ATPrabhudas Lilladher

Submitted in partial fulfillment of the requirements of the two year Post Graduate Programme (PGP)

Submitted by

Manoj Kumar Dash……………………………………………………………………………….

Roll No: PG20090161Batch: 2009-2011

IILM Institute for Higher Education, Lodhi Road

A REPORT

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ON

“GROWTH OF INDIAN ONLINE TRADING INDUSTRY”_____________________________________________________________A report submitted in partial fulfillment of the requirements of PGDM program of

IILM Institute for Higher Education, New Delhi

SUBMITTED TO:

Mr. Sandeep Sharma

Sales Manager

Prabhudas Lilladher, North Region

MOBILE:-+918800439431

&

Mr. Sandeep Kapoor

Asst. Professor

IILM Institute

MOBILE -+919891375383

ACKNOWLEDGEMENT

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The beatitude, bliss and euphoria that accompany the successful completion of any task

would not be complete without the expression of appreciation of simple virtues to the people

who made it possible.

The final project report is submitted to institute of technology and science, Ghaziabad for

partial fulfillment of diploma, post graduate diploma in management (PGDM).

This project is an attempt to study “future and growth of online trading in India

At IL&FS INVESTSMART SECURITIES LTD.(HSBC Group).

I would like to thanks to the Management of IL&FS INVESTSMART SECURITIES

LTD. (HSBC Group) for giving me the opportunity to do my two-month project training in

their esteemed organization. I am highly obliged to Mr. RAHUL KUMAR AGARWAL

(AREA SALES MANAGER) for granting me to undertake my training at RDC RAJ NAGAR

branch.

I express my thanks to all Sales Managers and other relationship managers under whose

guidance and direction, I gave a good shape to my training. Their constant review and

excellent suggestions throughout the project are highly commendable. My heartfelt thanks

go to all the executives who helped me to gain knowledge about the actual working and the

processes involved in various departments. I would also like to sincerely thank my faculty

guide Dr. KAVITA SRIVASTAVA whose guidance has helped me to Understand and

complete my project in a timely and proper manner

ANKUL MAHESHWARI

DECLARATION

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I do hereby declare that the project report is submitted as partial fulfillment of the

requirement of PGDM Program of INSTITUTE OF TECHNOLOGY AND SCIENCE,

GHAZIABAD

The Project has been done under the guidance of Mr. RAHUL KUMAR AGARAWAL,

KUMER SINGH NEGI and GAURAV KUMAR in Raj nagar branch, Ghaziabad and Dr.

KAVITA SRIVASTAVA Faculty guide, INSTITUTE OF TECHNOLOGY AND

SCIENCE, Ghaziabad

No part of this report has not been published or submitted elsewhere for the fulfillment of

any degree or diploma for any institute or university.

ANKUL MAHESHWARI

CONTENTS

PAGE NO.

EXECUTIVE SUMMARY……………………………………..………………..……6

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PROJECT DETAIL………………………………………………………………..…..7

Project title……………………………………………………..............………7Justification of the title…………………………………………...…………….7Scope of the study……………………………………………………..……….7Research objective…………………………………………………………..….8 Research methodology………………………………………………………... 8Research design……………………………………………………..………….9. Sampling methodology……………………………………………..………….10.Limitations of the study…………………………………………………….... 10

COMPANY PROFILE……………………………………………………................. 11

LITERATURE REVIEW………………………………………………...……………34

ONLINE TRADING……………………………………………….………………….38

THE EMERGENCE OF ONLINE TRADING IN INDIA……………………………42

ICICIdirect ……………………………………………….……………………44 Reliance money ………………………………………….…………………….46 Share khan ……………………………………………….…………………….48 Kotak securities ………………………………………….…………………….51 Indiabulls …………………………………………………..…………………..54 Motilal Oswal ……………………………………………….…………………55 Religare ………………………………………………………………………..57 IndiaInfoline …………………………………………………………………..58

GROWTH OF ONLINE TRADING ………………………………………………....62

ANALYSIS PART ………………………………………………….…………………67

CONCLUSION ………………………………………………………….…………….79

RECOMMENDATIONS ……………….……………………………….………….....80

INDUSTRY RELEVANCE ……………………………………………………….…..81

LEARNING ……………………………………………………………………………82

BIBLIOGRAPHY ………………………………………………………..…………….83

1. EXECUTIVE SUMMARY

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As per the title suggest the project report has been prepared regarding the growth and

development of online trading in India. Online trading was initiated by NSE in India and soon after

the other exchanges also followed it.

There was a major boom in yr. 2000 when lots of online trading companies came with a bang

but only few were survived because of lack of computer knowledge and low internet penetration.

There are two types of online trading companies one is the banking online trading companies and

the other is non-banking trading. A few examples of banking online trading companies are HDFC

securities, ICICI direct.com, UTI securities etc.

On the other hand non -banking trading companies are IL&FS investsmart, Religare securities

Angel Broking, Reliance Money etc. A study was undertaken to determine the growth of various

online trading companies in India in terms of trade done by them through online and services

provided by them. Major findings indicates that out of a survey of 100 respondents it was seen that most of the

investors prefer online trading because of few major factors such as time saving convenience,

protection through Freudian brokers etc. although during my research project I’ve seen that most of

the respondents feel online trading, a secure way of investing into stock market still a few of them

feel that it’s unsafe and a bit complicated but they posses information about online trading.

Today the online trading companies having cut-throat competition in our offering whose brokerage

discounts lower margin money and zero balance accounts. Due to the rising education awareness

and use of internet there is a huge potential for online trading in future and companies must come

up with innovative offerings to capture the untapped market.

2. PROJECT DETAIL

PROJECT TITLE:

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To determine the “GROWTH OF INDIAN ONLINE TRADING INDUSTRY”

TITLE JUSTIFICATION:

The above title is self explanatory. This study mainly deals with growth and development of

online trading in India since its inception in the year 2000. Due to subprime mortgage crisis in year

2008 NASDAQ and S&P 500, two major stock exchange of the world entered into the bearish

market. it also affected the stock market all over the world including India. It is the challenge for

the growth and development of trading in India that’s why I choose that particular topic for the

study.

SCOPE OF THE STUDY

Since the year 2000 a big boom has been witnessed in the Indian Stock Market when the

market showed the coming up of Online Trading System. Many online stock trading companies

came but initially due to lack of online trading some companies vanished and some survived. The

companies which survived are getting the handsome returns also attracting the foreign Investment

Companies. Nowadays this sector is facing cut-throat competition and also provides huge growth

prospects. The study then goes to evaluate and analyze the findings so as to present a clear picture

of the trends in the online trading sector.

RESEARCH OBJECTIVES

The objectives of my research project is –

1. To determine the growth and future of online trading industry in India

2. To understand the customer perception of online trading.

3. To see the type of technology used by stock exchanges and by the Indian customer in online

trading

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4. To determine what type of products the customers deal while doing the online trading.

