Tejas Joshi Complete

Motilal Oswal Securities Limited

“A STUDY OF SATISFACTION LEVEL OF EQUITY SUB-

BROKERS”

AT

MOTILAL OSWAL SECURITIES LTD.,

(AHMEDABAD CITY)

A SUMMER PROJECT REPORT SUBMITTED IN THE PARTIAL

FULLFILLMENT OF AWARD OF MBA

(BATCH 2010-12)

SUBMITTED TO SUBMITTED BY

ANKIT SHAH TEJASH. JOSHI

(107240592052)

K.P PATEL SCHOOL OF MANAGEMENT & COMPUTER STUDIES

Kapadwanj, Gujarat, India

JULY 2011


CERTIFICATE


DECLARATION

Myself Tejas H. Joshi hereby declare that this project is the record of authentic work carried

out by me, in well reputed company MOTOLAL OSWAL SECURITIES LIMITED

during the academic year 2010-2011, under the guidance of. MR. ANKIT SHAH, faculty

member K P PATEL SCHOOL OF MGT &COMPUTER STUDIES KAPADWANJ.

This is my real work and has not been submitted to any other university or institute towards

the award of any degree.

YOURS FAITHFULLY

TEJAS H. JOSHI


PREFACE

In order to achieve Perfection, theoretical knowledge must be supplemented with

practical knowledge and training. The basic objective of the summer internship is to

bridge between theoretical knowledge and practical knowledge.

I know that training is for the development and enhancement of the knowledge in a

particular field. It can never be possible to make a mark in today’s competitive era

only with theoretical knowledge when industries are developing at global level,

practical knowledge of administration and management of business is very important.

Hence, practical study is of great importance to M.B.A. student.

With a view to expand the boundaries of thinking, I have undergone summer

internship training program at MOTILAL OSWAL SECURITIES LTD. I have made

deliberate efforts to collect the required information and fulfill training objective.

I consider myself very fortunate that I got an opportunity to work with an esteemed

company like MOTILAL OSWAL SECURITIES LTD.

Place: KAPADWANJ TEJAS H. JOSHI Date: (107240592001)


ACKNOWLEDGMENT

Guidance, cooperation, and inspiration are the important factors in the

accomplishment of an assigned task. I am most indebted to those mentioned below for

their moral and active support.

At the outset, I profoundly thank to our college KSMCS for providing us with this

opportunity and for all its cooperation and contribution. I also express my gratitude to

our honorable Head of the Department. Mr.AJAY TIWARI and are highly thankful to

my project guides Mr.ANKIT SHAH, and all others professors who helped me with

the project. I am also thankful to other college staff that helped in my project

I am very thankful to Mr. M. K. JAYAPRAKASH SIR [ A.V.P. ( Acquisition) OF

MOTILAL OSWAL SECURITIES LTD.] and Mr. PRATIK SANGHVI [ A.V.P

(B.A.D.) MOTILAL OSWAL SECURITIES LTD.] who has given me such a nice

opportunity to undergo the training and also very thankful to Mr. Hiral Raval [B.D.M

of MOTILAL OSWAL SECURITIES LTD.] who is our external guide of my project,

for giving me his valuable suggestions and guidance throughout the training period

and would also like to thank the whole MOTILAL OSWAL staff for helping me in

queries.

Finally, I am sincerely thankful to others who have directly or indirectly helped me in

the completion of the project.


EXECUTIVE SUMMARY

As a part of our study, I did my project in “Motilal Oswal Securities Ltd.”. Basically,

MOSL is in the broking industry providing a varied products and services to their

clients. MOSL is one of the leading broking firms at National level.

In my summer internship I was given the project work on “A STUDY OF

SATISFACTION LEVEL OF EQUITY SUB-BROKERS”- wherein I found the

possibilities for MOSL’s business expansion via Franchisee in Ahmedabad city. For

which I have done my practical study on sub-brokers survey in Ahmedabad city.

During my internship at MOSL, I also engaged myself in the work of searching for

franchisee prospect. I found out address of various franchisees from NSE sub-brokers

list and from the lead given by the visited sub-brokers themselves.

After finding out the address of franchisee, my starting point of research was visit

them and took detailed information from them. I survey 150 sub-brokers and

questioned them relating to the products & services provided by their brokers,

departments with their present brokers, business development supports provided and

required by them for their business development and other personal information. I

also visited some of the leading regional brokers to make my selves more aware of the

market scenario. I also discussed this with our research guides (the assistant branch

manager and Business acquisition manager) and with also other staff of the branch.

