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A REPORT ONSUMMER INTERNSHIP/ PROJECT WORK

For

__________(SHAREKHAN LTD ,VADODARA)__________

Submitted to

INDUKAKA IPCOWALA INSTITUTE OF MANAGEMENT (I2IM)CHAROTAR UNIVERSITY OF SCIENCE AND TECHNOLOGY (CHARUSAT)

CHANGA

Prepared by(PARIMAL SONERA)

ID No.:10MBA106M.B.A. First Year

Under the Guidance ofMIS.PINKY TALATI

_____________

INDUKAKA IPCOWALA INSTITUTE OF MANAGEMENT (I2IM)CHAROTAR UNIVERSITY OF SCIENCE AND TECHNOLOGY (CHARUSAT)

AT. & PO. CHANGA – 388 421 TA: PETLAD DIST. ANAND, GUJARAT

JULY 2011

DECLARATIONI , PARIMAL SONERA , student of the two-year MBA programme at Indukaka Ipcowala Institute ofManagement (I2IM) hereby declare that the report on summer training and project work entitled“ANALYSATION OF PROCESS OF PORTFOLIO MANAGEMENT SERVICE” is the result of my /our own work. I/we also acknowledge the other works / publications cited in the report.

(Signature)Place: ChangaDate: 31.07.2011 (PARIMAL SONERA)

ACKNOWLEDGEMENT

Every successful work is not completed without the help and support of the people around us. A success

is shared by not an individual but in fact by the people who constantly help him and guide him in his

work. Through this I want to express my gratitude towards all those who have directly or indirectly

contributed in my journey.

I am greatly thankful to prof G.K.krishnamurthy the Incharge Director of Indukaka Ipcowala Institute of

Management, who gave us the valuable opportunity of involving ourselves in such project assignments.

I am greatly thankful to my company guide Mis.Pinky Talati for his kind support and help during this

eight weeks of my summer training and in completion of my target. I wish to express my deep sense of

gratitude towards Sharekhan Ltd. for their help and valuable guidance in conducting this summer

internship project from its conception to its completion.

I would also like to thanks our faculty for their ever inspiring guidance about the summer training.

CHAROTAR UNIVERSITY OF SCIENCE AND TECHNOLOGY (CHARUSAT)INDUKAKA IPCOWALA INSTITUTE OF MANAGEMENT (I2IM)

MBA PROGRAMMEBATCH 2010-12

CERTIFICATE

This is to certify that this report ‘Portfolio Management Service’ is the bona fide work of Mr.

Parimal Sonera , student of Second Year of MBA Programme (2010-2012) at “sharekhan Ltd.”

submitted to INDUKAKA IPCOWALA INSTITUTE OF MANAGEMENT, CHANGA in partial

fulfillment of their academic requirement of the MBA PROGRAMME.

Ms. Shetal Thomas Prof.G Krishnamurthi

Project Guide Principal

Date: 19/08/2011

Place: Changa

TABLE OF CONTENTS

Executive Summary ----------------------------------------------------------------------------------7

Part-I Organizational Profile ------------------------------------------------------------------------------- 8

1 Introduction---------------------------------------------------------------------------------------------- 8

2 Industry overview ---------------------------------------------------------------------------------------

3 About Company (SHAREKHAN) ----------------------------------------------------------------- 11

3.1 Introduction -----------------------------------------------------------------------------------------

3.2 History -----------------------------------------------------------------------------------------------

3.3 Company overview ---------------------------------------------------------------------------------

3.4 Mission and Vision ---------------------------------------------------------------------------------

4 Functional area ---------------------------------------------------------------------------------------- 23

4.1 Market and Marketing --------------------------------------------------------------------------- 23

4.2 Production / Operations ------------------------------------------------------------------------- 28

4.3 Human Resources Management Departmentalisation --------------------------------------- 30

4.4 Finance and Accounts---------------------------------------------------------------------------- 31

5 Financial Analysis------------------------------------------------------------------------------------- 36

5.1 Profitability of the firm-----------------------------------------------------------------------36

5.2 Balancseheet of firm------------------------------------------------------------------------- 38

5.3 cash flow anylsis -------------------------------------------------- 39

PART –II Project Study ------------------------------------------------------------------------------41

7 Project study -----------------------------------------------------------------------------------41

7.1 introduction of the study ------------------------------------------------------------------------

7.2 Importance of the study --------------------------------------------------

7.3 Objectives of the study --------------------------------------------------------------------------

8 Research -----------------------------------------------------------------------------------------------

8.1 Research Design ---------------------------------------------------------------------------------

8.2 Data Sources and Data Collection Method --------------------------------------------------

8.3 Sampling Plan -----------------------------------------------------------------------------------

9 Data and data analysis ---------------------------------------------------------------------------49

10 Findings and Interpretations -----------------------------------------------------------------------

EXECUTIVE SUMMARY

Investing is both Arts and Science. Every Individual has their own

specific financial need and expectation based on their risk taking

capabilities, whereas some needs and expectation are universal.

Therefore, we find that the scenario of the Stock Market is changing day

by day hours by hours and minute by minute. The evaluation of financial

planning has been increased through decades, which can be best seen

in customers. Now a day’s investments have become very important

part of income saving.

In order to keep the Investor safe from market fluctuation and make

them profitable, Portfolio Management Services (PMS) is fast gaining

Investment Option for the High Net worth Individual (HNI). There is

growing competition between brokerage firms in post reform India. For

investor it is always difficult to decide which brokerage firm to choose.

The research design is analytical in nature. A questionnaire was

prepared and distributed to Investors. The investor’s profile is based on the

results of a questionnaire that the Investors completed.

In order to identify the effectiveness of Share khan PMS services

this Research is carried throughout the area of Baroda. At the time

of investing money everyone look for the Risk factor involve in the

Investment option. The Report is prepared on the basis of Research work

done through the different Research Mythology the data is collected from

both the source Primary sources which consist of Questionnaire and

secondary data is collected from different sources such as Company

website, Magazine and other sources.

PART -I ORGANISATION PROFILE

INTRODUCTION TO THE INDUSTRY

What is stock market?

A stock market or equity market is a public (a loose network of economic transactions, not a

physical facility or discrete) entity for the trading of company stock (shares) and derivatives at an

agreed price; these are securities listed on a stock exchange as well as those only traded privately.

The size of the world stock market was estimated at about $36.6 trillion at the start of October

2008. The total world derivatives market has been estimated at about $791 trillion face or nominal

value, 11 times the size of the entire world economy.

