SUMMER TRAINING PROJECT REPORT

ON

MARKETING AND PROMOTION OF ONLINE TRADING

ACCOUNT AND EQUITY RESEARCH

SUBMITTED BY:-
Parinita Kapila
BBA(gen) 1st Year

SESSION:-2009-2012

BLS INSTITUTE OF TECHNOLOGY & MANAGEMENT

CERTIFICATE

This is to certify that the project titled “ Marketing and Promotion of

Online Trading Account and Equity Research” is an original work of Ms.
Parinita Kapila student of BLS Institute of Technology and
Management.
 ACKNOWLEDGEMENT

Many of the ideas that lead me to design and develop the “Online Trading
Account and Equity Research” resulted from a distillation of the experience
and opinions of many people. It would be prudent to commence this report
with a sincere tribute to all those who have played an indispensable role in
the accomplishment of this work by providing whenever and wherever their
able guidance was required.

My sincere gratitude to Mr.Puneet Nakra (Manager - Equity, Religare

Securities Ltd.) and Mr.Rajeev Kumar Pathak (Area Manager, Religare
Securities Ltd.), for providing me with an opportunity to work with
Religare Securities limited.

I also thank Mr. Sachin Kumar Gupta, (Relationship Manager, Religare

Securities Ltd) who has sincerely supported me with the valuable insights
into the completion of this project.

I am grateful to Mr Ashok Kumar and Mr Sunil Chamoli (Dealer,

Religare Commodities Limited) and all of the members of Rajouri Garden
branch, who have helped me in the successful completion of this project,
special mention of Mr. Bineet Kumar (Branch Coordinator).

Parinita Kapila
CONTENTS

TITLE
INTRODUCTION
OVERVIEW OF THE INDUSTRY
EVOLUTION OF THE INDUSTRY
• PRE 1990

• FAST FORWARD TO 1990’S

• POST 2000
STOCK EXCHANGES
• BOMBAY STOCK EXCHANGE

• NATIONAL STOCK EXCHANGE

STOCK BROKERS
PROFILE OF THE COMPANY
• INTRODUCTION

• BRAND IDENTITY

• VISSION AND MISSION

GROUP COMPANIES
PRODUCTS AND SERVICES
PROBLEMS OF THE COMPANY
COMPETITION INFORMATION
SWOT ANLYSIS

RELIGARE’S PRODUCT SERVICES

 • RACE

• RALLY

COMPETITORS ANALYSIS
• 5PAISA.COM

• KOTAK SECURITIES

• INDIA BULLS

• ICICI DIRECT

RECENT DEVELOPMENTS IN RELIGARE

BENEFITS OF ONLINE TRADING
HURDLES IN ONLINE TRADING
FINDINGS AND RECOMMENDATIONS
SCOPE OF DEVELOPMENT OF RELIGARE
SECURITIES
BIBLIOGRAPHY
INTRODUCTION
OVERVIEW OF THE INDIAN RETAIL BROKERAGE INDUSTRY

Industry Definition and Segmentation

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 basis.

Hence, to understand this industry we have to study Security Market:

Security Market

Which is the most televised structure in India? A study has revealed that it is not the
Rastrapati Bhawan or Parliament House; it is not the Taj Mahal; it is not even the abode
of Lord Tirupati; it is the Pheroze Jeejeebhoy Towers which houses the oldest securities
market participant in India, i.e. The Stock Exchange, Mumbai. This indicates our intimate
relationship with the securities market. In today’s rational world, it really means the
immense contribution of the securities market to our life and economy.

Which is the most reformed sector / segment / market in the Indian economy? Which
sector / segment / market of the economy has witnessed as much as nine special
legislative interventions during the last decade? Which market / segment / sector acquired
the first ever autonomous regulator (which in course time became the model regulator) in
India? Which sector / segment / market of the economy consumes 3/4th space of the pink
newspapers everyday? Which sector / segment / market of the economy most promptly
reflects the feel good factor? The answer to all these questions is the securities market. It
expresses the significance of the securities market in our life.

Two years down the line, there are few questions to ask-Which is the securities market
first to set up demutualised stock exchanges in the World? Which is the securities market
first to use satellite communication technology for securities transactions? Which is the
securities market first to introduce the straight through processing in securities
transactions? Which major securities market has implemented T+2 rolling settlement?
Which is the largest market for stock futures? Which securities market started real time
on line position monitoring of brokers? Which is the securities market where trading
terminals go off automatically when the margins are exhausted? Probably answer to all of
these is the Indian securities market. This has earned a place of respect amongst the
comity of securities markets in the World.

Segmentation Of Security Market :

It has two main interdependent segments:

PRIMARY MARKET and the SECONDARY MARKET.

The primary is that part of the capital markets that deals with the issuance of new
securities. Companies, governments or public sector institutions can obtain funding
through the sale of a new stock or bond issue. This is typically done through a syndicate
of securities dealers. The process of selling new issues to investors is called underwriting.
In the case of a new stock issue, this sale is an initial public offering (IPO). Dealers earn a
commission that is built into the price of the security offering, though it can be found in
the prospectus.

In primary market certain companies issue their shares directly to the public, collect
applications and after sorting out the good issues, they put in their applications. The share
brokers get their brokerage on the transactions made.

The secondary market is the financial market for trading of securities that have already
been issued in an initial private or public offering.

The secondary market comprises of brokerage that a broker earns in the buying and
selling of companies that are listed in the stock exchange. These people are in charge of
the conformation and carrying out of transactions. Orders are taken and deliveries are
made in the latter half of the day. The erratic fluctuation of rates in the share market
makes the activity in a trade market a dynamic process. It is necessary for a broker to
have adequate knowledge about the economic and political factors as they affect the
share market.

EVOLUTION OF THE RETAIL BROKERAGE MARKET

A Brief History :

1. Pre 1990

Though the historical records relating to securities market in India is meager and obscure,
there is evidence to indicate that the loan securities of the East Indian Company used to
be traded towards close of the 18th century. By 1830’s, the trading in shares of banks
started. The trader by the name of broker emerged in 1830 when 6 persons called
themselves as share brokers. This number grew gradually. Till 1850, they traded in shares
of banks and securities of the East India Company in Mumbai under a sprawling Banyan
Tree in front of the Town Hall, which is now in the Horniman Circle Park. It is no
surprise that the majestic Phiroze Jeejeebhoy Towers is located at the Horniman Circle.
In 1850, the Companies Act introducing limited liability was enacted heralding the era of
modern joint stock company which propelled trading volumes.

