terms of the
number of trades in equities. It is the second fastest growing stock exchange in the
world with a recorded growth of 16.6%.

Origins:

The National Stock Exchange of India was promoted by leading Financial

institutions at the behest of the Government of India, and was incorporated in
November 1992 as a tax-paying company.

In April 1993, it was recognized as a stock exchange under the Securities

Contracts (Regulation) Act, 1956.
 NSE commenced operations in the Wholesale Debt Market (WDM) segment
in June 1994.

The Capital Market (Equities) segment of the NSE commenced operations

in November 1994, while operations in the Derivatives segment commenced in
June 2000.

Markets:

Currently, NSE has the following major segments of the capital market:

Equity
Futures and Options
Retail Debt Market
Wholesale Debt Market
Currency futures

NSE became the first stock exchange to get approval for Interest rate
futures as recommended by SEBI-RBI committee, on 31 August,2009, a futures
contract based on 7% 10 Year GOI bond (NOTIONAL) was launched with quarterly
maturities.

Hours:

NSE's normal trading sessions are conducted from 9:00 am India Time to
3:30 pm India Time on all days of the week except Saturdays, Sundays and Official
Holidays declared by the Exchange (or by the Government of India) in advance.

The exchange in association with BSE (Bombay Stock Exchange Ltd.,)

thinking to revise its timings from 9.00 am India Time till 5.00 pm India Time.

However, on Dec 17, 2009, after strong protests from brokers, the Exchange
decided to postpone the change in trading hours till Jan 04, 2010.

NSE new market timing from Jan 04, 2010 is 9:00 am till 3:30 pm India
Time.
 NSE Group:

National Securities Clearing Corporation Ltd. (NSCCL)

National Securities Depository Ltd. (NSDL)
India Index Services & Products Ltd. (IISL)
NSE.ITltd.
DotEx International Limited

History of N.S.E

Capital market reforms in India and the launch of the Securities and
Exchange Board of India (SEBI) accelerated the incorporation of the second Indian
stock exchange called the National Stock Exchange (NSE) in 1992. After a few
years of operations, the NSE has become the largest stock exchange in India.

Three segments of the NSE trading platform were established one after
another. The Wholesale Debt Market (WDM) commenced operations in June 1994
and the Capital Market (CM) segment was opened at the end of 1994. Finally, the
Futures and Options segment began operating in 2000. Today the NSE takes the
14th position in the top 40 futures exchanges in the world.

In 1996, the National Stock Exchange of India launched S&P CNX Nifty and
CNX Junior Indices that make up 100 most liquid stocks in India. CNX Nifty is a
diversified index of 50 stocks from 25 different economy sectors. The Indices are
owned and managed by India Index Services and Products Ltd (IISL) that has a
consulting and licensing agreement with Standard & Poor's.

In 1998, the National Stock Exchange of India launched its web-site and
was the first exchange in India that started trading stock on the Internet in 2000.
The NSE has also proved its leadership in the Indian financial market by gaining
many awards such as 'Best IT Usage Award' by Computer Society in India (in 1996
and 1997) and CHIP Web Award by CHIP magazine (1999).
 Indices of N.S.E

NSE also set up as index services firm known as India Index Services &
Products Limited (IISL) and has launched several stock indices, including:

S&P CNX Nifty(Standard & Poor's CRISIL NSE Index)

CNX Nifty Junior
CNX 100 (= S&P CNX Nifty + CNX Nifty Junior)
S&P CNX 500 (= CNX 100 + 400 major players across 72 industries)
CNX Midcap (introduced on 18 July 2005 replacing CNX Midcap 200)

Mission of N.S.E.

NSE's mission is setting the agenda for change in the securities markets in
India. The NSE was set-up with the main objectives of:

Establishing a nation-wide trading facility for equities, debt instruments and

hybrids,
Ensuring equal access to investors all over the country through an
appropriate communication network,
Providing a fair, efficient and transparent securities market to investors
using electronic trading systems,
Enabling shorter settlement cycles and book entry settlements systems, and
Meeting the current international standards of securities markets.

The standards set by NSE in terms of market practices and technology have
become industry benchmarks and are being emulated by other market participants.
NSE is more than a mere market facilitator. It's that force which is guiding the
industry towards new horizons and greater opportunities.
 Theoretical aspect about topic

What is Investment?

The money you earn is partly spent and the rest saved for meeting future
expenses. Instead of keeping the savings idle you may like to use savings in
order to get return on it in the future. This is called Investment.

Why should one invest?

One needs to invest to:

Earn return on your idle resources
Generate a specified sum of money for a specific goal in life
Make a provision for an uncertain future

One of the important reasons why one needs to invest wisely is to meet the
cost of Inflation. Inflation is the rate at which the cost of living increases. The cost
of living is simply what it costs to buy the goods and services you need to live.

Investor:

An investor is any party that makes an investment.

An individual who commits money to investment products with the expectation
of financial return.
The term has taken on a specific meaning in finance to describe the particular
types of people and companies that regularly purchase equity or debt securities
for financial gain in exchange for funding an expanding company.
 Investor's Behaviour:

Generally, Investors Behaviour regarding the any investment is primary

concern with to minimize risk while maximizing return, as opposed to a speculator,
who is willing to accept a higher level of risk in the hopes of collecting higher-than-
average profits.

While, some people are also believes in High Risk, High Return Many
investors purchase a particular stock with the intention of making a big
profit over a short period of time. However, this action is not investing, but a pure
gambling.

The stock market is characterized by the trade-off between risk

and return. The higher the risk the investor is willing and able to take, the higher
the potential rewards from the investment. Therefore, if a particular investment
offers you high returns, it is an indication that it will come with a high risk burden.

Some people are also believes in that there is no safe investment that will
provide you with high returns over a short period of time. Therefore, you should
direct your resources toward long-term investments that are more likely to reward
you for the patience with high returns.

Investors Behaviour regarding the financial investment is closely related

with the Behavioral Finance and Behavioral Economics are closely related
fields making up a separate branch of economic and financial analysis using social,
cognitive and emotional factors in understanding the economic decisions of
investors for investment, and their effects on market prices, returns and the
allocation of resources.

Information of Equity Market & various sectors

 What is Equity Market?

A market where investors buy and sell securities

providing ownership of a company's shares.

The market in which shares are issued and traded, either through
exchanges or over-the-counter markets. Also known as the stock market, it
is one of the most vital areas of a market economy because it gives companies
access to capital and investors a slice of ownership in a company with the potential
to realize gains based on its future performance.

Equity market, or stock market, is a system through which company shares

are traded. The equity market offers investors an opportunity to participate in a
company's success through an increase in its stock price. With enhanced
opportunity, however, the equity market usually carries greater risk than debt
markets.

Indian Equity Market

The Indian Equity Market is more popularly known as the Indian Stock
Market. The Indian equity market has become the third biggest after
China and Hong Kong in the Asian region.
According to the latest report by ADB, it has a market capitalization of
nearly $600 billion. As of March 2009, the market capitalization was around
$598.3 billion (Rs 30.13 lakh crore) which is one-tenth of the combined valuation
of the Asia region. The market was slow since early 2007 and continued till the first
quarter of 2009.

The Indian equity market depends on three factors -

Funding into equity from all over the world

Corporate houses performance
Monsoons

The equity market is also affected through trade integration policy. The
country has advanced both in foreign institutional investment (FII) and trade
integration since 1995. This is a very attractive field for making profit for medium
and long term investors, short-term swing and position traders and very intra day
traders.

The Indian market has 22 stock exchanges. The larger companies are
enlisted with BSE and NSE. The smaller and medium companies are listed
with OTCEI (Over The counter Exchange of India). The functions of the Equity
Market in India are supervised by SEBI (Securities Exchange Board of India).

The Indian Equity Market was not well organized or developed before
independence. After independence, new issues were supervised. The timing,
floatation costs, pricing, interest rates were strictly controlled by the Controller of
Capital Issue (CII).

In the 1950s, there was uncontrollable speculation and the market was
known as Satta Bazaar'. Speculators aimed at companies like-Tata Steel,
Kohinoor Mills, Century Textiles, Bombay Dyeing and National Rayon. The
Securities Contracts (Regulation) Act, 1956 was enacted by the Government of
India. Financial institutions and state financial corporation were developed through
an established network.

Two new stock exchanges, NSE (National Stock Exchange of India)

established in 1994 and OTCEI (Over the Counter Exchange of India)
established in 1992 gave BSE a nationwide competition. In 1995-96, an
amendment was made to the Securities Contracts (Regulation) Act, 1956 for
introducing options trading. In April 1995, the National Securities Clearing
Corporation (NSCC) and in November 1996, the National Securities Depository
Limited (NSDL) were set up for demutualised trading, clearing and settlement.

!!!!.....Equity Markets climb a wall of worry..!!!!

 The Sensex has returned about 18.62 % compounded
Annual return over the past 27 years in spite of following
Uncertainty..!!!