5. To understand the presence of major online traders in the Indian market and looking about

the features provided by them

6. To find out the important factor which do mostly affect to the customer

7. To develop a good strategy and process that improves the business of the organization

8. To be able to compare and analyze the various Financial Products.

9. Business development and revenue generation.

RESEARCH METHODOLOGY

The research methodology for the project completed in two phases:

First Phase is the collection of Secondary Data:

This involves the collection of Secondary data using internet and internal sources for

comparison of Online trading account of other Broking houses in the market like

PRABHUDAS,ICICI Direct, MOTILAL Oswal, Religare and Reliance Money etc. This also

involves talking to their executives regarding various features provided to the customer along with

their Brokerage structure.

Second Phase is Collection of Primary Data and Analysis:

After collecting the Secondary data the next phase will be collection of primary data using

Questionnaires. The questionnaire will be filled by around 53 people who will be mainly from

Delhi/NCR region. The sample will consist of people who are employed or work as free lancers

dealing in investment options to know their financial requirements. Based on these requirements

different investments will be informed to them for further perusal. The data collected will be then

entered into SPSS (software) and MS-excel for analysis of the data collected

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RESEARCH DESIGN

Non probability

The non –probability respondents have been researched by selecting the persons who do the stock

trading. Those persons who do not trade in stocks have not been interviewed.

Exploratory and descriptive research

The research is primarily both exploratory and descriptive in nature. The sources of information are

both primary and secondary. The secondary data has been taken by referring to various magazines,

newspapers, internal sources and internet to get the figures required for the research purposes. The

objective of the exploratory research is to gain insights and ideas. The objective of the descriptive

research study is typically concerned with determining the frequency with which something occurs.

A well structured questionnaire was prepared for the primary research and personal interviews were

conducted to collect the responses of the target population.

SAMPLING METHODOLOGY

Sampling Technique

Initially, a rough draft was prepared a pilot study was done to check the accuracy of the

Questionnaire and certain changes were done to prepare the final questionnaire to make it more

judgmental.

Sampling Unit

The respondents who were asked to fill out the questionnaire in the National Capital Region are the

sampling units. These respondents comprise of the persons dealing in stock trading. The people

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have been interviewed in the open market, in front of the companies, telephonic interviews and

through other sources also

Sample Size

The sample size was restricted to only 53 respondents.

Sampling Area

The area of the research was National Capital Region (NCR).

LIMITATION OF THE STUDY

The various limitations of the study are:

People were not willing to fill the entire questionnaire due to the less time available to them

Some respondents might be hesitant to divulge personal and financial information which can

affect the validity of all responses

There is lack of awareness among people about investing in stock market. So the people

who are aware of such things were found in specific areas for survey purposes.

Most people are comfortable with traditional system in small towns and like to trade from

their respective brokers, hence not providing a true opinion of theirs.

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Some of the respondents who did not do online trading were able to respond to only few

questions.

The survey was done in the NCR region and may not truly express the opinion of whole

country

3. COMPANY PROFILE

Prabhudas Lilladher is one of the India’s leading financial service houses, was established as a brokerage house in 1944 by Mr. Prabhudas Lilladher Sheth. It provides a complete range of financial services in the Institutional and Retail domain. It has nationwide distribution network through branches, franchisees and associates. It has Strong adherence to founding principles of integrity, transparency and accountability.

VisionTo be a leading financial services house providing maximum value addition by offering innovative products and servicesApproach

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Prabhudas Lilladher is committed to provide excellent customer service while maintaining the highest levels of ethical and professional conduct. At PL, integrity, transparency and accountability form the founding principles, to which Prabhudas Lilladher strictly adheres.Prabhudas Lilladher adopts a service-centric approach, providing customised and practical solutions that are most pertinent for their clients’ businesses. Prabhudas Lilladher works in close association with each individual client to provide outstanding financial insights, while maintaining complete transparency throughout the process. Work cultureOver the years PL has nurtured and advocated excellence as their attitude; Company believes in delivering the best constantly and consistently.Experience has proved that effective communication is the key to success. Therefore the open door policy at PL is another defining aspect of their Organizational Culture.PL puts our employees on the fast track and throws open challenges, encouraging excellence. Moreover PL strongly believes in acknowledgement as a strong motivational tool, thus performers are duly rewarded. Company always looks out for ideas, creativity and innovation.

Group Companies

Prabhudas Lilladher Advisory Services Private LimitedPrabhudas Lilladher Advisory Services Private Limited is the group holding company. Besides providing financial advisory services to the Corporates, the Company helps its clients to raise resources from domestic & global investors through various instruments.

Prabhudas Lilladher Private LimitedPrabhudas Lilladher Private Limited is the stock-broking arm of the PL Group. A member of the National Stock Exchange and The Stock Exchange, Mumbai, PLPL provides equity trading facilities and related products and services on these premier exchanges. PLPL also known as Majorgainz offers these services through all branches, Progress Partner locations and the internet (www.majorgainz.com).

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Prabhudas Lilladher Financial Services Private LimitedPrabhudas Lilladher Financial Services Private Limited is the non banking financial services (NBFC) arm of PL group. An RBI-approved NBFC, PLFS offers Loans and Margin Funding against approved securities to meet the fund requirements various borrowers.

PL Capital Markets Private LimitedPL Capital Markets Private Limited offers capital raising and other investment banking services including the management of public offerings, private placements (including qualified institutional placements), rights issues, share buybacks, open offers/delistings, Valuation services, mergers & Acquisitions etc.

PL Fund Advisors Private LimitedPL Fund Advisors Private Limited offers Wealth management services across the entire spectrum right from equities to Mutual Funds, Private equity, Insurance, Real Estate, Art Funds among others.

PL Distribution Company Private LimitedDistribution of Financial Products including Mutual Funds and IPOs is offered by PL Distribution Company Pvt. Ltd. With a reach across cities in India, we service the needs of investors pan-India.

Prabhudas Lilladher Pvt. Ltd. (MajorGaniz)

Prabhudas Lilladher Pvt. Ltd. provides equity research and brokerage services for the institutional and retail clients. The company offers a range of investment products and services, which include offline and online equity execution systems; trading in derivatives that include hedging and index arbitrage; online trading; portfolio management services; portfolio advisory services; and initial public offer services. It also provides depository services, such as account opening facilities, dematerialization of physical shares, re-materialization, pledging, and settlements; mutual funds; reports on select companies by research analysts, daily market reports, and economy overviews.

Founded 1944

Headquarters Worli , Mumbai

Company Type Private Limted

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Industry Financial Services

No. of employees 400

Status Operating

Key people

Amisha Bora (Group Joint Managing Director) Dilip Bhat (Group Joint Managing direct) Mihir Sheth (Group Executive Director) Rakesh Bharuch (Group CFO) Subrahmanian Analakkatt (President Operational Settlement )

Achievements Ranked 8th Best Indian Broking House by Asia Money 2007 Rated 3rd in generating small cap ideas by Asia Money 2007

Associated Banks ICICI and HDFC Banks

Sub Brokers

SRG Investment Consultants

Mulki Investments & Financial Consultants (Pvt) Ltd.