From the data collected through questionnaire, I have found out the various marketing

strategies, possibilities that MOSL can use for acquiring business in the future; in the

other uncovered regions of Ahmedabad.

I have found that MOSL is enjoying good reported place in the market through its

varied products and services, various department desk, its unique business models.


TABLE OF CONTENTS

S.No. Topic Page

No.

I Certificate

II Declaration

III Acknowledgment

IV Preface

V Executive Summary

Chapter 1 Introduction 1

1.1 Industry profile 4

1.1.1 Over the counter exchange of India 7

1.1.2 National Stock Exchange of India 7

1.1.3 Division of Share Market 8

1.1.4 Major Players in the broking Industry 11

1.2 Company Profile 12

1.2.1 Introduction 13

1.2.2 MOSL Four Companies 14

1.2.3 Organization Structure 15

1.2.4 Values 16

1.2.5 Management Team 17

1.2.6 Trading Department 22

1.2.7 H.R Department 22

1.2.8 Awards & Accolades 24

1.2.9 Services By MOSL 25

1.3 Product Profile 26

1.3.1 Products & Services 27

1.3.2 New Offering 34


1.3.3 Stoke Market Review 36

1.4 Theoretical Aspects of Business 38

1.4.1 Percentage of Sub-broker in Each region 39

1.4.2 Business Model 40

Chapter 2 Research Methodology 45

2.1 Statement of Problem 46

2.2 Hypothesis 46

2.3 Objectives of Study 47

2.4 Utility of the Study 48

2.5 Research Design 48

2.6 Sample Design 49

2.7 Source Of Data 49

2.8 Limitation of the Study 49

2.9 Data Analysis & Interpretation 50

Chapter 3 Findings & Recommendation 68

Chapter 4 Conclusion 80

Chapter 5 Reference 82

Chapter 6 Annexure 84


1

CHAPTER 1

INTRODUCTION


2

INTRODUCTION

Motilal Oswal Securities Ltd. (MOSL) was founded in 1987 as a small sub-broking

unit, with just two people running the show. Focus on customer-first-attitude, ethical

and transparent business practices, respect for professionalism, research-based value

investing and implementation of cutting-edge technology has enabled us to blossom

into an over 1600 member team.

Today Motilal Oswal has a well-diversified financial services firm offering a range of

financial products and services such as Wealth Management, Broking & Distribution,

Commodity Broking, Portfolio Management Services, Institutional Equities, Private

Equity, Investment Banking Services and Principal Strategies.

It has a diversified client base that includes retail customers (including High Net

worth Individuals), mutual funds, foreign institutional investors, financial institutions

and corporate clients. It‟s headquartered in Mumbai and as of March 31st, 2011, had a

network spread over 611 cities and towns comprising 1,644 Business Locations

operated by our Business Partners and us. As at March 31st, 2011, MOSL had

709,041 registered customers

MOSL is one of the best companies among Indian domestic broking houses enjoying

an unmatched and unparalleled brand recall. Motilal Oswal Securities Ltd. Is

financially sound and have an excellent track record of consistent market growth in all

key business segments.

Company is committed to give their customers the best services and holding to their

core values which always place their client's interests first. These values are reflected

in their business principles, which emphasize integrity, commitment to excellence,

innovation and teamwork

http://www.motilaloswal.com/home

http://www.mostshares.com/

http://www.arihantcapital.com/about-us/our-culture-people.aspx#b-principals


3

MOSL provide the solid research to their clients. As a part of project concern we are

studying the business models and for the growth of business which is the tools being

used and required by the sub-brokers.

So, this project aspires to know the competent market leaders, behavior of the

individual client. This also helps us to know the preferences of the Sub-brokers to

choose the main brokers so that they can provide good services according to the sub-

brokers requirements to make more and more sub-brokers, individual client and other

HNI clients


4

1.1. Industry Profile

Introduction:

The Indian financial services industry has experienced significant growth in the last

few years. The Indian financial markets have considerably broadened and deepened

due to various financial market reforms undertaken by the regulators. Introduction of

innovative and diverse financial instruments and entry of large domestic players and

sophisticated international players have triggered this growth.