1 War (With Pakistan Kargil 1999).

Increasing Terrorism and threats to Internal Security (Punjab, J&K, Assam ,
Naxalite problem in Bihar & other parts of India).
2 Major financial scandals and a number of minor ones (Harshad Mehta,
Ketan Pareikh, C.R. Bhansali,Sanjay Agarwal etc).
2 assassinations of Prime ministers (Indira Gandhi & Rajiv Gandhi).
Number of communal riots (Ayodhya, Godhra - They keep happening with
immaculate consistency).
More then 11 different Governments perusing different manifestos and putting
all of them under a common banner titled Common Minimum Program..
Poor Monsoons on more then 3 to 4 occasions. Each year the market
speculates as to how the Monsoons have hit the coast of Kerala but
over alonger period of time they do not matter. More so with increasing
irrigation systems and development our dependence on monsons will come
down further.
Mortgage of Gold to tide over the foreign exchange crisis (In 1991 the Indian
Govt. mortgaged Gold to the Bank of England).
Coalition governments have governed major portion of the last 25 years.
Numerous numbers of natural calamities and disasters (Tsunami 2004,
Gujarat Earthquake 2001, Surat Plague 1995).

In this way, stock prices are rising regardless of market uncertainties,

so, the stock market is said to be climbing a wall of worry. These worries may
include political or economic risks etc.
 INTRODUCTION OF VARIOUS SECTORS

A. Meaning of Sector:

There are many companies or scrip that manufacturer the same

products and provide services are specified under the particular name that
called Industry or Sector.

There are many other different kinds of industries, and often organized
into different classes or variety of industrial classifications its called Sector.

In this report, I have study on these Five Sectors which are:

Oil & Gas Sector

1.
Banking Sector
2.
IT Sector
3.
Infrastructure Sector
4.
Automobile Sector
5.
 List of various sector:

SECTORS
Agro Inputs Sector IT Sector

Agriculture Sector Insurance Sector

Auto Ancillaries Sector Infrastructure Sector

Automobile Sector Mining Sector

Aviation Sector Media & Entertainment Sector

Banking Sector Medical Sector

Cement Sector Oil & Gas Sector

Chemicals Sector Paint Sector

Cigarettes Sector Paper Sector

Construction Sector Pharmaceutical Sector

Consumer Durables Sector Petrochemicals

Courier & Logistic Services Sector Power Sector

Cycle & Accessories Sector Real Estate Sector

Engineering Sector Retail Sector

Financial Institutions Sector Sugar Sector

Food Products Sector Service Sector

FMCG Sector Shipping Sector

Fertilizer Sector Steel Sector

Garment Sector Tele communication Sector

Health Care Sector Textiles Sector

 INTRODUCTION OF selected SECTORS

1. Oil & gas Sector:

The oil & gas industry in recent years has been characterized by rising
consumption of oil products, declining crude production & low reserve accretion.
India remains one of the least-explored countries in the world, with a well density
among the lowest in the world. India is the fourth largest oil consumption zone
in Asia, even though on a per capita basis the consumption is a mere 0.1 tonne,
the lowest in the region- This makes the prospects of the Indian Oil industry even
more exciting.

The oil and gas industry has been instrumental in fuelling the rapid growth
of the Indian economy. The petroleum and natural gas sector which includes
transportation, refining and marketing of petroleum products and gas industry
constitutes over 15 per cent of the GDP.

India's domestic demand for oil and gas is on the rise. As per the Ministry of
Petroleum, demand for oil and gas is likely to increase which is 186.54 million
tonnes in 2008-09.

India is emerging as the global hub for oil refining with capital costs
lower by 25 to 50 per cent over other Asian countries.

Already, the fifth largest country in the world in terms of refining capacity,
with a share of 3 per cent of the global capacity, India is likely to boost its refining
capacity by 45 per cent or 65.3 to 242 mtpa (million tonne per annum) over the
next five years.
 2. Banking Sector:

Banking in India originated in the last decades of the 18th century. The
oldest bank in existence in India is the State Bank of India, a
government-owned bank that traces its origins back to June 1806 and that is the
largest commercial bank in the country. Central banking is the responsibility of
the Reserve Bank of India, which in 1935 formally took over these responsibilities
from the then Imperial Bank of India.

The banking sector will navigate through all the aspects of the Banking
System in India. It will discuss upon the matters with the birth of the banking
concept in the country to new players adding their names in the industry in coming
few years. The banker of all banks, Reserve Bank of India (RBI), the Indian Banks
Association (IBA) & top 20 banks like IDBI, HSBC, ICICI, ABN AMRO, etc.

With the Indian economy moving on to a high growth trajectory,

consumption levels soaring & investment riding high, the Indian banking sector is
at a watershed. Further, as Indian companies globalize & people of Indian origin
increase their investment in India, several Indian banks are pursuing global
strategies,

In the Third Quarter Review of Monetary Policy for 2009-10, the RBI
observed that the Indian economy showed a degree of resilience as it recorded a
better-than-expected growth of 7.9 percent during the second quarter of 2009-
10.

The industry has been growing faster than the real economy, resulting in the
ratio of assets of commercial banks to GDP increasing to 92.5 per cent at end-
March 2007. The Indian banks have also been doing exceptionally well in the
financial sector with the price-to-book value being second only to china, according
to a report by (BCG) Boston Consultancy Group.

3. IT Sector:
 Over the past decade, the Information Technology (IT) industry has
become one of the fastest growing industries in India. The key segments that have
contributed significantly (96 percent of total) to the industrys exports include
Software & services (IT services) & IT-enabled services (ITeS) i.e. business
services. Over a period of time, India has established itself as a preferred global
sourcing base in these segments & they are expected to continue to fuel growth in
the future.

At present, India is emerging as one of the popular Software outsourcing

locations to offer cost effective software solutions. The contribution of India in
Software Outsourcing is remarkable. One just can not reject the reality that currently
India is described as the most prospering name in software outsourcing. Now there
are several grounds for this flourishing popularity of the offshore IT outsourcing
services of India. The prime reason for choosing India, as an offshore development
partner in software outsourcing business is the availability of enormous pool of
educated manpower combined with world-class quality offerings.

The Indian information technology (IT) industry has played a key role
in putting India on the global map. Thanks to the success of the IT industry, India
is now a power to reckon with. According to the National Association of Software
and Service Companies (NASSCOM), the apex body for software services in India,
the revenue of the information technology sector has risen from 1.2 per cent of
the gross domestic product (GDP) in FY 1997-98 to an estimated 5.8 per cent in
FY 2008-09. Further, the industry body expects the sector to grow between 4 per
cent and 7 per cent during 2009-10 and return to over 10 per cent growth next
year.

India's IT growth in the world is primarily dominated by IT software and

services such as Custom Application Development and Maintenance (CADM),
System Integration, IT Consulting, Application Management, Software testing, and
Web services.

According to NASSCOM, software and services exports (including exports

of IT services, business process outsourcing (BPO), engineering services and
research and development (R&D) and software products) reached US$ 47 billion
in FY 2008-09, contributing nearly 78 per cent to the total software and services
revenue of US$ 59.6 billion.

India's domestic market has also become a force to reckon with, as the
existing IT infrastructure evolves both in terms of technology and depth of
penetration.

According to NASSCOM, domestic IT market (including hardware) reached

US$ 24.3 billion in FY 2008-09 as against US$ 23.1 billion in FY 2007-08, a
growth of 5.3 per cent.

Investments:

The Andhra Pradesh Government expects the IT-related SEZs and

Software Technology Parks of India (STPI) in the State to receive about
US$ 3.27 billion investments in the next five years.
Mahindra Satyam has tied up with defence and security company Saab to
develop its operations in India for the global defence and homeland security
market. The estimated deal value is US$ 400 million.
San Francisco-based Virtualisation solutions provider VMware Inc plans to
invest US$ 100 million in India by end 2010.
The total investments of EMC Corporation, a leading global player of
information infrastructure solutions, in India will touch US$ 2 billion by 2014.

The Indian information technology sector continues to be one of the sunshine

sectors of the Indian economy showing rapid growth and promise.

4. Infrastructure Sector:
Infrastructure is the basic physical and organizational structures needed
for the operation of a society or enterprise, or the services and facilities necessary
for an economy to function. The term typically refers to the technical structures that
support a society, such as roads, water supply, sewers, power grids,
telecommunications, and so forth.

India's Infrastructure has been expanding at an accelerated pace to

support the economic growth rate of over 9 per cent. The six core-infrastructure
industries, which account for a combined weight of 26.68 percent in the index of
industrial production (IIP), registered a growth of 8.6 percent in 2006-07 as against
6.2 percent during 2005-06.

The growth has continued apace during the current fiscal, with the six
core-infrastructure industries growing at the rate of 6.9 percent during April-
September 2007. Significantly, electricity recorded a growth rate of 7.6 per cent
compared to 6.7 per cent in the same period last year. Other sectors recording
major growth include: petroleum refinery products (9.8 per cent), cement (8.3 per
cent) & finished (carbon) steel (6.6 per cent).

Infrastructure investment in India is set to grow dramatically accelerated by

5.3 percent in 2008-09. India has become a major outbound investor and people
are engaging with Indians to seek investment into their countries, said the Minister
for Road Transport and Highways, Mr Kamal
Nath,According to investment banking company Goldman Sachs, India's
infrastructure sector will require US$ 1.7 trillion investment in the next 10-
years. It also added that such investment would come more from the domestic
market than overseas.

5. Automobile Sector:
 Automobile industry is one of the fastest growing industries of the world.
With more than 2 million new automobiles rolling out each year, on roads of
India, the industry is set to grow further.

