tha final.doc1
TRANSCRIPT
-
8/7/2019 THA FINAL.doc1
1/39
1.1
INDUSTRY PROFILE
The Indian broking industry is one of the oldest trading industries that have been around
even before the establishment of the BSE in 1875. Despite passing through number of
changes in the post liberalization period, the industry has found its way onwards sustainable
growth. With the purpose of gaining a deeper understanding about the role of the Indian
stock broking industry in the countrys economy, we present in this section some of the
industry insights gleaned from analysis of data received through primary research.
For the broking industry, we started with an initial database of over 1,800 broking
firms that were contacted, from which 464 responses were received. The list was further
short listed based on the number of terminals and the top 210 were selected for profiling.
394 responses, that provided more than 85% of the information sought have been included
for this analysis presented here as insights. All the data for the study was collected through
responses received directly from the broking firms. The insights have been arrived at
through an analysis on various parameters, pertinent to the equity broking industry, such as
region, terminal, market, branches, sub brokers, products and growth areas.
Some key characteristics of the sample 394 firms are:
On the basis of geographical concentration, the West region has the maximum
representation of 52%. Around 24% firms are located in the North, 13% in the South
and 10% in the East
3% firms started broking operations before 1950, 65% between 1950-1995 and 32%
post 1995.
On the basis of terminals, 40% are located at Mumbai, 12% in Delhi, 8% in
Ahmedabad, 7% in Kolkata, 4% in Chennai and 29% are from other cities
From this study, we find that almost 36% firms trade in cash and derivatives and 27%
are into cash markets alone. Around 20% trade in cash, derivatives and commodities
In the cash market, around 34% firms trade at NSE, 14% at BSE and 52% trade at
both exchanges. In the derivative segment, 48% trade at NSE, 7% at BSE and 45% at
both, whereas in the debt market, 31% trade at NSE, 26% at BSE and 43% at both
exchanges
-
8/7/2019 THA FINAL.doc1
2/39
Majority of branches are located in the North, i.e. around 40%. West has 31%, 24%
are located in South and 5% in East
In terms of sub-brokers, around 55% are located in the South, 29% in West, 11% in
North and 4% in East
Trading, IPOs and Mutual Funds are the top three products offered with 90% firms
offering trading, 67% IPOs and 53% firms offering mutual fund transactions
In terms of various areas of growth, 84% firms have expressed interest in expanding
their institutional clients, 66% firms intend to increase FII clients and 43% are
interested in setting up JV in India and abroad
In terms of IT penetration, 62% firms have provided their website and around 94%
firms have email facility
A BRIEF HISTORY
India Infoline was originally incorporated on October 18, 1995 as Probity Research
and Services Private Limited at Mumbai under the Companies Act, 1956 with Registration
No. 11 93797. India Infoline commenced operations as an independent provider of
information, analysis and research covering Indian businesses, financial markets and
economy, to institutional customers. India Infoline became a public limited company on April
28, 2000 and the name of the Company was changed to Probity Research and Services
Limited. The name of the Company was changed to India Infoline.com Limited on May 23,
2000 and later to India Infoline Limited on March 23, 2001.
In 1999, India Infoline.com identified the potential of the Internet to cater to a mass
retail segment and transformed our business model from providing information services to
institutional customers to retail customers. Hence India Infoline launched Internet portal,
www.indiainfoline.com in May 1999 and started providing news and market information,
independent research, interviews with business leaders and other specialized features.
-
8/7/2019 THA FINAL.doc1
3/39
In May 2000, the name of India Infoline was changed to India Infoline.com Limited
to reflect the transformation of our business. Over a period of time, India Infoline.com has
emerged as one of the leading business and financial information services provider in India.
In the year 2000, India Infoline leveraged its position as a provider of financial
information and analysis by diversifying into transactional services, primarily for online
trading in shares and securities and online as well as offline distribution of personal financial
products, like mutual funds and RBI Bonds. These activities were carried on by our wholly
owned subsidiaries.
India Infoline broking services was launched under the brand name of 5paisa.com
through our subsidiary, India Infoline Securities Private Limited and www.5paisa.com, the e-
broking portal, was launched for online trading in July 2000. It combined competitive
brokerage rates and research, supported by Internet technology besides investment advice
from an experienced team of research analysts, India Infoline also offer real time stock
quotes, market news and price charts with multiple tools for technical analysis.
Facilities
India Infolines main offices are located in approximately 4,000 square feet of
office space located in Mumbai, India. India Infoline Branches collectively occupy an
additional 10,000 square feet of office space located throughout India, As on March 31, 2005,
India Infoline has 73 branches across 36 locations in India.
Terminals
Almost 52% of the terminals in the sample are based in the Western region of India,
followed by 25% in the North, 13% in the South and 10% in the East. Mumbai has got the
maximum representation from the West, Chennai from the South, New Delhi from the North
and Kolkata from the East.
-
8/7/2019 THA FINAL.doc1
4/39
Branches & Sub-Brokers
The maximum concentration of branches is in the North, with as many as 40% of all
branches located there, followed by the Western region, with 31% branches. Around 24%
branches are located in the South and East constitutes for 5% of the total branches of the
total sample.
In case of sub-brokers, almost 55% of them are based in the South. West and North
follow, with 30% and 11% sub-brokers respectively, whereas East has around 4% of total
sub-brokers.
-
8/7/2019 THA FINAL.doc1
5/39
Financial Markets
The financial markets have been classified as cash market, derivatives market, debt
market and commodities market. Cash market, also known as spot market, is the most
sought after amongst investors. Majority of the sample broking firms are dealing in the cash
market, followed by derivative and commodities. 27% firms are dealing only in the cash
market, whereas 35% are into cash and derivatives. Almost 20% firms trade in cash,
derivatives and commodities market. Firms that are into cash, derivatives and debt are 7%.
