Final Report on Summer Internship Program

Under Guidance of

Debarati Chatterjee
Name of Company

Sudip Gupta 8NBKD011

Acknowledgements

It is a privilege to express our heartiest sense of gratitude to Debarati Chatterjee of INC-DUMDUM, and Mr. Deepak Sarkar of DBS Cholamandalam Asset Management without her support, encouragement and guidance, this project would not have been possible for us to prepare. We are also thankful to our friends for their constant support, help, encouragement, co-operation and valuable suggestion throughout the progress of the project. Finally, a special thanks to our family members for their constant support, without which we would not have been able to complete our project work. Thanking You,

Sudip Gupta. 8NBKD011

PREFACE
A good broker system must be able to cope with an extremely complex and dynamic environment. The microstructure of the stock market in which brokers work is highly dynamic and volatile. Many stocks are available to be bought and sold, each exhibiting its own patterns and characteristics that are highly unpredictable. With so many options and considerations that need to betaken into account, it is an extremely arduous task for a broker to investigate aspects of the stock market and consistently provide effective advice to their clients. Thus, brokers perform their day-to-day tasks with the aid of a broker system. Such a system should provide tools for interacting with exchanges and performing analysis. As a consequence, these broker systems are quite large and complicated by themselves. This research aims is to analysis Stock broker on the basis of their services, products, growth, and their subsidiaries. Because Stockbrokers are one of the main participants in stock exchanges worldwide, they often act as an agent for their clients, making trades on their behalf. They also act as advisors, providing suggestions to their clients on what stocks to buy and sell.

INTRODUCTION
In most industrialized countries, a substantial part of financial wealth is not managed directly by savers, but through a financial intermediary, which implies the existence of an agency contract between the investor (the principal) and a broker or portfolio manager (the agent). Therefore, delegated brokerage management is arguably one of the most important agency relationships intervening in the economy, with a possible impact on financial market and economic developments at a macro level. In most of the metros, people like to put their money in stock options instead of dumping it in the bank-lockers. Now, this trend pick pace in small but fast developing Cities like Kolkata, Silliguri, Durgapur etc. So I would like to utilize the market of Kolkata and its nearby areas. The Indian stock markets taking a sharp dip from the heights of April 2006, the doomsday predictions abound, we believe that there is no reason to panic with these doomsday predictions prevalent in the market today. Markets will be range bound over time with a gradual upward trend and they will await expectations of increase in economic growth for their next big upswing. As the per-capita-income of the city is on the higher side, so it is quite obvious that they want to invest their money in profitable ventures. On the other hand, a

numbers of brokerage houses make sure the hassle free investment in stocks. Asset management firms allow investors to estimate both the expected risks and returns, as measured statistically. Every country today is aiming at reaching the status of developed country; the most important input they require is the investment. Where do they get their investments? Capital Market is the place where the economy can pool up funds required for their investment needs. In the modern scenario of globalization Capital Market plays a vital role in any economy. The strong presence of Capital Market resembles the strength of the economy.

BUSINESS PLAN FOR OPENNING A Stock and Share Broking Services Ltd. Kolkata
Proposed companys name: Fortune Stock and Share Broking Services Ltd.
(formation under companies Act 1956) Activities: Financial service providers engaged in providing services in the field of Share, Mutual Fund, Bond, Debenture Commodities trading, research and analysis.

Number of member of the company: Eight. Director (CFO) of the company: Mr.Sudip Gupta. Listed in: Calcutta Stock Exchange. Register office: Kolkata. Our Vision: The markets in which we operate are becoming increasingly volatile,
the most carefully laid plans may go wrongso why take risk, only through being the very best - in terms of the service we offer, our product and premises - can we hope to be successful and grow. Companys vision is crystal clear and mind frame very directed. To be pioneering financial services company. And continue to grow at a healthy pace, year after year, decade after decade. Companys foray into ITenabled services and internet business has provided an Opportunity to explore new frontiers and business solutions. To build a corporate that sets benchmarks for others to follow.