Automobile industry made its silent entry in India in the nineteenth century.
Since the launch of the first car in 1897, India automobile industry has come a long
way. Today India is the largest three wheeler market in the world and is
expected to take over China as the second largest automobile market, in the
coming years.

Some facts on Automobile industry in India:

India has the fourth largest car market in the world

India has the largest three wheeler market in the world
India is the second largest producer of two wheelers in the world
India ranks fifth in the production of commercial vehicles

The growth of the Indian middle class along with the growth of the economy
over the past few years has attracted global auto majors to the Indian market.
Moreover, India provides trained manpower at competitive costs making India
a favoured global manufacturing hub. The attractiveness of the Indian markets
on one hand and the stagnation of the auto sector in markets such as Europe, US
and Japan on the other have resulted in shifting of new capacities and flow of
capital to the Indian automobile industry.

Global auto majors such as Japanese auto majors Suzuki, Honda and
Korean car giant Hyundai are increasingly banking on their Indian operations to
add weight to their businesses, even as numbers stay uncertain in developed
markets due to economic recession and slowdown.

According to figures released by the Society of Indian Automobile

Manufacturers (SIAM), domestic passenger car sales have increased 32.28
percent to reach 145,905 units in January 2010 from 110,300 units in the same
month last year.
Across all categories, total sale of vehicles increased 44.94 per cent to
1,114,157 units in January 2010, against 768,698 units in the January 2009.

The Indian auto industry is likely to see a growth of 10-12 percent in sales
in 2010, according to a report by the global rating firm.

India has become the second-largest maker of small cars, overtaking

Brazil. Small cars account for 80 per cent of the domestic market (up from 75 per
cent last year) and exports are growing at top speed. According to SIAM, small
car exports rise 53 percent between April and September 2009 to 197,249 units
against 129,090 units a year ago.

In order to make India a power to reckon with in the automotive sector

the government launched the Automotive Mission Plan (AMP) 2006-2016.

The vision of the AMP is "to emerge as the destination of choice in the
world for design and manufacture of automobiles and auto components with
output reaching a level of US$ 145 billion accounting for more than 10 per
cent of the GDP and providing additional employment to 25 million people by
2016." As per the AMP, it is estimated that the total turnover of the automotive
industry in India would be in the order of US$ 122 billion - US$ 159 billion in 2016.

Further, by 2016, the automotive sector would double its contribution to

the country's GDP from current levels of five percent to 10-12 per cent.

List of companies under selected SECTORS

OIL & GAS SECTOR:

Indian Oil Corporation
ONGC (Oil and Natural Gas Corporation India.)
 Essar Oil Limited
Gas Authority of India Limited
Oil India Limited
Gujarat Gas
Indian Oil
Aban
Tata Petrodyne
Gas Projects (India) Private Limited
Hindustan Oil Exploration Company Limited
India LPG
Oil Gas India
etc

BANKING SECTOR:

State Bank of India

ICICI Bank
Unit Trust of India (UTI)
HDFC (Housing Development Financial Corporation)
ABN Amro Bank
HSBC
IDBI Bank
Union Bank of India
Central Bank of India
Bank of Baroda
etc

IT SECTOR:
Infosys
TCS Limited
Wipro
Microsoft
 L&T Infotech Ltd.
Lenovo
HCL
Mahindra Satyam
etc

INFRASTRUCTURE SECTOR:
DLF
Reliance Infrastructure
HCC Infrastructure
Maytas Infra Limited
GMR Infrastructure
IBR Infrastructure
etc

AUTOMOBILE SECTOR:
Hero Honda
Ford Motor
Honda Motors
Bajaj Auto
Tata Motors
Maruti Suzuki
TVS Motors
Mihindra Motors
Yamaha Motors
etc

INTRODUCTION OF CAPITAL MARKET

Concept:
 Capital market is the markets for funds which have a long or undefined
maturity i.e. it deal with long term funds. Generally capital market supplies long
term and medium term securities and funds, which have a maturity period of above
one year. Capital market generates the funds from the saver and transfer to user.
Generally it done with ordinary share, stocks, debentures and bonds of
corporations and securities of the government. They do so by converting financial
assets into productive physical assets.

Capital market provides a market mechanism for those who have savings
and to those who need funds for productive investments. It diverts resources from
wasteful and unproductive channels to productive investment.

The Capital Market:

The origination of the Indian securities market may be traced back to 1875,
when 22 enterprising brokers under a Banyan tree established the Bombay Stock
Exchange (BSE). Over the last 133 years, the Indian securities market has evolved
continuously to become one of the most dynamic, modern and efficient securities
markets in Asia. Today, Indian markets conform to international standards both in
terms of structure and in terms of operating efficiency.

A capital market is a market for securities (debt or equity), where

business enterprises (companies) and governments can raise long-term funds. It is
defined as a market in which money is provided for periods longer than a year, as
the raising of short-term funds takes place on other markets

Structure and Size of the Markets:

Corporation of the exchanges assumes the counter-party risk of each
member and guarantees settlement through a fine-tuned risk management system
and an innovative method of online position monitoring. It also ensures the financial
settlement of trades on the appointed day and time irrespective of default by
members to deliver the required funds and/or securities with the help of a
settlement guarantee fund. Today India has two national exchanges, the Bombay
Stock Exchange (BSE) and the National Stock Exchange (NSE). Each has fully
electronic trading platforms with around 9400 participating broking outfits.

BSE reaches to over 400 cities and town nation-wide and has around 4,937
listed companies, with over 7745 scripts being traded as on 31st
July 09. The companies listed on BSE command a total market capitalization of
USD Trillion 1.06 as of July, 2009.

NSE has a market capitalization of around Rs 47,01,923 crore

(7 August 2009)

There are some 9600 companies listed on the respective exchanges. Any
market that has experienced this sort of growth has an equally substantial demand
for highly efficient settlement procedures.

In India 99.9% of the trades, according to the (NSDL) National

Securities Depository Limited, are settled in dematerialized form in a T+2 rolling
settlement environments. In addition, trades are guaranteed by the National
Clearing Corporation of India Ltd (NSCCL) and Bank of India Shareholding Ltd
(BOISL), Clearing Corporation houses of NSE and BSE respectively. The main
functions of the Clearing Corporation are to work out (a) what counter parties owe
and (b) what counter parties are due to receive on the settlement date.
Furthermore, each exchange has a Settlement Guarantee Fund to meet with any
unpredictable situation and a negligible trade failure of 0.003%.

Highlights of the highly attractive Indian capital markets:

Two major reasons why Indian securities are now increasingly regarded as
attractive to international investors are:

1. The relatively high returns compared with more developed global markets
as well as the low correlation with world markets.
 2. However until the early 90s, the foreign investors only way of accessing the
Indian capital markets was through listed country funds

Indias Security Market

A Brief History

The capital market is one of the most exciting sectors in the financial
system, marking an important contribution to economic development.

Asia Focus was launched by the Unit Trust of India (UTI) in London in 1986.
The success of this initiative ensured that this fund was followed by numerous
others. Indian companies are now also allowed to raise equity capital in the
international market through the issue of GDRs. In 2004, there are 498 Foreign
Institutional Investors who hold 1325 sub-accounts with a net investment of
approximately $15 billion. Indias regulator, the Securities Exchange Board of India
(SEBI) is playing more of a development role rather than being merely a watchdog.
Transparency, competitiveness and equal opportunity to all market participants
has been the driving philosophy behind all the development and regulatory
initiatives of SEBI. The availability of derivative products including index futures,
index options, individual stock futures and individual stock options re-enforces the
overall attractiveness of this market to foreign and domestic investors. The
derivatives market in only two years has shown spectacular growth. Compared to
last financial year the annual turnover grew by over 300%. As if further evidence
was needed of Indias willingness to embrace change, the availability of Internet
trading and dual fungibles of American Depository Receipts (ADRs) and Global
Depository Receipts (GDRs) provides a clear indication of the vibrancy and
dynamism of the Indian securities market.

Meaning of Capital Market

Capital market refers to the market for rising of financial resources

by the business enterprises, firms, government, semi-
government bodies, public sector units and other organization.

OR
 A market where debt or equity securities are traded.

A capital market is a market for securities (debt or equity), where business

enterprises (companies) and governments can raise long-term funds. It is defined
as a market in which money is provided for periods longer than a year, as the
raising of short-term funds takes place on other markets (e.g., the money market).

The capital market includes the stock market (equity securities) and the bond
market (debt).
Capital markets may be classified as:
1) Primary markets
2) Secondary markets

In primary markets, new stock or bond issues are sold to investors via a
mechanism known as underwriting.

In the secondary markets, existing securities are sold and bought among
investors or traders, usually on a securities exchange, over-the-counter, or
elsewhere.

Investors purchase securities in the capital markets in order to extract a return

and earn profit on the securities.

CHART OF CAPITAL MARKET

CAPITAL MARKET
 Types of Capital/Security Market:

The securities market can be divided in to three parts:

A. Industrial securities market

B. Government securities market
C. Long term loans market

A. Industrial Security Market:

The industrial securities market consists of two complementary parts i.e. the
New Issue Market, and Secondary Market.

It is a market for industrial securities namely:

 (i) Equity shares or ordinary shares or common stock.
(ii) Preference shares
(iii) Debenture or Bonds.