On the other hand, firms into cash and commodities are 3%, cash & debt market and
commodities alone are 2%. 4% firms trade in all the markets.
In the cash market, around 34% firms trade at NSE, 14% at BSE and 52% trade at
both exchanges. In the equity derivative market, 48% of the sampled broking houses are
members of NSE and 7% trade at BSE, while 45% of the sample operate in both stock
exchanges. Around 43% of the broking houses operating in the debt market, trade at both
exchanges with 31% and 26% firms uniquely at NSE and BSE respectively.
-
8/7/2019 THA FINAL.doc1
6/39
Products
The survey also revealed that in the past couple of years, apart from trading, the firms
have started offering various investment related value added services. The sustained growth
of the economy in the past couple of years has resulted in broking firms offering many
diversified services related to IPOs, mutual funds, company research etc. However, the core
trading activity is still the predominant form of business, forming 90% of the firms in the
sample. 67% firms are engaged in offering IPO related services. The broking industry seems
to have capitalized on the growth of the mutual fund industry, which was pegged at 40% in
2006. More than 50% of the sample broking houses deal in mutual fund investment services.
The average growth in assets under management in the last two years is almost 48%.
Company research is another lucrative area where the broking firms offer their services;
more than 33% of the firms are engaged in providing company research services.
Additionally, a host of other value added services such as fundamental and technical
analysis, investment banking, arbitrage etc are offered by the firms at different levels.
-
8/7/2019 THA FINAL.doc1
7/39
Of the total sample of broking houses providing trading services, 52% are based in the West,
followed by 25% from North, 13% from South and 10% from the East. Around 50% of the
firms offering IPO related services are based in the West as compared to 27% in North, 13%in South and 10% in East. In providing mutual funds services, the Western region was
dominant amounting to 49% followed by 27% from North; The South and the East are
almost at par with 13% and 11% respectively.
-
8/7/2019 THA FINAL.doc1
8/39
Future Plans
68% of the firms from the sample have envisaged strategies for future
growth. With the middle class Indian investor as well as foreign investorwilling to invest in the stock market, majority of the firms preferred expansion
of institutional and the Foreign Institutional Investor clients in their areas of
growth. Around 84% have shown interest in expanding their institutional client
base. Nearly 51% of such firms are located in the West, 25% in North, 15% are
from South and 9% from East. Since the past couple of years, India, along with
Korea and Taiwan, has been one of the preferred destinations for the FIIs. With
corporate restructuring, rising market capitalization and sectoral friendly
policies helping the FIIs, more than two thirds of the firms are interested in
increasing their FII client base. Amongst these firms, west again has maximum
representation of 53%, followed by North with 22%. South has 15% firms and
East makes up for 9%.
-
8/7/2019 THA FINAL.doc1
9/39
1.2 BACK GROUND TO THE STUDY
Equities
IIFL is a member of BSE and NSE registered with NSDL and CDSL as a depository
participant and provides broking services in the cash, derivatives and currency segments,
online and offline. IIFL is a dominant player in the retail as well as institutional segments of
the market. It recently became the first Indian broker to get a membership of the Colombo
Stock Exchange and is also the first Indian broker to have received an in-principle approval
for membership of the Singapore Stock Exchange.
COMMODITIES
IIFL offers commodities trading to its customers vide its membership of the MCX and theNCDEX. Our domain knowledge and data based on in depth research of complex paradigms
of commodity kinetics, offers our customers a unique insight into behavioral patterns of these
markets. Our customers are ideally positioned to make informed investment decisions with a
high probability of success.
CREDIT AND FINANCE
IIFL offers a wide array of secured loan products. Currently, secured loans (mortgage loans,
margin funding, loans against shares) comprise 94% of the loan book. The Company has
discontinued its unsecured products. It has robust credit processes and collections mechanism
resulting in overall NPAs of less than 1%. The Company has deployed proprietary loan-
processing software to enable stringent credit checks while ensuring fast application
processing. Recently the company has also launched Loans against Gold.
INSURANCE
IIFL entered the insurance distribution business in 2000 as ICICI Prudential Life Insurance
Co. Ltds corporate agent. Later, it became an Insurance broker in October 2008 in line with
its strategy to have an open architecture model. The Company now distributes products ofmajor insurance companies through its subsidiary India Info line Insurance Brokers Ltd.
Customers can choose from a wide bouquet of products from several insurance companies
including Max New York Life Insurance, MetLife, Reliance Life Insurance, Bajaj Allianz
Life, Birla Sun life, Life Insurance Corporation, Kotak Life Insurance and others.
-
8/7/2019 THA FINAL.doc1
10/39
WEALTH MANAGEMENT SERVICE
IIFL offers private wealth advisory services to high-net-worth individuals (HNI) and
corporate clients under the IIFL Private Wealth brand. IIFL Private Wealth is managed by a
qualified team of MBAs from IIMs and premier institutes with relevant industry experience.The team advises clients across asset classes like sovereign and quasi-sovereign debt,
corporate and collateralized debt, direct equity, ETFs and mutual funds, third party PMS,
derivative strategies, real estate and private equity. It has developed innovative products
structured on the fixed income side.
INVESTMENT BANKING
IIFLs investment banking division was launched in 2006. The business leverages upon its
strength of research and placement capabilities of the institutional and retail sales teams. Ourexperienced investment banking team possesses the skill-set to manage all kinds of
investment banking transactions. Our close interaction with investors as well as corporate
helps us understand and offer tailor-made solutions to fulfill requirements.