The American Civil War broke out in 1861 which cut off supply of cotton from the USA
to Europe. This heightened the demand for cotton from India. Cotton prices increased.
Exports of cotton grew, payments were received in bullion. The great and sudden spurt in
wealth produced by cotton price propelled setting up companies for every conceivable
purpose. Between 1863 and 1865, the new ventures raised nearly Rs.30 crore in the form
of paid up capital and nearly Rs. 38 crore of the premia. Rarely was a share which did not
command a premium between 1861 and 1865. The Back Bay Reclamation share with
Rs.5,000 paid up was at Rs.50,000 premium, the Port Canning share with Rs. 1,000 paid
up was at Rs.11,000 premium, etc. There was a share mania and every body was after a
piece of paper, variously called ‘allotments’, ‘scrips’ and ‘shares’. The people woke up
only when the American Civil war ended. Then all rushed to sell their securities but there
were no buyers. They were left with huge mass of unsaleable paper. This occurred then.
This also occurs today at regular intervals. There is, little seems to have changed since
then; the bubbles and burst continue to be a perennial feature of the securities market
world over.

The depression was so severe that it paved way for setting up of a formal market. The
number of brokers, which had increased during the civil war to about 250, declined.
During the civil war, they had become so influential and powerful that even the police
had only salams for them. But after the end of the civil war, they were driven from pillar
to post by the police. They moved from place to place till 1874 when they found a
convenient place, which is now appropriately called Dalal Street after their name. They
organized an informal association on or about 9th July 1875 for protecting their interests.
On 3rd December 1887, they established a stock exchange called ‘Native Share and
Stock Brokers’ Association’. This laid the foundation of the oldest stock exchange in
India. The word ‘native’ indicated that only natives of India could be brokers of the
Exchange.

In 1880s a number textile mills came up in Ahmedabad. This created a need for trading
of shares of these mills. In 1894, the brokers of Ahmedabad formed "The Ahmedabad
Share and Stock Brokers' Association".

The 1870s saw a boom in jute prices, 1880s and 1890s saw boom in tea prices, then
followed coal boom. When the booms ended, there were endless differences and disputes
among brokers in eastern India which was home to production of jute, tea and coal. This
provoked the establishment of "The Calcutta Stock Exchange Association" on June 15,
1908.

Then followed the proliferation of exchanges, many of them even do not exist today. The
rest is history.
2. Fast Forward to 1990s

In 1980s and 1990s, it was increasingly realized that an efficient and well developed
securities market is essential for sustained economic growth. Without venturing into a
detailed discussion, it would suffice if I just say that the securities market fosters
economic growth to the extent it augments the quantities of real savings and capital
formation from a given level of national income and it raises productivity of investment
by improving allocation of investible funds. The extent depends on the quality of the
securities market. In order to improve the quality of the market, that is, to improve market
efficiency, enhance transparency, prevent unfair trade practices and bring the Indian
market up to international standards, a package of reforms consisting of measures to
liberalize, regulate and develop the securities market is being implemented since early
1990s.

Legal Developments :

Control of capital issues was introduced through the Defence of India Rules in 1943
under the Defence of India Act, 1939 to channel resources to support the war effort. The
control was retained after the war with some modifications as a means of controlling the
raising of capital by companies and to ensure that national resources were channeled to
serve the goals and priorities of the government, and to protect the interests of investors.
The relevant provisions in the Defence of India Rules were replaced by the Capital
Issues (Continuance of Control) Act in April 1947.

Though the stock exchanges were in operation, there was no legislation for their
regulation till the Bombay Securities Contracts Control Act was enacted in 1925. This
was, however, deficient in many respects. Under the constitution which came into force
on January 26, 1950, stock exchanges and forward markets came under the exclusive
authority of the central government. Following the recommendations of the A. D.
Gorwala Committee in 1951, the Securities Contracts (Regulation) Act, 1956 was
enacted to provide for direct and indirect control of virtually all aspects of securities
trading and the running of stock exchanges and to prevent undesirable transactions in
securities.

3. Post 2000

Gone are the days when you left orders with your broker, received conformations on the
price and quality of the shares at the end of the day and the payment made upfront or
received after delays. Your securities settlement took days to reflect in your account.
Internet has changed the way you do trading. The entire process is speedy with limited to
zero paper work. NSE launched internet trading in early February 2000. It is the first
stock exchange in the country to provide a web-based access to investors to trade directly
on the exchange.

The process : Log on to the brokers site of your choice where you get real time quotes,
place a buy or sell order on the spot, and direct the site to debit the requisite amount. In
some time you get confirmation and after the trade settlement your bank and depository
account will reflect the changes which you can view anywhere, anytime. Online trading
has become seamless. All that you need is a PC, a modem, subscription to an Internet
Service Provider (ISP), a saving and a depository account with any bank providing online
trading facility. Along with stocks one can trade in mutual funds and investment
instruments. The advantage with online trading that you can operate in both BSE and
NSE depending on the broking firm.

NSE introduced for the first time in India a fully automated screen based trading. It uses a
modern fully computerized trading system designed to offer investor across the length
and breadth of country a safe and easy way to invest. The NSE trading system called
“National Exchange for Automated Trading” (NEAT) is a fully automated screen-based
trading system which adopts the principle of an order driven market.
STOCK EXCHANGES AND STOCK BROKERS

BOMBAY STOCK EXCHANGE

Background: The BSE Sensitive Index (1978-79=100) has, to a considerable extent,

been serving the purpose of quantifying the price movements as also reflecting the
sensitivity of the market in an effective manner.

The number of companies listed on the Bombay Stock Exchange has registered a
phenomenal increase from 992 in the year 1980 to about 4800 companies by the end of
July 2005 and their combined market capitalization rose from Rs. 5,421 crores to around
Rs. 18, 00,000crores at end of July 2005.

These factors necessitated compilation of a new broad-based index series reflecting the
present market trends in a more effective manner and providing a better representation of
the increased equity stocks, market capitalization as also the newly emerged industry
groups. Towards this end, the Exchange constructed and launched on 27th May 1994,
two index series viz. the BSE-200 and the DOLLEX.

Coverage: The equity shares of 200 selected companies from the specified and non-
specified lists of this Exchange have been considered for inclusion in the sample for
`BSE-200'. The selection of companies has primarily been done on the basis of current
market capitalization of the listed scrips on the exchange. Besides market capitalization,
the market activity of the companies as reflected by the volumes of turnover and certain
fundamental factors were considered for the final selection of the 200 companies.

Choice of Base Year: The financial year 1989-90 has been chosen as the base year for
the price stability exhibited during that year and due to its proximity to the current period.

