< PROJECT TITLE >

Project Report

Submitted in partial fulfillment of requirements for the award of the degree of

Master of Business Administration

SUBMITTED BY

< STUDENT NAME >

(ROLL NO: ______)

Under the guidance of

< NAME >

<Designation>
(Faculty Guide)

RL INSTITUTE OF MANAGEMENT STUDIES

Madurai – 625 022

MARCH 2019
 R L INSTITUTE OF MANAGEMENT STUDIES
(A Unit of Subbalakshmi Lakshmipathy College of Science)

TVR Nagar, Aruppukottai Road, MADURAI 625 022

An Autonomous Institution and approved by AICTE, New Delhi

BONAFIDE CERTIFICATE

This is to certify that the training report entitled “ PROJECT NAME ” is a bonafide
record of the project work done by < STUDENT NAME > (ROLL NO: ____) in
partial fulfillment of requirements for the award of Degree of M.B.A (Master
Business Administration)

I certify that the project work carried out by her/him is an independent work under my
supervision and guidance and this project has not formed the basis for the award of
any Degree / Diploma / Associate ship / Fellowship or similar nature to any Candidate
in any University / Institution earlier.

Submitted for the viva-voce to be held on _____________.

Internal Guide External Examiner

Head of the Department PRINCIPAL

Place:
Date:

DECLARATION
 I hereby declare that the project work entitled “ PROJECT

NAME ” submitted to R.L. Institute of Management Studies, Madurai-22

is a record of original work done by me in Madurai and this project has not

formed the basis for the award of any Degree/Diploma/Associate

ship/Fellowship or similar nature to any candidate in any University/Institution

earlier.

Signature of candidate
< NAME, ROLL NO >
 ACKNOWLEDGEMENT

At the very outset, I dedicate my deepest sense of gratitude to my Parents

for showering on me that blessing and love which have induced me to make this
subject as success.

I would like to express my grateful thanks to our Respected President

Dr. R. Lakshmipathy and our beloved Principal _____________, for
permitting me to do this project and for their encouragement in my academic
career.

I take this opportunity to acknowledge my thanks to Head of the

Department Dr. S. Pugalanthi for all the help to complete the project
successfully.

I express my deepest sense of gratitude to < Internal Faculty Guide Name>

for his/her guidance and moral support during the project period, because their
keen interest and valuable suggestions have helped me throughout the project. I
express my sincere thanks to <Project Company Name > providing me all
facilities to carry out my project work in this Organization.

I am thankful to My Friends who are the real supporters of my academic

career.

< STUDENT NAME >

< Reg.No. xxxxx >
 CHAPTER 1

INTRODUCTION

Stock Market
A stock market (also known as a stock exchange) has two main functions. The first function
is to provide companies with a way of issuing shares to people who want to invest in the
company. This can be illustrated by an example: Suppose a company has a mining lease over
an area with some rich ore deposits. It wants to exploit these deposits, but it doesn’t have any
equipment. To buy the equipment it needs money. One way to raise money is through the
stock market. The company issues a prospectus, which is a sort of advertisement informing
people about the prospects of the company and inviting them to invest some money in it.
When the company is ‘floated’ (established) on the stock market, interested investors can
become part-owners of the company by buying ‘shares’. If the company operates at a profit,
shareholders benefit in two ways – through the issuing of dividends in the form of cash or
more shares, and through growth in the value of the shares. On the other hand, if the company
does not operate at a profit (e.g., if the price of the product dips), the shareholders will
probably lose money. The second function of the stock market, related to the first, is to
provide a venue for the buying and selling of shares.

Stock Exchange
An exchange is an institution, organization, or association which hosts a market where stocks,
bonds, options and futures, and commodities are traded. Buyers and sellers come together to
trade during specific hours on business days. Exchanges impose rules and regulations on the
firms and brokers that are involved with them. If a particular company is traded on an
exchange, it is referred to as "listed". Companies that are not listed on a stock exchange are
sold OTC (short for Over-The-Counter). Companies that have shares traded OTC are usually
smaller and riskier because they do not meet the requirements to be listed on a stock
exchange.
What Is A Share?
In finance a share is a unit of account for various financial instruments including stocks,
bonds, mutual funds, limited partnerships. In simple Words, a share or stock is a document
solely to stocks is so common that it almost replaces the word stock itself. It is issued by a
company, which entitles its holder to be one of the owners of the company. A share is issued
by a company or can be purchased from the stock market. By owning a share you can earn a
portion in the firm and by selling shares you get capital gain. So, your return is the dividend
plus the capital gain. However, you also run a risk of making a capital loss if you have sold
the share at a price below your buying price.