The corporate sector raises their capital through these above three types of
securities. This is the physical or tangible asset through which the market functions.

1. Equity Shares:

Equity shares represent proportionate ownership in the company. Investors

who own equity shares of a company are entitled to ownership rights, like voting
for selection of directors on the Board, share in profits of the company, etc.

Investors who own equity shares in a company are called shareholders.

They are ordinary shares with no guarantee of dividend. Equity shares gain
maximum returns when there are high profits.

The Indian Equity Market is more popularly known as the Indian Stock
Market. The Indian equity market has become the third biggest after
China and Hong Kong in the Asian region.
According to the latest report by ADB, it has a market capitalization of
nearly $600 billion. As of March 2009, the market capitalization was around
$598.3 billion (Rs 30.13 lakh crore) which is one-tenth of the combined valuation
of the Asia region. The market was slow since early 2007 and continued till the first
quarter of 2009.

2. Preference Shares:

Stock whose holders are guaranteed priority in the payment of

dividends but whose holders have no voting rights

Preference shareholders do not have voting rights. They generally bear a

fixed dividend, payable if the company declares dividends.

Preference shares have different features and are accordingly available as:
 Cumulative and non-cumulative preference shares
Redeemable and non-redeemable preference shares
Convertible and non-convertible preference shares
Preference shares with a combination of the above features.

3. BONDS:

A bond is a debt security, in which the authorized issuer owes the

holders a debt and, depending on the terms of the bond, is obliged to pay
interest (the coupon) and/or to repay the principal at a later date, termed
maturity.

A bond is a formal contract to repay borrowed money with interest at

fixed intervals.

While the size of Indian dept market is 239.2 (US$ billion) which is 34.5%
of GDP as on 2004 -05.

Many financial institutions like IDBI, ICICI, and IFCI, have been raising
capital for their operations by issuing of bonds. These too are available in a large
variety.

These include Income bonds, Tax-free bonds, Capital gains bonds,

Infrastructure bonds, Retirement bonds etc

Company raises it capital in the primary market though:

1) Primary Market (New Issue Market):

Primary market is the market for those securities which are issued first time
in the market for the public. The New Issue Market deals with new securities i.e.
securities which were not previously availably and are offered to the investing
public for the first time.

Primary market is a market for new issues or new financial claims.

Hence, it is called New Issue Market.
 In the Primary market, borrowers exchange new financial securities for long
term funds. It facilitates capital formulation.

Companies raise its capital in the primary market though:

(i) Public Issue

(ii) Right Issue
(iii) Primary placement/subscription
Public Issue is most popular method of raising capital is sale of securities
to the public by new companies is called Public Issue.
Right Issue means, when existing company first offered. The security to
existing shareholders on Preemptive bases, while company want to raise
additional capital is called capital is called Right Issue.
Private placement imagine private sale of securities to small group
investors.

2) Secondary Market:

Secondary market is the market for those securities which have already
been available in the market and listed on a stock exchange. The main benefit of
Secondary market is securities sold and purchased continuously among investors
without involvement of company. This market consists of all stock exchange
recognized by the Government of India. The stock exchange in India are regulated
under the securities contracts (Regulation) Act, 1956.

B. Government Security Market:

The government securities market (G-secs) is the largest segment of the

long term debt market in India, accounting for nearly two-thirds of the issues in the
primary market and more than four fifths of the turnover in the secondary market.

It is otherwise called Gilt-Edged securities market. It is a market where

Government securities are traded. In India there are many kinds of Government
Securities-short term and long term. Long term securities are traded in this market
while short term securities are traded in the money market. Securities issued by
the Central Government, State Government, Semi Government authorities like
city Corporation, Port Trusts etc. Improvement Trusts, State Electricity Boards, All
India and State level financial institutions and public sector enterprise are dealt in
this market.

Participants in the G-secs Market:

Banks are the largest holders of G-secs. About onethird of the net demand
and time liabilities of the banks are partly in government securities market mainly
to meet statutory liquidity requirements and partly for investment purpose. Other
investor in G-secs includes mutual funds, primary and satellite dealers, and trusts.

Government securities are issued in denominations of RS. 100. Interest is

payable half- yearly and they carry tax exemptions also. The role of brokers in
marketing these securities is practically very limited and the major participant in
this market in the commercial banks because they hold a very substantial
portion of these securities to satisfy their S.L.R. requirements.

The secondary market for these securities is very narrow since most of the
institutional investors tend to retain these securities until maturity.

The Government securities are in many forms. These are generally:

(i) Stock certificates of inscribed stock

(ii) Promissory Notes
(iii) Carrier Bonds which can be discounted.

Government securities are sold through the Public Debt Office of the RBI
while Treasury Bills are sold through auctions.

Government securities offer a good soured of raising inexpensive finance

for the Government exchequer and the interest on these securities influences the
prices and yields in this market. Hence this market also plays a vital role in
monetary management.
 C. Long Term Loan Market:

Development banks and commercial banks play a significant role in this

market by supplying long term loans to corporate customers.

Long term loans market may further be classified into:

(i) Term loans market

(ii) Mortgages market
(iii) Financial Guarantees market

Term Loans Market:

Term loans: A loan from a bank for a specific amount that has a
specified repayment schedule and a floating interest rate. Term loans almost
always mature between 1 and 10 years.

In India, many industrial financing institutions have been created by the

Government both at the national and regional levels to supply long term and
medium term loans to corporate customers directly as well as indirectly. These
development banks dominate the industrial finance in India.

Institutions like IDBI, IFCI, ICICI, and other state financial corporations come
under this category. These institutions meet the growing and varied long term
loans. They also help in identifying investment opportunities, encourage new
entrepreneurs and support modernization efforts.

Mortgages Market:

The mortgage market refers to these centers which supply mortgage loan
mainly to individual customers. A mortgage loan is a loan against the security
of immovable properly like real estate. The transfer of interest in a specific
immovable properly to secure a loan is called mortgage. These mortgages may be
equitable mortgage or legal one. Again it may be a first charge of title deeds to
properties as security whereas in the case of a legal mortgage the title in the
property is legally transferred to the lender by the borrower. Legal mortgage is less
risky.
 Similarly, in the first charge, the mortgages transfer his interest in the
specific property to the mortgagee as security. When the properly in question is
already mortgaged once to another creditor, it becomes a second charge when it
is subsequently mortgaged to somebody else. The mortgagee can also further
transfer his interest in the mortgaged property to another, in such a case; it is called
a sub mortgage.

The mortgage market may have primary market as well secondary market.
The primary market consists of original extension of credit and secondary market
has sales and re-sales of existing mortgages at prevailing prices.

In India residential mortgages ate the most common ones. The Housing and
Urban Development Corporation and the LIC play a dominant role in financing
residential projects. Besides, the Land Development Banks provides cheap
mortgages loans for the development of lands, purchase of equipment etc. These
development banks raise finance through the sale of debentures which are treated
as trustee securities.

Financial Guarantees Market:

Financial Guarantees is a non-cancelable indemnity bond guaranteeing

the timely payment interest and repayment of principal to the buyers (holders) of a
debt security at a maturity date.

A guarantees market is a centre where finance is provide against the

guarantee of a reputed person in the financial circle. Guarantee is a contract to
discharge the liability of a third party in case of his default. Guarantee acts as a
security from the creditors point of view. In case the borrower fails to repay the
loan, the liability falls on the shoulders of the guarantor. Hence the guarantor must
be known to both the borrower and the lender and he must have the means to
discharge his liability.

Though there are many types of guarantees, the common forms ate:
 (i) Performance Guarantee
(ii) Financial Guarantee
Performance guarantees cover the payment of earnest money, retention
money, advance payments, non-completion of contracts etc. On the other hand
financial guarantees cover only financial contracts.

In India, the market for financial guarantees is well organized. The financial
guarantees in India relate to:

(i) Deferred payments for imports and exports

(ii) Medium and long term loans raised abroad
(iii) Loans advanced by banks and other financial institutions
These guarantees ate provided mainly by commercial banks, development
banks, Governments both central and states and other specialized guarantee
institutions like ECGC (Export Credit Guarantee Corporation) and DICGO (Deposit
Insurance and Credit Guarantee Corporation). This guarantee financial service is
available to both individual and corporate customers. For a smooth functioning of
any financial system, this guarantee service is absolutely essential.

Capital Market Instruments

There are a number of capital market instruments used for market trade,
including stocks, bonds, debentures, T-bills, foreign exchange, fixed deposits, and
others. These are used by the investors to make a profit out of their respective
markets. All of these are called capital market instruments because these are
responsible for generating funds for companies, corporations, and sometimes
national governments.

This market is also known as securities market because long term funds are
raised through trade on debt and equity securities. These activities may be
conducted by both companies and governments.
 Stocks and bonds are the two basic capital market instruments used in both
the primary and secondary markets.

There are different types of capital market instrumentsLike.

DEBENTURES

BONDS

PREFERENCE SHARES

EQUITY SHARES

GOVERNMENT SECURITIES

DEBENTURES:
A type of fixed-interest security, issued by companies (as
borrowers) in return for medium and long-term investment of funds. A
debenture is evidence of the borrower's debt to the lender.

These are issued by companies and regulated under the SEBI guidelines
of June 11, 1992.