NATIONAL STOCK EXCHANGE

The 13-year-old National Stock Exchange (NSE) has outshined the 130 years old
Bombay Stock Exchange (BSE) in terms of turnover and volumes. The BSE has lost its
market share in these segments from 36 per cent to 31 percent in last three years. The
turnover in BSE stood at around Rs 2,950 crore as on August 17, 2005 while the turnover
in NSE was Rs 3,926 crore. The volumes (numbers of shares traded) of NSE at 2.94 crore
was also much higher than the volumes of BSE. The NSE has rewritten a number of rules
and upset many traditions. As the derivatives segment has immense effect on the cash
market, the movement in this segment mostly determines the trend in the market.

Against nearly 1,400 companies listed on the NSE, the BSE has nearly 4,800 listed
companies. Despite such a huge number of listed companies, the total market
capitalization of BSE is around Rs 20 lakh crore while on the other hand NSE has a total
market capitalization of Rs 19.7 lakh crore.
The most tracked index on NSE, CNX Nifty also has more number of stocks than the
BSE Sensex. Nifty represents 50 stocks while the Sensex represents only 30 stocks. The
presence of more stocks on Nifty gives a better valuation than Sensex.

STOCK BROKERS

A stockbroker is a person who buys and sells stocks on behalf of another person (or
company). Stockbrokers also sometimes or exclusively trade on their own behalf, as a
principal, speculating that a share or other financial instrument will increase or decline in
price. In such cases the term broker makes little sense and the individuals or firms trading
in a principal capacity sometimes call themselves dealers, stock traders or simply traders.

In the US: When acting as an agent, the stockbroker typically charges the client a flat fee
and/or a percentage-based commission for undertaking the trade, and the price quoted the
client must be the best price available in the market. When acting as a principal, the trade
could be with another market participant or one of the stockbroker's clients. When trading
in a principal capacity with a client, the broker informs the client and charges the client a
markup or markdown from the prevailing market price.
In the UK: When acting as an agent, the stockbroker charges the client a flat fee and/or a
percentage-based commission for undertaking the trade, and the price quoted the client
must be the best price available in the market. When acting as a principal, the trade could
be with another market participant or one of the stockbroker's clients. When trading in a
principal capacity with a client, the broker is obliged to inform the client and no
commission is charged

Roles similar to that of a stock broker include investment advisor, financial advisor, and
probably many others. A stockbroker may or may not be also an investment advisor.
Similarly, investment advisor may or may not be a stockbroker.

The Certified Financial Planner designation initially offered by the American College in
Pennsylvania is considered by many to be the next educational step a stock broker can
take in order to be consider a legitimate and ethical financial consultant.

The stock market will have either one or a number of stock exchanges.

In India, the most famous are the Bombay Stock Exchange and the National Stock
Exchange.

Then there are regional exchanges like the Ahmedabad Stock Exchange, Calcutta Stock
Exchange and the Cochin Stock Exchange.

The two most prominent ones are the BSE and NSE. Together, they account for most of
the stock trades in the country. This means that if they catch a cold, exchanges all over
the country will sneeze

People like you and me just cannot go to a stock exchange and buy and sell shares. If we
want to do so, we have to get in touch with someone who is a member of the stock
exchange. This means we need to talk to a stockbroker.
Stockbrokers buy and sell shares for themselves to make a profit. They also buy and sell
shares on behalf of people like you and me and take a commission for doing so (more on
this on another day).

Every stockbroker has to be registered with the Securities and Exchange Board of India,
which is the stock market regulator. SEBI's main function is to make sure those who
invest in the stock market follow the rules and no scams take place. It is supposed to act
as a watchdog on behalf of the investors.

Readers from Mumbai may have seen the imposing stock exchange building called
Jeejeebhoy Towers. That's the home of the BSE.

But you would be disappointed if you think you can step inside the building and watch
the market excitement firsthand as brokers frenziedly trade stocks. That's because all
stock markets in India are now electronic.

Brokers have BSE computer terminals in their offices, from which they trade. They also
have BSE terminals in other cities and don't have to be physically present in Mumbai to
trade on the BSE. This means that even if you stay outside Mumbai, you can contact a
BSE broker and buy or sell stocks on the BSE.

Years ago, the BSE was a place where brokers physically bought and sold stocks and
shares through a system known as 'open outcry'. As a result, the market then resembled
a fish or vegetable market.

If you watch CNBC, you'll find that the New York Stock Exchange still follows that
system, with traders rushing around on the trading floor, scribbling trades on little slips of
paper.

Actually, the improvements in the BSE came about when the government promoted the
NSE. The NSE was an electronic exchange from the beginning and it started competing
with the BSE, which in turn forced the BSE to tone up its act.
PROFILE OF THE COMPANY

Religare is a diversified financial services group of India offering a multitude of

investment options. The diverse bouquet of financial services which Religare
offers can be broadly clubbed across three key verticals - Retail, Institutional and
Wealth spectrums. The services extend from asset management, Life Insurance,
wealth management to equity broking, commodity broking, investment banking,
lending services, private equity and venture capital. Religare has also ventured
into the alternative investments sphere through its holistic arts initiative and Film
fund. With a view to expand, diversify and introduce offerings benchmarked
against global best practices, Religare operates in the life insurance space under
'Aegon Religare Life Insurance Company Limited’ and wealth management under
the brand name 'Religare Macquarie Private Wealth'.

Religare has a pan India presence, 1837* locations across 498* cities and towns.
It also currently operates from nine international locations following its
acquisition of London's brokerage & investment firm, Hichens, Harrison & Co.
plc. (Now Religare Hichens, Harrison Plc).

The vision is to build Religare as a globally trusted brand in the financial services
domain and present it as the 'Investment Gateway of India'. All employees of the
group guided by an experienced and professional management team are
committed to providing financial care, backed by the core values of diligence,
innovation, ambition and passion.
 OUR BRAND IDENTITY

Name

Religare is a Latin word that translates as 'to bind together'. This name has been
chosen to reflect the integrated nature of the financial services the company
offers.

Symbol

The Religare name is paired with the symbol of a four-leaf clover. Traditionally,
it is considered good fortune to find a four-leaf clover as there is only one four-
leaf clover for every 10,000 three-leaf clovers found.

For us, each leaf of the clover has a special meaning. It is a symbol of Hope. Trust. Care.
Good Fortune. For the world, it is the symbol of Religare.

The first leaf of the clover represents Hope. The aspirations to succeed. The
dream of becoming. Of new possibilities. It is the beginning of every step and the
foundation on which a person reaches for the stars.

The second leaf of the clover represents Trust. The ability to place one’s own
faith in another. To have a relationship as partners in a team. To accomplish a
given goal with the balance that brings satisfaction to all, not in the binding, but
in the bond that is built.

The third leaf of the clover represents Care. The secret ingredient that is the
cement in every relationship. The truth of feeling that underlines sincerity and the
triumph of diligence in every aspect. From it springs true warmth of service and
the ability to adapt to evolving environments with consideration to all.