Our Core Values:

Integrity, Customer Focus, Meritocracy, Progressiveness.

Our Mission: To provide best value for money to Investors through innovative
products, trade / investments Strategies and personalized service. To offer highly professional and flexible services with the highest level of accuracy. We strive to protect confidentiality and interests of the clients. An organization exists to accomplish something or achieve something. The mission statement indicates what an organization wants to achieve. The mission statement may be changed periodically to take advantage of new opportunities or respond to new market

conditions. Our mission statement is To Bring Industry, Finance and People Together. We are work as intermediary between industry and people. Our work as investment advisor and helps people to invest their money same way we helps industry in achieving finance from people by issuing shares, debentures, bonds, mutual funds, fixed deposits etc.Companys mission statement is clear and thoughtful which guide geographically dispersed employees to work independently yet collectively towards achieving the organizations goals.

Various legal stapes for the formation of the company:

It will be a leading research and advisory based stock broking house of India, with a dominant position in both institutional and retail broking with specialized skills, has an ability to serve customers with flexibility. It became the member of the National Stock Exchange of India Limited. In the due course, the company acquired clearing membership in NSE F&O and also trading & clearing membership in BSE Capital Market and BSE F&O. It is also a Depository Participant with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL).It is also registered with NCDEX and MCX.The company is AMFI registered Mutual Fund Distributor and IPO Broker We are registered with Calcutta Stock Exchange.

Services will be Offer:

We want to be a leading service providers engaged in providing services in the field of share, commodities trading, research and analysis.

We offer:

Research & Analysis. Equity Research & Analysis. Corporate Research & Analysis. Market Research & Analysis. Direct investment in shares listed on NSE / BSE. Portfolio Management Services. Commodities Trading. Marketing of various schemes in different Mutual Funds. Online Trading.

The value added services we will provides:

Free Depository A/c Instant Cash Transfer

Multiple Bank Option Secure Order by Voice Tool Dial-n-Trade 24x7 Voice Tool acess to your trading account Personalized Price and Account Alerts delivered instantly to your Mobile Phone & E-mail address Live Chat facility with Relationship Manager on Yahoo Messenger

services will provide to our client

Trading In Equity
These trading in equity & derivatives are carried out by our team of experienced and qualified professionals. Being a member of NSE and BSE we efficiently offer our brokerage services to investors and facilitate them in trading in spot and derivatives market.

Financial Research Services

We are backed by adept professionals who are offering financial research services and are well versed in research practices. They study the market and provide exhaustive information on companies and markets. Our research reports will be offer on daily, weekly and monthly basis on the following areas:

Company financial results Announcements Industry specific analysis Market commentary IPO news SRE recommendations

Arbitrage Services

Our proficient 100 arbitrageurs cater to the requirements of our esteemed clients will offer arbitrage services opportunities that exist on NSE and BSE in both cash and future markets.

Matching deals that capitalize upon the imbalance Profit- the difference between the market prices Transaction that involves no negative cash flow

Mutual Funds
Our access to various mutual funds will help the small investors in investing their savings. Our empanelment with the top Mutual Funds will help in rendering variety of schemes ranging from safe Debt Funds and Gilt Funds to very aggressive Equity Funds. Our investors could be chosen schemes as per their Risk-Return preference. We have investment advisers who will assist in selecting the best suited scheme for our clients depending upon their preferences. The regular ratings and update of the Mutual Funds market are timely will provided by our team of researchers.

Internet Trading Services

Our Internet trading services platform will enables the online broker to execute a large number of transactions from a large client base and a large order book position utilizing sophisticated and efficient technology & software. This will enables the investors in comprehending the market scenario and trading practices, thereby make an informed trade decision with the help of:

Live inter-active charts Streaming quotes User friendly online portal Charts Research Recommendations

Currency Derivatives
Our currency derivatives will help different companies to increase their exposure to the currency derivatives market and effectively raise their respective position limits for clients and non-bank trading members. Being a member of NSE, BSE and MCX, we will successfully currency derivatives and brokerage services to traders and will facilitate them in trading in the currency derivatives markets.