The following are types of debentures:-

Convertible debentures

Non-Convertible debentures

Zero coupon convertible notes

 Zero interest fully convertible debentures

Fully convertible debentures with interest

Partly convertible debentures.

BONDS:
A bond is a debt security, in which the authorized issuer owes the
holders a debt and, depending on the terms of the bond, is obliged to pay
interest (the coupon) and/or to repay the principal at a later date, termed
maturity.

A bond is a formal contract to repay borrowed money with interest at

fixed intervals.

International Bond Market is very big and has an estimated size of nearly
$47 trillion. The size of the US bond market is the largest in the world. The US
bond market's outstanding debt is more than $25 trillion.

While the size of Indian dept market is 239.2 (US$ billion) which is 34.5%
of GDP as on 2004 -05.

Indian development financial institutions like IDBI, ICICI, and IFCI, have
been raising capital for their operations by issuing of bonds. These too are
available in a large variety. These include:

Income bonds
Tax-free bonds
Capital gains bonds
Deep discount bonds
Infrastructure bonds
Retirement bonds etc
 PREFERENCE SHARES:
Stock whose holders are guaranteed priority in the payment of
dividends but whose holders have no voting rights

Preference shareholders do not have voting rights. They generally bear a

fixed dividend, payable if the company declares dividends.

Preference shares have different features and are accordingly available as:

Cumulative and non-cumulative preference shares

Redeemable and non-redeemable preference shares
Convertible and non-convertible preference shares
Preference shares with a combination of the above features.

EQUITY SHARES:
Equity shares represent proportionate ownership in the company. Investors
who own equity shares of a company are entitled to ownership rights, like voting
for selection of directors on the Board, share in profits of the company, etc.

Investors who own equity shares in a company are called shareholders.

They are ordinary shares with no guarantee of dividend. Equity shares gain
maximum returns when there are high profits.

As a shareholder, the extent of your ownership (your stake) in a company

depends on the number of shares you own in relation to the total number of shares
available

For example, if you buy 1000 shares of stock in a company that has
issued a total of 100,000 shares, you own one per cent of the company.
 A shareholder or a beneficial owner can exit from the ownership by selling
the shares. An investor can become shareholder/beneficial owner of a company
by purchasing shares of the company.

Shareholders are entitled to share profit of the company in the form of

"dividend" on "bonus shares", if Board of Directors and majority of the shareholders
agree. If a company is wound up for any reason, equity shareholders may receive
money from the residual funds after satisfying all other liabilities.

GOVERNMENT SECURITIES:
Government securities (G-secs) are sovereign securities which are issued
by the Reserve Bank of India on behalf of Government of India.

The term Government Securities includes:

Central Government Securities

State Government Securities
Treasury bills

The Central Government or State Governments issue securities periodically

for the purpose of raising loans from the public.

There are two types of Government Securities

I. Dated Securities
II. Treasury Bills
 Dated Securities: Dated Securities have a maturity period of more than one
year.

Treasury Bills: Treasury Bills have a maturity period of less than or up to

one year.

The Public Debt Office (PDO) of the Reserve Bank of India performs all
functions with regard to the issue management, settlement of trade, distribution of
interest and redemption. Although only corporate and institutional investors
subscribe to government securities, individual investors are also permitted to
subscribe to these securities.

An investor has to approach RBI to receive government securities in

physical form. Investors can invest in book entry form with Banks and other
institutions like NSDL, SHCIL, and NSCCL etc. NSDL facility to buy and hold
government securities is convenient because of its reach and depository account
opened for other securities can be used for holding government securities.

Importance of Capital Market

Capital market is important as it plays an important role in bringing rapid

industrial development in a country. The savings are invested profitably for
economic development because of the services offered by capital market.
Mobilization of investable surplus and provision of expert services to investors and
companies are two significant activities undertaken by the capital market.

Capital market is importance due to: It enables the investors to adopt their
investment to their expectations which are constantly changing.

It acts as a link between those who want to save funds and those who
need funds and are in a position to invest them with safety and reasonable
return.
It provided the capital to those enterprises which can apply it profitably,
productively and increase the aggregate national income.
 It provides proper flow of funds and brings about the rational allocation of
resources through the conversion of financial assets into physical assets.
Thus, the capital market facilitates capital formation.
It provides incentives to saving and facilitates capital formation by offering
suitable rate of interest as the price of capital.
It facilitated buying and selling of securities at listed price by providing
continuously marketability to the investors.
The securities offered in the capital market are transferable in character.
The changing business conditions in the economy are immediately reflected
on capital market. Booms and depression can be identified by capital
market. So suitable monitory and fiscal policies can be taken by
government.
Capital market supplies securities of different kinds with different maturity
and yields in unable the investors to diversify their risk by wider portfolio of
investment.
 RESEARCH METHODOLOGY

Introduction:
Research is one of the best instruments to identify the investing pattern of
investors to invest in various sectors & to study different sectors of Capital market.

Definition:
Research is careful inquiry or examination to discover new
information and relationship and to expand and to vary existing knowledge.
 Research always starts with question or any problem and finds answer of
problem by using scientific method. It gives complete knowledge about any
problem or question.

Objective of Study (research):

Every study is conducted within for some specific purpose or to solve some
problem. When any research is conducted it has some primary objective that helps
to solve the main problem whereas a secondary objective helps to solve peripheral
problems. The primary and secondary objectives of this research are:

Primary Objective:
The primary objective of carrying out this research is:--

Investors behaviour for Investing in Equity Market in Various Sectors

Secondary Objectives:

To find out in which investment option people invests most.

To find out how investors are motivates for investing in Equity Market.

To study the general investment criteria of people.

To know the peoples time horizon for investing in Equity Market and to know

the rate of return expected by them.

To study the interest of people for further investment in Equity Market.

To assess the customer satisfaction level for investing in equity market.

To classify the different sector on the basis of investors behaviour regarding

investing in equity market.
 To identify various motivation factor which affect to investor while investing
in various selected sectors.

BENEFITS OF STUDY:

The study carried out under the title of Investors Behaviour for Investing
in Equity Market in Various Sectors will give benefits as under:

The research will be help to know in which sector investors are investing

more.

The study will be helpful in knowing that what factors consider most

important while selecting the Sectors and company under the sectors.

The study will be helpful in knowing that how the investors are trade in Equity

market.

The study will be helpful in knowing responses regarding problems faced by

the investors while investing in Equity Market

The study will be helpful in knowing that what are the motivational factors

that encouraging to the investors for investing in Equity Market.

LIMITATIONS OF THE STUDY:

As no human being is perfect, it is not possible for anyone to make the best
or perfect report. Each person has some level of knowledge and is affected by
some uncontrollable factors within which he/she has to work. So, it might
possible that there can be some limitations in this report that may be due to my
knowledge level or some other factors.

According to me following limitations can be prevailing in my report:

 Respondents might have felt hesitation in providing information related to
their age, income etc. So, there can be some data that might questionable
because of unwillingness of respondents to give right information.
Sample selected may not represent whole population, as sample size
selected is very small in proportion to population due to time and cost
constraints.

Even many of the respondents may give bias answer.

Research Design:

Research design is the plan structure and strategy if investigation

conceived so as obtain answers to research question and to control
variance

A research design is the master plan or model for the conduct of formal
investigation and survey. It is a specification of methods and procedures for
acquiring the information needs for solving the problem. It decides the source of
information and methods for gathering the data. A questionnaire and other forms
are tested to use the collection of data.
 In the research study there is no perfect study to solve the problem. The
research design has broadly three categories as follow.

RESEARCH
DESIGN

Exploratory Descriptive Casual

Research Research Research

1. Exploratory Research
I have used Descriptive Research
2. Descriptive Research
Design for research purpose.
3. Casual Research

2. Descriptive Research:

Descriptive research, also known as statistical research. It describes

data and characteristics about the population or phenomenon being studied.

Descriptive research answers the questions who, what, where, when and
how. This study is complex and determines high degree scientific skill to study the
problem.
 The description is used for frequencies, averages and other statistical
calculations. Often the best approach, prior to writing descriptive research, is to
conduct a survey investigation. Qualitative research often has the aim of
description and researchers may follow-up with examinations of why the
observations exist and what the implications of the findings are.

In short descriptive research deals with everything that can be counted and
studied.

In this report, I have used this Descriptive Research Design for

conducting survey on Investors behaviour for Investing in Equity Market in
Various Sectors

Data Collection Method:

Data collection usually takes place early on in an improvement project, and

is often formalized through a data collection plan which often contains the following
data collection methods.

The source of data collection method is as follows.

Primary Data
Secondary Data

Primary Data:

Primary data means data collected directly from first-hand experience.

Means data collected for the first time by any researcher for any research use.
There are many methods of collecting primary data and the main methods
include:

Methods of collecting the primary data are:

 Questionnaire method
Interviews method
Focus group interviews
Observation method
Case-studies method
Diaries method

I have used Questionnaire method for the Primary data collection for
the study.

Secondary Data:

Secondary data means data which are collected by any one for a particular
research purpose and which are used by others for different purpose.

I have also used the secondary data for the study like some company
resources like broachers, websites etc.

Sampling Plan:

Sampling is the process to analyze the whole population

by analyzing a part of it.
 The effectiveness of the report depends on the sample size selected from the
population.