The fourth and final leaf of the clover represents Good Fortune. Signifying that
rare ability to meld opportunity and planning with circumstance to generate those
often looked for remunerative moments of success.
 Hope. Trust. Care. Good Fortune. All elements perfectly combine in the
emblematic and rare, four-leaf clover to visually symbolize the values that bind
together and form the core of the Religare vision.

Accent usage

The diacritical tilde mark ( ˜ ) over the letter A in the Religare typeface indicates a palatal
emphasis sound of the letter A.

Pronunciation

rel•i•ga•re (rel'i-gâir

VISION AND MISSION

Vision - To build Religare as a globally trusted brand in the financial services domain
and present it as the ‘Investment Gateway of India'.

Mission - Providing complete financial care driven by the core values of diligence and
transparency.

Brand Essence - Core brand essence is Diligence and Religare is driven by ethical and
dynamic processes for wealth creation.
GROUP COMPANIES

Religare Enterprises Limited group comprises of Religare Securities Limited, Religare

Commodities Limited, Religare Finvest Limited and Religare Insurance Broking Limited
which deal in equity, commodity and financial services business.

1. Religare Securities Limited

RSL is one of the leading broking houses of India and are dealing into Equity Broking,
Depository Services, Portfolio Management Services, Internet Trading, Institutional
Equity Brokerage & Research, Investment Banking, Merchant Banking and Corporate
Finance.

To facilitate free and fare trading process Religare is a member of major financial
institutions like, National Stock Exchange of India, Bombay Stock Exchange of India,
Depository Participant with National Securities Depository Limited and Central
Depository Services (I) Limited, and a SEBI approved Portfolio Manager.

RSL serves a platform to all segments of investors to avail the opportunities offered by
investing in Indian equities either on their own or through managed funds in Portfolio
Management

2. Religare Commodities Limited

Religare is a member of NCDEX and MCX and provides platform for trading in
commodities, which is an online facility also.

RCL provides platform to both agro and non-agro commodity traders to derive the actual
price of the commodity and also to trade and hedge actively in the growing commodity
trading market in India.
With this realization, Religare Commodities is coming up with its branches at mandi
locations. It is a flagship effort from our team which would be helpful in facilitating trade
and speculating price of commodities in future.

3. Religare Finvest

Religare Finvest Limited (RFL), a Non Banking Finance Company (NBFC) is

aggressively making a name in the financial services arena in India. In a fast paced,
constantly changing dynamic business environment, RFL has delivered the most
competitive products and services.

RFL is primarily engaged in the business of providing finance against securities in the
secondary market. It also provides finance for application in Initial Public Offers to non-
retail clients in the primary market .

RFL is also planning to initiate personal loan portfolio as fund based activity and mutual
fund distribution as fee based activities.

Along with this, the company also undertakes non-fund based advisory operations in the
field of Corporate Financing in the nature of Credit Syndication which includes inter
alias, bills discounting, inter corporate deposit, working capital loan syndication,
placement of private equity and other structured products.

4. Religare Insurance Broking Ltd.

Religare has been taking care of financial services for long but there was a missing link.
Financial planning is incomplete without protective measure i.e. structured products to
take care of event of things that may go wrong

Religare Insurance Broking Limited. As composite insurance broker, deals in both

insurance and reinsurance, providing our clients risk transfer solutions on life and non-
life sides.
This service will take benefit of Religare’s vast business empire spread throughout the
country -- providing our valued clients insurance services across India. We aim to have a
wide reach with our services – literally! That’s why we are catering the insurance
requirements of both retail and corporate segments with products of all the insurance
companies on life and non-life Still, there is more in store. We also cater individuals with
a complete suite of insurance solutions, both life and general to mitigate risks to life and
assets through our existing network side.

For corporate clients, we will be offering value based customized solutions to cover all
risks, which their business is exposed to. Our clients will be supported by an operations
team equipped with the best of technology support

Religare Insurance Broking aims to provide neutral, transparent and professional risk
transfer advice to become the first choice of India
Why customer trade with Religare?

1. Personal Assistance

• Dedicated dealers for facilitating trading and post trade needs.

• Dedicated Relationship Managers for assisting multiple investment needs.

2. Research & Advisory

• Regular news and updates on market

• Research service over SMS to keep you abreast

• Daily and weekly technical reports

• A complete information report on results and performance individual companies.

Complete reports on various economic sectors and their performance along with
analysis of few major companies in that sector

• Trading calls in Futures & Options

• Daily capsule of Market indices and index movement, national and international
corporate news, and their performance along with forth coming IPO tracker.

3. Add-Ons

• Access to all your accounts through your Customer Relationship Number (CRN)

• Access your ledger balances and account information over internet, branch and
call center
PRODUCT & SERVICES

 Equity & Derivatives

 Commodity

 Depository

 Portfolio Management Services

 International Equity & Commodity

 NRI Services

 Investment Banking

 Corporate Advisory Group

PROBLEMS OF THE ORGANIZATION

Religare has failed to evolve into a widespread Internet broking firm because of its un-
focused promotional strategies (advertisements in electronic media, newspapers, etc)
across the length and breadth of India. Although it is a well-known broking house in
some states like Maharashtra, Gujarat, etc. It still lacks considerable awareness in the
northern parts of India where its competitors have been building their reputation very
rapidly.

The other problem faced by Religare is that they give more attention to HNIs (high
networth individuals) as compared to retail investors or individuals; this is why volumes
of trading at Religare are less as compared to its competitors.
 COMPETITION INFORMATION

 5paisa.com

 Sherkhan.com

 India Bulls

 Bonanza

SWOT ANALYSIS

Strengths

1. Religare is A Ranbaxy promoter Group Company.

2. It is a pioneer in online trading with a turn over of Rs.400 crores and more than
800 peoples working in the organization.

3. Religare provides multi-channel access to all its customers through a strong

online presence with www.religare.in, 580 share shops in 130 cities and a call-
center based Dial-n-Trade facility

4. Religare has dedicated research teams for fundamental and technical research,
Which constantly track the pulse of the market and provide timely investment
advice free of cost to its clients which has a strike rate of 70-80%.
Weakness

1. Localized presence due to insufficient investments for countrywide expansion.

2. Lack of awareness among customers because of non-aggressive promotional

strategies (print media, newspapers, etc).

3. Lesser emphasis on customer retention.

4. Focuses more on HNIs than retail investors which results in meager market-share
as compared to close competitors.

Opportunities

1. With the booming capital market it can successfully launch new services and raise
its client’s base.

2. It can easily tap the retail investors with small saving through promotional
channels like print media, electronic media, etc.