About the Indian stock marketIn India there are 23 stock exchanges of which the major ones are:

Bombay stock exchange(BSE)

National Stock Exchange(NSE)

BSE:-At the end of the American civil war, the brokers who thrived out of this war in 1874, found a

place in a street, where they would easily assemble and transact business. This street is nowadays,

popularly known as DALAL STREET. In 1887, they formally established in Bombay, and were

known as “Native Shares and Stock Brokers Association”. In 1895, it acquired a premise in the

same street and finally was inaugurated in 1899 with the name Bombay Stock Exchange (BSE).

India's premier stock exchange Bombay Stock Exchange (BSE) can also trace back its origin to as

far as 125 years when it started as a voluntary non-profit making association. You hear about it

any time it reaches a new high or a new low, and you also hear about it daily in statements like

'The BSE Sensitive Index rose 5% today'. Obviously, stocks and stock markets are important.

Stocks of public limited companies are bought and sold at a stock exchange. But what really are

stock exchanges? Known also as News on the stock market appears in different media every day.

The stock market , a stock exchange is an organized marketplace for securities (like stocks, bonds,

options) featured by the centralization of supply and demand for the transaction of orders by

member brokers, for institutional and individual investors. The exchange makes buying and selling

easy. The need for stock exchanges developed out of early trading activities in agricultural and

other commodities. During the middle Ages, traders found it easier to use credit that required

supporting documentation of drafts, notes and bills of exchange.

India's other major stock exchange National Stock Exchange (NSE), promoted by leading financial

institutions, was established in April 1993. Over the years, several stock exchanges have been

established in the major cities of India. There are now 23 recognised stock exchanges — Mumbai

(BSE, NSE and OTC), Calcutta, Delhi, Chennai, Ahmedabad, Bangalore, Bhubhaneswar,

Coimbatore, Guwahati, Hyderabad, Jaipur, Kochi, Kanpur, Ludhiana, Mangalore, Patna, Pune,

Rajkot, Vadodara, Indore and Meerut.

NSE: -With the liberalization of Indian economy it was found necessary to lift the Indian stock markets

on par with the international standards. The NSE was incorporated in 1992 by industrial

development bank of India, industrial credit and Investment Corporation of India, industrial

finance corporation of India, all insurance corporations, selected commercial banks and others.

NSE is India’s leading stock exchange covering more than 160 cities and towns across the country.

It provides the modern fully computerized trading system designed to offer investors across the

country a safe and easy way to invest to liquidate investment and securities. Investors in many

areas of country did not have the same access and opportunity to trade so there arise the need for

setting up the national stock exchange. The NSE network has been designed to provide equal

access to investors from anywhere in India and to be responsive to their needs.

On its recognition as a stock exchange under the Securities Contract Act, 1956 in April 1993, NSE

started operations in the Wholesale Debt Market (WDM) segment in June 1994. Capital market

(equities) segment commenced operations in November 1994, and operations in derivative

segment started in June 2000.NSE started trading in the capital market segment on November3,

1994 and within one year became the largest exchange in India, in terms of volumes transacted.

During the year 2005-06 NSE reported, a turnover of Rs 1,569,556 crores in the equity segment.

The Indian retail brokerage market, which is going through a wonderful phase with high growth

rate. The total trading volume of the Indian brokerage companies stood at US$ 1239.1 billion in

the year 2004, which increased to US$ 1492.1 billion in 2005. It is further expected to reach US$

6535.7 billion by the year 2015.

INTRODUCTION OF SHAREKHAN LTD :

Sharekhan Ltd is one of the leading retail stock broking house of SSKI Groupwhich is running successfully since 1922 in the country. It is the retail brokingarm of the Mumbai-based SSKI Group, which has over eight decades ofexperience in the stock broking business. Sharekhan offers its customers a widerange of equity related services including trade execution on BSE, NSE,Derivatives, depository services, online trading, investment advice etc The firm’sonline trading and investment site - www.sharekhan.com - was launched on Feb8, 2000. The site gives access to superior content and transaction facility toretail customers across the country. Known for its jargon-free, investor friendlylanguage and high quality research, the site has a registered base of over onelakh customers. The content-rich and research oriented portal has stood outamong its contemporaries because of its steadfast dedication to offeringcustomers best-of-breed technology and superior market information. Theobjective has been to let customers make informed decisions and to simplify theprocess of investing in stocks.

On April 17, 2002 Sharekhan launched Speed Trade, a net-based executableapplication that emulates the broker terminals along with host of otherinformation 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 sixmonths Speed Trade has become a de facto standard for the Day Tradingcommunity over the net.

Sharekhan’s ground network includes over 640 centers in 280 cities in Indiawhich provide a host of trading related services.Sharekhan has always believedin investing in technology to build its business. The company has used some ofthe best-known names in the IT industry, like Sun Microsystems, Oracle,Microsoft, Cambridge Technologies, Nexgenix, Vignette, Verisign FinancialTechnologies India Ltd, Spider Software Pvt Ltd. to build its trading engine andcontent. 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 groupventured into institutional broking and corporate finance 18 years ago. PresentlySSKI is one of the leading players in institutional broking and corporate financeactivities. 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 ForeignInstitutional portfolio investment and 5% of all Domestic Institutional portfolioinvestment in the country. It has 60 institutional clients spread over India, FarEast, UK and US. Foreign Institutional Investors generate about 65% of theorganization’s revenue, with a daily turnover of over US$ 2 million. TheCorporate 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 hasplaced over US$ 1 billion in private equity deals. Some of the clients include BPLCellular Holding, Gujarat Pipavav, Essar, Hutchison, Planetasia, and Shopper’sStop.

PROFILE OF SHAREKHAN

Name of the company: Sharekhan ltd.

Year of Establishment: 1925

Headquarter : ShareKhan SSKIA-206 Phoenix HousePhoenix Mills CompoundLower ParelMumbai - Maharashtra, INDIA- 400013

Nature of Business : Service Provider

Services : Depository Services, Online Services andTechnical Research.

Number of Employees : Over 3500

Revenue : Data Not Available

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 infact-

• 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

OWNERSHIP PATTERN AT SHAREKHAN

Major shareholders

Citi Venture Capital And Other Private Equity

Firms

60%

Barings Pvt. Equity Asia 23%

IDFC 6%

Employees 11%

Management Team

Mr. Tarun P. Shah. CEO.

Mr. Shankar Vailaya. Director-Operations.

Mr. JaideepArora. Director-Product and Technology.

Mr. Ketan Parekh. Chief Technology Officer.

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

AWARDS AND ACHIEVEMENTS :

Share khan is amongst the top 2 online trading websites from India. Share khan is the most preferred financial destination amongst the online

banking customers. Share khan is the winner of “Best Financial Website Award”.