Commodities Trading Services

We will attain a lot of recognition in the market offering commodities trading services or brokerage services to traders engaged in trading in the commodities derivatives market. Being a member of both the NDEX and MCX, we will exercise ethical business practices in carrying out our valuable services. In offering our commodities trading services or brokerage services.

OPPERTUNITIES FOR THE INDUSTRY

We are looking for opportunities for inorganic growth; the broking business will continue the good run for at least two more years, thanks to the growing economy and good performance by the Indian corporate sector. The best is yet to come only about 1.1 to 2 per cent of the household income is routed into the stock markets while the stock markets have risen by 45 per cent in the last calendar, there is lot of good opportunity. Buoyed by booming stock markets and growing retail interest in equity and equity-related investments, Indian stock broking firms are on an expansion drive to increase their network into more cities and towns to lure clients into stock investments Having witnessed a high level of consolidation in the last 3-4 years, the domestic stock-broking houses could tap the IPO market to raise funds for their expansion, besides mergers and acquisitions. Let's consider the facts and see where they lead us: 1) 50% of the population below age 25. 2) A current savings rate of 25%. 3) A formidable amount of gold already in every home. 4) Investment in the stock market by less than 4% of the population. 5) Huge investment potential due to capital requirements in infrastructure, power, education, medicine and agriculture across the country. 6) Increasing consumption. 7) An aging global population. 8) The importance placed on education. 9) The mix of religion, a nonchalant perspective to the future or the belief in fate or destiny, and the need for a family support system (a truly astounding and immensely successful system at that). 10) The virtue of a being an integral part of a strong democratic, secular republic. So what we see is the possibility that a young population, within the next decade, will turn to investment due to increased savings. This could be in the form of gold, bank deposits or stocks, and the acceptance that reality bites, but the realization there is always a new day. 11) Mutual fund can penetrate rural like the Indian insurance industry with simple and limited products. 12) SEBI allowing the MF's to launch commodity mutual funds.

Our Team

We are backed by a team of committed and hardworking team, our well experienced team is well versed with the latest technologies and trends assist us in offering qualitative service to our clients. Our team comprises of fundamental as well as technical analyst, MBA's & technocrats who are committed to provide highest level of customer service.

Our Target Market & CUSTOMERS

Being a client oriented industry; we are engaged in offering a wide range of services for equity and commodities trading. We are a congregation of talented and experienced persons who are committed to add value and optimize the benefits accruing to clients. In most of the metros, people like to put their money in stock options instead of dumping it in the bank-lockers and Kolkata is not out of list. We will use demographic segmentation strategy and segment people based on their occupation. We will use selective specialization strategy for market targeting. Target person for the Manhattan Stock and share Broking Service Ltd. are persons who can work as sub-broker for the company. The Company also focuses on Advisors of Insurance and post office, Tax consultants and CAs for making them sub-broker. Our massive R&D facility caters to the need of Investors, who are continuously in need of opportunities for striking rich rewards on their investment. We have one of the most advanced, hi-tech in-house R&D wing with some of the best people, process and technology resources providing complete research solutions on Equity, Commodities, IPOs and Mutual Funds. We offer proactive and timely world class research based advice and guidance to our clients so that they can take informed decisions. Our customers consider themselves part of our family and share their experiences and dreams with other customers and thus we will become successful not only in relating customers but also gains new customers from satisfied prevailing customers.

MARKETING STRATEGY OF OUR COMPANY:

Market Positioning:
Market positioning statements of our company will be are At Fortune Stock and Share Broking Services Ltd.we give you single window service and We also ensure your comfort. So, we will focus on the consumers who prefer almost all investment activities at same place by providing number of various financial services. At Manhattan a person can purchase or sell shares, debentures etc. and at the same place also demat it. We will also provides other Investment option to the same person at same place like Mutual Fund, Fixed Deposit, and Bonds etc. and help the person in designing his portfolio. By this way we will provides comfort to our customers. Fortune will also position according to Ries and Trout.