None banking financial services sector, such as equities, derivatives and commodities

brokerage, residential mortgage and insurance services, where new innovative

products and expanding delivery channels have helped these sectors achieve high

growth rates. Retail segment has grown multi-fold due to Regulatory reforms, diverse

asset instruments, changing demographic profile, soft real interest rates and enhanced

foreign participation (FIIs).

Finance and investment industry is playing a vital role for the development of the

economy. Financial market in India is one of the oldest in the world and is considered

to be the fastest growing and best among all the markets of the emerging economies.

The history of Indian capital markets dates back 200 years toward the end of the 18th

century when India was under the rule of the East India Company. The development

of the capital market in India concentrated around Mumbai where no less than 200 to

250 securities brokers were active during the second half of the 19th century.

The financial market in India today is more developed than many other sectors

because it was organized long before with the securities exchanges of Mumbai,

Ahmedabad and Kolkata were established as early as the 19th century. By the early

1960s the total number of securities exchanges in India rose to eight, including

Mumbai, Ahmedabad and Kolkata apart from Madras, Kanpur, Delhi, Bangalore and

Pune. Today there are 21 regional securities exchanges in India in addition to the

centralized NSE (National Stock Exchange) and OTCEI (Over the Counter Exchange

of India).


5

The international financial market over the world has grown very fast in the recent

years. The private capital market is consistently improving since 1997. The buoyant

capital flows among the nation's boundaries have raised the existing strength of the

financial market domestically as well as internationally.

Trading Pattern of the Indian Stock Market

Trading in Indian stock exchanges is limited to listed securities of public limited

companies. They are broadly divided into two categories, namely, specified securities

(forward list) and non-specified securities (cash list). Equity shares of dividend

paying, growth-oriented companies with a paid-up capital of at least Rs.50 million

and a market capitalization of at least Rs.100 million and having more than 20,000

shareholders are, normally, put in the specified group and the balance in non-specified

group.

Two types of transactions can be carried out on the Indian stock exchanges:

Spot delivery transactions "for delivery and payment within the time or on the date

Stipulated when entering into the contract which shall not be more than 14 days

following the date of the contract": and

Forward transactions "delivery and payment can be extended by further period of

14 days each so that the overall period does not exceed 90 days from the date of the

contract". The latter is permitted only in the case of specified shares. The brokers who

carry over the outstanding pay carry over charges (can tango or backwardation) which

are usually determined by the rates of interest prevailing.

A member broker in an Indian stock exchange can act as an agent, buy and sell

securities for his clients on a commission basis and also can act as a trader or dealer as

a principal, buy and sell securities on his own account and risk, in contrast with the

practice prevailing on New York and London Stock Exchanges, where a member can

act as a jobber or a broker only.


6

The nature of trading on Indian Stock Exchanges are that of age old conventional

style of face-to-face trading with bids and offers being made by open outcry.

However, there is a great amount of effort to modernize the Indian stock exchanges in

the very recent times.

1.1.1 Over The Counter Exchange of India (OTCEI)

The traditional trading mechanism prevailed in the Indian stock markets gave way to

many functional inefficiencies, such as, absence of liquidity, lack of transparency,

unduly long settlement periods and benami transactions, which affected the small

investors to a great extent. To provide improved services to investors, the country's

first ring less, scrip less, electronic stock exchange - OTCEI - was created in 1992 by

country's premier financial institutions - Unit Trust of India, Industrial Credit and

Investment Corporation of India, Industrial Development Bank of India, SBI Capital

Markets, Industrial Finance Corporation of India, General Insurance Corporation and

its subsidiaries and Can Bank Financial Services.

Trading at OTCEI is done over the centers spread across the country. Securities traded

on the OTCEI are classified into: Listed Securities, Permitted Securities, Initiated

debentures.

OTC has a unique feature of trading compared to other traditional exchanges. That is,

certificates of listed securities and initiated debentures are not traded at OTC. The

original certificate will be safely with the custodian. But, a counter receipt is

generated out at the counter which substitutes the share certificate and is used for all

transactions.


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1.1.2 National Stock Exchange (NSE)

With the liberalization of the Indian economy, it was found inevitable to lift the

Indian stock market trading system on par with the international standards. On the

basis of the recommendations of high powered Pherwani Committee, the National

Stock Exchange 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.

Trading at NSE can be classified under two broad categories:

1) Wholesale debt market 2) Capital market.

Wholesale debt market operations are similar to money market operations -

institutions and corporate bodies enter into high value transactions in financial

instruments such as government securities, treasury bills, public sector unit bonds,

commercial paper, certificate of deposit, etc.