Parekh Shares & Securities

Website http://www.plindia.com

NetworkName of the

CityNo. of Branch offices

State Name of the City No. of Branch offices

State

Ahemdabad 1 Gujrat Mumbai (Head office) 3 MaharashtraBharuch 2 Gujrat Nadiad 1 GujratChennai 1 Tamilnadu Nagpur 1 Maharashtra

Durgapur 1 West bengal New Delhi 3 UTjaipur 1 Rajisithan Satana 1 Madhya

PradeshKannur 1 Kerela Surat 1 GujratKocchi 1 Kerela Thiruvananthapuram 1 KerelaKolkata 1 West bengal Vadodara 1 Gujrat

Vashi 1 Maharashtra

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Management and Sales Organization Structure

Prabhudas Liiladher Pvt. Ltd. Follows territory design organization structure when it comes to sales organization structure where every salesperson is assigned a specific area for sales responsibilitiesAdvantages: Limits travel time and cost

Better customer service – more personal involvement

Limited conflict of responsibilities and rewards

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Possible to develop and execute territory specific marketing/promotional strategy

Disadvantages No product specialization

No customer specialization

Duplication of sales effort/staffing requirements

Management Trainees work under supervision of Relation manager / Relation executive. They accomplish task given by relation manager/executive. Check Sometimes Sales Manager takes class room training and over check the performance of trainees once in a week.

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Products

Product Types:-A) Power+B) Power1C) Power3D) Power6E) Turbo12F) Turbo30G) Turbo60H) Turbo120

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PYOBS Scheme:-Common Features PYOBS Scheme

Turbo120 Turbo60 Turbo30 Turbo12 Power6 Power3 Power1 Power+AO charges (Rs.)

Free300

Demat AMC P.A. (Rs.)

As per the scheme selected

Exe App Access As per Table 1 in case of Exe ApplicationDefault App Access Exe based application Web applet based application

Trading Platform (Cash & Derv.)

Odin/RTGSL/NOW(Only NSE) Odin/RTGSL/NOW(Only NSE)

Trading Platform(Currency Derv.)

NSE NOW NSE NOW

Brokerage on Delivery (Rs.)

0.10% 0.10% 0.15% 0.20% 0.25% 0.30% 0.35% 0.40%

Cash Intraday & Future Trades (Rs.) 0.005% 0.01% 0.015% 0.02% 0.025% 0.03% 0.035% 0.04%Min Paisa per Scrip 0.5p 1p 1.5p 2p 2.5p 3p 4p 5p

Options(Rs. per Lot)

20 30 40 50 Higher of 2.5% of premium or Rs. 75/-

Initial Margin Amount (Rs.)

Optional Optional 5000

Validity Period 12 Months 12 Months 6 Months LifetimeFree Call N Trade

calls30 Calls 20 Calls

Charges for Call N Trade

Rs 5/- from 31st Call Rs 5/- from 21st Call

Adjustable OptionCost of

Subscription(Rs.)Adjustable

120,000 60,000 30,000 12,000 6,000 3,000 1,000 NA

# Newsletters & SMS Calls (Free)

Till Scheme period 2 Quarters 1 Quarters 1 Months Table2

Scheme Extension(only if renewed) 1 Quarter

NA

Only if adjustable amount is more than 75% 80% 85% 90%Installment Option

(ECS)Quarterly Half Yearly

Reduction in Option Brokerage per lot Rs. 15,000 for every Rs 5 reduction

(Min Rs 10 per lot)Early Exit cost (5% of Scheme Value) 6,000 3,000 1,500 600Non Adjustable

OptionCost of

Subscription(Rs.)Non Adjustable

3,000 15,000 7,500 3,000

# Newsletters & SMS Calls(Free)

Till Scheme Period 2 Quarter 1Quarter

Reduction in Option per lot

Rs. 4,00 for every Rs 5 reduction(Min Rs. 10 per lot)

Discount on Scheme Extension (%) = 20 Times of

Brokerage Generated/Cost(Rounded off to Nearest Integer)

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ECS (Electronic Clearing System)

Table-1Exe App Charge (Rs.)

If Monthly Brokerage Generated (Rs.) MonthlyIs Less than 100 750

Is Less than 1,000 500Is Less than 2,000 250

Is >= 2,000 Free

Table-2Newsletter & SMS charges (Rs.)

Period Newsletters SMS ComboMS WG

Monthly 400 300 100 600Quarterly 1,000 750 250 1,500

Yearly 3,600 2,700 900 5,400

Power - 20 Calls Free If software taken then charges – 750/- Lifetime AMC(Annual Maintenance Charges) – 600/- Demat a/c opening Charges – 300/-

Power+ = 300+600+5,000(Advanced Margin)Power1 = 300+600+1000(Advanced Brokerage, 6M)Power3 = 300+600+3000(Advanced Brokerage, 12M)Power6 = 300+600+6000(Advanced Brokerage, 12M)

Turbo - 30 Calls FreeTurbo12 = 12,000(Advanced Brokerage, Adjustable, 12M)Turbo30 = 30,000(Advanced Brokerage, Adjustable, 12M)Turbo60 = 60,000(Advanced Brokerage, Adjustable, 12M)Turbo120 = 120,000(Advanced Brokerage, Adjustable, 12M)

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Opening of Depository account:-1. What are the types of Depository accounts with PL? 2. What is the process for Dematerialisation of Securities with PL ? 3. What are the different transactions I can conduct from my BO( beneficiary

ownership ) account with PL? 4. What will the Account Statements comprise of ? 5. How to read the holding statement?

Top1. What are the types of Depository accounts with PL?  

You can open two types of depository accounts: INDIVIDUAL ACCOUNTWhile opening an Individual Account you will require the following documents:

Completed Account opening form, signed by all applicants (to be collected from us) One set of photographs of all applicants with their signatures across the face of the

photograph Execute agreement on a Rs.20/- non judicial stamp paper (to be collected from us) Proof of Identity – copies of any one of the following documents for all applicants

Ration Card Passport Driving License Voters ID Card PAN Card (supplementary proof for address required as PAN card does not

mention the cardholder’s address) First page of bank pass-book attested by the bank manager Letter from the bank on their letterhead confirming the bonafide and address

of the accountholder.

CORPORATE ACCOUNTWhile opening an Corporate Account you will require the following documents:

Completed Account opening form (to be collected from us) One set of photographs of all authorized Signatories with their signatures across the

face of the photograph. Execute agreement on a Rs.20/- non judicial stamp paper (to be collected from us) Certified True copies of the Memorandum and Articles of Association. Certified true copy of Board Resolution for person/s authorized by the Board to act

as authorized Signatory/s to be given on the company’s letterhead Names of the authorized Signatories, Designation and their Specimen signatures on

the company’s letterhead. POA if any given to the authorized Signatories.

Top 2. What is the process for dematerialization of Securities with PL?  

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For dematerialization of your securities (i.e. converting physical shares into Demat form) you will need to follow this process:

Submit your application for dematerialization on a Demat Request Form (DRF) Submit certificates along with the DRF.