Target Market:
We will use demographic segmentation strategy and segment people based on their occupation. We will use selective specialization strategy for market targeting. Target person for the Manhattan Stock and share Broking Service Ltd. are persons who can work as sub-broker for The company. The Company focuses on Advisors of Insurance and post office, Tax consultants and CAs for making them sub-broker.

Marketing channel System:

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

Advertising and Promotion:

The objective of advertising of Fortune is to create awareness about services of Manhattan among investors and sub-brokers and increase sub brokers of ours.Company give advertisement in media like TV, Newspapers, and Magazines etc also advertisement is made indirectly by the companies associate with it.

Competitive Analysis AND MARKET SHARE:

Eureka Stock& Share Rajasthali Geojit Financial Broking commodities Services Ltd Services Ltd Pvt. Ltd- II

FACTOR

My Business

Strength

Weakness

Products Image Service

Financial Service like Equity, MF, currency derivatives etc _____ Newly Establish Providing prompt and personalized services to all. _____

_____

Financial Service like Equity, MF, currency derivatives etc

Financial Financial Service like Service like Equity, MF, Equity, MF, currency currency derivatives etc derivatives etc Strength Strength Customer service team assist their customer for any help that they need

Weakness Strength

We offer _____ proactive & timely world class research based

Extra dependency Strong to the distributions Relationship chine manager. (Weakness)

FACTOR

My Business

Strength

Weakness

Eureka Stock& Share Rajasthali Geojit Financial Broking commodities Services Ltd Services Ltd Pvt. Ltd- II

advice and guidance to our clients We are ISO 9001:2000 certified DP for shares Responsible and and dynamic Reliability commodities leadership. _____ Ethical business practices Very much optimistic partially

relating to transactions, billing, demat and other queries.

Stability

Strength

Strength

Strength

Expertise

Diligence, Integrity and Provide Professionali value-added sm services. Proactive & timely world and class research based advice to every client. Kolkata Kolkata

Evinced team of professionals Company & Teamwork Aggressive Reputatio and managemen n Efficiency t _____ Location Kolkata ______ Yes

Prompt personalized services Kolkata

Sales Method

committed to provide the best possible services to all of our associates and clients

Provide best valueformon ey to Investors through innovative investments Strategies personalized service Partially.

To provide robust back office support backed by excellent accounting standards to the branches, Sales promotion they have through ensured distribution chain connectivity & franchise. through FTP

Innovative products, trade / investments Strategies and personalized service.

Market share

NAME OF THE COMPANY

MARKET SHARE ( %)

GEOJIT FINANCIAL SERVICES LTD RIGHTEX TRADING PVT. LTD MOONSTAR EQUITIES & SHARE CONSULTANCY RAJASTHALI COMMODITIES PVT. LTD- II V.L. ASSOCIATES SWARAJ SHARES & SECURITIES PVT. LTD EUREKA STOCK & SHARE BROKING SERVICES LTD COOPERS WEALTH CREATORS SERVICE LTD. NAVIN BAFNA CONSULTANCY OTHERS

15% 8% 6% 12.50% 12% 10% 12% 7.50% 6% 11%

SWOT ANALYSIS OF MANHHATAN STOCK AND SHARE BROKING LTD.

Strengths: Employees are highly empowered. Good co-operation between employees and management. Work as a Transfer agent. Aggressive management. Weaknesses:

Weak Brand Equity. Opportunity: Growth rate of mutual fund industry is 40 to 50% during last year and it expected that this rate will be maintained in future also. Try Market at rural and semi-urban areas.

Threats:

Increasing number of local players. Volatility of the market.