Sampling Unit:

Here, target population is decided who are the actual and potential
investors, each sample has the chance to be selected on an equal basis & this
research has been conducted through surveying the whole of the equity market of
Surat city

Sample Size:

For getting better result of the given problem I have to determine the perfect
sample size as on 90% confidence level which is calculated statically by the given
formula.

n = p*q (z /c) 2
Where,

n = sample size

p = percentage picking a choice (expressed as decimal)

q = (1 - p)

Z = Z value (e.g. 1.645 for 90% confidence level)

c = confidence interval, expressed as decimal

(e.g., 0.05 = 5)

For Example:

p = 0.80 q = 0.20

z = 1.645 c = 0.05

n = p*q (z /c) 2
= 0.80*0.20 (1.645/0.05) 2
 = 173.1856

= 175

Therefore, I used sample size is 175

Confidence interval:
In statistics, a confidence interval (CI) is a particular kind of interval
estimate of a population parameter. Instead of estimating the parameter by a single
value, an interval likely to include the parameter is given. Thus,
confidence intervals are used to indicate the reliability of an estimate.

The end points of the confidence interval are referred to as confidence

limits.

A confidence interval is always qualified by a particular confidence level,

usually expressed as a percentage.

The calculation of a confidence interval generally requires assumptions

about the nature of the estimation.

For example,

Here, I have used a confidence interval of 0.05 and 80% percent of sample
picks an answer is to be "sure" that if I had asked the question of the entire relevant
population between 80% (100-20) and 20% (100-80) would have picked that
answer.

Confidence level:

The confidence level tells you how sure you can be. It is expressed as a
percentage and represents how often the true percentage of the population who
would pick an answer lies within the confidence interval.
 The confidence level associated with a confidence interval estimate is the
success rate of the method used to construct the interval.

The 90% confidence level means you can be 90% sure; When I put the
confidence level and the confidence interval together, I can say that I am 90% sure
that the true percentage of the population is between 20% and 80%.

So, I have taken 90% confidence level means I am 90% sure. As on

90% confidence level value of Z = 1.645

Here, I have calculated formula on the basis of 90% confidence level.

Sampling frame:

Sampling frame is the actual set of units from which a sample has been
drawn. In sampling frame, I have used simple random sampling method for
conducting survey. In a simple random sample ('SRS') all units from the sampling
frame have an equal chance to be drawn and to occur in the sample.

Here, I have used sampling frame as an actual and potential investors from
whole of the equity market of Surat city and also from Sharekhan Securities Pvt.
Ltd. Here, each sample has the chance to be selected on an equal basis because
I have used simple random sampling method for surveying purpose.

Response Rate:

The response rate was average.

 I have used questionnaire method for the financial information of the
respondent, most of the people hesitated to provide the required information
and also the questionnaire contained some financial terms that were technical
in nature, which resulted into reduced response rate.
I have visited nearly 200 potential respondents, out of which only 175 gave
proper response.
Hence,
Response Rate = 175/200 = 87.5%

Data analysis tools:

I have used SPSS software (Statistical Package for the Social Sciences)
for analysis purpose.
In that I have used Mean, Median, Mode, Frequency Table, and Cross
Tabulation, Graphical representation & interpretation with each graphs and
charts.
Microsoft Office is used for data typing formatting and analyzing the data.
 ANALYSIS OF QUESTIONNAIRE

Que. 1. Do you investing in Equity Market?

[ ] Yes

[ ] No

Particulars Investing Percentage

Yes 119 68%

No 56 32%
Total 175 100%

Investing In Equity Market

140
119
120
100
Yes
80
56
60 No
40
20
0
Yes No
 Investing In Equity Market
( In Percentage)

36% Yes

No

68%

Interpretation:

According to the above chart we can see that:

68% of investors (119) are investing in Equity Market.

While 36% of investors (56) are not investing in Equity Market.

Que. 2. If you want to invest, which investment option will provide
the best returns?

[ ] Equity Share
[ ] IPO
[ ] Mutual Funds
[ ] Bonds
[ ] Fixed Deposits
[ ] If any other _________

Investment option Investors in Percentage

Equity Share 53%

IPO 18%
Mutual Funds 8%
Bonds 7%
Fixed Deposits 4%
Other 10%

Investors are investing in

various Investment option
(Investors in Percentage)
10%
4% Equity Share

7% IPO

Mutual Funds

8% Bonds
53%
Fixed Deposits

Other

18%
 Interpretation:
According to the previous chart:

According to 53% of investors, Equity market will provide the best returns
in compare to other investment option.

18% of investors believe that IPO (Primary Market) will provide the best
returns.

8% of investors think that Mutual Funds will provide the best returns.

7% of investors believe that Bonds Market will provide the best returns.

4% of investors trust that Fixed Deposits will provide the best returns.

According to 10% of investors, other investment option will provide the

best returns.

According to them other investment options are:

Commodity Market
Insurance
Government Securities etc.
 Que.3. Which factors motivate you for investing in Equity Market?

[ ] Return
[ ] Liquidity
[ ] Safety
[ ] Capital Appreciation
[ ] Other _____________

Investors in
Motivation Factors
Percentage
Return 49%
Liquidity 26%
Safety 7%
Capital Appreciation 17%
Other 1%

Motivating factors for Investors

to invest in Equity Market
(Investors in Percentage)
5%
16%
Return
6% 48%
Liquidity

Safety

Capital Appreciation
25%
Other
Interpretation:

According to the Previous Figure:

49% of investors are motivated by Return to invest in Equity market.

26% of investors are motivated by Liquidity to invest in Equity market.

6% of investors are motivated by Safety to invest in Equity market.

16% of investors are motivated by Capital Appreciation to invest in

Equity market.

While 5% of investors are motivated by other factors like-Investment,

Profit etc. to invest in Equity market.
Que. 4. How much percentage of your income you invest in
Equity Market?

[ ] Less than 5%
[ ] 5%-10%
[ ] 10%-15%
[ ] 15%-20%
[ ] 20%- 25%
[ ] More than 25%

Percentage of Income Investors in Percentage

Less than 5% 23%

5%-10% 45%
10%-15% 17%
15%-20% 7%
20%- 25% 5%
More than 25% 3%

Percentage of income investors are

investing in Equity Market
(Investors in Percentage)
5% 3%
7% 23%
Less than 5%
5%-10%
17%
10%-15%
15%-20%
20%- 25%
More than 25%

45%
 Interpretation:
According to the Previous Figure:

23% of the investors are investing Less than 5% of their income in Equity Market.

45% of the investors are investing 5%-10% of their income in Equity Market.

17% of the investors are investing 10%-15% of their income in Equity Market.

7% of the investors are investing 15%- 20% of their income in Equity Market.

5% of the investors are investing 20%-25% of their income in Equity Market.

While 3% of the investors are investing More than 25% of their income in Equity
Market.

Que. 5. How do you trade in Equity Market?

 [ ] Intraday
[ ] Delivery
[ ] Speculation
[ ] Arbitragers
[ ] Hedging
[ ] If any other please specify _____________

Types of Trade Investors in Percentage

Intraday 13%
Delivery 31%
Speculation 26%
Arbitragers 17%
Hedging 11%
Other 2%

Investors are Trade in

Equity Market
(Investors in Percentage)

2%
11% 13% Intraday

Delivery

Speculation
17%
Arbitragers

31% Hedging

Other

26%

Interpretation:
 According to the Previous Figure:

13% of the investors are doing Intraday trading in Equity Market.

Intraday Trading is trading for that one day only. Means any securities are
purchase & sell within the day.

31% of the investors are investing in Equity Market as a Delivery base Trading.
Delivery based trading is normally considered as a safer approach for
trading in shares when compared to day trading. Delivery based trading
involves buying shares on a market day and selling them only after receiving
the delivery of those shares in demat account.

26% of the investors are trading in Equity Market as a Speculator.

Speculators are those classes of investors who willingly take higher-than-

average risk in return for a higher-than-average profit potential in future.
Speculators aim primarily at quick profit from a short-term acquisition of
assets.

17% of the investors are Arbitragers in Equity Market.

Arbitrager means who purchases securities in one market for immediate
resale in another in the hope of profiting from the price differential

11% of the investors are trading in Equity Market as Hedgers.

Hedging means reducing or controlling risk. Hedgers wish to eliminate or
reduce the price risk to which they are already exposed.

While 2% of the investors are trade in Equity Market for Other Purpose.

Que.6. What is the time horizon for investing in Equity Market?

[ ] Less than 1 Months
 [ ] 1 to 3 Months
[ ] 3 to 6 Months
[ ] 6 to 12 Months
[ ] More than 12 Months

Time Horizon Investors in Percentage

Less than 1 Months 14%

1 to 3 Months 28%
3 to 6 Months 15%
6 to 12 Months 18%
More than 12 Months 25%

Investors Time Horizon for

investing in Equity Market
(Investors in Percentage)
30% 28%
25%
25%

20% 18%
14% 15%
15%

10%

5%

0%
Less than 1 1 to 3 Months 3 to 6 Months 6 to 12 Months More than 12
Months Months

Interpretation:
According to the Previous Figure:
 14% of investors invest in Equity market for Less than 1 Months.

28% of investors invest in Equity market for the period of 1

to 3 Months.

15% of investors time horizon for in Equity market is 3 to 6 Months.

18% of investors time horizon for in Equity market is 6 to 12 Months.