3. As interest on fixed deposits with post office and banks are all time low, more and
more small investors are entering into stock market.

4. Abolition of long-term capital gain tax on shares and reduction in short term
capital gain is making stock market as hot destination for investment among small
investors.

5. Increasing usage of Internet through broadband connectivity may boost a whole

new breed of investors for trading in securities.
Threats

1. Aggressive promotional strategies by close competitors may hamper Religare’s

acceptance by new clients.

2. Lack of sufficient branch-offices for speedy delivery of services.

3. More and more players are venturing into this domain, which can further reduce
the earnings of Religare.
 EQUITY & DERIVATIES

Religare provides two type of Product in Equity & Derivative market:

R-ACE (Religare Advanced Client Engine) is a group of highly sophisticated trading

platforms meant for tech-savvy individuals. Various platforms of R-ACE have been
designed to suit the varying needs of different investors. It is fully automated platform,
wherein the client may do all his investments through Internet.

R-ACE clients also have the option to trade on following types of product.

A. R-ACE

B. R-ACE Lite

C. R-ACE pro

R-ACE

• Account Activation Charges Rs.299/-

• Minimum margin of Rs.5000/- required

• No software installation required, easily accessible on browser

• NSE cash segment, NSE F&O and BSE on single platform

• Trade online and over phone

 • Access your ledger balances and account information over Internet, SMS and
phone.

• Integrated DP, back- office and trading account

• Online transfer of funds through multiple banks

• Lifetime free DP account (No annual maintenance charges)

• Earn interest on cash margin deposited with us

• 24∗7 Customer support center

R-ACE lite

• Account Activation Charges Rs.499/-

• Minimum margin of Rs.5000/- required

• No software installation reqqired, easily accessible on browser

• NSE cash segment, NSE F&O and BSE on single platform

• Real- time streaming quotes

• Alerts

• Hot key functions

• Access your ledger balances and account information over Internet, SMS and
phone.

• Integrated DP, back- office and trading account

 • Online transfer of funds through multiple banks

• Lifetime free DP account (No annual maintenance charges)

• Earn interest on cash margin deposited with us

• 24∗7 Customer support center

R-ACE pro

• Account Activation charges Rs. 999/-

• Minimum margin of Rs.10000/- required

• Traders terminal on your desktop

• NSE cash segment,NSE F&O and BSE on single platform

• Real- time streaming quotes

• Advanced alerts

• Technical charting (intra- day and EOD)

• Multiple watch lists

• Advanced hot- key function

• Derivative chains

• Futures & Option calculator

• Access your ledger balances and account information over Internet, SMS and
phone.
 • Integrated DP, back- office and trading account

• Online transfer of funds through multiple banks

• Lifetime free DP account (No annual maintenance charges)

• Trade online and over phone

• Earn interest on cash margin deposited with us

• 24∗7 Customer support center

RELIGARE’s ALLY also known as R-ALLY is a perfect partner for savvy investors.

It has been designed to provide world-class experience and expertise to investors. Clients
opting for this service would be provided services managed by a team of dedicated
relationship managers and experienced trade dealers. They would not only assist the
client in information dissemination but would also take care of all post trade requirements

R-ALLY clients also have the option to trade on following types of product.

A. R-ALLY

B. R-ALLY Lite

C. R-ALLY pro

R-ALLY

• R-ALLY clients have no option to trade on their own through our online platforms.
• No subscription fees

• No Enrolment Deposit

• Brokerage :

Jobbing : 0.10% each side + All Taxes

Delivery : 0.50% each side + All Taxes

(Negotiable based on volume)

R-ALLY lite

• Account Activation charges Rs. 500/-

• Browser based platform, easily accessible over internet explorer from anywhere

• Minimum margin to be maintained Rs.5000

• No software installation required

• NSE cash segment, NSE F&O and BSE on single platform

• Real- time streaming quotes

• Multiple watch lists

• Hot key function

• Online transfer of funds through multiple banks

• Trade Online and Over phone at Branch

• Brokerage:
  Trading 0.10% each side + All Taxes

 Delivery 0.50% each side + All Taxes

 (Negotiable based on volume)

R-ALLY pro

• Application based platform

• Account Activation charges Rs. 1800 (refundable subscription fees )

• Traders’ terminal on your desktop

• NSE cash segment, NSE F&O and BSE on single platform

• Real time streaming quotes

• Multiple watch lists

• Alerts and triggers

• Advanced Hot key functions

• Online transfer of funds through multiple banks

• Trade Online and Over phone at Branch

• Make and save your own workspace

• View charts

• Brokerage:
  Trading 0.10% each side + All Taxes

 Delivery 0.50% each side + All Taxes

 (Negotiable based on volume)

FUTURE PLANS (NEED TO HAVE STRATEGIC PERSPECTIVE WITH

TIMELINESS)

 2, 00,000 + retail customers being serviced through centralized call centre / web
solution.

 60branches/semi-branches servicing affluent/aggressive traders through highly skilled

financial advisors.

 250 independent investment managers/franchisees servicing 50000 highly valued

clients.

 Strong advisory role through Fundamental & technical research.

 New initiatives - Portfolio Management Services & Commodities trading.

DEPOSITORY SERVICES
Religare is a depository participant with the National Securities Depository Limited and
Central Depository Services (India) Limited for trading and settlement of dematerialized
shares. Religare performs clearing services for all securities transactions through its
accounts. We offer depository services to create a seamless transaction platform –
execute trades through Religare Securities and settle these transactions through the
Religare Depository Services. Religare Depository Services is part of our value added
services for our clients that create multiple interfaces with the client and provide for a
solution that takes care of all your needs.

Dematerialization and trading in the demat mode is the safer and faster alternative to the
physical existence of securities. Demat as a parallel solution offers freedom from delays,
thefts, forgeries, settlement risks and paper work. This system works through depository
participants (DPs) who offer demat services and the securities are held in the electronic
form for the investor directly by the Depository. Religare Depository Services offers
dematerialization services to individual and corporate investors. We have a team of
professionals and the latest technological expertise dedicated exclusively to our demat
department, apart from a national network of franchisee, making our services quick,
convenient and efficient.
 COMPETITORS ANALYSIS

OTHER MARKET PLAYERS

5paisa.com

Company Background

Indiainfoline was founded in 1995 and was positioned as a research firm. In 2000
e-broking was started under the brand name of 5 paisa.com. Apart from offering online
trading in stock market the company offers mutual funds online. It also acts as a
distributor of various financial services i.e. GOI securities, Company Fixed Deposits,
Insurance. It has a limited ground network, present in 20 Cities.