IDENTIFY KEY COSTS:

Statement showing of expenses for commencing the business
Particulars Registration Charge with BSE Registration Charge With NSE Registration Charge with NSDL Registration Charge with MCX Registration Charge with CDSL Cost Of Terminal Amount (Rs.) 15,00,000 20,00,000 13,00,000 15,00,000 10,00,000 14,00,000 ___________ Fixed Cost: Computers & Accessories Furniture & Fixture Lease hold property (Rs.50,000/ Month) 4,00,000 1,50,000 50,000 ____________ 6,00,000 Preliminary Expenses: Fees of the Legal Adviser Miscellaneous Expenses (before formation of the company) 1,50,000 50,000 __________ 2,00,000 87,00,000 Amount (Rs.)

Total

95,00,000

Notes: Here initial investment as Capital is Rs. (87, 00,000+ 6, 00,000) = Rs.93, 00,000 Out of Rs.93, 00,000 30% as Debt Capital and 70% is Own Capital. There is no Current Asset or Current Liability So Operating expenses are treated as Working Capital (Rs. 5, 00,000).

.
Attachm ent FORM FOR ESTABLISHMENT OF A NEW STOCKBROKING COMPANY This form is an attachment to the Application for Establishment of a New Stock broking Company. Under SEBI guidelines Particulars of the Applicant 1 Corporation Name . 2 Name of immediate, penultimate and ultimate holding . company 3 Date of incorporation . 4 Incorporation/Registration number . 5 Registered office . 6 Principal place of business . 1 Names of contact persons and their . positions 2 Telephone Number . 3 Facsimile Number . 4 E-mail address . 5 Correspondence address . License Record in Other Jurisdictions Please mention the place where the Applicants group of companies are licensed/authorized, approved or registered with regulatory bodies or authorized stock exchange to engage in stock broking activities. Compliance Information 1. Please provide a brief outline of the Applicants group compliance, internal audit and risk management function, system and framework.

Please provide relevant information on the group corporate and equity structure in relation to the application. Contact Information

2 Please provide a brief outline of the Applicants organization initiatives . and major taken in Anti-Money Laundering/Counter Terrorism Financing (AML/CTF) and promoting Know Your Customer; for example, to adopt best practices for financial institutions

under the 40 + 9 recommendations issued by the Financial Action Task Force.

3. Please provide the Applicants organization risk management scorecard/register. 4. Has any disciplinary actions or proceedings been taken against the Applicant, or any of its directors by any regulatory authority in relation to stock broking activities for the last five (5) years? If yes, please provide details. 5. Has the Applicant or any of its directors been investigated for offences involving fraud or dishonesty or adjudged by a court to be civilly liable for fraud, dishonesty or misfeasance within the last five (5) years? If yes, please provide details. 6. In relation to stock broking activities, has the Applicant or any of its directors been a party to a civil litigation in the past five (5) years? If yes, are there any judgments or court orders, which have not been complied with? 7. Has the Applicant been a party to a scheme of arrangement or served a winding Up petition or entered into any form of compromise with creditors in the past five (5) years? If yes, please provide details. 8. Please provide any other material information that you disclose relating to the Applicant and the groups compliance track record. Additional Information 1 Please provide information in relation to the Applicants group . market share, position and asset size based on the following: Geographical coverage; and coverage by market segments. 2. Please provide information on the Applicants group brand value and expertise in may wish to

Various markets, products, services and technological capabilities, including research capabilities. 3. Please describe the Applicants proposed business model as well as business plan in India and its value proposition for the overall development of the capital market. This would include:

a. The proposal on how the Applicant can source and intermediate business and b.The possibility of conducting capital market activities other than stock broking in the near future (3 - 5 years), the proposed staffing requirement of the proposed business model and etc.

4. Please briefly describe the Applicants relationship with its country regulator or exchange. This may include active participation in dialogues, workshops, road shows, sharing of information/technology and other promotional or marketing activities.

I/ We declare that all the information provided in this Application attachments) is complete, true and correct.
Signature of Authorised Company Representative Name Designation Date:

(including