PRIMARY AND SECONDARY MARKETS

There are two ways for investors to get shares from the primary and secondary markets. In
primary markets, securities are bought by way of public issue directly from the company. In
Secondary market share are traded between two investors.

Primary Market
It is a Market for new issues of securities, as distinguished from the Secondary Market, where
previously issued securities are bought and sold. A market is primary if the proceeds of
sales go to the issuer of the securities sold.

Secondary Market
The market where securities are traded after they are initially offered in the primary market is
known as secondary market. Most trading is done in the secondary market. Generally, most
shares have a face value (i.e. the value as in a balance sheet) of Rs.10 though not always
offered to the public at this price. Companies can offer a share with a face value of Rs.10
to the public at a higher price. The difference between the offer price and the face value is
called the premium.

A company’s aim is to raise money and simultaneously serve the equity capital. As far as
accounting is concerned, premium is credited to reserves and surplus and it does not increase
the equity. Thus the companies seek to make premium issues. In a buoyant stock market
when good shares trade at very high prices, companies realize that it’s easy to command a
high premium. The biggest difference between them is the length of time you hold onto the
assets. An investor is more interested in the long-term appreciation of his assets, counting on
that historical rise in market equity. He’s not generally concerned about short-term
fluctuations in prices, because he’ll ride them out over the long haul. An investor relies
mostly on Fundamental Analysis, which is the analytical method of predicting long-term
prospects of a particular asset. Most investors adopt a “buy and hold” approach to assets,
which simply means they buy shares of some company and hold onto them for a long time.
This approach can be dangerous, even devastating, in an extremely volatile market such as
today’s BSE or NSE Indexes Show. What most investors need to remember is this: investing
is not about weathering storms with your “beloved” company – it’s about making money.
Traders, on the other hand, are attempting to profit on just those short-term price fluctuations.
The amount of time an active trader holds onto an asset is very short: in many cases minutes,
or sometimes seconds. If you can catch just two index points on an average day, you can
make a comfortable living as a Trader.

Initial Public Offerings:

Corporate may raise capital in the primary market by way of an initial public offer, rights
issue or private placement. An Initial Public Offer (IPO) is the selling of securities to the
public in the primary market. This Initial Public Offering can be made through the fixed price
method, book building method or a combination of both.

In case the issuer chooses to issue securities through the book building route then as per SEBI
guidelines, an issuer company can issue securities in the following manner:

 100% of the net offer to the public through the book building route.

 75% of the net offer to the public through the book building process and 25% through
the fixed price portion.

 Under the 90% scheme, this percentage would be 90 and 10 respectively.

SEBI (Securities and Exchange Board of India)

In 1988 the Securities and Exchange Board of India (SEBI) was established by the
Government of India through an executive resolution, and was subsequently upgraded as a
fully autonomous body (a statutory Board) in the year 1992 with the passing of the Securities
and Exchange Board of India Act (SEBI Act) on 30th January 1992. In place of Government
Control, statutory and autonomous regulatory boards with defined responsibilities, to cover
both development & regulation of the market, and independent powers have been set up.
Paradoxically this is a positive outcome of the Securities Scam of 1990-91.

The basic objectives of the Board were identified as:

 To protect the interests of investors in securities;
 To promote the development of Securities Market;
 To regulate the securities market and
 For matters connected therewith or incidental thereto.

Since its inception SEBI has been working targeting the securities and is attending to the
fulfillment of its objectives with commendable zeal and dexterity. The improvements in the
securities markets like capitalization requirements, margining, establishment of clearing
corporations etc. reduced the risk of credit and also reduced the market.

SEBI has introduced the comprehensive regulatory measures, prescribed registration norms,
the eligibility criteria, the code of obligations and the code of conduct for different
intermediaries like, bankers to issue, merchant bankers, brokers and sub-brokers, registrars,
portfolio managers, credit rating agencies, underwriters and others. It has framed bye-laws,
risk identification and risk management systems for Clearing houses of stock exchanges,
surveillance system etc. which has made dealing in securities both safe and transparent to the
end investor.

Another significant event is the approval of trading in stock indices (like S&P CNX Nifty &
Sensex) in 2000. A market Index is a convenient and effective product because of the
following reasons:

 It acts as a barometer for market behavior;

 It is used to benchmark portfolio performance;
 It is used in derivative instruments like index futures and index options;
 It can be used for passive fund management as in case of Index Funds.
NSE (National Stock Exchange):
The National Stock Exchange of India Limited (NSE), is a Mumbai-based stock exchange.
It is the large stock exchange in India in terms daily turnover and number of trades, for both
equities and derivative trading. 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. 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%.