We will then Verify the order of names in the certificates and BO account Verify the signatures of all holders Process your Demat request and forward the same to the Registrar/Issuers

The Registrars/Issuers will process the request and on confirmation by them, the Depository will credit your BO account, which will be reflected as Free Balance in your account. Top 3. What are the different transactions I can conduct from my BO (beneficiary ownership) account with PL?   You can conduct following transactions from your BO account

DEBIT TRANSACTIONSYou can transfer securities through a debit transaction from your BO account to

a. Clearing House account for fulfilling your sale obligation (On-Market Transaction) b. Any BO account at CDSL (Off-Market Transaction) c. Any BO account at NSDL (Inter-Depository Transaction)

For this, you will have to give us instruction from the personalized Instruction slip-book issued to you at the time of opening of your BO account. This slip will have to be signed by all the holders in the same manner as recorded with us.

CREDIT TRANSACTIONSYou can receive securities through a credit transaction from any BO (beneficiary ownership) account to your account. It would be convenient for you and for us if you opt for a waiver from confirmation for credits (in other words standing instructions to receive all credits) at the time of opening of your BO account. You will not be required to give a receipt instruction to us whenever you are to receive a credit in your account.

4. LITERATURE REVIEW

ONLINE TRADING INFRASTRUCTURE

The emergence of online exchanges has facilitated faster transactions by providing online

trading portals and brokerage houses ease and flexibility. The Internet has indeed opened up new

opportunities for conducting the business. The worldwide stock exchanges has made a major shift

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from the traditional method of trading and now conduct a bulk of its business online through its

brokers and partners.

In the developed countries majorly all the exchange transactions are conducted online. The

trend took off slowly in India and the National Stock Exchange (NSE) and the Bombay Stock

Exchange (BSE) two of the largest exchanges in India have been conducting online trade

successfully for some time.

WHY ONLINE TRADING ENTERED LATE IN INDIA?

The Indian exchanges and brokering houses have been very slow in moving their

transactions online and the major reason has been the lot government regulations. The initial delay

was due to laying down the specifications for creating Closed User Groups (CUGs). This issue was

resolved between the Department of Telecommunications (DoT) and the Finance Ministry around

1998 and after that soon came the online trading portals like IL&FS investsmart, ICICIDirect.com,

motilaloswal.com, sharekhan.com etc. Connectivity related issue was perhaps the most important

technological factor.RBI made regulation that it is mandatory for company to store at least 7 year

financial and transactional data.

In the non-stop, 24 hours a day, seven days a week world of investing, we are able to

Obtain investment news around the clock

Check quotes on exchanges all over the world – day or night

Easily compare one investment to another via numerous ratios, charts, graphs, and

tables

Screen for the best investments to fit our individual goals and requirements

Trade stocks as easily and quickly as professional traders

Calculate retirement needs based on various scenarios

Regularly monitor portfolios and make necessary changes quickly and almost

effortlessly

Control the routing of individual trades for the best possible price and execution

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Even many years after the launch of the first online brokerage firm, there remain a

large contingent of individual investors who still pick up the phone and call their

stock broker to buy and sell investments. However, every year a growing number of

investors are placing their trades using online brokers.

INDIAN EXCHANGES: NSE and BSE

The NSE and BSE are among the largest exchanges in the country handling very large daily

trading volumes, support large amounts of data traffic, and have a very large nationwide network.

The trading volume in year 2000 was huge with the average daily turnover in the capital markets

segment at NSE is around Rs 2300 crore and in the derivatives segment, around Rs 1300 crore.

The average daily traffic volume was around one million trades per day in the capital markets

segment and around 50,000 trades per day in the derivatives segment and there were around

13,000 registered users in both segments and an average of around 9500 users is logged in at a

time. At BSE the average daily turnover in 2001-2002 (April-March) was Rs 1244.10 crore and the

number of average daily trades was Rs 5.17 lakh.

THE NETWORK DESIGN

Any online exchange should always be-on, safe, secure, redundant and should have adequate

backup & recovery processes. The Vice President of NSE-IT G.M Shenoy tells that the basic design

objective of NSE was to provide fair, equal and transparent access across all NSE nationwide

locations and to provide connectivity to the trading members as soon as possible.

RECOMMENDATIONS OF SEBI

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The SEBI has also played an important role in the issue of the guidelines regarding online

trading so that the chances of fraud and misrepresentation are minimized.The stock brokers which

are being registered with Securities Exchange Board of India (SEBI) will have to apply to stock

exchanges for a formal permission. The following conditions must be fulfilled-

The online trading company must have a minimum net worth of Rs 50 lakh

The encryption technology should be there in the system used by the brokers to ensure the

provision for confidentiality ,security ,justifiability and reliability of data .The user id, first

level and second level password, automatic expiry of passwords at the end of a reasonable

period,

The brokers must maintain adequate back-up systems and data storage capacity which must

be checked by the stock exchanges.

SEBI has recently announced that to reduce the fraud cases each and every broking house

has to give back the full amount of customer after each three month, they will have to show

the zero balance of every customer’s account at the end of every 3 month

The minimum qualification must be laid down by the stock exchange to ensure that the

persons hired by the brokers must have the proper qualification regarding trading so as to

guide the clients and he can communicate regarding trading instructions.

To ensure the authenticity and accuracy of data a certification agency must be appointed

using the certification technologies when notified by the government or the SEBI.

The better client and the broker relationship to be maintained.

To determine the risk associated with the clients the brokers must have the have sufficient

verifiable information about clients and the stock exchange must ensure it.

The clients must be taken into an agreement stating about all the obligations and rights

including the minimum service standards to be maintained by the service provider broker

for services specified by SEBI/exchanges for Internet-based trading from time to time.

The web site of the broker providing the online trading facility should contain information

rules and regulations affecting client broker relationship, arbitration rules, investor

protection rules, etc meant for investor protection. It should also provide and display

prominently hyper link to the web site/page on the web site of the relevant stock

exchange(s) displaying rules/ regulations/circulars. Ticker/quote/order book displayed on

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the web site of the broker should display the time stamp as well as the source of such

information.

An e-mail should be sent to he investor for the confirmation of his Order or trade.

The limits of trading and exposure provided to the client must be set on system-based

control and brokers and exchanges must ensure it. The limits must be predefined by the

broker on the exposure and turnover of each client. The system of broker should be such

that it is capable of assessing the risk of the client as soon as the order comes in. The system

should inform the clients client the reports on margin requirements, payment and delivery

obligations etc.

As per the regulations the Contract Notes must be issued to clients within 24 hours of the

trade execution.

Cross trades of the clients will not be allowed with each other to the brokers using Internet-

based systems for routing client order and all orders must be offered to the market for

matching.

A separate working group has been set up to look into the surveillance and enforcement-

related issues arising due to Internet-based securities trading. However, general anti-fraud

provisions (SEBI Fraudulent and Unfair Trade Practices Regulations, 1995) will apply to all

transactions involving securities or financial services, regardless of the mediu.

5. ONLINE TRADING

Online trading involves investment activity which takes place over the Internet and it does not

require physical inclusion of the broker. An investor has to register with an online trading portal

like Investsmart.in, ICICIdirect.com,Religare, motilaloswal.com and sharekhan.com and many

companies like that and investor gets into an agreement with the firm to trade in different securities

according to the terms and conditions given on the agreement. As the servers of the online trading

portal are connected all the time to the stock exchanges and designated banks the order processing

is done in real time and investors can also have updates on the trading.