25% of investors invest in Equity market for more than 12 Months.

Que.7. What is the rate of return expected by you from Equity Market
in a year?

[ ] 5% 10 %
[ ] 10% 15 %
[ ] 15% 20%
[ ] 20% 25%
[ ] 25% 30%
[ ] 30% and above

Rate of Return Investors in Percentage

5% 10 % 12%
10% 15 % 18%
15% 20% 32%
20% 25% 26%
25% 30% 8%
30% and above 4%
 4% 12%
8%
Rate of Return
5% 10 %

18% 10% 15 %

26% 15% 20%

20% 25%

25% 30%

30% and above

32%

Interpretation:

According to the above Figure:

12% of investors are expects 5%-10% return from Equity market.

18% of investors are expects 10%-15% return from Equity market.

32% of investors are expects 15%-20% return from Equity market.

26% of investors are expects 20%-25% return from Equity market.

Here, above two cases investors are more expects from Equity

market.

8% of investors are expects 25%-30% return from Equity market.

While 4% of investors are expects more than 30% return from Equity

market.
Que.8. Are you satisfied with the current performance of the Equity Market
in terms of expected return?

[ ] Fully Satisfied
[ ] Satisfied
[ ] Neutral
[ ] Unsatisfied
[ ] Fully Unsatisfied

Rate of Return No. of Investors Percentage

Fully Satisfied 30 17%

Satisfied 73 42%
Neutral 49 28%
Unsatisfied 18 10%
Fully Unsatisfied 5 3%

Total 175 100%

Investors satisfaction level

From Equity Market
(Investors in Numers)(Total 175)
80 73
70
60
49
50
40 30
30
18
20
10 5
0
Fully Satisfied Satisfied Neutral Unsatisfied Fully
Unsatisfied

Interpretation:
According to the Previous Figure:

30 investors are Fully Satisfied from current performance of

Equity market.

73 investors are Satisfied from Equity market.

49 investors are Neutral with current performance of Equity market.

18 investors are Unsatisfied from Equity market.

While 5 investors are Fully Unsatisfied from Equity market.

Que. 9. Who advise you to enter in Equity Market?

[ ] Friends
[ ] Relatives
[ ] Advisers
[ ] Media
[ ] Research Report
[ ] Magazines
[ ] If any other ___________

Particulars Investors in Percentage

Friends 28%
Relatives 12%
Advisers 25%
Media 17%
Research Report 10%
Magazines 5%
Other 3%
 Investor's Referance for enter into
Equity Market
(Investors in Percentage)

5% 3% Friends
10% 28% Relatives
Advisers
Media
17%
Research Report
Magazines
12%
Other
25%

Interpretation:

According to the Above Figure:

Friends motivate 28% of the investors to enter into the equity market.
Relatives motivate 12% of the investors to enter into the equity market.
25% of investors enter in Equity market by the Advise of Financial
Advisor.
Media motivate 17% of the investors to enter into the equity market.
Magazines motivate 10% of the investors to enter into the equity market.
5% of investors are motivates by Reading Magazines to enter in Equity
market.
While other factors like self-Study, their own View etc. motivate 3%
of the investors to enter into the equity market.
Que.10. Which Factors do you consider most important while selecting
the Sectors?
[ ] Market Trend
[ ] Profitability
[ ] Economic Condition
[ ] Industry Condition
[ ] Existence of well established Companies under Sectors
[ ] Government Policy
[ ] If any other please specify _____________

Particulars Percentage

Market Trend 29%

Profitability 23%
Economic Condition 14%
Industry Condition 16%
Existence of well established
12%
Companies under Sectors
Government Policy 5%
Any Other 1%

Factors Consider by Investors

while selecting sector
(Investors in Percentage)
5% 1% Market Trend
12%
29% Profitability

Economic Condition

Industry Condition
16%
Existence of well established
Companies under Sectors
Government Policy

14% 23% Any Other

Interpretation:

According to the Previous Figure:

29% of the investors have considered Market Trend as a most important

factor while selecting the Sector.

23% of the investors have considered Profitability as a most important

factor while selecting the Sector.

14% of the investors have considered Economic Condition as a most

important factor while selecting the Sector.

16% of the investors have considered Industry Condition as a most

important factor while selecting the Sector.

12% of the investors have considered Existence of well established

Companies under Sectors as a most important factor while selecting the
Sector.

5% of the investors have considered Government Policy as a important

factor while selecting the Sector.

While 1% of the investors have considers Other Factor like

Global Position of the company and etc. important factor while selecting
the Sector.
 Que.11. Which Sectors do you prefer the most?
(Give 1 to 5 Orders in given boxes)
Here, I have decided to study only these five sectors.

Oil & Gas Sector

Banking Sector

IT Sector

Infrastructure Sector

Automobile Sector

Orders(Ranks) Given by Respondents

Sectors
1 2 3 4 5 Total

Oil & Gas Sector 44 30 49 21 31 175

Banking Sector 26 24 53 42 30 175

IT Sector 20 40 47 35 33 175

Infrastructure Sector 37 32 33 28 45 175

Automobile Sector 35 30 28 52 30 175

Total 162 156 210 178 169 875

 100% 1st Rank
26 20
37 35
90% 44
80% 24 40 2nd Rank
32 30
70% 30
60% 53 28 3rd Rank
47 33
50%
49
40%
28 52 4th Rank
30% 42 35
21
20%
31 30 33 45 30
5th Rank
10%
0%
Oil & Gas Sector
Banking Sector IT SectorInfrastructure Sector
Automobile Sector

On the basis of above chart:

How many investors given 1st to 5th Rank to which sector?

Sectors Investors Rank

Oil & Gas Sector 44 1st

IT Sector 40 2nd

Banking Sector 53 3rd

Automobile Sector 52 4th

Infrastructure Sector 45 5th

 Interpretation:

On the basis of Previous Figures:

Oil & Gas Sector:
44 Investors gave 1st rank, 30 Investors gave 2nd rank, 49 investors gave
3rd Rank, 21 Investors gave 4th Rank, & 31 Investors gave 5th Rank to this
sector.
Here, over all 44 investors have selected oil & gas sector as a First Rank
in comparison with First Rank of all sectors.

IT Sector:
20 Investors gave 1st rank, 40 Investors gave 2nd rank, 47 investors gave
3rd Rank, 35 Investors gave 4th Rank, & 33 Investors gave 5th Rank to this
sector.
Here, over all 40 investors have selected IT sector as a 2nd Rank in
comparison with 2nd Rank of all sectors.

Banking Sector:
26 Investors gave 1st rank, 24 Investors gave 2nd rank, 53 investors gave 3rd
Rank, 42 Investors gave 4th Rank, & 30 Investors gave 5 th Rank
to this sector.
Here, over all 53 investors have selected Banking sector as a 3nd Rank in
comparison with 3nd Rank of all sectors.

Automobile Sector:
35 Investors gave 1st rank, 30 Investors gave 2nd rank, 28 investors gave 3rd
Rank, 52 Investors gave 4th Rank, & 30 Investors gave 5th Rank to this
sector.
Here, over all 52 investors have selected Automobile sector as a 4th Rank
in comparison with 4th Rank of all sectors.

Infrastructure Sector:
 37 Investors gave 1st rank, 32 Investors gave 2nd rank, 33 investors gave 3rd
Rank, 28 Investors gave 4th Rank, & 45 Investors gave 5th Rank
to this sector.
Here, over all 45 investors have selected Infrastructure sector as a
5nd Rank in comparison with 5nd Rank of all sectors.

Que. 12. Mention the most important factors for selecting a company
of your choice.

[ ] Earning Per Share

[ ] Dividend
[ ] Brokers advise
[ ] Market capitalization
[ ] Performance of company
[ ] P.E. Ratio
[ ] If any other __________

Factors affect for Investors in

selecting company Percentage
Earning Per Share 19%

Dividend 17%

Brokers advise 15%

Market capitalization 7%

Performance of company 16%

P.E. Ratio 24%

Other 2%
 Factors affect to Investors for for
selecting company
(Investors in Percentage)

2%
19% Earning Per Share
24%
Dividend

Brokers advise

Market capitalization
17%
Performance of company
16%
P.E. Ratio

7% 15% Other

Interpretation:

On the basis of above Figures:

19% of the investors have considered Earning Per Share as a most important
factor to select a Company under the sector of their Choice.

17% of the investors have considered Dividend as a most important factor to

select a Company under the sector of their Choice.

While 15% of the investors are select a company under the sector of their
choice on the basis of Brokers advises.

7% of the investors have considered Market capitalization by the company

as a important factor to select a company under the sector.
16% of the investors have considered as a Performance of company most
important factor to select a company under the sector of their choice.

24% of the investors have considered Price Earning Ratio as a most important
factor select a company under the sector of their choice.

At last 2% of the investors have considered Other Factors like

Suggestion from reference group, External advisors, Stakeholders,
Growth of Company, Market Trend, Profitability and their own view etc. to
select a company under the sector.
 As the main
objective of the research is to find out the Investors behaviour for
Investing in Equity Market in Various Sectors in Surat city. So, I have
questionnaire method on 175 sample size for research and found out the views
of investors on various parameters.