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
NSE Indices
 S&P CNX Nifty
 CNX Nifty Junior
 CNX IT
 Bank Nifty
 Mini nifty
 CNX 100 CNX Midcap

BSE (Bombay Stock Exchange):

Bombay Stock Exchange Limited is the oldest stock exchange in Asia with a rich heritage.
Popularly known as "BSE", it was established as "The Native Share & Stock Brokers
Association" in 1875. It is the first stock exchange in the country to obtain permanent
recognition in 1956 from the Government of India under the Securities Contracts
(Regulation) Act, 1956.The Exchange's pivotal and pre-eminent role in the development of
the Indian capital market is widely recognized and its index, SENSEX, is tracked worldwide.
Earlier an Association of Persons (AOP), the Exchange is now a demutualised and
corporatized entity incorporated under the provisions of the Companies Act, 1956, pursuant
to the BSE (Corporatization and Demutualization) Scheme, 2005 notified by the Securities
and Exchange Board of India (SEBI).

Of the 22 stock exchanges in the country, Mumbai's (earlier known as Bombay), Bombay
Stock Exchange is the largest, with over 6,000 stocks listed. The BSE accounts for over two
thirds of the total trading volume in the country. Approximately 70,000 deals are executed on
a daily basis, giving it one of the highest per hour rates of trading in the world. There are
around 3,500 companies in the country which are listed and have a serious trading volume.
The market capitalization of the BSE is Rs.5 trillion. The BSE `Sensex' is a widely used
market index for the BSE.

With demutualization, the trading rights and ownership rights have been de-linked effectively
addressing concerns regarding perceived and real conflicts of interest. The Exchange is
professionally managed under the overall direction of the Board of Directors. The Board
comprises eminent professionals, representatives of Trading Members and the Managing
Director of the Exchange. The Board is inclusive and is designed to benefit from the
participation of market intermediaries.
In terms of organization structure, the Board formulates larger policy issues and exercises
overall control. The committees constituted by the Board are broad-based. The day-to-day
operations of the Exchange are managed by the Managing Director and a management team
of professionals.

The Exchange has a nation-wide reach with a presence in 417 cities and towns of India. The
systems and processes of the Exchange are designed to safeguard market integrity and
enhance transparency in operations. During the year 2004-2005, the trading volumes on the
Exchange showed robust growth.

The Exchange provides an efficient and transparent market for trading in equity, debt
instruments and derivatives. The BSE's On Line Trading System (BOLT) is a proprietary
system of the Exchange and is BS 7799-2-2002 certified. The surveillance and clearing &
settlement functions of the Exchange are ISO 9001:2000 certified.

BSE - Other Indices

Apart from BSE SENSEX, which is the most popular stock index in India, BSE uses other
stock indices as well:
 BSE 100
 BSE 200
 BSE PSU
 BSE MIDCAP
 BSE SMLCAP
 BSE BANKEX
 BSE CAPITAL GOODS
 BSE AUTO
 BSE DOLLEX 200
 BSE REALTY
 BSE TECH
Demat Form of Shares:
There are two forms of shares physical or dematerialized (demat) shares. Though the
company is under obligation to offer the securities in both physical and demat mode, you
have the choice to receive the securities in either mode. If you wish to have securities in
demat mode, you need to indicate the name of the depository and also of the depository
participant with whom you have depository account in your application. It is, however
desirable that you hold securities in demat form as physical securities carry the risk of being
fake, forged or stolen. just as you have to open an account with a bank if you want to save
your money, make cheque payments etc, Nowadays, you need to open a demat account if you
want to buy or sell stocks So it is just like a bank account where actual money is replaced by
shares. You have to approach the DPs (they are like bank branches), to open your demat
account. Let's say your portfolio of shares looks like this: 150 of DLF, 50 of Axis Bank, 200
of GMR Infra and 100 of RIL. All these will show in your demat account. So you don't have
to possess any physical certificates showing that you own these shares. They are all held
electronically in your account. As you buy and sell the shares, they are adjusted in your
account. Just like a bank passbook or statement, the DP will provide you with periodic
statements of holdings and transactions.

Is a demat account a must? Nowadays, practically all trades have to be settled in

dematerialized form. Although the market regulator, the Securities and Exchange Board of
India (SEBI), has allowed trades of up to 500 shares to be settled in physical form, nobody
wants physical shares any more. So a demat account is a must for trading and investing. Most
banks are also DP participants, as are many brokers.