Share khan is awarded at the Awaaz “Consumer Awards 2005” in the India’sstock broking firm

PRODUCTS AND SERVICES OF SHAREKHAN LIMITED

The different types of products and services offered by Sharekhan Ltd. are asfollows:

Equity and derivatives trading

Depository services

Online services

Commodities trading

Dial-n-trade

Portfolio management

Share shops

Fundamental research

Technical research

DIAL-N-TRADE

Along with enabling access for trade online, the CLASSIC and

SPEEDTRADE ACCOUNT also gives Dial-n-trade services. With this

service, one can dial Share khan’s dedicated phone lines 1800-22-7500,

3970-7500. Beside this, Relationship Managers are always available on

Office Phone and Mobile to resolve customer queries.

SHAREMOBILE

Share khan had introduced Share Mobile, mobile based software

where one can watch Stock Prices, Intra Day Charts, Research & Advice and

Trading Calls live on the Mobile.

PREPAIDACCOUNT

Customers pay Advance Brokerage on trading Account andenjoy uninterrupted trading in their Account. Beside this, great

discount are also available (up to 50%) on brokerage

IPO ON-LINE

Customers can apply to all the fo r t h co m in g IPOs online. This is

quite hassle-free, paperless and time saving. Simply allocate fund to IPO

Account, Apply for the IPO and Sit Back & Relax.

MutualFundOnline

Investors can apply to Mutual Funds of Reliance, Franklin

Templeton Investments, ICICI Prudential, SBI, Birla, Sundaram, HDFC, DSP

Merrill Lynch, PRINCIPAL and TATA with Share khan

ZeroBalanceICICISavingAccount

Share khan had tied-up with ICICI bank for Zero Balance Account for Share

khan’s Clients. Now their customers can have a Zero Balance Saving Account

with ICICI Bank after your demat account creation with Share khan

TYPES OF ACCOUNT IN SHAREKHAN LIMITED

Sharekhan offers two types of trading account for its clints

Classic Account (which include a feature known as Fast Trade

Advanced Classi

Account for the online users) and

Speed Trade Account

CLASSIC ACCOUNT

This is a User Friendly Product which allows the client to trade throughwebsite www.sharekhan.com and is suitable for the retail investor whois risk-averse and hence prefers to invest in stocks or who does nottrade too frequently. This account allow investors to buy and sell stocksonline along with the following features like multiple watch lists,Integrated Banking, Demat and digital contracts, Real-time portfoliotracking with price alerts and Instant credit & transfer.

This account comes with the following features:

a. Online trading account for investing in Equities and Derivativesb. Free trading through Phone (Dial-n-Trade)

I. Two dedicated numbers(1800-22-7500 and 39707500) forplacing the orders using cell phones or landline phones

II. Automatic funds transfer with phone banking facilities (forCitibank and HDFC bank customers)

III. Simple and Secure Interactive Voice Response basedsystem for authentication

IV. get the trusted, professional advice of Sharekhan limited’sTele Brokers

V. After hours order placement facility between 8.00 am and9.30 am

c. Integration of: Online Trading +Saving Bank + Demat Account.d. Instant cash transfer facility against purchase & sale of shares.e. IPO investments.f. Instant order and trade confirmations by e-mail.g. Single screen interface for cash and derivatives.

SPEED TRADE ACCOUNTThis is an internet-based software application, which enables one to buy andsell in an instant. It is ideal for active traders and jobbers who transactfrequently during day’s session to capitalize on intra-day price movement.

This account comes with the following features:

a. Instant order Execution and Confirmation.b. Single screen trading terminal for NSE Cash, NSE F&O & BSE.c. Technical Studies.d. Multiple Charting.e. Real-time streaming quotes, tic-by-tic charts.f. Market summary (Cost traded scrip, highest value etc.)g. Hot keys similar to broker’s terminal.h. Alerts and reminders.i. Back-up facility to place trades on Direct Phone lines.j. Live market debts.

CHARGE STRUCTURE

Fee structure for General Individual:

Charge Classic Account Speed Trade AccountAccount Opening Rs. 750/= Rs. 1000/=

BrokerageIntra-day – 0.10 %

Delivery - 0.50 %

Intra-day - 0.10%

Delivery - 0.50%

Depository Charges:

Account Opening Charges Rs. NIL

Annual Maintenance Charges Rs. NIL first year Rs. 300/= p.a.from second calendar year onward

BROKERAGE STRUCTURE OF SHAREKHANBROKERAGE:

INTRADAY DELIVERY

CASH- EQUITIES 0.05% 0.5%

PREPAID SCHEME 0.025% 0.25%

HOW TO OPEN AN ACCOUNT WITH SHARE KHAN LIMITED?

For online trading with Sharekhan Ltd., investor has to open an account.Following are the ways to open an account with Sharekhan Ltd.:

One need to call them at phone number provided below and asks thathe want to open an account with them.

a. One can call on the Toll Free Number: 1-800-22-7500 to speak toa Customer Service executive

b. Or If one stays in Mumbai, he can call on 022-66621111

One can visit any one of Sharekhan Limited’s nearest branches.Sharekhan has a huge network all over India (640 centers in 280cities). One can also log on to “http://sharekhan.com/Locateus.aspx”link to find out the nearest branch.

One can send them an email at [email protected] to know abouttheir products and services.

One can also visit the site www.sharekhan.com and click on the option“Open an Account” to fill a small query form which will ask theindividual to give details regarding his name, city he lives in, his emailaddress, phone number, pin code of the city, his nearest SharekhanLtd. shop and his preferences regarding the type of account he wants.

These information are compiled in the headquarter of the company thatis in Mumbai from where it is distributed through out the country’sbranches in the form of leads on the basis of cities and nearest shareshops. After that the executives of the respective branches contact theprospective clients over phone or through email and give theminformation regarding the various types of accounts and the documentsthey need to open an account and then fix appointment with theprospective clients to give them demonstration and making themundergo the formalities to open the account. After that the forms thathas collected from the clients, is scrutinized in the branch and then itis sent to Mumbai for further processing where after a few days theclients’ account are generated and activated. After the accounts areactivated, a Welcome Kit is dispatched from Mumbai to the clients’address mentioned in the documents provided by them. As soon as theclients receive the Welcome Kit, which contains the clients’ Trading IDand Trading Password, they can start trading and investing in shares.