1.3 STATEMENT OF THE PROBLEM
The online brokerages currently account for about 15-30% of all US stock trades, dependingon definitions used. More than 5 million investors trade online and analysts expect that
number to almost double in 1999 (Bicknell, 1998). The number of online-brokers in the US is
rapidly increasing and at present the number is more than 120 (Warner 1998;
http://www.gomez.com). James Marks a Credit Suisse First Boston analysts has taken an in-
depth study of the Charles Schwabs on-line brokerage business, and he says that most of the
online-brokerages increased market-share will be stolen from the full-service, full-
commission brokers (Weisul, 1997). A Yankee Group Study found that while 40% of bank
customer felt loyalty to their bank, only 12% of brokerage customers felt the same way
(Pennsburg, 1997).
The online-trading will most likely continue to be an alternative to the traditional brokering.The number of online-accounts has reached unexpected highs, and it is believed to grow even
further. At the same time it has been shown that the on-line brokers gains market-shares on
behalf of the traditional full-commission brokers. In addition there seems to be little loyalty
among the customers. All this indicates that traditional brokerage-firms that still do not offer
on-line trading should take the threat from this emerging new way of buying stocks,
seriously. Merrill Lynch on the other hand has a different view on the on-line trading, being
skeptic and very averse to jump on the "hype" as they call it. In this term paper we will take a
closer look at the on-line trading from Merrill Lynchs point of view, and present a strategy
of how they should position themselves.
-
8/7/2019 THA FINAL.doc1
11/39
1.4 NEED AND IMPORTENTS OF MARKATING STRATAGIS
To know about the kind of brokerage they are charge
and the way they portfolios of the client
To know how they handle the risk
-
8/7/2019 THA FINAL.doc1
12/39
1.5
EXPECTED CONTRIBUTION FROM THE STUDY
For the Research work, I have taken India info line and others into consideration. A
comparative analysis of both the brokerage is done in terms of risk and return. Also the
research work includes the return which the investors would get by investing in these
brokerages and which will provide greater returns to the investor is the purpose of the
research.
OBJECTIVES OF THE STUDY
To study India info line in detail.
To study the basics of other brokerages
To analyze the amount of risk involved in brokerage.
To know the risk and return from the brokerage
To know how brokerages provide better returns to the investors.
-
8/7/2019 THA FINAL.doc1
13/39
2.0 INTRODUCTION TO INDIAINFOLINE
India Infoline founded in 1995 by Mr. Nirmal Jain (Chairman and Managing Director) as an
independent business research and information provider. We gradually evolved into a one-
stop financial services solutions provider. Our strong management team comprises competent
and dedicated professionals.
We are a pan-India financial services organization across 1,361 business locations and a
presence in 428 cities. Our global footprint extends across geographies with offices in New
York, Singapore and Dubai. We are listed on the Bombay Stock Exchange (BSE) and the
National Stock Exchange (NSE).
We offer a wide range of services and products comprising broking (retail and institutional
equities and commodities), wealth management, credit and finance, insurance, asset
management and investment banking.
We are registered with the BSE and the NSE for securities trading, MCX, NCDEX and
DGCX for commodities trading, CDSL and NSDL as depository participants. We are
registered as a Category I merchant banker and are a SEBI registered portfolio manager. We
also received the FII license in IIFL Inc. IIFL Securities Pte Ltd received approval from the
Monetary Authority of Singapore to carry out corporate advisory and dealing in securities
operations. Two subsidiaries India Infoline Investment Services and Moneyline Credit
Limited are registered with RBI as non-deposit taking non-banking financial services
companies. India infoline Housing Finance Ltd, the housing finance arm, is registered with
the National Housing Bank.
-
8/7/2019 THA FINAL.doc1
14/39
HISTROY OF INDIAINFOLINE
The IndiaInfoline Group was originally incorporated on October 18, 1995 as Probity
Research and Services Private Limited at Mumbai under the Companies Act, 1956 with
Registration No. 11 93797. The IndiaInfoline Group commenced its operations as an
independent provider of information, analysis and research covering Indian businesses,
financial markets and economy, to institutional customers. We became a public limited
company on April 28, 2000 and the name of the Company was changed to Probity Research
and Services Limited. The name of the Company was changed to India Infoline.com Limited
on May 23, 2000 and later to India Infoline Limited on March 23, 2001.
In 1999, The IndiaInfoline Group identified the potential of the Internet to cater to a
mass retail segment and transformed our business model from providing information services
to institutional customers to retail customers. Hence we launched our Internet portal,
www.indiainfoline.com in May 1999 and started providing news and market information,
independent research, interviews with business leaders and other specialized features.
In May 2000, the name of our Company was changed to India Infoline.com Limited
to reflect the transformation of our business. Over a period of time, we have emerged as one
of the leading business and financial information services provider in India.
In the year 2000, The India Infoline Group leveraged its position as a provider of
financial information and analysis by diversifying into transactional services, primarily for
online trading in shares and securities and online as well as offline distribution of personal
financial products, like mutual funds and RBI Bonds. These activities were carried on by our
wholly owned subsidiaries.
The India Infoline Groups broking services was launched under the brand name of
5paisa.com through our subsidiary, India Infoline Securities Private Limited and
www.5paisa.com, the e-broking portal, was launched for online trading in July 2000. It
combined competitive brokerage rates and research, supported by Internet technology
Besides investment advice from an experienced team of research analysts, we also offer real
time stock quotes, market news and price charts with multiple tools for technical analysis.