Difference between a Broker and a DP:

A broker is separate from a DP. A broker is a member of the stock exchange, who buys and
sells shares on his behalf and on behalf of his clients. A DP will just give you an account to
hold those shares in dematerlized form. Broker can also provides the facility of DP but he
need to take a permission of either NSDL or CDSL two DP service provider in India.
UNDERSTANDING STOCK MARKET RISK
As a long term investor, one needs to understand several different kinds of risk:
Market Risk
Market risk is the risk associated with fluctuations in stock prices. This is the first risk many
people think of when they think of the stock market. Many factors can cause stock prices to
fluctuate. Examples include actual or anticipated developments within a particular company
or industry; changes in the outlook for the economy as a whole; or shifts in investor attitude
toward the stock market in general. Downward and upward trends in stock prices can occur
over short or extended periods, and can have a very significant affect on the value of an
investment.
There are two ways to reduce market risk. One is to diversify your investments among
different kinds of assets: divide your money among fixed-income and growth investments,
for example. The second way is to steadily invest on a regular basis and ignore market ups
and downs and focus on long-term results.

Inflation Risk
Inflation, defined as a persistent increase in prices, is a serious risk for any long-term
investor. Historically, inflation in the United States has averaged 3.1%, offsetting most of the
returns from investment in cash reserves and bonds, but less than half of that of stocks.
Because stocks' real returns are often generally higher than inflation, stocks offer a way to
help protect your money against inflation risk. If your principal doesn't grow, you can't
possibly stay ahead of inflation. A good way to reduce inflation risk is to invest in growth
assets like stocks.

Business Risk
Business risk is the risk of losing your money in an investment that seemed like a winner but
wasn't. It is the specific risk associated with the underlying business of the issuer of a
particular stock, bond, or other investment. If the company's product suddenly loses value,
the value of your investment declines. You can reduce business risk by diversifying your
investments.

Currency Risk
Currency risk is the risk associated with the price fluctuations in the dollar value of
international stocks due to changing currency exchange rates. To an American, the value of
any stock held internationally is not what the stock is worth in its domestic market, but what
the stock is worth in terms of dollars.

Beta
This refers to how a stock moves vs. the market. If a stock moves more than the market, it has
a high beta. If it moves less than the market it has a low beta. Technology generally has a
high beta while Utilities have low betas. A portfolio of high beta stocks in a down market can
create extreme downward movements, while up-markets can cause tremendous performance.
If a market is demonstrating extreme risk, it is wise to raise cash, lower the beta of your
portfolio, and even consider some hedging of exposure.
All above are different types of risks that influence the stock market. After looking at all the
risks one thing is very clear that controlling price fluctuations is not in our hand. Our major
job is to maximize our returns keeping all the above risks in mind. This is done by hedging
funds in market in way that maximizes the returns. Creating portfolios wisely is another
method of risk hedging, apart from that there are other methods with the help of which risk is
minimized.

Hedging
The word hedge literally means to surround in a way as to provide complete protection. A
hedge is an investment that is taken out specifically to reduce or cancel out the risk in another
investment. Defining it in simple words ‘Hedging’ is a strategy designed to minimize
exposure to an unwanted risk, while still allowing the business to profit from an investment
activity. But one thing has to be kept in mind hedging does not always make money. The best
that can be achieved using hedging is the removal of unwanted exposure. The hedged
position will make less profit than the no hedged position, half the time. One should not enter
into the hedging strategy hoping to make excess profits for sure.
 CHAPTER 2

Objectives of the Study

 To Identify Overbought and Oversold Condition in three major

Automobile Companies

 To Figure out the Bullish and Bearish Trends

 To Find the Appropriate Time For Buying and Selling the Shares
 CHAPTER 3

Scope of the study

 CHAPTER 4

Company Profile

Sharekhan Ltd is one of the leading retail stock broking house of SSKI Group which is
running successfully since 1922 in the country. It is the retail broking arm of the Mumbai-
based SSKI Group, which has over eight decades of experience in the stock broking
business. Sharekhan offers its customers a wide range of equity related services including
trade execution on BSE, NSE, Derivatives, depository services, online trading, investment
advice etc The firm’s online trading and investment site - www.sharekhan.com – was
launched on Feb 8, 2000. The site gives access to superior content and transaction facility
to retail customers across the country. Known for its jargon-free, investor friendly language
and high quality research, the site has a registered base of over one lakh customers. The
content-rich and research oriented portal has stood out among its contemporaries because of
its steadfast dedication to offering customers best-of-breed technology and superior market
information. The objective has been to let customers make informed decisions and to
simplify the process of investing in stocks.
On April 17, 2002 Sharekhan launched Speed Trade, a net-based executable application that
emulates the broker terminals along with host of other information relevant to the Day
Traders. This was for the first time that a net- based trading station of this caliber was
offered to the traders. In the last six months Speed Trade has become a de facto standard for
the Day Trading community over the net.
Sharekhan’s ground network includes over 640 centers in 280 cities in India which provide
a host of trading related services.Sharekhan has always believed in investing in technology
to build its business. The company has used some of the best-known names in the IT
industry, like Sun Microsystems, Oracle, Microsoft, Cambridge Technologies, Nexgenix,
Vignette, Verisign Financial Technologies India Ltd, Spider Software Pvt Ltd. to build its
trading engine and content. The Morakhiya family holds a majority stake in the company.
HSBC, Intel & Carlyle are the other investors.