Generally the process of opening an account follows the following steps:

LEAD MANAGEMENT SYSTEM (LMS) / REFERENCES

CONTACT THE PERSON OVER PHONE OR THROUGH EMAIL

FIXING AN APPOINTMENT WITH THE PERSON

GIVINGDEMONST-RATION

NOYES

DOCUMENTATION

FILLING UP THE FORM

SUBMISSION OF THE FORM

LOGIN OF THE FORM

SENDING ACCOUNT OPENING KIT TO THE CLIENT

TRADING

Apart from two passport size photographs, one needs to provide with thefollowing documents in order to open an account with Sharekhan Limited.:

Photocopy of the clients’ PAN Card which should be duly attached

Photo copy of any of the following documents duly attached which willserve as correspondence address proof:

a. Passport (valid)b. Voter’s ID Cardc. Ration Cardd. Driving License (valid)e. Electricity Bill (should be latest and should be in the name of the

client)f. Telephone Bill (should be latest and should be in the name of the

client)g. Flat Maintenance Bill (should be latest and should be in the

name of the client)h. Insurance Policy (should be latest and should be in the name of

the client)i. Lease or Rent Agreement.j. Saving Bank Statement** (should be latest)

Two cheques drawn in favour of Sharkhan Limited, one for theAccount Opening Fees and the other for the Margin Money (theminimum margin money is Rs. 5000).

** A cancelled cheque should be given by the client if he provides SavingBank Statement as a proof for correspondence address.

NOTE: Only Saving Bank Account cheques are accepted for the purposeof

Opening an account.

RESEARCH SECTION IN SHAREKHAN LIMITED

Sharekhan Limited has its own in-house Research Organisation which isknown as Valueline. It comprises a team of experts who constantly keep aneye on the share market and do research on the various aspects of the sharemarket. Generally the research is based on the Fundamentals and Technicalanalysis of different companies and also taking into account various factorsrelating to the economy.

Sharekhan Limited’s research on the volatile market has been found accuratemost of the time. Sharekhan's trading calls in the month of November 2007has given 89% strike rate.

Out of 37 trading calls given by Sharekhan in the month of November 2007,33 hit the profit target. These exclusive trading picks come only to SharekhanOnline Trading Customer and are based on in-depth technical analysis.

As a customer of Sharekhan Limited, one receives daily 5-6 Research Reportson their emails which they can use as tips for investing in the market. Thesereports are named as Pre-Market Report, Eagle Eye, High Noon, InvestorsEye, Daring Derivatives and Post-Market Report. Apart from these,Sharekhan Limited issues a monthly subscription by the name of Valuelinewhich is easily available in the market.

Sharekhan has tie up with the following banks:

HDFC Axis Bank IDBI Citi Bank IndusInd Bank Union Bank ICICI Bank

Customer .

Business class people (high class) High Net worth Individuals Service class people Government Employees Young Adults (19-30 yrs.) Adults (35-50 yrs.) HUF (Hindu Undivided Family) Women (literate and working)

Baroda branch of Sharekhan have around 3000 customers.Types of customers in Share khan:

INTRADAY : 25% of the customers are trading on intradaybasis.

DELIVERY : 50% of the customers are trading on deliverybasis.

F&O : 12% of the customers are investing in futuresand options.

COMMODITY : 5% Customers are investing in commodities.HNI (initial investment > 2,00,000) : 8% of the customers are Investing.CORE ACTIVITIES

Sharekhan is India’s leading broking houses providing a complete life cycle of investmentsolution 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 COMPANYBusiness is categorized into SIX areas :

1. Equity2. Derivatives3. PMS4. Commodities5. Mutual Funds6. IPO’s

TRADER’S are having two options for trading:

(1)Online(2)Offline

FUNCATIONAL AREA :

MARKET AND MARKETING

TYPES OF MARKETS

(A)Primarymarket(IPO’s):

In financial markets, an Initial Public Offering (IPO) is the first sale of a company's

common shares to public investors. The company will usually issue only primary shares,

but may also sell secondary shares. Typically, a company will hire an investment banker

to underwrite the offering and a corporate lawyer to assist in the drafting of the

prospectus. The sale of stock is regulated by authorities of financial supervision and where

relevant by a stock exchange.

It is usually a requirement that disclosure of the financial situation and prospects of a

company be made to prospective investors. The Federal Securities and Exchange

Commission (SEC) regulates the securities markets of the United States and, by

extension, the legal procedures governing IPOs. The law governing IPOs in the United

States includes primarily the Securities Act of 1933, the regulations issued by the SEC, and

the various state "Blue Sky Laws".

(B) Secondarymarket:

The secondary market (also called "aftermarket") is the financial market for trading of

securities that have already been issued in its initial private or public offering. Stock

exchanges are examples of secondary markets. Alternatively, secondary market can refer to

the market for any kind of used goods.

Function of the secondarymarket:

In the secondary market, securities are sold by and transferred from one speculator to

another. It is therefore important that the secondary market be highly liquid and transparent.

The eligibility of stocks and bonds for trading in the secondary market is regulated

through financial supervisory authorities and the rules of the market place in question,

which could be a stock exchange.

SALES & MARKETING DEPARTMENT

The Marketing Department is one of the most important departments in every concern.

The effectiveness of this department is the most important factor in the progress of the

firm. The whole performance of the company depends on marketing and without the

knowledge of this department; the company cannot sell its goods. The sales manager has the

right to perform these functions. He has many functions like he has to organize promotional

activities and sales events like “First Step”. The department has a Sales manager,

Assistant sales manager, Sales executives and trainees. The department gets databases

from various sources but the main source for leads is internet registration by the clients.

LEAD MANAGEMENT SYSTEM:

Lead management system is the software used by the sales department to manage the

leads. Every employee of sales department will have unique user id and password to

access this software. Every morning the sales manager will be provided with some leads

from the head office. The sales manager will split this work and assign the leads for assistant

sales manger and executives. Assistant sales manger will assign some leads to the trainees of

the company and he also assign some personal references to the trainees. Then the

employees will work on the leads and they will update the response in the lead management

system.

STRATEGY ADOPTED BY SALES DEPARTMENT

MARKETING STRATEGIES AND

PROMOTIONAL STRATEGIES

MARKETING STRATEGIES

The marketing strategy was mainly focused on reaching to every segment of people

SEGMENTATION:

Sharekhan segmented the whole market in to three types of clients which are as follows,

Retail investors

High net worth investors

Day traders (or) speculators

Most of the retail investors are salaried persons and middle income class people. They enter with

initial capital around Rs.5000-25000. High net worth investors are clients who invest more than

Rs.5 lakhs . They are mostly high income group. Day traders are clients who are professional

speculators and day traders.

TARGETING:

As most of clients are middle income people, Sharekhan targets mainly on retail investors such

as salaried people and middle income people.

POSITIONING:

Positioning strategy adopted by Sharekhan is they associated themselves with technology.

Standardized procedures are the first thing that comes to mind of a client when he thinks of

Sharekhan.