-
8/7/2019 THA FINAL.doc1
15/39
Acquisition of Agri Marketing Services Limited ("Agri")
In March 2000, The IndiaInfoline Group acquired 100% of the equity shares of Agri
Marketing Services Limited, from their owners in exchange for the issuance of 508,482 of
our equity shares. Agri was a direct selling agent of personal financial products including
mutual funds, fixed deposits, corporate bonds and post-office instruments. At the time of our
acquisition, Agri operated 32 branches in South and West India serving more than 30,000
customers with a staff of, approximately 180 employees. After the acquisition, we changed
the company name to India Infoline.com Distribution Company Limited.
The India Infoline group, comprising the holding company, India Infoline Ltd (NSE:
INDIAINFO, BSE: 532636) and its subsidiaries, is one of the leading players in the Indianfinancial services space. India Infoline offers the entire gamut of financial services covering
investment products ranging from Equities and derivatives, Commodities, Portfolio
Management Services, Mutual Funds, Life Insurance, Fixed deposits, Loans, Investment
Banking, GoI bonds and other small savings instruments. It owns and manages the website,
www.indiinfoline.com, which is one of Indias leading online destinations for personal
finance, stock markets, economy and business.
A forerunner in the field of equity research, IndiaInfolines research is acknowledged by none
other than Forbes as Best of the Web and a must read for investors in Asia.
IndiaInfolines research is available not just over the internet but also on international wire
services like Bloomberg (Code: IILL), Thomson First Call and Internet Securities where it is
amongst the most read Indian brokers.
A network of 753 business locations spread over 346 cities across India, facilitates the
smooth acquisition and servicing of a large customer base. All these offices are connected
with the corporate office in Mumbai with cutting edge networking technology.
http://www.timesprivatetreaties.com/india-infoline.html#%23http://www.timesprivatetreaties.com/india-infoline.html#%23http://www.timesprivatetreaties.com/india-infoline.html#%23http://www.timesprivatetreaties.com/india-infoline.html#%23 -
8/7/2019 THA FINAL.doc1
16/39
-
8/7/2019 THA FINAL.doc1
17/39
Stock Option details: whether to be issued at discount as well as the period over which to be
accrued and over which exercisable. - To conduct discussions with the HR department and
form suitable remuneration policies.
Share Transfer and Investor Grievance Committee
Details of the Members, Compliance Officer, No of Complaints received and pending and
pending transfers as on close of the financial year. The committee functions under the
Chairmanship of Mr Kranti Sinha, a Non-executive independent Director. The other
Members of the committee are Mr Sanjiv Ahuja, Independent Director and Mr R
Venkataraman, Executive Director. Ms Komal Parikh, Company Secretary is the Compliance
Officer of the Company.
-
8/7/2019 THA FINAL.doc1
18/39
-
8/7/2019 THA FINAL.doc1
19/39
COMPANY STRUCTURE
IndiaInfoline Limited is listed on both the leading stock exchanges in India, viz. the Stock
Exchange, Mumbai (BSE) and the National Stock Exchange (NSE) and is also a member of
both the exchanges. It is engaged in the businesses of Equities broking, Wealth Advisory
Services and Portfolio Management Services. It offers broking services in the Cash and
Derivatives segments of the NSE as well as the Cash segment of the BSE. It is registered withNSDL as well as CDSL as a depository participant, providing a one-stop solution for clients
trading in the equities market. It has recently launched its Investment banking and
Institutional Broking business.
A SEBI authorized Portfolio Manager; it offers Portfolio Management Services to clients.
These services are offered to clients as different schemes, which are based on differing
investment strategies made to reflect the varied risk-return preferences of clients
-
8/7/2019 THA FINAL.doc1
20/39
CHALLENGES FACES BY INDIAINFOLINE
Category related - the market is skewed primarily to the metros with Mumbai, Ahmedabad,
and New Delhi accounting for major bulk of the trading.
Competition related - due to high brand proliferation, the market from a consumer standpoint
has become commoditized given product parity in terms of offerings.
Brand related - challenge being to maintain high decibel and impactful communication on asustained basis.
Key executives
S.No Name Designation
1 Mr. Nirmal Jain Chairman and Managing director
2 Mr. A K Purwar Director
3 Mr. R Venkataraman Executive Director
4 Mr. Nilesh Vikamsey Independent Director
5 Mr. Kranti Sinha Independent Director
6 Mr. Sat Pal Khattar Non Executive Director
-
8/7/2019 THA FINAL.doc1
21/39
PRODUCT & SERVICES
Equities
India Infoline provided the prospect of researched investing to its clients, which was
hitherto restricted only to the institutions. Research for the retail investor did not exist prior
to India Infoline. India Infoline leveraged technology to bring the convenience of trading to
the investors location of preference (residence or office) through computerized access.
India Infoline made it possible for clients to view transaction costs and ledger updates in
real time.
Over the last five years, India Infoline sharpened its competitive edge through the
following initiatives:
Multi-channel delivery model :
The Company is among the few financial intermediaries in India to offer a complement of
online and offline broking. The Companies network of branches also allows customers to
place orders on phone or visit our branches for trading.
Integrated middle and back office :
The customer can trade on the BSE and NSE, in the cash as well as the derivatives segment
all through the available multiple options of Internet, phone or branch presence.
Multiple-trading options :
The Company harnessed technology to offer services at among the lowest rates in the
business.
Membership:
The Company widened client reach in trading on the domestic and international exchanges.
Technology :
The Company provides a prudent mix of proprietary and outsourced technologies, which
facilitate business growth without a corresponding increase in costs.