There are two kinds of players in NSE:

1) Trading members and

2) Participants.

Recognized members of NSE are called trading members who trade on behalf of

themselves and their clients. Participants include trading members and large players

like banks who take direct settlement responsibility.

Trading at NSE takes place through a fully automated screen-based trading

mechanism which adopts the principle of an order-driven market. Trading members

can stay at their offices and execute the trading, since they are linked through a

communication network. The prices at which the buyer and seller are willing to

transact will appear on the screen. When the prices match the transaction will be

completed and a confirmation slip will be printed at the office of the trading member.


8

1.1.3 Basically, Share Market can be divided into two parts

Primary Market It is the market where new issues of securities are offered to the

investors.

Secondary Market An investor of a secondary market buys a security from another

participant of the same and not from any issuing corporation (as in case of Primary

Market

Difference between Primary and Secondary Markets

In the primary market securities are issued to the public and the proceeds go to the

issuing company. Secondary market is a term used for stock exchanges, where stocks are

bought and sold after they are issued to the public.

Company Owners

Company IPO

Individuals apply to

get shares of the

company

Companies share ownership by issuing share

Primary market

Companies allocate shares to individuals and those who get the shares

become part owners of the company.


9

Secondary Market

Company

Companies get themselves listed on popular stock exchanges like

BSE and NSE

Broker Stock

Exchange Individual

Investors


10

CUSTOMER SUPPORT

SMS

Email

Live chat Relationship Manager

Call centre

Website

Multi Channel

Investment Option

Online Trading

Share Shops Dial n Trade

Multi Channel Access to the Stock Market


11

1.1.4 Major Players in the Broking Industry


12

COMPANY

PROFILE


13

1.2.1 Introduction of Motilal Oswal Securities Ltd

The story of Motilal Oswal Securities Ltd (MOSL) goes back many years, when Mr.

Motilal Oswal and Mr. Raamdeo Agrawal met each other as students in a Mumbai

suburban hostel in the early eighties. Both the young chartered accountants hailing

from a rural & an unpretentious background had a common dream viz 'to build a

professional organization with strong value systems, to provide reliable & honest

investment advice to investors'. Thus was born their first enterprise called "Prudential

Portfolio Services" in 1987. Motilal Oswal Securities Ltd. was founded in 1987 as a

small sub-broking unit, with just two people running the show. Focus on customer-

first-attitude, ethical and transparent business practices, respect for professionalism,

research-based value investing and implementation of cutting-edge technology has

enabled us to blossom into an almost 1600 member team.

Today MOSL is a well-diversified financial services firm offering a range of

financial products and services such as Wealth Management, Broking & Distribution,

Commodity Broking, Portfolio Management Services , Institutional Equities, Private

Equity , Investment Banking Services and Principal Strategies.

MOSL have a diversified client base that includes retail customers (including High

Net worth Individuals), mutual funds, foreign institutional investors, financial

institutions and corporate clients. MOSL‟s headquartered in Mumbai and as of March

31st, 2010, had a network spread over 611 cities and towns comprising 1,644

Business Locations operated by our Business Partners and us. As at March 31st,

2010, MOSL had 709,041 registered customers.

Motilal Oswal Financial Services is a well-diversified financial services group having

businesses in securities, commodities, investment banking and capital venture With

over 1,644 business locations and more than 709,041 customers in over 611 cities,

Motilal Oswal is well suited to handle all your wealth creation and wealth

management needs. These solutions are provided by a force of over 1600 employees

and over 808 Business Associates


14

1.2.2 Motilal Oswal Financial Services Ltd consists of four

companies

Motilal Oswal Investment Advisors Pvt. Ltd. is our Investment Banking arm with

collective experience of over 100 years in investment banking/corporate banking and

advisory services

Motilal Oswal Commodities Broker (P) Ltd. has been providing commodity trading

facilities and related products and services since 2004.

Motilal Oswal Venture Capital Advisors Private Limited has launched the India

Business Excellence Fund (IBEF); a US$100 mn India focused Private Equity Fund.

Motilal Oswal Securities Ltd. (MOSL) is a leading research and advisory based

stock broking house of India, with a dominant position in both institutional equities

and wealth management. Our services include equities, derivatives, e-broking,

portfolio management, mutual funds, commodities, IPOs and depository services.