PROMOTIONAL STRATEGIES:

Telemarketing:

In the organization, database of contact numbers of various category of people are

maintained who may or may not know about the services.Sales executives and assistant

managers make phone calls to these people and if they are interested, give various details about

the services and products.This will make people to opt for Sharekhan in future even if they are

not interested to enter stock market currently.

Seminars:

The sales personnel of Sharekhan prepare seminars depending upon the type of people

they are going to meet ie students or coporate people.They go to respective institutions and take

seminars giving various details suiting that category people and the contact numbers of

Sharekhan sales personnel to contact further if interested.

Door steps:

The sales personnel also go to domestic homes of people and various institutions(meet

every person in person, not like seminars).They explain to them in detail, various schemes,

products and services. They also explain about the documents required to open an account with

Sharekhan. If the person is interested the sales personnel will acquire the documents and will

proceed further.

KIOSKS:

The sales team puts up stalls in various locations and provide pamphlets containing

details about various products and services of Sharekhan.They also explain orally to people who

are interested.

Online advertising:

Sharekhan has links to various websites through which they market their products and

services ie through pop up windows and flash texts which when clicked directly leads to

Sharekhan’s website.

Media :

Sharekhan also uses advertisements in TV channels like CNBC.

Operations Department

Inputs :There are many inputs to the production & operations viz., land & buildings,

machinery & equipments, furniture & fixtures, employees, technology, capital (invested by

promoters & deposited by the customers) and the most important input, i.e., management

functions carried out at national, regional and branch level in Sharekhan.

Conversion Process :The main aim of it is to make profit with customer satisfaction. The conversion of

inputs works as the Sharekhan earn brokerage from the customers. The profits are

generated from getting a higher return on the invested amount of money than the amount

payable to the customers. The process is facilitated by a centralized computer system in

which the data is stored and recovered for the whole INDIA and it is having the CPU at the

H/O in Mumbai, Sharekhan is regulating the brokerage rates all over India by keep watch

on each transaction done from the branch office. The data of a customer will be stored in

the central computer and all facilities such as bills, credit/debit reports etc. are provided by

that computer to all customers on-line on the internet.

The conversion process is also facilitated by some adjustments to the inputs and

then the random fluctuations are also handled in the process and lastly the monitoring of

the process is done and a feedback is given to do the adjustments for the process as

indicated in the figure given.

Outputs :Outputs are those services generated by Sharekhan with the help of the inputs and

using the conversion process. These services are as listed in the figure above.

Table Sharekhan

Consumer

Services

Retail brokering Channels Financial

advisory Services

Complain

resolvance

Corporate Broker Capital markets

advisor

Nationwide

electronic data

transfer

Depository

participant

Others

Operations Strategy at SharekhanOperations strategies are implemented in Sharekhan as shown in the chart given

above and the main points of consideration are Efficiency, Dependability, Quality and

Flexibility.

The points demand a facility mission that is made up of process, capacity, facilities,

vertical integration, and infrastructure facilities provided to get the desired outputs as per

the plan.

The main aim of the operations strategy at Sharekhan is that the efficiency of the

organization and high level of it is desired outputs with low costs, i.e., productivity with

effectiveness. Quality should be high and consistent in delivering services; Flexibility is

related with fast introduction of new services and providing a wide range to select an

option to the customer. This is facilitated by the process of operations, capacity/ability of

the organization, competitive advantages, vertical integration and the infrastructure created

by the firm.

Sharekhan plans the strategies to get a working plan from it and the planning is

done from top-to-bottom level, i.e., national level, regional level, divisional level and the

branch level planning is carried out by the managers.

In this way, the Operations are managed with the best efforts in a direction that is to

facilitate future plans by achieving success in time and create milestones in the industry by

driving the company with excellence.

Human Resource Department

Human resource is the crucial resource that a company can use to grow with the

work of the employees. HRM activities at Sharekhan start form induction to the specific

job training and are done by H/O at Mumbai. H/O takes a written test and selection

interview for filling up vacancies in branches but the recruitment is done by the branch

itself and the selection is performed by H/O from the screened applicants.

Any new recruit is firstly inducted to the company and sent to T & D department

that is covered under HRD and T & D programmes makes employees aware about all the

activities/jobs within the department he/she is to be recruited. Suppose if, I would be

recruited for finance department then the finance related employees are known to me wit

their work profiles, that is, what they really do?

Then the specific job training is provided at H/O and the person has to keep in

touch with the concerned department at H/O on internet because he/she has t solve many

conflicts arising in the investor’s mind and to have an up-to-date information regarding the

procedures and any new facilities or policies to resolve the problems of the clients. It is a

must for each employee because the employee is the people by whom the company gets its

customers and retains them.

HRP (Human Resource Planning), HRIS (Human Resource Information System),

Recruitment & Selection, Career planning and development, Assessment & development

of employees for Performance appraisal, etc. activities of managing the HR at Sharekhan is

maintained in a way to meet the requirements.

The corporate culture at Sharekhan is maintained in such a way that the people are

helpful to each other and eager to get the work done as soon as possible with a co-operative

thinking. An additional Rs.10000 is provided for each outlet of Sharekhan to motivate its

employees by performance appraisal and also the heads of each departments and branches

has to go through a 3606 performance appraisal for maintaining the consistency in growth

of the company.

In the end we can say that the human resource of Sharekhan is a best managed and

used for the continuous growth and development of the company for its future plans to be

achieved time-to-time.

Finance DepartmentLike blood is the most important factor in our body, Finance is the blood of any

business. Finance is needed for all the activities like production or services as well as their

distribution. The finance department directly influences all the functions of the other

departments. Also finance has to give equal importance to all departments. Finance is that

administrative area or set of administrative function in an organization may have the means

to carry out its objective as satisfactorily as possible. Sharekhan has special accounts

department for separate calculation of pay-in and pay-out of funds according to the client’s

Proft/Loss. Finance management is done at Sharekhan is done by managing the stocks in

the demat accounts and funds in the margin & trading accounts

Finance

Finance is the lifeblood of an organization to continue its activities and the finance

management at Sharekhan can be divided into two major parts viz. DP (Depository

Participation) and Accounts management, which are shown in the figure given above.