-
8/7/2019 THA FINAL.doc1
22/39
Content :
The Company has leveraged its research capability to provide regular updates and
investment picks across the short and long-term.
Service :
Clients can access the customer service team through various media like toll-free lines,
emails and Internet- messenger chat for instant query resolution. The Companies customer
service executives proactively contact customers to inform them of key changes and
initiatives taken by the Company. Business World rated the Companies customer service as
Best in their survey of online trading sites carried out in December 2003.
Key features :
Membership on the Bombay Stock Exchange Limited and the National Stock Exchange
Registered with the NSDL as well as CDSL as a depository participant, providing a
one-stop solution for clients trading in the equities market
Broking services in cash and derivative segments, online as well as offline.
Presence across 350 cities and towns with a network of over 850 business locations
Equity client base of over 500,000 clients
Provision of free and world-class research to all clients
Commodities
India Infolines extension into commodities trading reconciles its strategic intent to emerge
as a one stop solutions financial intermediary. Its experience in securities broking has
empowered it with requisite skills and technologies. Increased offering: The Companies
commodities business provides a contra-cyclical alternative to equities broking. The
Company was among the first to offer the facility of commodities trading in Indias young
commodities market (the MCX commenced operations only in 2003). Average monthly
turnover on the commodity exchanges increased from Rs 0.34 bn to Rs 20.02 bn. The
commodities market has several products with different and non-correlated cycles. On the
whole, the business is fairly insulated against cyclical gyrations in the business.
-
8/7/2019 THA FINAL.doc1
23/39
IndiaInfoline distinguished its business through the interplay of knowledge and
technology:
Complete solution :
The Company provides a complete - advice to execution solution facilitated by information
and advice on likely commodity trends in the Indian and international environment.
Technology :
The Company has extended the trading terminal to the investors home/workplace reinforced
with real-time commodity information and ledger position.
Rates :
The Company harnessed technology to offer services at among the lowest rates in the
business. Membership: The Company widened client reach in trading on the domestic and
international exchanges.
Key Features :
Enjoys memberships with the MCX and NCDEX, two leading Indian commodities
exchanges
Recently acquired membership of the DGCX
Multi-channel delivery model, making it among the select few to offer online as well as
offline trading facilities
Extended commodity trading to retail investors, among the few Indian financial
intermediaries to do so
Online business at 80% of revenues dominates commodities trading revenues
Provides regular commodity updates pertaining to the Indian and international
environment
-
8/7/2019 THA FINAL.doc1
24/39
INSURANCE
An entry into this segment helped complete the client's product basket; concurrently, it graduated
the Company into a one stop retail financial solutions provider. To ensure maximum reach to
customers across India, we have employed a multi pronged approach and reach out to customers
via our Network, Direct and Affiliate channels. Following the opening of the sector in 1999-2000,
a number of private sector insurance service providers commenced operations aggressively and
helped grow the market.
The Companies entry into the insurance sector derisked the Company from a predominant
dependence on broking and equity-linked revenues. The annuity based income generated from
insurance intermediation result in solid core revenues across the tenure of the policy.
Over the last five years, India Infoline sharpened its competitive edge in this business segment
through the following initiatives:
Client base :
Grew its 40,000 strong client base through knowledge-led analysis, translating into an attractive
opportunity to cross-sell products and generate referral business.
Distribution network :
Invested in a distribution network of 177 branches across 19 states, which provided it with an
unmatched reach within its segment.
Hands-on training :
Invested aggressively in training its field force more than 100 hours a year in product attributes
across the insurance sector - highlighting various product details and marketing skills apart from
regular meets where best practices are shared.
Technology :
-
8/7/2019 THA FINAL.doc1
25/39
The Company provides a prudent mix of proprietary and outsourced technologies, which facilitate
business growth without a corresponding increase in costs.
Research and advice :
Provided clients with advice on diverse investment products based on the customers existing and
prospective financial profile.
Key features :
India Infoline was the first corporate in India to get the agency licence in early 2001
The Company is the biggest corporate agency in India for life insurance products
The Company operates multiple channels, namely branch network, preferred client
group, direct marketing, corporate tax advisory, walk-ins and seminars, to reach out to
customers.
INVEST ONLINE
India Infoline has made investing in Mutual funds and primary market so
effortless. All you have to do is register with us and thats all. No paperwork no
queues and No registration charges.
If you are 5p customer use your existing login ID and Ledger (fund transfer) password.
Indiainfoline offers you a host of mutual fund and IPO choices under one roof; backed by
in-depth information and research to help you invest effortlessly.
INVEST IN MF
Indiainfoline offers you a host of mutual fund choices under one roof, backed by in-depth
research and advice from research house and tools configured as investor friendly.
Investing in Mutual Funds has never been easier
-
8/7/2019 THA FINAL.doc1
26/39
APPLY IN IPOs
You could also invest in Initial Public Offers (IPOs) online without going through the
hassles of filling ANY application form/ paperwork.
Know more about IPO
Get in-depth analyses of new IPOs issues (Initial Public Offerings) which are
about to hit the market and analysis on these recent IPO listings,
prospectus/offer documents, and IPO reports are few of the features, which help
you, keep on top of the IPO markets.
Loans
They say you mustn't trust a man till you know his house. Everyone likes hearing people say
Wow, what a beautiful house you have! From cave dwelling, we have evolved and now a
house provides far more than just shelter...it also becomes a source of pride. A Housing Loan
is used as finance to help you buy or modify that perfect home.
The different Housing Loan products can be classified as:
Home Loans & Home Extension Loans
NRI Loans
Land Loans
Home Equity Loans
What is a housing loan?