Online Account Types

•Investor Terminal: Investors / Students

•Trader Terminal: Day Traders / HNI’s

PRICING FOR RETAIL CLIENTS

Investor Terminal:-

•Account Opening: Rs 500

•Demat 1st Yr: Rs 250

•Initial Margin: Rs 2500(Compulsory)

•Min Margin Retainable: Rs 1000

•Brokerage:

Trading 0.10% each side + ST

Delivery 0.50% each side + ST

PRICING FOR HNI CLIENTS

Trader Terminal

•Account Opening: Rs 500

•Demat 1st Yr: Rs 250

•Initial Margin: Rs 5000(Compulsory)

•Min Margin Retainable: Rs 1000

•Brokerage:

Trading 0.10% each side + ST

Delivery 0.50% each side + ST

 (Negotiable to 0.05% each side & 0.25%)

•Account Access Charges

Monthly Rs 800, adjustable against Brokerage

Yearly Rs 8000, adjustable against brokerage

PROBLEMS OF 5 PAISA

•Downtime

Recent past 5 paisa Trader Terminal (T.T) is experiencing high frequency downtime
between 3 – 3:30 p.m due to server load (as their T.T is feature heavy compared to
Speedtrade charting)

•Manual Accounting

The 5 paisa accounting system is manual, Online fund transfer through bank is not
credited instantly. Limit is provided EOD for shares sold from DP, or call Similarly limit
released for shares sold under BTST is manual Delay in receiving pay-out of clear funds
from trading to Bank Account.

•Min Account Balance

Concept of Min Rs1,000 is to be maintained in form of cash / securities to keep account

active. This can be withdrawn only on closure of account.
 KOTAK SECURITIES
Company Background

Kotakstreet is the retail arm of kotak securities. Kotak Securities limited is a joint venture
between Kotak Mahindra Bank and Goldman Sachs.

Online Account Types

• Twin Advantage / Green Channel: 2 DP’s, Limit against shares

• Free Way: Flat Rs 999 Cover Charge p.m, 0.03% per transaction
• High Trader: 6 Times Exposure Cash & Derivatives, Auto sq off 2:55

Pricing of KOTAK

• Account Opening: Rs 500

• Demat: Rs 22.5 p.m
• Initial Margin: Rs 5000(Compulsory)
• Min Margin Retainable: Rs 1000
• Brokerage Slab wise: Higher the volume, lower the brokerage. Even older
customers (on 0.25% & 0.40%) have been moved to the slab wise structure.

PROBLEMS OF KOTAKSTREET

• Rigid Account Opening Terms

• No Flexibility of A/c opening charges (Rs 500) + Compulsory margin Rs 5000/-
Account opening free with Rs 10,000 Margin OR Competitor Contract Note.
 • No Flexibility in Leverage – Dependent on Type of Account ( 4 to 6 times only)
No flexibility in Brokerage, driven by slab structure.
• No Customization of commercial Terms.
• Restricted Access to Terminal like product
• KEAT Desktop restricted distribution on payment of Rs 500 Non refundable.

Many Other Charges:

• Rs 22.5 p.m towards DP AMC charges
• DP incoming charges extra, 0.02%
• Rs 1,000 as retainable Margin to keep account active
• Rs 25 per call after 20 calls for the month
 INDIABULLS

Company Background

India Bulls is a retail financial services company present in 70 locations covering 62

cities. It offers a full range of financial services and products ranging from Equities to
Insurance. 450 + Relationship Managers who act as personal financial advisors

Online Account Type

•Signature Account: Plain Vanilla Account with focus on Equity Analysis. The equity
analysis is a paid service even for A/c holders

•Power Indiabulls: Account with sophisticated trading tools, low commissions and
priority access to R.M

Pricing of IB Accounts

Signature Account

•Account Opening: Rs 250

•Demat: Rs 200 if POA is signed, No AMC for this DP
•Initial Margin: NIL
•Brokerage: Negotiable
Power IndiaBulls
•Account Opening: Rs 750
•Demat: Rs 200 if POA is signed, No AMC for this DP
•Initial Margin: NIL
•Brokerage: Negotiable

PROBLEMS OF INDIABULLS

POA for Clients DMAT

Charges are levied to move shares from IB pool Account to client DP account All shares
held by client trading with IB are moved to IB Pool Account and the same is shown as a
reflection in client DP account.

Paid Research Services

Access to a research even for an IB trading account holder is charged a min of Rs 500 a
month.

Margin funding hoax

The interest on funding starts on leveraged delivery trades from T+1 day itself @21%
p.a, on a daily basis.

The role of Relationship Manager

Each RM is looked upon as a revenue generator and he gets a % on business generated
from client. This can lead to over leveraged (Interest) & high frequency (Brokerage)
trading, which may not be in the best interest of the client.
 ICICI DIRECT

Company Background

ICICI Web Trade Limited (IWTL) maintains ICICIdirect.com. IWTL is an affiliate of

ICICI Bank Limited and the Website is owned by ICICI BankLimited.

Account Types

ICICI Direct e-invest Account:

Premium trading interface of ICICIDirect Link is given to DBC partners and HNI’s Plain
Vanilla Account with focus on 3 in 1 advantage. Differentiated in services within the
account.

1. Cash on spot
2. MarginPlus

Account Opening: Rs 750

Schemes: For short periods Rs 750 is refundable against brokerage generated in a qtr.
These schemes are introduced 3-4 times a year.
Demat: NIL, 1st year charges included in Account Opening Plus a facility to open
additional 4 DP’s without 1st yr AMC.
Initial Margin: Nil
Brokerage: All brokerage is inclusive of stamp duty and exclusive of other taxes.
Slab wise brokerage ranges from 0.75% to 0.25% depending on volume.
 PROBLEMS OF ICICI DIRECT

Poor online Interface

Slow website interface with no real-time quotes creates dissatisfaction among high
frequency traders

Margin trading restriction

The margin trading system is available up to 2:45 p.m, with outstanding net positions
under margin segment automatically squared off at any time between 2:45 – 3:30 p.m.
Thus no control of square off price.

Morning Trades Issue

Being one of the websites with largest no of after hour orders which are pushed 1 st thing
in the morning, creates a choking of orders to the exchange, causes delay of
confirmations for new order placed during the early morning trades.

Restriction of BTST
The sale of shares purchased is restricted to T+1 day and is not permitted on T+2 Day.

No leverage for Delivery trades

Delivery is restricted to the total money allocated into the trading account.

No flexibility on leverage on Intra-day trades

The leverage of 4 times is available for intra- day trades.