DP means providing the facility to the clients for managing the stock bought/sold

by them. DP covers two major terminologies viz. settlements and the auctions which is a

part of managing demat account. Settlements as defined by SEBI are T+2, currently and it

means that the demat account of the clients are prone to be sufficient for selling a script

with no debit at all, i.e., the account must have the sold amount of stock to fulfill the

settlement after 2 days from trade-day. Generally, the timings are 9:30 and 3:00 as a

deadline for the client and he must provide the stock for giving a delivery to the buyer. The

chart show the total transaction between two clients:

DP Accounts

The chart shows the process that the request for selling and buying passes through

the DPs of the respective clients and finally the exchanges like SKSE (Saurashtra Kutch

Stock Exchange) becomes the controlling intermediary for the delivery of stocks and this

process is done in two days. Nowadays, as banks are becoming fast for E-Fund Transfer

(EFT) and Phone-banking is getting more popularity, SEBI is thinking to make the

financial market of India to have a maximum speed of transactions just like the other

nations in the world and proposing for T+1 settlement scheme but the system is not enough

competent for that thing. But soon or later we will have such a settlement system in India,

as said by Mr. J. N. Bajpai, chairman of SEBI.

C DP (Sharekhan) E DP (anyone) C

The client, if not capable of providing the delivery of say, 1000 shares of SAIL then

the Auctions are initiated by the exchanges and the client has to pay for the price

prevailing in the market with 4-5% penalty. The penalty can go on maximum to 20% more

than the market price of the sold stock. Generally, it is known as a buying auction and a

same kind of auction is for selling the stock for which the buyer was proved unable to pay

the price is carried out by exchange, known as the selling auction. And a debit or credit

note is provided in the respective case of auction to the clients, i.e., for buying auction

debit note is given on the T+4 basis and in case of selling auction the credit note is given

on T+5 basis. There are two types of auctions called as Internal auctions & Market

auctions, the internal auctions are defines as the auctions carried out between the other

shops of Sharekhan and market auctions are those as explained earlier, the auction carried

out in the market.

This is all about settlements but now switch to funds management or accounts

management at Sharekhan. The accounts are different that is the margin a/c for deposits of

the client and trading a/c for which Profit/Loss are settled. The collection of funds from the

clients who had a debit balance or made a loss are made on the next day of trading and the

payments to the profiting traders are made after two days of trading because the cheques

are received from H/O and then pay-out is done and Pay-in is as explained that amounts to

be taken from the clients. In this way, accounts are managed but in case if the client is

unable to pay, the deposit from the margin a/c is cut down to the payments and in case if a

client is having a credit balance in F&O trading though he had a debit balance in cash-NSE

& BSE trading, a JV request is sent to H/O for totaling the three balances. The main aim

for accounts management is that the clients must have a credit or no debit on the next day.

The DP services provided by Sharekhan are falling under the regulation of NSDL

(National Securities Depository Limited) and CDSL (Central Depository Services

Limited), organizations governed by SEBI to regulate the depository services in the

interest of the investors. So, the financial market in India is governed by Ministry of

finance under which two major bodies viz. SEBI & RBI are covered and under RBI the

banks and other financial institutions are covered while SEBI covers the exchanges, NSDL

& CDSL and the whole DP service providers with the brokers to the investors.

In this way we have gained a meaningful knowledge about India’s financial market and itsstructure from this training at Sharekan. In this way, the finance function is carried out atSharekhan by following the guidelines given by SEBI. And the company is a private limited onewith its own policies for disclosing its financial statement.

SWOT ANALYSIS OF SHAREKHAN :

(A) STRENGTH:

1) EMPLOYE MOTIVATION POLICY

2) RESEARCH TEAM

3) GOOD INFRASTRUCTURE

4) HELTHY FINACIAL MARKET

5) USER FRIENDLY WEB SITE

(B) WEAKNES

1) INSUFFICIENT ADVERTISEMENT POLICY

2) NO ACCESS TO THE RURAL MARKET

(C) OPPORTUNITY

1-Sharekhan having goog 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 becouse 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

GOVERNMENT POLICY

FIANANCIAL ANALYSIS OF SHAREKHAN

LAST FIVE YEAR PROFIT AND LOSS A/C OF SHAREKHAN LTD AS UNDER.

(Rs.in cr)

PARTICULARS

MARCH

2011

MARCH

2010

MARCH

2009

MARCH

2008

MARCH2007

Income

Operating income 51.10 67.57 70.97 60.09 70.03

Expenses

Material Consumed 26.08 30.31 32.22 25.65 37.15

Manufacturing Expenses 6.99 10.36 9.32 7.06 8.45

Personnel Expenses 8.26 8.50 8.34 7.38 6.44

Adminstrative Expenses 9.54 4.25 3.96 3.93 3.05

Selling Expenses 0.00 10.43 9.17 7.75 9.28

Cost of sales 50.87 63.85 63.01 51.76 64.38

Operating Profit 0 .23 3.72 7.96 8.33 5.64

Other Recurring Income 0.57 0.21 0.17 1.98 1.82

Adjusted PBDIT 0 .80 3.92 8.12 10.31 7.46

Financial Expenses 4.84 4.55 4.16 3.06 2.40

Depreciation 1.53 1.13 1.10 0.99 0.76

Adjusted PBT -5.56 -1.76 2.86 6.26 4.30

Tax Charges -1.88 -0.18 1.45 1.65 1.92

Adjusted PAT -3.68 -1.58 1.41 4.61 2.38

Equity Dividend 0.00 0.00 1.10 1.10 0.00

Reported Net Profit -3.68 -1.23 1.49 4.48 3.64

NET PROFIT FOR THE FIVE YEAR

YEAR NET PROFIT (RS.IN CR.)

2006-07 3.64

2007-08 4.48

2008-09 1.49

2009-10 (-1.23)

2010-11 (-3.68)

As per the graph shown above, the net profit of the company in 2007-08 was

increase to 0.76 cr. from the previous year. But after this period the figure was continuously

decline. In 2010-11, the net profit was -3.68 that shows huge loss in this year compare to

previous year. The data regarding profit reflect the negative sign for the firm. The firm has to

take corrective step as fast as possible. The reason for the huge loss is financial crises.

-4

-2

0

2

4

6

2006-07 2007-08 2008-09

3.644.48



2006-07 3.64

2007-08 4.48

2008-09 1.49

2009-10 (-1.23)

2010-11 (-3.68)






2008-09 2009-10 2010-11

1.49

-1.23

-3.68

Net Profit



2006-07 3.64

2007-08 4.48

2008-09 1.49

2009-10 (-1.23)

2010-11 (-3.68)






Net Profit

OPERATING INCOME:


2006-07 70.03

2007-08 60.09

2008-09 70.97

2009-10 67.57

2010-11 51.10

The operating income shows the current earning capability of the firm form current

operations. Hear, the firm’s ability was reduced from the previous year that reflect the

ability was reduced in financial year 2010-11.