They say you mustn't trust a man till you know his house. Everyone likes hearing people say
"Wow, what a beautiful house you have!" From cave dwelling, we have evolved and now a
house provides far more than just shelter...it also becomes a source of pride. A Housing Loan
is used as finance to help you buy or modify that perfect home. The different Housing Loan
-
8/7/2019 THA FINAL.doc1
27/39
products can be classified as:
Home Loan
Home Extension Loans
Home Improvement Loans
Land Loans
NRI Loans
Home Equity Loans
Short term Bridging Loans
Balance Transfer
Who can apply?
As long as you want to buy a house in India, you can apply for a Home Loan. You could be a
Resident Indian or an NRI; you could want to buy a property now or in the future, but you
may still apply for a Home Loan. In case you go with the last option and want to wait before
you consider nests, all you have to be sure of is the amount you are willing to spend on this
property and the HfIs will let you know your eligibility based on your income which will help
you plan out your budget. To find out your eligibility, please use our calculator.
General Terms and Conditions of a Housing Loan Product
You are allowed to visit zoos on the condition that you do not feed the animals. When you're
18, you are allowed to go for that late night party on the condition that someone drops you
home before 12. Every step we take requires condition to be fulfilled. Similarly, these are the
general terms & conditions of a Home Loan. For more details, please refer to the individual
product.
-
8/7/2019 THA FINAL.doc1
28/39
LTV Ratio will not exceed a particular percentage. This percentage differs from HFI
to HFI and the components of the value of property are covered in Cost of Property
Elastic can be stretched only to a certain extent. The loan tenure also will not go
beyond 20 years. However, HFIs do provide for different tenures with different terms
and conditions.
Your EMI normally does not exceed 50% of your Gross Monthly income.
The total monthly payment towards all the loans you have availed of, including the
present one, will normally not exceed 50% of your Gross Monthly Income.
Your loan eligibility is calculated using LTV, IIR and FOIR norms and the lowest
from the three is chosen.
Your profile is considered by the HFI before your repayment capacity is judged.
If the HFI insists on a personal guarantor, you need to provide one before the
disbursement of your loan.
Your property should be both technically and legally clear before your loan can get
disbursed by the HFI.
In case you have bought an under construction property, your loan will be partly
disbursed, as per the stages of construction and PEMI needs to be paid on it.
The disbursement, in most cases, will be in the name of the builder or the seller or the
society or the development authority unless you have made some payment to them.
Repayment of the loan is either via Deduction Against Salary, Post Dated Cheques,
standing instructions or by cash / DD.
You can either choose to repay the loan using the Annual rests or Monthly rests.
Charges applicable to Housing Loans
The different kinds of charges applicable to Home Loans are listed below:
Upfront Fees
Rate of Interest
Legal and Technical Charges
Stamp Duty and Registration Charges
Personal Guarantee from Charges
Cheque Bounce Charges
-
8/7/2019 THA FINAL.doc1
29/39
Delayed Payment Charges
Additional Charges
Incidental Charges
Prepayment Charges
PDC Swapping Charges
Legal and technical charges :
Some HFIs charge you for the legal and technical checks undertaken on your documents and
property, by lawyers and the technical team of the HFI.
Stamp duty and registration charges:
If you go in for a registered mortgage, these charges incurred by the HFI are passed onto
you. Sometimes these charges are rather heavy depending on the State laws in the state from
where you purchase your property.
Personal Guarantee form charges:
A piece of paper signed does not have much value unless stamped and validated by the
concerned authority. That power of attorney document that you signed with your spouse
would not be credible unless signed on a Rs.100 stamp paper. Similarly, HFIs currently
charge you a minimum of Rs.100 to get the personal guarantee validated and stamped in the
eyes of the law.
PDC swapping charges:
In case you want to exchange the PDCs you gave the HFIs for EMI repayments because of a
change in bank accounts, a change in EMI amount, etc., the HFis might charge a flat fee for
it.
Repayment capacity
Your repayment capacity is judged according to your income and your income is considered
differently if you are salaried and differently if you are self-employed. Income is used to
-
8/7/2019 THA FINAL.doc1
30/39
calculate the amount of money that you will be able to shell out every month towards your
loan installment using IIR and FOIR norms. FOIR calculation also takes into account the
installments of loans you are currently repaying. The lower between the IIR and FOIR is
chosen as your maximum repayment capacity. This is then compared to the loan amount that
you have requested for and the loan eligibility as per LTV norms and the lowest of these
would be your final loan eligibility.
Salaried Self-employed
Any extra income on your salary slip(including overtime, etc.) is subtracted
Any non-recurring income that affects profit(like sale of asset) is subtracted.
50% of the average variable income over the
last 6 months is added
Any non-recurring expense that adversely
affects profits and was not capitalized (like
repairs and maintenance) is added
Any fixed cash or voucher payment that can
be proved is added.
50% of the average depreciation of the last
two years is added.
HRA that can be received and is not being
received is added.
50% of the average annual income of the last
two years is added.
Credit Documentation
Would you trust any Tom, Dick or Harry with any matter at all? We all require a certain
assurance from people before we trust them; some sort of guarantee that they are trustworthy.
For HFIs this guarantee rests in the form of tangible documents. Credit documents are
required by all HFIs but vary in kind based on your occupation, employer, qualifications,
experience, etc. Credit documents can be classified as
Income documents:
Money money money...no one can take a chance on the credibility of money matters because
at the end of the day, business is business. Almost everything about your loan is based on
-
8/7/2019 THA FINAL.doc1
31/39
your income and therefore proof regarding the same is required by the HFI to ensure that no
miscommunications occur.