With a legacy of more than 80 years in the stock markets, the SSKI group ventured into
institutional broking and corporate finance 18 years ago. Presently SSKI is one of the leading
players in institutional broking and corporate finance activities. SSKI holds a sizeable portion
of the market in each of these segments. SSKI’s institutional broking arm accounts for 7% of
the market for Foreign Institutional portfolio investment and 5% of all Domestic Institutional
portfolio investment in the country. It has 60 institutional clients spread over India, Far East,
UK and US. Foreign Institutional Investors generate about 65% of the organization’s
revenue, with a daily turnover of over US$ 2 million. The Corporate Finance section has a
list of very prestigious clients and has many ‘firsts’ to its credit, in terms of the size of deal,
sector tapped etc. The group has placed over US$ 1 billion in private equity deals. Some of
the clients include BPL Cellular Holding, Gujarat Pipavav, Essar, Hutchison, Planetasia, and
Shopper’s Stop.

PROFILE OF SHAREKHAN
Name of the company : Sharekhan ltd.

Year of Establishment : 1925

Headquarter : ShareKhan SSKI

A-206 Phoenix House

Phoenix Mills Compound

Lower Parel

Mumbai - Maharashtra, INDIA- 400013

Nature of Business : Service Provider

Services : Depository Services, Online Services

Technical Research.

Number of Employees : Over 3500

Website : www.sharekhan.com

Slogan : Your Guide to The Financial Jungle.

Vision

To be the best retail brokering Brand in the retail business of stock market.

Mission

To educate and empower the individual investor to make better investment

decisions through quality advice and superior service.
Sharekhan is in fact-

 Among the top 3 branded retail service providers

 No. 1 player in online business
 Largest network of branded broking outlets in the country serving more than
7,00,000 clients

AREA OF OPERATION OF SHAREKHAN:

The area of operations of SHAREKHAN is spread over two countries. They are:
1. INDIA
2. UAE

The services are available through a network of 1437 Share shops spanning
170 major towns and cities in the country along with an international branch
in Dubai (UAE)
Growing retail network across

 1120 franchisees
 168 branches
 325 cities
PRODUCTS AND SERVICES OF SHAREKHAN LIMITED
The different types of products and services offered by Sharekhan Ltd. are as
follows:

 Equity and derivatives trading

 Depository services
 Online services
 Commodities trading
 Dial-n-trade
 Portfolio management
 Share shops
 Fundamental research
 Technical research
CORE ACTIVITIES
Sharekhan is India’s leading broking houses providing a complete life cycle of
investment solution in:

 Equities and Derivatives Trading

 Commodity Trading
 Depository Service
 Portfolio Management Services
 Mutual Fund
 IPO Services
 Fundamental and Technical Research
 Online Trading

BUSINESS OF THE COMPANY

Business is categorized into SIX areas:

1. Equity
2. Derivatives
3. PMS
4. Commodities
5. Mutual Funds
6. IPO’s

SWOT ANALYSIS OF SHAREKHAN:

(A) STRENGTH:

1) Employee motivation policy

2) Research team

3) Good infrastructure

4) Healthy financial market

 5) User friendly web site

(B) WEAKNES

1) Insufficient advertisement policy

2) No access to the rural market

(C) OPPORTUNITY

1) Sharekhan having good customer relation strategy so that it create good

opportunity to create goodwill and capture the market.
2) Growing initial public offer create opportunity to capture the new market

3) Positive outlook of people towards financial product because most of

investor more about financial instrument and working strategy of stock
brokers.

(D) THREATS

1. Market uncertainty
2. Stiff competition
3. New entry in to market
4. Government policy
Table of Content:

1. Introduction

2. Objectives for the Study

3. Scope of the Study

4. Company profile

5. Review of Literature

6. Research Methodology

7. Data analysis and Interpretation

8. Findings

9. Suggestions

10. Conclusion

11. Bibliography