They can also check the status of their orders either through e-mail or through the interface that

it cannot be accessed by a third party. Some options are usually given to users such as to link their

bank account, Demat accounts and brokerage accounts into a single interface. A single window is

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also there for all exchanges and a single screen is there for the complete order routing mechanism.

The hardware used comprises Web and application servers, switches, routers, firewalls and security

devices, and specialized appliances. There are two broad models in play in the online brokerage

space-

Bank-backed firms

Entrepreneur-floated firms.

Bank-backed brokerages such as ICICIdirect and HDFC Securities have expanded on the

basis of their brand name and the trust of investors in them. The integrated 3-in-1 accounts offered

by these bank-backed brokerages help their parent bank by giving it accounts along with float

income.

In second case i.e. Entrepreneur-backed companies like Investsmart, Indiabulls, Sharekhan,

Religare and IndiaInfoline have expanded by offering customers a mix of online and offline

accounts, higher margin finance amounts and lower brokerage rates. Though the bank based has

performed better but the latter have not lagged too far behind. The reason why online trading has developed over conventional offline brokerage firms is that this

conventional method struggled with unfavorable economies. Staff cost is just one

example of it. As the markets opens for 335 minutes a day one dealer can at best execute 500 trades

in a day while online company like ICICI direct executes 150,000-200,000 trades a day on the

National Stock Exchange alone accounting for 3-4% of NSE trades of 5 million a day. It would

require a large amount of dealers to service this demand. Besides the salary costs it would also

demand huge expenses in real estate and support systems.

The offline model has got a downfall in the form of lower bandwidth and IT costs and the cost of

bandwidth has fallen to one-eighth of what it was in 2000 giving online broking an advantage

especially in the case of lower-volume retail investors. In 2004, 30% of volumes on the NSE comes

from this and it gone up to 50% in year 2008-2009 providing explosive growth for online broking

in India.

To be a successful trading portal it will definitely depend on bunch of services provided by it for an

end-user. Most of the portals charge a small registration fee and brokerage based on various

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conditions but it's important for the organization to keep focussed on customer-centric services and

delivery models to actually enjoy the most attention.

ADVANTAGES OF ONLINE TRADING

1. Provides with the Freedom of Information

The Internet provides a new sense of controlling our financial future as the amount of

investment information available online is truly outstanding. An investor can-

Know the price of any stock he desires at any point time on the internet.

An investor can review the price history of any stock in chart format online

An investor can follow in-depth the events happening in the market

Helps an investor in receiving a wealth of free commentary and analysis about stock

markets in the global economy

Helps an investor to conduct an extensive financial research of any company he desires

He may also consult with other investors online present around the world

Some online stock broking companies provide real-time stock quotes, daily roundups

of the stock market, expert commentary, and a deep community of fellow investors.

2. Provides Control to Investors Money

When an investor wants to buy or sell stock he no longer need to call his broker on the

phone thus helping in the execution of the order instantly on the internet.

3. Provides access to the market

Through the sophisticated information streams, dedicated trading platforms and

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Sophisticated tools the investor can access the markets which provide more agility in

buying and selling stocks.

4. Ensures the best price for investors

Some companies like Investsmart (IL&FS)specialize in the techniques which offers

the best price deals for the buy and sell orders of the investors and traders providing the high

level of transparency by displaying of information relating to the specific stocks and

company profiles which helps in getting the best quote for the orders.

5. Online trading offers greater transparency

Online trading offers the investors with greater transparency by providing with an

audit trail. The process involves a complete integrated electronic chain starting from order

placement, to clearing and settlement and finally ending with a credit into the depository

account of the investor. All these stages are inspected which brings the transparency into the

system.

6. Provides hassle free trading

Online trading provides an integration of the bank account, trading account and

demat accounts, which leads to easy and paperless trading for the client.

7. Online trading allows instant trade execution

Online transactions helps in the quick execution of the entire trading transaction

right from logging to the traders site and to the settlement of the bank account in a very

short period of time.

8. It provides a level playing field

Trading online gives even the smallest retail investor access to information which

was earlier available only to the big traders. It has provided with a level playing field for all

investors in the securities market.

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9. Online trading reduces the settlement risk

This method of trading reduces the settlement risk for the investor as when a short

sell order is played the orders are squared off at the specified cut-off time and are not

allowed to be carried forward.

10. Provides live financial news & analysis

The online sites also provide live terminals which provide streaming news to give

investor the latest financial information as it occurs.

11. Online help desk

Some companies provide online help desk an investor cancan contact the Tele

Trading Executives from the Tele Trading team during and after market hours and can

clarify questions.

12. Instant order trade confirmations

Through online trading every trade is confirmed immediately and investor receives an

on-screen confirmation following every trade with full details for the investors records

which avoids costly errors that would have been discovered when it is too late.

13. Keeps Information Secure

As per the guideline provided by SEBI every effort has to be made to keep the

investors account and personal information secure by use of encryption technology and

updated security technology to advanced fraud prevention measures.

DISADVANTAGES OF ONLINE TRADING

In online terminal, investor can’t get customized expert advice, whereas in offline the broker

gives suggestions according to investors strategy (i.e. short term or long-term)

Brokerage is high compared to offline.

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Privacy is less due to hacking scandals

Transactional errors due to technical problems

6. THE EMERGENCE OF ONLINE TRADING IN INDIA

Company Profiles It includes company profiles of the following companies.Indiabulls Financial Services Limited (www.indiabulls.com)

India Infoline (www.5paisa.com)

Sharekhan (www.sharekhan.com)

Karvy (www.karvy.com)

Religare Securities (www.religare.in)

And finally the comparative Competitor analysis is done on the basis of Product Comparison Pricing Comparison Service Comparison

The competitive positioning of various firms is also studied on the parameters such as Website: Ease of use, Pace of transaction execution, Trading Terminal facility, Tie up with banks, Branch network and Customer service.

Indiabulls

HQ Region Delhi Area, India

Industry Financial ServicesType Public CompanyStatus Operating

Company Size

10,000 employees

2007 Revenue

11,819 million [INR] (102%)

Founded 2000Website http://www.indiabulls.com

Indiabulls Group is one of India’s top Business houses with businesses spread over Real Estate, Infrastructure, Financial Services, Securities, Retail, Multiplex and Power sectors. The group companies are listed on important Indian and Overseas markets. Indiabulls has

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been conferred the status of a “Business Superbrand” by The Brand Council, Superbrands India.

India Infoline

The India Infoline group, comprising the holding company, India Infoline Limited and its wholly-owned subsidiaries, straddle the entire financial services space with offerings ranging from Equity research, Equities and derivatives trading, Commodities trading, Portfolio Management Services, Mutual Funds, Life Insurance, Fixed deposits and other small savings instruments to loan products and Investment banking. India Infoline also owns and manages the websites www.indiainfoline.com and www.5paisa.com The Company has a network of 976 business locations (branches and sub-brokers) spread across 365 cities and towns. It has more than 800,000customers. 