Personal documents:
Previously, tribes and clans had passwords without which you could not enter into the
territory; as proof of who he was, King Solomon had a ring as identification. Throughout
history, proof of identity has been important as mistaken identity has never been uncommon.
To prevent any such shams, HFIs also require a set of documents, for a general Home Loan
Product, identifying who you are.
He following list out all the documents needed. {under this line will be placed the document
sent separately as an excel sheet}
Legal Documentation
We might be living in the electronic age but that doesn't take away the importance and
monopoly of paper as everything to do with law will always be on paper. To stick by this
unwritten rule, there are legal documents that need to be submitted by you to the HFI for
mortgaging and these differ from state to state and also depend on your property type. The
following form a broad outline of the documents required and a detailed list can be found
here.
Copy of the offer letter sent by the HFI, accepted by you.
Title documents of the property which include
-Duly registered sale agreement.
-Receipts of your own contribution.
-Allotment letter
-Registration receipt
-If needed, land documents indicating ownership.
-Possession letter
-Lease agreement, if the property is bought from a development authority
-Mortgage deed if the HFI opts for a registered mortgage.
No Objection Certificate from the developer, society or development authority Personal Guarantees, if required.
-
8/7/2019 THA FINAL.doc1
32/39
Documents for alternate or additional security.
Post dated cheques for the EMIs.
These documents do NOT cover the entire list needed and if it is a resale property, the
pertaining agreements, etc. will also need to be attached.
Tax Benefits
Tax benefits are currently available only under Home Loans and Home Extension loans. The
details are given under the respective sections.
Property Insurance
Some events are not in our hands and are completely unavoidable. Floods, drought and
storms uproot trees and destroy the land. Along with this the birds lose their homes and while
building a nest may not be that bad and the loss is not that great, the money that you invest in
your cosy home might just be washed away. For this reason insuring your property is a good
idea as you safeguard the asset against damage or loss.. Property insurance is not compulsory
though some HFIs insist on a mortgage redemption life insurance policy and you will
therefore get a reduced interest rate. Some of the points that need to be noted regarding
property insurance are:
You can choose the tenure of your insurance.
The premium is charged up front
The longer your tenure, the greater the discounts insurance companies offer you.
News Letter
The Daily Market Strategy is your morning dose on the health of the markets. Five intra-
day ideas, unless the markets are really choppy coupled with a brief on the global markets
and any other cues, which could impact the market. Occasionally an investment idea from
the research team and a crisp round up of the previous day's top stories. That's not all. As a
subscriber to the Daily Market Strategy, you even get research reports of India Infoline
-
8/7/2019 THA FINAL.doc1
33/39
research team on a priority basis.
The IndiaInfoline Weekly Newsletter is your flashback for the week gone by. A weekly
outlook coupled with the best of the web stories from India Infoline and links to importantinvestment ideas, Leader Speak and features is delivered in your inbox every Friday
evening.
Portfolio Management
You get recessions. You have stock market declines. If you don't understand that's going to
happen, then you're not ready; you won't do well in the markets. No need to worry. We atIndia Infoline would take care of all issues related to managing your hard earned money.
Our Portfolio Management Service is a product wherein an equity investment portfolio is
created to suit the investment objectives of a client. We at India Infoline invest your resources
into stocks from different sectors, depending on your risk-return profile. This service is
particularly advisable for investors who cannot afford to give time or don't have that expertise
for day-to-day management of their equity portfolio.
It is all about your money, being managed by the experts, while you continue with your
routine life. Isn't it simple and totally hassle free.
What's more, you can keep track of your dividends / bonus / rights issues with paperless
tracking. So you always know how fast your investment is growing. It basically means
assigning the right job to the right person.
Research
IIFL special research cell where some of India's finest financial analysts bring you
intensive research reports on how the stock market is faring, when is the right time to
invest, when to execute your order and more.
IIFL make sure that investors are always prepared to make own investment decision when
the opportunity arises.IIFL bring you intensive research reports - whether sectoral or company-wise or more - that
-
8/7/2019 THA FINAL.doc1
34/39
tell you exactly when and where to invest. So whenever there is an exciting investment
opportunity, you are in the know and always ready to invest. Research reports IIFL will help
you choose your investments wisely, without wasting time. Presented in a lucid and easy-to-
understand format; these reports help you make informed decisions.
ASSET MANAGEMENT
India Infoline is a leading pan-India mutual fund distribution house associated with leading
asset management companies. It operates primarily in the retail segment leveraging its
existing distribution network to reach prospective clients. It has received the in-principle
approval to set up a mutual fund.
The group recently commenced its offshore asset management business under the IIFL
Capital brand. Also, IIFL Securities Pte Ltd received approval from the Monetary
Authority of Singapore to carry out global asset management operations. The Singapore arm
can now offer broking, asset management and investment banking services.
IIFL Inc received an FII license, thereby facilitating the investment of dedicated funds inIndia.
With offices in New York, Singapore and Dubai, IIFL Capital aims to offer India-focused
equity products, fund management and advisory services for offshore and domestic wealth
management customers.
MILESTONES ACHIEVED
1995
Incorporated as an equity research and consulting firm with a client base that included leading
FIIs, banks, consulting firms and corporates.
1999
Restructured the business model to embrace the internet; launched archives.indiainfoline.com
mobilised capital from reputed private equity investors.
http://archives.indiainfoline.com/http://archives.indiainfoline.com/ -
8/7/2019 THA FINAL.doc1
35/39
2000
Commenced the distribution of personal financial products; launched online equity trading;
entered life insurance distribution as a corporate agent. Acknowledged by Forbes as Best of
the Web and ...must read for investors.