From the research I found out that 68% of investors (119) are investing in
Equity Market. While 36% of investors (56) are not investing in Equity Market
as per my sample size 175.
I also found out that, 53% of investors believe that Equity Market is better
investment option and will provide the best returns in compare to other investment
option.
I found out that the 49% of investors who are dealing in equity market they are
motivated by return factor and 26% of investors are motivated by Liquidity and
some investor also consider capital appreciation and safety factor while investing
in equity market in various sectors.
I also found out that the 45% of the investors are ready or interested to invest
their 5%-10% of income in Equity Market. It means many investors trust on the
growth of equity market as they are ready to spend major proportion of their
income.
Going ahead I found out that very few investors want to deal in intraday
trading which shows that they consider safety factors while investing. 31% of the
investors are investing in Equity Market as a Delivery base Trading and 26% of
the investors are trading in Equity Market as a Speculator. Means 26% of
investors who willingly take higher-than-average risk in return for a higher-than-
average profit potential.
28% of investors invest in Equity market for the period of 1 to 3 Months and
the same proportion of investors are invest for long period more than year.
 I also found out that 32% of investors are expects 15%-20% return from Equity
market and 26% of investors are expects 20%-25% return from Equity market.
Here, investors are more expects from Equity market.

42% of investors are satisfied with the current performance of the Equity
Market in terms of expected return, while 28% of investors are Neutral about
equity market.

I found that most of investors are motivated by their friends to enter in the
equity market and some investors are motivated by Advisers, Media, Research
Report and other factors like and self study of current scenario of equity market.

Other thing I found out that 29% of the investors have considered market trend
and 23% of the investors have considered Profitability as a most important factor
as a most important factor while selecting the Sector. There are also other factors
like - government policy, industry condition, and economic condition also
important factor while selecting the Sector
Then I found that 44 investors selected Oil & gas sector as a First
Rank (in comparison with First Rank of all sectors)
40 investors have selected IT sector as a 2nd Rank.
53 investors have selected Banking sector as a 3nd Rank
52 investors have selected Automobile sector as a 4th Rank
45 investors selected Infrastructure sector as a 5nd Rank
I also found out that 24% of the investors have considered Price Earning Ratio,
19% of the investors have considered Earning per Share and 17% of the
investors have considered Dividend as a most important factor while selecting a
company from these selected sectors. Investors also consider other factors like -
Suggestion from reference group, External advisors, Stakeholders, Growth
of Company, Market Trend, Profitability and their own view etc. are as an
important factor while selecting a company from these selected sectors.
 During my training period I have study on Investors Behaviour for
Investing in Equity Market in Various Sectors by using Descriptive
Research Design as a Questionnaire method where respondents are from
whole of the equity market of Surat city and also from Sharekhan Securities
Pvt. Ltd.

From the survey I found that major people are investing in equity market
only due to Earn High Return and Hedge the Risk by investing their major
proportion of income in Equity Market. Here, the most of people are trade in
equity market as a speculation and they are invests for one to three months.
Generally, the investors who are invest for long period more than year they are
surely beneficial in equity market. Majority of people are motivated by their friends
& medias advise to enter into equity market. Majority people are expecting
something more from the equity market.So, finally some are satisfied and some
are not satisfy with equity market.

Major investors prefer the Oil & gas sector as a first rank on the basis of
Market trend, Profitability, industry condition and economic condition also
important factor while selecting the Sector and investors have also considered
Price Earning Ratio, Earning per Share and Dividend as a most important factor
while selecting a company under these selected sectors.
 Recommendation to Investors:

Prefer investment for long term investment strategy that provides you
moderate return with liquidity.

Investors should not invest in only equity market but, also invest in other
Safe Securities Like- Fixed Deposits, Government Securities, Bonds,
Mutual fund and Insurance etc. which also provides moderate
return.
For Example: One should prefer

o Equity 50%
o Other Safe Securities 50%

So, one can get moderate return with liquidity.

Investors should invest money at lower level price and sale the stock at
higher price.

Investors should select company on the basis of PE ratio, EPS, Current

Growth of Company and Market capitalization and many more. So,
investors can get higher return on their investment.

Always invest extra money in stock market. Do not invest by taking

loan from banks or other resources.
 Recommendation to Company:

From my research, I found that only 68% of investors are investing in

equity market, so more focus should on 32% of investors who are not
investing in equity market.

Broking firms or companies should promote Equity investment aggressively

for long term investment purpose.

Majority of investors (53%) are investing secondary market (equity

market) and very few (18%) investors are investing in Primary Market. So,
here broking firm should promote to their client for investing in Primary
Market also.

Company should have to concentrate on those people who are not

investing in Equity Market because of High risk than convert them in
investing other security like-Mutual Fund, Bonds, and Insurance etc. which
also provides moderate return.

The Stock Broking firm should also provide better services to the investor to
increase the satisfaction level of the investors.

Company should focus on students also because equity market has risk and
the younger generation likes to take risk.

Majority investors are investing in Oil & gas sector and IT sector.
So, Company should also suggest to investors for investing other sector
which is also profitable.
@. BOOKS:
Gordon & Natrajan, Financial Markets And Services Second
Revised Edition Reprint, Himalaya Publishing House, 2005.
Investment Management V.A. AVADHANI

@. Websites:

www.sharekhan.com
www.nseinda.com
www.bseindia.com
www.moneycontrol.com
www.investopedia.com
www.wikipedia.com
www.autherstream.com
www.myrisis.com

@. NEWS PAPER:
ECONOMICS TIMES
TIMES OF INDIA

@. OTHER:
Sharekhans Broachers
NCFM Capital Market Dealers Module
Other Magazines for Capitals Markets
 Questionnaire
On
INVESTORS BEHAVIOUR FOR INVESTING IN EQUITY MARKET
IN VARIOUS SECTORS IN SURAT CITY

Student of Vivekanand College for B.B.A. is conducting a survey on

Investors Behaviour for Investing in Equity Market in Various Sectors
on behalf of Sharekhan Security Pvt. Ltd, Surat
for fulfillment of BBA programme.
This information is purely for an academic purpose and will be kept completely
confidential. You are requested to fill the below QUESTIONNAIRE.
1. Do you investing in Equity Market?

[ ] Yes [ ] No

2. If you want to invest, which investment option will provide the best returns?

[ ] Equity Share [ ] IPO [ ] Mutual Funds

[ ] Bonds [ ] Fixed Deposits [ ] If any other _________

3. Which factors motive you investing in Equity Market?

[ ] Return [ ] Liquidity [ ] Safety

[ ] Capital Appreciation [ ] If any other please specify _____________

4. How much percentage of your income you invest in Equity Market?

[ ] Less than 5% [ ] 5%-10% [ ] 10%-15%

[ ] 15%-20% [ ] 20%- 25% [ ] More than 25%

5. How do you trade in Equity Market?

[ ] Intraday [ ] Delivery [ ] Speculation [ ] Arbitragers

[ ] Hedging [ ] If any other please specify _____________
6. What is the time horizon for investing in Equity Market?

[ ] Less than 1 Months [ ] 1 to 3 Months [ ] 3 to 6 Months

[ ] 6 to 12 Months [ ] More than 12 Months

7. What is the rate of return expected by you from Equity Market in a year?

[ ] 5% 10 % [ ] 10% 15 % [ ] 15% 20%

[ ] 20% 25% [ ] 25% 30% [ ] 30% above

8. Are you satisfied with the current performance of the Equity Market in terms

of expected return?

[ ] Fully Satisfied [ ] Satisfied [ ] Neutral

[ ] Unsatisfied [ ] Fully Unsatisfied

9. Who advise you to enter in Equity Market?

[ ] Friends [ ] Relatives [ ] Advisers [ ] Media

[ ] Research Report [ ] Magazines [ ] If any other ___________

10. Which Factors do you consider most important while selecting the Sectors?
 [ ] Market Trend [ ] Profitability [ ] Economic Condition

[ ] Industry Condition [ ] well established Companies under Sectors

[ ] Government Policy [ ] If any other please specify _____________

11. Which Sector do you prefer the most? (Give 1 to 5 Orders in given boxes)

Oil & Gas Sector Infrastructure Sector

Banking Sector Automobile Sector

IT Sector If any other please specify _____________

12. Mention the most important factors for selecting a company of your choice.

[ ] Earning Per Share [ ] Dividend [ ] Brokers advise

[ ] Market capitalization [ ] Performance of company [ ] P.E. Ratio

[ ] If any other _____________

13. If any Suggestion from your side, then please specify.

______________________________________________________________
______________________________________________________________

-: Personal Information:-

Name: _______________________________________________
Address: _______________________________________________
_______________________________________________

E-mail ID: ..
Contact No.: ..
Gender [ ] Male [ ] Female

Age:
 [ ] Below 20 Years [ ] 21 TO 30 Years [ ] 31 TO 40 Years

[ ] 41 TO 50 Years [ ] 51 TO 60 Years [ ] Above 60 Years

Occupation:
[ ] Business [ ] Service [ ] Employee
[ ] Student [ ] Other please specify _____________

Income (Yearly):
[ ] Less than 100000 Rs. [ ] 100000 to 200000 Rs. [ ] 200000 to 300000 Rs.

[ ] 300000 to 400000 Rs. [ ] 400000 to 500000 Rs. [ ] Above 500000 Rs.

!!!!.....Thanking you for providing your valuable Response..!!!!

Projected By:
Ashish l. Sorathiya