0

10

20

30

40

50

60

70

80

2006-07 2007-08 2008-09

70.03

60.09

70.97

OPERATING INCOME:


2006-07 70.03

2007-08 60.09

2008-09 70.97

2009-10 67.57

2010-11 51.10




2008-09 2009-10 2010-11

70.97 67.57

51.1

Operating…

OPERATING INCOME:


2006-07 70.03

2007-08 60.09

2008-09 70.97

2009-10 67.57

2010-11 51.10




Operating…

BALANCE SHEET

LAST FIVE YEAR BALANCESHEET OF SHAREKHAN :

BALANCESHEET OF SHAREKHAN 2011 2010 2009 2008 2007

Equity share capital 18.33 18.33 18.33 18.33 18.33

Reserve and surplus -1.31 2.37 3.61 3.40 0.24

Loans and fundsSecured loan 10.84 31.38 35.72 26.46 17.20

UnSecured loan 35.75 9.32 5.87 7.27 4.75

Total 63.62 61.40 63.53 55.45 40.51

Uses of funds

Gross block 88.13 84.60 76.99 76.14 69.09

Less : Accumulated Depreciation 63.62 62.10 60.97 59.88 58.91

Net block 24.51 22.49 16.03 16.25 10.17

Capital work in progress 1.45 2.36 5.66 2.01 0.40

Investments 0.05 0.05 0.05 0.05 0.05

Net current assests

Current assets,loans and advances 60.99 60.78 67.28 56.51 43.38

Less current liabilities & provisons 23.38 24.29 25.50 19.37 13.49

Total net currunt assest 37.61 36.49 41.79 37.14 29.89Total 63.62 61.40 63.53 55.45 40.51

Note

Book value of unquoted investment 0.05 0.05 0.05 0.05 0.05

Contigent liabilities 23.39 15.74 15.85 14.90 9.32

Numbers of equity share outstanding( in lacs)

183.27 183.27 183.27 183.27 183.27

Cash flow statement

CASH FLOW ANALYSIS OF LAST FIVE YEAR :

OPERATING ACTIVITY :

YEAR CASH FLOW FROM OPERATINGACTIVTIY

2006-2007 2.712007-2008 5.192008-2009 1.732009-2010 1.872010-2011 10.24

0

2

4

6

8

10

12

CASH FLOW FROM OPERATING ACTIVTIY

CASH FLOW FROMOPERATING ACTIVTIY

Last five year cash flow statement 2011 2010 2009 2008 2007Net profit before tax 1.41 2.94 6.13 5.56 4.12

Net cash from operating activities 10.24 1.87 1.73 5.19 2.71Net cash from investing activities 4.15 4.54 8.58 1.79 1.15

Net cash from financing actigities 6.67 2.78 8.69 2.41 2.20

Net decrease/increase in cash and cash

Equivalents 0.58 0.11 1.63 1.00 0.64

INVESTING ACTIVITY :

YEAR CASH FLOW FROM INVESTINGACTIVITY

2006-07 1.152007-08 1.792008-09 8.582009-10 4.542010-2011 4.15

FINANACING ACTIVITY :YEAR CASH FLOW FROM FINANCING

ACTIVITY2006-07 2.202007-08 2.412008-09 8.692009-10 2.782010-2011 6.67

0123456789

10

CASH FLOW FROM INVESTING ACTIVITY

CASH FLOW FROMINVESTING ACTIVITY

0123456789

10

CASH FLOW FROM FINANCING ACTIVITY

CASH FLOW FROMFINANCING ACTIVITY

PART –II PROJECT STUDY :

(A)INRODUCTION OF PORTFOLIO MANAGMENT

SERVICES :

Portfolio (finance) means a collection of investments held by an

institution or a private individual. Holding a portfolio is often part of an

investment and risk-limiting strategy called diversification. By owning

several assets, certain

types of risk (in particular specific risk) can be reduced. There are

also portfolios which are aimed at taking high risks –

these are called concentrated portfolios.

Investment management is the professional management of

various securities (shares, bonds etc) and other assets (e.g. real estate),

to meet specified investment goals for the benefit of the investors.

Investors may be institutions (insurance companies,pension funds,

corporations etc.)or private investors (both directly via investment

contracts and more commonly via collective investment schemes e.g.

mutual funds)

The term asset management is often used to refer to the investment

management of collective investments, whilst the more generic

fund management may refer to all forms of institutional investment as

well as investment management for private investors. Investment

managers who specialize in advisory or discretionary management on

behalf of (normally wealthy) private investors may often refer to

their services as wealth management or portfolio management often

within the context of so-called "private banking".

The provision of 'investment management services' includes elements of

financial analysis, asset selection, stock selection, plan implementation

and ongoing monitoring of investments. Outside of the financial

industry, the term "investment management" is often applied to

investments other than financial instruments. Investments are often

meant to include projects, brands, patents and many things other than

stocks and bonds. Even in this case, the term implies that rigorous

financial and economic analysis methods are used.

(B)Needof PMS

As in the current scenario the effectiveness of PMS is required. As the

PMS gives investors periodically review their asset allocation across

different assets as the portfolio can get skewed over a period of time.

This can be largely due to appreciation / depreciation in the value of the

investments.

As the financial goals are diverse, the investment choices also need to

be different to meet those needs. No single investment is likely to meet

all the needs, so one should keep some money in bank deposits and / liquid

funds to meet any urgent need for cash and keep the balance in other

investment products/ schemes that would maximize the return and

minimize the risk. Investment allocation can also change depending on

one’s risk-return profile.

(C)ObjectiveofPMS

There are the following objective which is full filled by Portfolio

Management Services.

1. Safety Of Fund: -

The investment should be preserved, not be lost, and should

remain in the returnable position in cash or kind.

2. Marketability: -

The investment made in securities should be marketable

that means, the securities must be listed and

traded in stock exchange so as to avoid difficulty in their

encashment.

3. Liquidity: -

The portfolio must consist of such securities, which could be

en- cashed without any difficulty or involvement of time to meet

urgent need for funds. Marketability ensures liquidity to the portfolio.

4. Reasonable return: -

The investment should earn a reasonable return to upkeep

the declining value of money and be compatible with opportunity

cost of the money in terms of current income in the form of

interest or dividend.

5. Appreciation in Capital: -

The money invested in portfolio should grow and result into

capital gains.

6. Tax planning: -

Efficient portfolio management is concerned with composite

tax planning covering income tax, capital gain tax, wealth tax and gift

tax.

7. Minimize risk: -Risk avoidance and minimization of risk are important objective of

portfolio management. Portfolio managers achieve these objectives

by effective investment planning and periodical review of market,

situation and economic environment affecting the financial market.

(D)PORTFOLIO MANAGEMENT PROCESS :1.specification of investment objectives and constraints

2.choice of the asset mix

3.formulation of [portfolio strategy

4.selection of securities

5.portfolio execution

The Portfolio Construction of Rational investors wish to maximize

the returns on their funds for a given level of risk. All investments

possess varying degrees of risk. Returns come in the form of income, such

as interest or dividends, or through growth in capital values (i.e. capital

gains).