2004
Acquired commodities broking license; launched Portfolio Management Service.
2005
Listed on the Indian stock markets.
2006
Acquired membership of DGCX; launched investment banking services.
2007
Launched a proprietary trading platform; inducted an institutional equities team; formed a
Singapore subsidiary; raised over USD 300 mn in the group; launched consumer finance
business under the Moneyline brand.
2008
Launched wealth management services under the IIFL Wealth brand; set up India Infoline
Private Equity fund; received the Insurance broking license from IRDA; received the venture
capital license; received inprinciple approval to sponsor a mutual fund; received Best broker-
India award from FinanceAsia; Most Improved Brokerage- India award from Asiamoney.
2009
Received registration for a housing finance company from the National Housing Bank;
received Fastest growing Equity Broking House - Large firms in India by Dun & Bradstreet.
MARKET SHARES OF COMPANY
Retail broking :
-
8/7/2019 THA FINAL.doc1
36/39
IndiaInfoline has around 3 lakh customers. It has a tie-up with Bank of Baroda
for e-broking.
Institutional broking :
IndiaInfoline has roped in Bharat Parajia, director of sales at CLSA inSingapore, H Nemkumar, CLSA's country head for India, Aniruddha Dange, CLSA's
head of research in India, and Vasudev Jagannath, CLSA's head of sales in India.
While Parajia will join as head of institutional sales at India Infoline, Dange will be
head of research and Nemkumar head of investment banking.
Each one of them is bringing in more than 10 years of experience with a
top institutional brokerage in Asia. The CLSA foursome will also pick up stakes in
India Infoline through the preferential allotment route. Their collective stake would
add up to around 15%. Parajia already holds a 2.88% stake in India Infoline. He will
subscribe to 25 lakh equity warrants at Rs 440 each.Nemkumar will pick up another
25 lakh, while Jagannath and Aniruddha Dange will subscribe to 20 lakh warrants
each. The preferential allotment includes the four men buying 90 lakh equity warrants
at a price of Rs 440 each, of which 10% will be paid up front as their sign-on bonus.
The remaining will be payable at the end of eighteen months when the warrants will
be convertible into shares.That is, all these guys will have to cough up about Rs 360
crore to convert their warrants into shares. Currently, the company's institutional
equities team has 35 people, including research analysts and dealers.
Consumer Finance:
During the quarter, it managed a book size of Rs 25 crore and has suffered a loss of
Rs 5.5 crore. It expects to break even in 2-3 quarters. NIM of 6-8% on personal loans
and 3-4% on home refinancing. It is looking at a Rs 200 crore private-equity funding
for its consumer finance subsidiary. It intends to leverage its extensive branch
network to expand its consumer finance division to tier-II and tier-III cities in the
coming quarters. IndiaInfoline is going slow as it has just started this business with a
robust risk management system. The company has roped in experts from Citi
Financial and other banks.
-
8/7/2019 THA FINAL.doc1
37/39
Ticker: 532636
Exchanges: BOM
2009 Sales: 9,630,900,000
Major
Industry:
Financial
Sub
Industry:
Securities
Brokerage
Country: INDIA
Employees: 14105
4.1TYPE OF RESEARCH
There are types of research design:
1. Exploratory
2. Descriptive
3. Casual
To know the customer attitudes and preferences towards Retail Banking and their
behavior, descriptive research was undertaken
Descriptive research is focused on the accurate description of the variable in the problem
model. This research was undertaken to know the avenues preferred by the people, to know
the factors considered while investing, frequency of investment and how they plan their
investment.
QUESTIONNAIRE DESIGN
The questionnaire used for the research purpose is simply a formalized set of questions
for eliciting information. As such its function is measurement and it represents the most
common form of measurement technique in marketing research.
The questionnaire contains both open ended and closed ended questions to elicit required
information. Open ended questions were used to leave the respondents free to offer any
replies that seem appropriate in light of the questions. They were used where no pre-stated set
of responses categories could be given. They were used as they are easier for both respondent
-
8/7/2019 THA FINAL.doc1
38/39
as well as researchers. The questions reduce the interviewers bias and bias caused varying
level of respondents articulateness.
Multiple choice questions were used to facilitate the respondents to choose any one, from
the given option. These kinds of questions were used in the questionnaire to know the top of
mind recall of the customer from the given set of avenues. These questions were essential for
securing adequate co-operation from respondents.
METHODOLGY:
The methodology adopted to achieve the objective of our study is by collecting
information from different sources.
There are two types of collection sources, they are
1. Primary Data
2. Secondary Data
Primary Data :
The Primary Data has been collected for the purpose of understanding customer
awareness about various products offered by the ING Vysya Bank and satisfaction towards
various bank services. This was done through interviews and by administering questionnaire
a. Customer Interview
b. Manager Interview
c. Questionnaire
Secondary Data :
The secondary data was collected to assist the research for analyzing the Retail Banking
awareness along with primary data, which was collected during the project time. The two
sources of secondary data that were used for research are as follows
-
8/7/2019 THA FINAL.doc1
39/39
1. Internal Sources : In this project, the internal sources are Brochures of Retail
Banking products and information collected from the concerned staff and
internal expert of bank.
2. External Sources : The external sources, used for collecting data in the
research includes
Internet
Magazines
4.6 OTHER SOFTWARE USED FOR DATA ANALYSIS
The data for analysis was collected from primary and secondary sources. The data
thus collected during the interaction respondents were organized, processed and
edited before tabulating and drawing the inference from the, The data got was
analyzed using statistical methods, techniques, graphical representation of data
was done. Bar graph is used for graphical representation.