HQ Region

Mumbai Area, India

Industry Financial ServicesType Public CompanyStatus OperatingCompany Size 15,000 employees

Founded 1995Website http://www.indiainfoline.com

Sharekhan

Sharekhan Limited offers online security broking and portfolio services to institutions and

large corporate houses as well as individual investors. Sharekhan Limited was formerly

known as SSKI Investor Services Private Limited. The company is based in Mumbai, India.

HQ Region Mumbai Area, India

Industry Financial Services

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Type Privately Held

Status Operating

Company

Size1001-5000 employees

Website http://www.sharekhan.com

Karvy

Karvi is a leading player in the financial services industry in India. Karvy has presence with leadership position in a wide range of financial services including Broking, Commodities, Registry Services, Merchant Banking, Realty services etc. The group also has presence in the BPO services and technology services space. IT’S a professionally managed and highly focused financial intermediary in the Indian markets.

HQ Region Hyderabad, India

Industry Financial ServicesType Public CompanyStatus OperatingCompany Size 7,000 employees

Founded 1981Website http://www.karvy.com

Religare

Religare Enterprises Limited (REL) is a global financial services group with a presence across Asia, Africa, Middle East, Europe and the Americas. In India, REL’s largest market, the group offers a wide array of products and services ranging from insurance, asset management, broking and lending solutions to investment banking and wealth management. The group has also pioneered the concept of investments in alternative asset classes such as

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arts and films. With 10,000 plus employees across multiple geographies, REL serves over a million clients, including corporates and institutions, high net worth families and individuals, and retail investors.

HQ Region Delhi Area, IndiaIndustry Financial ServicesType Public CompanyStatus OperatingCompany Size

10,000 employees

Founded 2006

Website http://www.religare.in

Competitive Analysis on the basis of product, Charges and Service Offered

In online trading Indiabulls has mainly competition with Religare, ICICI-Direct and Sharekhan. Prabhudas Lilladher broking has an advantage of being in this industry for more than six decades. It has launched its website and was among the first players in the online share trading. All companies have decided to spend its advertisement budget through four media i.e. Television, Print, Web and Outlets.

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Comparison between Advance brokerage charging firmsReligare come up with less brokerage charges but big advance brokerage . Major Ganiz here stands somewhere between religare and Sharekhan Securities( which charges less advance brokergae than Religare and much lesser brokerage charges).Here Reilance money provides option of different upfront brokerage at the same advance brokerage fee, with different trading limits.Major Gainz advance brokerage schemes come in form of two plan types: Power and Turbo Range respectively.Plan pricing is mentioned under Pricing ‘P’ of service marketing in Project later.

PlansAdvance

Brokerage fee

Upfront brokerage Validity

Trading limit

A 750 500 1 year 2 lakhs

B 750 1000 2 months 1 crore

C 750 2500 6 months 6 crore

D 750 5000 12 months 7 crore

E 750 10000 12 months 20 crore

Fig : Advance brokerage plans at Reliance Money

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Fig : Advance brokerage plans at Religare Securites

Certaintly if we compare different Advance brokerage plans than Reliance Money stands out as unique and chapest advance brokerage plan provider as different upfront brokerage at the same advance brokerage fee, with different trading limits make it simple and easy to prospects.On the other hand Sharekhan Securities comes up with different advance brokerge plans which are designed considering usage rates of customers.Advance brokerage plans by Religare Securities are least complicated to understand and come in only two account type : Raily Dhanaka Plus and Raily Dhamaka Grand respectively. These two plans require lesser advance brokerage and brokerage charges than Sharekhan Securities.

Fig : Advance Brokerage plans by Sharekhan Secutities

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7. GROWTH OF ONLINE TRADING

According to an article by Krishnamurthy B in 2005 after inception of online trading in

India in the year 2000 online trading is gained momentum with trading volumes growing by 150

per cent per annum in the years 2003-2005 and it was more than approx. 250% in the year 2009

The volume of all trades executed through the Internet on the National Stock Exchange had grown

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from less than Rs 100 crore (Rs 1 billion) in June 2003 to over Rs 700 crore (Rs 7 billion) in July

2005 which was a handsome growth in the year 2005in the starting of 2008 the growth of online

share was good but at the mid of the year when subprime crisis affected India including all over the

world, market of online trading got shrunk by more than 50%.

Now the growth of online trading is on its right track ,Indian stock market has been announced

the one of the Safe and stable market of the world, so here in India the online trading is growing

like anything in comparison to the whole world

At the end of July 2009, there were more than 600 registered brokers on the NSE and the

number of Internet trading subscribers to about 2.024 million. In the year 2007 India has 8 crore

(80 million) internet user, the % of internet user is growing in each year

At the same time the number of subscribers trading through the portal of Kotak Securities had

gone up significantly by 150 per cent and the number of online trading customers had grown from

30,000 to 75,000. And the company expected to have at least 130,000 customers by the end of that

fiscal. In the recent past years of 2005 ICICIDirect and Indiabulls recorded an annual volume

growth of 100 per cent and Indiabulls had about 30 per cent of India's online trading volumes.

Today the total volume of online trade in India is about 29-31% of total trades.

According to brokers the better broadband connectivity across the country and wider awareness of

equity as an asset class will raise the online trade volumes to over 50% of total trade.In India the

demography is such that 75% of the population is under the age of 36 and more than 50% of the

75% is under age of 25 and this is another supporting factor

The Chief Executive of Reliance Money Ltd says that online investing is still at a nascent

stage in India and expects that Internet-based trading will eventually take about half of the total

stock market trading as like with developed markets such as the US. Philippines has the highest

online trade with about 55-60% execution of trade is online. The reason is because they had wider

Internet connectivity years before India. The biggest challenge in India remains better Internet

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connectivity. The earlier Web-based technology used for Internet trading has been replaced by

specialized software which gives real-time global data streaming rates to trader helping investors to

analyze the market trends and helps in faster execution of trades. Earlier the investors made trade

calls over the phone which sometimes led to the delays.

Online share trading in India was at a boom in the end of 2006 with daily-traded volumes

more than tripling from Rs 1,500 crore to Rs 5,000 crore in the last one year and terminals was set

up in small towns such as Rajkot, Hubli and Vijayawada .In that year the share of online trading

rose dramatically from 7% last year to 20% as a percentage of overall traded volumes. Due to this

factor the top five US brokerage firms decided to make a foray into India in the next year driven by

strategic interest. Also at that time non-metros accounted for half of the daily turnover of online

trading.

Graph is showing the declining in the turnover of online trading in Indian stock exchange during

slowdown in economy due to subprime mortgage crisis.

A crash of the market in the early February 2008 the investors remained away from online

trading the turnover of the NSE from internet-based trading dipped to a daily average of Rs 1,648

crore between February 1 and February 8 as compared with Rs 3,450 crore in January 2008 Rs

3,587 crore in December 2007 and Rs 4,417 crore in November 2007 in the exchange’s cash market

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segment. In the mid February 2008 it accounted for just 12% of NSE’s total cash turnover as

compared with a high of 24% in November last year.