Restriction of Bank Account

The choice of bank is restricted to ICICI Bank.
Higher Brokerage rates with slabs
The delivery brokerage is pegged at 0.75% and trading at 0.10% each side, this makes is
very unviable for customers dealing in large volumes. Although progressively the
delivery and trading brokerage reduce as volumes go up.
 RECENT DEVELOPMENTS OF RELIGARE

Online Trading

Online Trading is a service offered on the internet for purchase and sale of shares. In the
real world, you place orders on your stockbroker either verbally (personally or
telephonically) or in a written form (fax). In Online Trading, you will access
stockbroker's website through your internet-enabled PC and place orders through the
broker's internet-based trading engine. These orders are routed to the Stock Exchange
without manual intervention and executed thereon in a matter of a few seconds. .

There are 2 types of online trading service: discount brokers and full service online
broker. Discount online brokers allow you to trade via Internet at reduced rates. Some
provide quality research, other don't. Full service online brokerage is linked to existing
brokerages. These brokers allow their clients to place online orders with the Option of
talking/ chatting to brokers if advice is needed. Brokerage rates here are
higher.5Paisa.com, ICICIDirect.com, IndiaBulls.com, Religare.in,Geojitsecurities.com,
HDFCsec.com, Tatatdw.com, Kotakstreet.com are some of the online broking sites in
India.

The various transactions involved in online trading can be shown from the point of view
of the

• Client

• Broker

• Stock Exchange

The client places an order via the net by logging on to his broker’s site. The broker
accepts and executes the order, and places it with the exchanges.

The exchange accepts the order after checking the share limit for the day.
The brokers makes the payment either directly via the client’s bank account or pays
through his own account and recovers it later from the client.

The exchange receives money and completes the settlement.

The client is intimated about the settlement either through the demat account or via E-
mail.

BENEFITS OF ONLINE TRADING

This mode of trading has shifted the trading power from stockbrokers to individual
investors. The advantages are that it:

1. Ensures the best price for investors

This technique offers the best price for the buying and selling transactions of the
investors, by ensuring proper matching of their orders within the communication network
itself. Also due to the high level of transparency with regard to display of information
relating to the specific stocks and company profiles ,the investors will be able to get the
best quote for the shares. This leads to a reduction in the transaction cost for the
investors.

2. Offers liquidity to the investors

Online trading offers 24-hour trading facilities. or trading for longer hours when
compared to the traditional stock exchanges. This provides added liquidity to the
investors.

3. Offers greater transparency

Online trading gives greater transparency to the investors by providing them an audit
trail. This involves a complete integrated electronic chain starting from order placement,
to clearing and settlement and finally ending with a credit to the depository account of the
investor. All these stages are subject to inspection, thus bringing in transparency into the
system.

4. Enables hassle free trading

Online trading integrates the bank, the brokerage and the demat accounts, which leads to
easy and paperless trading for the client.

5. Allows quick trading

The investor will be able to execute the entire trading transaction, right from logging on
to the broker's site, to the execution and settlement of his bank account, in a very short
period of time.

6. Provides a level playing field

Trading on the net, gives even the smallest retail investor access to information that
earlier was available only to the big traders. This provides a level playing field for
investors in the securities market.

7. Reduces the settlement risk

This method of trading reduces the settlement risk for the investor, as in this case no short
sale is possible. That is .the seller will not be able to sell the securities unless he has their
actual possession. In the case of a demat account (required for an online transaction),
when a seller wants to sell the securities, his demat account is checked by the Depository
Participant before executing the sale transaction. This reduces the settlement risk for the
buyer, who is assured of the delivery of the securities.
 HURDLES FOR ONLINE SHARE TRADING

1. Internet fraud

In India, we see this kind of frauds happening in different way due to nature of our
society. Here when you talk to broker's staff while buying or selling, he will usually
advise you to buy share which he has bought and plans to dump when price goes up.

We have seen enough of PUMP and DUMP even without help of internet in cases of
Harshad Mehta boom of 1992 and Ketan Parekh boom of 2000 (he even had cult
following with Index of 10 shares called K-10).

Today lot of investor’s depending on TV channel for recommendation about stocks to

sell, or buy or hold. Channels like CNBS offer array of experts from economist to brokers
to analyst. Most of these people have vested interest in stocks they recommend and
promote.

One of the most common forms of securities fraud on the Internet involves an imposter
who attempts to manipulate the price of a stock by disseminating phony press releases or
information, or creating phony websites. A recent example of this scheme is the hoax
perpetrated against US based, PairGain Technologies.

2. Volatility of India’s Stock Markets

Recent market developments have once more focused attention on the volatility that has
come to characterise India’s stock markets.

Movements in the Sensex during the two years have clearly been driven by the behaviour
of foreign institutional investors (FIIs), who were responsible for net equity purchases of
as much as $6.6 and $8.5 billion respectively in 2003 and 2004. These figures compare
with a peak level of net purchases of $3.1 billion as far back as 1996 and net investments
by FIIs of just $753 million in 2002. In sum, the sudden FII interest in Indian markets in
the last two years account for the two bouts of medium-term buoyancy that the Sensex
recently displayed.

Given the presence of foreign institutional investors in Sensex companies and their active
trading behaviour, their role in determining share price movements must be considerable.
Indian stock markets are known to be narrow and shallow in the sense that there are few
companies whose shares are actively traded. Thus, although there are more than 4700
companies listed on the stock exchange, the BSE Sensex incorporates just 30 companies,
trading in whose shares is seen as indicative of market activity. This shallowness would
also mean that the effects of FII activity would be exaggerated by the influence their
behaviour has on other retail investors, who, in herd-like fashion tend to follow the FIIs
when making their investment decisions.

3. Rampant Speculation

The Indian stock markets are perhaps the only place in the world where you can buy
shares without having to put money on the table and sell shares you do not own. This
extraordinary situation has facilitated rampant speculation by all sorts of operators – the
indigenous variety, FIIs and even our own native financial institutions (FIs) as the
massive UTI scandal of recent years has demonstrated. So, when the stock markets were
made to collapse by a record 800-plus points on May 17 under the pretext that the Left is
opposed to divestment, the profits reaped by short sellers were astronomical and
incalculable.

Could this situation have been avoided? As aforesaid, the answer is yes. The electronic
monitoring system in both the Bombay Stock Exchange and the bigger National Stock
Exchange automatically stopped trading for half-an-hour when the two markets
respectively collapsed by 10 percentage points. Thereafter when trading resumed and the
markets fell further to another stipulated lower level, the electronic system automatically
stopped all trading again for another two hours.

A similar situation had occurred on Tuesday, September 11, 2001, the day of the terrorist
attacks in New York City. At the end of the day the stock exchange authorities of both
the New York Stock Exchange and the heavily-weighted software exchange called
NASDAQ suspended all trading for the remainder three working days during that fateful
week to safeguard investor interests.