The portfolio construction process can be broadly characterized as

comprising the following steps:

1.Settingobjectives.

The first step in building a portfolio is to determine the main objectives ofthe fund given the constraints (i.e. tax and liquidity requirements) thatmay apply. Each investor has different objectives, time horizons andattitude towards risk. Pension funds have long-term obligations and,as a result, invest for the long term. Their objective may be to maximizetotal returns in excess of the inflation rate. A charity might wish to generatethe highest level of income whilst maintaining the value of its capitalreceived from bequests. An individual may have certain liabilities and wishto match them at a future date. Assessing a client’s risk tolerance canbe difficult. The concepts of efficient portfolios and diversification mustalso be considered when setting up the investment objectives

2. DefiningPolicy.

Once the objectives have been set, a suitable investment policy must

be established. The standard procedure is for the money manager to ask

clients to select their preferred mix of assets, for example equities and

bonds, to provide an idea of the normal mix desired. Clients are then

asked to specify limits or maximum and minimum amounts they will

allow to be invested in the different assets available. The main asset

classes are cash, equities gilts/bonds and other debt instruments,

derivatives, property and overseas assets. Alternative investments, such

as private equity, are also growing in popularity, Attaining the optimal

asset mix over time is one of the key factors of successful investing.

3. Applying portfoliostrategy.

At either end of the portfolio management spectrum of

strategies are active and passive strategies. An active strategy

involves predicting trends and changing expectations about the likely

future performance of the various asset classes and actively dealing

in and out of investments to seek a better performance. For

example, if the manager expects interest rates to rise, bond prices

are likely to fall and so bonds should be sold, unless this expectation

is already factored into bond prices. At this stage, the active fund

manager should also determine the style of the portfolio. For

example, will the fund invest primarily in companies with

large market capitalizations, in shares of companies expected to

generate high growth rates, or in companies whose valuations are

low? A passive strategy usually involves buying securities to match

a preselected market index. Alternatively, a portfolio can be set up

to match the investor’s choice of tailor-made index. Passive

strategies rely on diversification to reduce risk. Outperformance

versus the chosen index is not expected. This strategy requires

minimum input from the portfolio manager. In practice, many active

funds are managed somewhere between the active and passive

extremes, the core holdings of the fund being passively

managed and the balance being actively managed.

4. Assetselections.

Once the strategy is decided, the fund manager must select

individual assets in which to invest. Usually a systematic

procedure known as an investment process is established, which

sets guidelines or criteria for asset selection. Active strategies

require that the fund managers apply analytical skills and judgment

for asset selection in order to identify undervalued assets and to try

to generate superior performance.

5. Performanceassessments.

In order to assess the success of the fund manager, the

performance of the fund is periodically measured against a pre-

agreed benchmark – perhaps a suitable stock exchange index or

against a group of similar portfolios (peer group comparison).

Theportfolio construction process is continuously

iterative, reflecting changes internally and externally. For example,

expected movements in exchange rates maymake overseas

investment more attractive, leading to changes in asset

allocation. Or, if many large-scale investors simultaneously decide

to switch from passive to more active strategies, pressure will

be put on the fund managers to offer more active funds. Poor

performance of a fund may lead to modifications in individual asset

holdings or, as an extreme measure; the manager of the fund may

be changed altogether.

(E) Objective of Research :

My objective of research condected in summer intership his

to analysais the inversement preference and process of portfolio

management service.

Research design :

A. Methodology:

(A)Primalry data:

A questionnaire schedule was prepared and the primary data was clloected.

(B)Secondary data:

→Company website→Customer data base→Company report’s→Books and publications→Related information from various websites.

(B.)Period study :

The study are conducted on 6th June to 31 Julie with help of data source available. Periodof study and analyzing primary data.

(C.)Type of research :

This is a descriptive research where survey method is adopted to collect primaryinformation from the investors using different scales as required secondary information forthe analysis.

(D).Sampling technique :

The sampling technique followed in this study is no-probability convenient sampling.Simple random techniques are used to select the respondent from the available database.The research work will be carried on the basis of structured questionnaire. The study isrestricted to the investors of VADODARA city only.

(E).Sample size :

The population being large the survey will be carried among 25 respondents who are theclients of share khan limited.They will be considered adequate to represent thecharacteristics of the entire population.

Data analysis

1. Investment preference among varies age groups:

Investment

Avenues

Age Group (in Years)

< 20 20 –

30

31 – 40 41 –

60

> 60

Equity 25 24 27 28 15

Debenture / Bonds 11 10 9 15 23

Bank Deposits 18 18 17 16 20

Insurance 20 24 22 21 14

Gold & Real Estate 18 15 15 12 17

Others 2 4 2 4 4

30

25Age Group (in

20 Years) < 2015 Age Group (in

10 Years) 20 – 30

Age Group (in5 Years) 31 – 400 Age Group (in

Years) 41 – 60

Age Group (inYears) > 60

Interpretation:

From the above tables we can conclude that, all the age groups are give more

preference on investing in equity, except those who are more than sixty years.

And the second more preferable investment avenue is insurance. But the age

group which is more that sixty yeas gives more preference to invest in

Debenture, Tax saving bonds and then bank deposits.

2. Investment preference among various income levels:

Investment

Avenues

Annual Income (in Rs. Lakh)

< 1 1 – 2 2 – 3.5 3.5 – 5 > 5

Equity 16 19 26 26 29

Debenture / Bonds 5 6 7 7 8

Bank Deposits 31 24 21 18 14

Insurance 15 17 18 20 21

Gold & Real Estate 3 4 5 8 9

Others 16 14 5 6 3

51

35

30Annual Income (in Rs.

25 Lakh) < 120 Annual Income (in Rs.15 Lakh) 1 – 210 Annual Income (in Rs.5 Lakh) 2 – 3.5

0 Annual Income (in Rs.Lakh) 3.5 – 5

Annual Income (in Rs. Lakh)>5

Interpretation:The above table reveals that higher income levels are giving more preference to invest inequity where as lower income levels given more preference to invest in bank deposits. Itimplies that the higher income level groups are preferred to take more risk in investmentrather than lower income level. And those who are taken more risk in investment are

preferred to invest in equality rather than any investment avenues.

52

BIBILOGRAPHY

REFERENCES

→ www.sharekha.com

→ www.sebi.gov.in

→ www.moneycontrol.com

→ www.karvy.com

→ www.valueresarchonline.com

→ www.yahoofinance.com

→ www.theeconomist.com

→ www.nseindia.com

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