"Issues that need to be addressed are education on cyber crime and the security solutions

around it," says Vinesh Menon, Deputy CEO & Head for Online Investment & Branch Channel,

Bajaj Capital

"It's a matter of time when we will see exponential growth in the online trading segment, not

just through the computer but also through our mobile phones," adds Menon. With over 20 million

investors,

India boasts of the third highest investor base in the world, unthinkable till a few years ago.

The most online stock broking companies started from 2000 onwards because of development of

global Internet economy and for years 2000 to 2003 the stock market was under a bear hug. The

intense competition among a new wave of online brokerage companies hammered down brokerage

rates from 1% (in 2000) to 0.25 %, or even lower to 5 paisa

The number of investors opting for online trading has gone up manifold, according to the

recently published 'India’s Leading Equity Broking Houses, 2008' by Dun & Bradstreet (D&B).

The publication says that less than 10% of the 191 broking firms surveyed reported huge growth in

opening of e-broking accounts and some firms saw a surge in value of up to 400% in e-broking

during 2007

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According to the report, numbers of e-broking accounts registered in 2007 have grown

exponentionally. Indiabulls Securities Ltd added 4,51,611 accounts while a relatively new firm in

the industry, Reliance Money added 2,15,678 accounts during the same time period. Motilal Oswal

Securities Ltd managed to add 19,065 accounts while Unicon Financial Intermediates Pvt Ltd could

increase their e-broking accounts by 13,787

According to market watchers, the rise in the value of on line transactions is also because of

sustained bull run witnessed in 2007, when the 30-share Sensex of the Bombay Stock Exchange

(BSE) gained from 13,842 points to 20,207 points, a gain of 6,365 points (up 47%).

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E-broking is contributing a sizeable portion to the trading volumes and also to the revenue

generated for leading stock broking firms. Some examples of the percentage contribution to trading

volumes contributed by e-broking are 91% in case of Reliance Money, 62% for India Bulls, 20%

each for ASL Capital and Shreyas Stock, 19% Angel Broking, and 15% Farsight Capital. In respect

of revenues generated from e-broking, India Bulls (63%), Reliance Money (54%), Unicon Financial

(30%) and Shreyas Stock (20%) reported higher shares in 2007. Ashika reported 98% growth in e-

broking business in the first 10 months of 2007.

Another significant trend is the growth in international business of broking firms. Firms that

reported presence of offices outside India include Reliance Money, Motilal Oswal, Karvy Stock

Broking, JRG securities, Vogue and Bonanza Portfolio.

HDFC Securities have 500,000 online customers’ deals in daily online trades worth Rs 250-

300 crore is also in the black. The revenues it had in 2007-08 is Rs 100 crore. HDFC Securities had

revenues of Rs 67 crore and a net profit of Rs 7.21 crore in 2006-07. ICICIdirect has 1.5 million

online broking accounts and parent ICICI Securities reported revenues of Rs 750 crore for March

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2008. The new player Reliance Money has 2 million online accounts trades worth Rs 2,000 to Rs

3,000 crore per day.

8. ANALYSIS PART

Ans.1 What is your education qualification?

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INTERPRETATION

the people who are dealing with the stock market either online or offline. mort of them are

graduate,49%of the total respondent who are dealing with the stock market are graduate, then 16%

are post graduate and 22%people is having professional degree. So here this is showing that

qualification up to graduation or more than that is in the favour of the online trading pattern

Ans. 2 What is your annual income?

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INTERPRETATION

58%respondent are having the income level of 100000-200000 ,21% is having 200000-

300000 , 12% in having300000-400000 , 7% of the total respondent are having income more than

400000 per annum and only 2% are having less than 100000 per annum.

To invest in the stock market minimum 100000 or more than this should be the annual

income level of the people. In India the per capita income in also increasing so we can say that there

is a good opportunity for the online trading market.

Ans.3 What percentage of your monthly household income could be available for investment?

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INTERPRETATION

According to the data 23% of the total respondent invest less than 5% of their income,

41% respondents are saying that they invest 5%-10% of their monthly income (which is highest)

Whereas the 21% investor do the investment 10%-15% of their total monthly income,13 invest

between 15%-20% of the total income and only 2% does more than 20% of their income invest in

the market

We can easily understand that 75% of the total population is having a good amount of

investment, so the investment is their in the market, good number of people are ready to invest a

good amount in the market

91% of respondent is in the income level of 100000 – 300000 (according to the last question

analysis).

So we can say that stock brokerage houses will have to do a good business with the help of

Online trading system with few value addition services

Ans.4 Where do you often invest your money?

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INTERPRETATION

Highest number of respondent is having their investment in the equity that is 65% whereas the

investment available for the mutual fund, term deposit and insurance is 14% ,12% and 9%

So the investor for equity is high which is again showing the n number of opportunity for online

trading

Ans.5 what is the primary objective of your investment?

INTERPRETATION

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13% of the respondent invest the money for the reason capital appreciation but most of the

investor is having same motive that is source of income and retirement plan, wealth preservation

and education funding for children or other are only 10%

From the analysis we can have idea that the main objective of the investor to earn the money

through trading in stock market 77% of the respondent achieve their objective with the help of

investment in the equity market, because most of the investment take place in the form of equity

(explanation of 4th ans. )So we can say that there is a huge potential in the market for the trading in

the stock market

Ans.6 Do you owe a Computer?

INTERPRETATION

78% of the total respondent who are dealing with the stock market is having computer in their

house and only 22% is not having computer in their house

The people who is having computer that is 78% can also go for online trading which can be a

large number of people who will go for online trading. they don’t need to do a additional

investment for computer to go for online trading

Ans.7 To operate a computer is easy for me

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INTERPRETATION

76% (26+51) of the total respondent believe that operate a computer is easy for me whereas

20%(13+7) of the respondent is having problem to operate a computer out of that 20% , 75 believe

that they can’t go for computer

So ,if 78% of the people who are dealing with the stock market is having computer at their house

and around 76% of the same population don’t have any problem to operate a computer

So around 60 % is their who is having computer and they don’t have problem to operate a computer

Ans.8 online trading is a secure way of trading.

INTERPRETATION

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71% of the respondent is having a positive thinking that online trading is a secure way of

trading whereas 185 of the respondent believes that online trading is not a secure way of trading

Satisfaction about the process, by which they will be going to do a trading that is online trading,

should be there in the mind of the customer. If they believe that their is no risk over the money

which they are going to invest in the market with the help of online trading, there will be a

perception to go for online trading at least one time

Ans.9 online trading is easy and fast way of trading?

INTERPRETATION

51% of the total respondent believe that online trading is a easy task Whereas 41% of the

respondent believes that to deal with online Trading is not a easy task and 85 was confused to

anything about that the trading via internet is a easy task or not

There is a difference between the people who believe and who don’t believe is not very big that

is only 10% , the reason of this problem can be if a person is doing its investment on its own he or

she think of the problem of being mistaken in the transaction. So there is a need of proper training

to do trading online

Ans.10 At what time do you trade?

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INTERPRETATION

45% of the total respondent do trading in office timing while 32% do trading in non office

timing and 23% of the respondents do the trading in free time.

Here the people who do the trading in office timing they face the problem of not in the continuous

touch of the stock market, so online trading can be one of the good solution of this problem.