T+2 Rolling Settlement

As per the directive by SEBI, all transactions in all groups of securities in the Equity
Segment and Fixed Income securities listed on the Exchange are required to be settled on
T+2 basis w.e.f. from April 1, 2003. The settlement calendar, which indicates the dates of
the various settlement related activities, is drawn by the Exchange in advance and is
circulated among the market participants.

Under rolling settlements, the trades done on a particular day are settled after a given
number of business days. A T+2 settlement cycle means that the final settlement of
transactions done on T, i.e., trade day by exchange of monies and securities between the
buyers and sellers respectively takes place on second business day (excluding Saturdays,
Sundays, bank and Exchange trading holidays) after the trade day.

The transactions in securities of companies which have made arrangements for

dematerialization of their securities are settled only in demat mode on T+2 on net basis,
i.e., buy and sell positions of a member-broker in the same scrip are netted and the net
quantity and value is required to be settled. However, transactions in securities of
companies, which are in "Z" group or have been placed under "trade to trade" by the
Exchange as a surveillance measure (“T” and “TS” group) , are settled only on a gross
basis and the facility of netting of buy and sell transactions in such scrips is not available.

The Exchange has introduced a new segment named “BSE Indonext” w.e.f. January 7,
2005. “S” group consists of scrips from “B1” & “B2” group on BSE and companies
exclusively listed on regional stock exchanges having capital of 3 crores to 30 crores. All
trades in this segment are done through BOLT system under S group.
The transactions in 'F' group securities representing "Fixed Income Securities" and "G"
group representing Govt. Securities for retail investors are also settled at the Exchange on
T+2 basis.

In case of Rolling Settlements, pay-in and pay-out of both funds and securities is
completed on the same day.

The members are required to make payment for securities sold and/ or deliver securities
purchased to their clients within one working day (excluding Saturday, Sunday, bank &
Exchange trading holidays) after the pay-out of the funds and securities for the concerned
settlement is completed by the Exchange. This is the timeframe permitted to the members
of the Exchange to settle their funds/ securities obligations with their clients as per the
Byelaws of the Exchange.

The following table summarizes the steps in the trading and settlement cycle for scrips
under CRS :

DAY ACTIVITY
T Trading on BOLT and daily downloading of statements
showing details of transactions and margins at the end of each
trading day.
Downloading of provisional securities and funds obligation
statements by member-brokers.
6A/7A* entry by the member-brokers/ confirmation by the
custodians.
T+1 Confirmation of 6A/7A data by the Custodians upto 11:00 a.m.
Downloading of final securities and funds obligation statements
by members .
T+2 Pay-in of funds and securities by 11:00 a.m. and pay-out of
funds and securities by 1:30 p.m. The member-brokers are
required to submit the pay-in instructions for funds and securities
to banks and depositories respectively by 10: 30 a.m.
T+3 
Auction on BOLT at 11.00 a.m.

T+4 Auction pay-in and pay-out of funds and securities by 12:00

noon and 1:30 p.m. respectively.
Thus, the pay-in and pay-out of funds and securities takes places on the second business
day (i.e., excluding Saturday, Sundays and bank & Exchange trading holidays) of the day
of the execution of the trade.

* 6A/7A : A mechanism whereby the obligation of settling the transactions done by a

member-broker on behalf of a client is passed on to a custodian based on confirmation of
latter. The custodian can confirm the trades done by the members on-line and upto 11
a.m. on the next trading day. The late confirmation of transactions by the custodian after
11:00 a.m. upto 12:15 p.m., on the next trading day is, however, permitted subject to
payment of charges for late confirmation @ 0.01% of the value of trades confirmed or
Rs. 10,000/-, whichever is less.
FINDINGS & SUGGESTIONS
MAIN FINDINGS (CONCLUSION)

Working with a broking firm especially was really a great experience.

 The researcher found that the working of a broking firm is a very risky job
because risk is involved in each and every activity of the business.

 The risk prevailing in the business is recognized therefore an efficient risk

management department is essential in every broking firm.

 Capital Market is growing very fast, turnover wise as well as area of

operation wise. The activities have reached through lengths and breadth of
the country. All these necessitated in the introduction of latest technology
in the form of advanced software’s.

 Broking business is a client-based business. The recent trend of voluminous

increase in investors has also increased the risk involved in it. There is need
of continuous up gradation of internal control measures

 Staff in a broking firm is continuous busy and due to which they are always
under stress.
POLICY SUGGESTIONS

 An Organization should have a risk management function that is

independent of its trading staff i.e. personnel responsible for the risk
management function should be separate from trading floor personnel.

 Senior management should regularly evaluate the risk management

procedure in place to ensure they are appropriate and sound.

 Senior management should also foster and participate in active discussions

with the board of directors, sub brokers, franchisee, staff of risk
management function and investors regarding procedures for measuring
and managing risk.

 Highly qualified staff not only in front office positions such as trading desk,
relationship officer and sales but also all back office functions responsible
for risk management and internal control.

 Risk management or control function should be able to produce a risk

management report that highlights positions, limits and excess on a basis
commensurate with trading activity. This report should be sent to senior
management, reviewed, signed and returned to control staff.

 Auditors should perform a comprehensive review of risk management

annually, emphasizing segregation of duties and validation of data integrity.

 The designated compliance officer should perform a review of trading

Practices annually.
SCOPE FOR DEVELOPMENT RELIGARE SECURITIES

RELIGARE SECURITIES have set themselves very stringent and high standards
of Risk Management. However I would like to make a few points, which would
help the organization in a big way.

 Recording of trader and dealer telephone calls, which will facilitate to

resolve the disputes at different levels.

 Fast and frequent interaction between the risk managers, the sub brokers
and client will help in reducing the delay in giving limits.

 Periodical visits to the sub brokers and franchisee by the RELIGARE

SECURITIES personnel for interaction and inspection will help in
minimizing the risk to great extent.

 Regarding dealers risks, well-trained and less stressed dealers will help in
reducing the mistakes. It has been observed that most of the mistakes are
done when they are under stress. HRD must help in this matter.

 In settlement department the persons have be appointed with utmost care

and their periodic check can be conducted to avoid any employee fraud.

 Along with large client base, quality of clientele will help in balanced
growth of business and minimizing the risk
 BIBLIOGRAPHY

Books and Newspapers:

 The Economic Times, Business Standard, Business line

 Securities Market (Basic) Module :--NCFM

 Indian financial system by M.Y KHAN

 Fischer and Jordon, “Security Analysis and Portfolio Management”, Prentice

Hall, 1983.

Websites and URLs:

 www.religare.in

 www.indiainfoline.com

 www.economictimes.com

 http://www.investopedia.com/articles/

 www.nseindia.com

 www.bseindia.com

 www.moneycontrol.com

 www.business-standard.com