Ans.11 Introduction of online trading helped to attract the new Investors thus increasing the trading volumes at Stock Market?

INTERPRETATION

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76% of the respondent believe that the introduction of online trading helped to attract the new

customer became the reason to increase the trading volume of the market On the other side 16% of

the respondent believe that it doesn’t affect the trading volume

Ans 12 . What factor would you consider before choosing an account in a brokerage house?

10.CONCLUSION

The online trading is growing with a rapid pace with the rising level of education among the

customers. The other factors being that the Indian Investor nowadays wants to deal himself in

trading rather than depending upon other middlemen. They also consider the factors like time

saving in doing the online transactions, convenience etc. Although some people feel that online

trading is not secure but the people doing the trading online is happy about the increasing security

concerns among the companies.

The year 2008 has not been so good for the stock market and the Sensex and Nifty has been

dipping and affecting the business negatively for these companies. This is due to the fact that at

these times people do not prefer to open the DMAT and Trading accounts. So the companies have

to reduce their account opening fees to attract more and more customers. Also people trade very

less in the bearish market and the company’s profits against brokerage fees soars downwards. It is

also a found fact that during the bearish market the ratio of online trading becomes very less. Also

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there is an intense competition among the companies and the companies come up with new and new

promotion schemes such as discounted and negotiable brokerages, Zero balance accounts, waiving

a/c opening fee and AMC etc. As the internet penetration is growing in India this business holds a

huge potential for growth.

Now if the existing company will have to capture the market they will have to look for the

innovation in their product as well as service mix

The mantra for success in the current situation will be educating the customers about the

benefits of online trading and the amount of ROI that can be generated through it.

11.RECOMMENDATIONS

The companies should come up with more and more innovative features in their web

portals.

We came to know about most important factor about the product with the help of factor

analysis , so we should go for change the product according to the customer need

We should also focus upon the value added services. Generally company does claim that if

you will by the product you will get these benefits but company doesn’t provide the services

here. So services always does matter when we talk of ONLINE TRADING

Company should also look for the problem which customer generally face when they do

trading (like problem of operating properly)

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The customer should be educated regularly regarding the new technologies and techniques

of trading online and also other relevant information.

The companies should look after to develop more safe and secure ways of transacting

business online.

The companies should make maximum efforts to detect fraud cases and minimize them.

12.INDUSTRY RELEVANCE

My research project is Quite Relevant to the Investment Industry. The following things can

be useful for Prabhudas Liladher Pvt. Ltd.

Prabhudas Liladher will be able to know their market position with other competitors.

The company will also get to know some areas of improvement which came forward

through my research.

The changing perception of Indian consumers and their requirements will also be made

clear.

The company will be able to do the effective segmentation of their market based on the

research analysis.

The investment companies at large will be able to understand how to keep themselves

abreast with the changing technology.

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13.LEARNINGS

The two month summer training was a good experience for me to learn the practical aspects

of the corporate life. Some of the learning of mine is:

I improved my communication skills by learning how to talk to different kind of people as it

requires the different approach to handle each person.

I learnt how to manage a team of member to achieve a goal

I learnt how to handle the pressure under difficult situations.

I became aware about various aspects of working of stock exchange

I learnt few things about back office work

I learnt about the consumer perception about the stock market and online trading.

Patience was the thing I learnt the most as I have to approach the clients who were to be

explained same things again and again while approaching or calling them at regular

Intervals.

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14. BIBLIOGRAPHY

httpeconomictimes.indiatimes.comarticleshow4758236.cms

http business.mapsofindia.comonline-tradingicici.html

http business.mapsofindia.comonline-tradingkotaksecurities.html

www.investsmart.in/ilfs-webapp/RetailOfferings/RetailIndex.jsp

http business.mapsofindia.comonline-tradingindiabulls.html

www.investsmart.in/ilfs-webapp/InstitutionalOfferings/InstitutionalIndex.jsp

Httpin.reuters.comarticlepersonalFinanceidINIndia-40914120090709pageNumber=2

http://EzineArticles.com/?expert=Tanya_Lobo

www.investsmart.in/ilfs-webapp/Home/AboutUs/CompanyProfile.jsp

httpbusiness.mapsofindia.comonline-tradingbest-online-trading.html

www.the financialexpress/home/growth of market.htm

www.rediff.com/money/2005/aug/31trading.htm

www.reliancemoney.com/Aboutus.aspx

www.icicidirect.com

www.kotakstreet.com

www.bseindia.com

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www.nseindia.com

www.bseindia.com

www.sebi.co.in

QUESTIONAIRE

(To understand the perception of customer toward online trading)

NAME _______________________________________________________________________AGE ______________________________ GENDER ____________________________MOBILE _______________________________________________________________________ OCCUPATION _______________________________________________________________________

Q.1 What is your education qualification? higher Secondary senior secondary Graduate Post Graduate professional degree holder

Q.2 What is your annual income? Below 100000 1,00,000 – 2,00,000 2,00,000 – 3,00,000 3,00,000 – 4,00,000 Above 4,00,000

Q.3 What percentage of your monthly household income could be available for investment? Less than 5%

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5% to 10% 10% to 15% 15% to 20% More than 20%

Q.4 Where do you often invest your money? Equity Mutual fund Insurance Term deposits Others

Q.5 What is the primary objective of your investment? Capital appreciation Source of income Retirement planning Wealth preservation Education funding /others

Q.6 Do you owe a Computer? Yes No

Q.7 To operate a computer is easy for me Strongly agree Agree Can’t say Disagree Strongly disagree

Q.8 online trading is a secure way of trading Strongly agree Agree Can’t say Disagree Strongly disagree

Q.9 online trading is easy and fast way of trading?

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Strongly agree Agree Can’t say Disagree Strongly disagree

Q.10 At what time do you trade? Office Hours Non Office Hours Free Time

Q.11 Introduction of online trading helped to attract the new Investors thus increasing the trading volumes at Stock Market?

Strongly agree Agree Can’t say Disagree Strongly disagree

Q.12 What factor would you consider before choosing an account in a brokerage house ?

Tick the appropriate option according to your choice on the scale of 1 to 5 (Where 1 is Most important to 5 for least important)

S.NO. PRODUCT ATTRIBUTES1 Variety of products offered 1 2 3 4 52 Time to open an account 1 2 3 4 5

3 Brokerage charged 1 2 3 4 54 Customer services 1 2 3 4 55 Software 1 2 3 4 56 Research reports 1 2 3 4 57 Efficiency at peak hours 1 2 3 4 58 Customer relationship 1 2 3 4 59 Compliance system 1 2 3 4 510 Infrastructure 1 2 3 4 511 Brand 1 2 3 4 512 Trading Calls/sms 1 2 3 4 5

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13 Effective execution 1 2 3 4 514 Regular delivery of contract notes 1 2 3 4 515 Market exposure 1 2 3 4 516 Recording confirmation 1 2 3 4 517 Access to back office 1 2 3 4 518 Comprehensive stock trading portal 1 2 3 4 519 Employees skill 1 2 3 4 520 Helpline services 1 2 3 4 521 Guidance 1 2 3 4 5

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