15

1.2.3 Organizational Structure:-


16

1.2.4 VALUES


17

Mr. Motilal Oswal CMD, MOSL

1.2.5 Management Team:-

Mr. Motilal Oswal is the Chairman and Managing Director of Motilal Oswal

Financial Services Ltd. (MOFSL). He is a Chartered Accountant and started the

business along with co-promoter, Mr. Raamdeo Agrawal in 1987.

Mr. Oswal has received the Rashtriya Samman Patra awarded by the Government of

India for being amongst the highest income tax payers in the country for a period of 5

years from FY95–FY99.

Mr. Oswal has served on the governing board of the Bombay Stock Exchange (BSE)

as well as IMC and also has served on many committees of BSE, NSE, SEBI and

CDSL. He is also a board member and a Director of Jain International Trade

Organisation (JITO).


18

The Indian Council of Management Executives (ICME) has awarded the Knight of

the Millennium to Mr. Oswal for the Capital Market

Recently, Mr. Oswal was conferred the “Udyog Rattan Award” for his outstanding

performance in the industrial development of the country by the Institute of Economic

Studies, New Delhi. He has also been inducted into The Hall of Fame for excellence

in Franchising by the Franchising World Magazine. He is also awarded as the

Champion of Arthshastra by the Rotary District and the Excellent Business Achiever

in Financial Services Award by the Institute of Chartered Accountants of India.

Motilal Oswal Financial Services group activities include Wealth Management,

Investment Banking, Institutional Broking, Private Equity and Asset Management

with operations in 1644 outlets in over 611 cities and more than 709,041 customers.

The company's employee‟s strength is about 1500 people including 600 MBAs,

Engineers and Chartered Accountants etc.

In the year 2006 and 2007, Asia Money Brokers Poll has rated Motilal Oswal

Securities as the country's Best Local Research Company. It was also ranked as the

Best Brokerage in the ET Now – Starmine Analysts Awards 2009 and among the top

2 Local Brokerages in the AsiaMoney and Institutional Investor Brokerage polls.

In the year 2008, NASCOM – CNBC – TV18 rated Motilal Oswal as the Best IT User

Award for the Financial Services Category. Franchisee World Magazine the most

coveted award in the retail and franchising industry rated Motilal Oswal as “The Best

Franchisee in Financial Services” for the second year in succession.


19

Mr. Raamdeo Agrawal JMD, MOSL

MD, MOSL

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the

document or the

Mr. Raamdeo Agrawal is the man behind the strong research capabilities at Motilal

Oswal Financial Services Ltd. He is an Associate of Institute of Chartered

Accountants of India and also a member of the National Committee on Capital

Markets of the Confederation of Indian Industry.

Mr. Agrawal specialises in equity research. He has been authoring the annual Motilal

Oswal Wealth Creation Study since its inception in 1996. In 1986, he wrote the book

„Corporate Numbers Game‟, along with co-author, Mr. Ram K Piparia. He has also

featured on 'Wizards of Dalal Street on CNBC TV 18'.

Mr. Agrawal has received the "Rashtriya Samman Patra" awarded by the Government

of India for being amongst the highest Income Tax payers in the country for a period

of 5 years from FY95–FY99.


20

Navin Agrawal Ashutosh Maheshvari

Director, MOFSL CEO, MOFSL


21


22

1.2.6 TRADING DEPARTMENT

Motilal Oswal is one of the broker who is acting as wholesalers and as a broker, it is

the duty of it to provide service of collecting funds and securities from the investors

and send it to clearing house and vice versa. According to SEBI investor has to open

trading account for trading in shares. Client can open an account in any depository.

Trading department is divided into three parts:

Pre-trading (A/c opening, Deposits, etc)

Trading (Dealing room, Sauda punching, conformation)

Post-trading (Payout process, Bills, Pay-in-process, Contract note)

1.2.7 HUMAN RESOURCE DEPARTMENT

MOFSL has grown at a scorching pace, not only in terms of business but also in terms

of its most valuable asset -people. They have an ever-growing employee strength of

2315 associates that operates out of a rapidly expanding Company network.

HR at Motilal Oswal, on the one hand strives to make every employee of the

organization its brand ambassador and on the other hand make the Motilal Oswal

brand stand for the best people practices.

The 3 pillars of HR strategy are:

(1) A clear and relentless (persistent) focus on leadership development

(2) Stringent (severe) focus on the identification and development of 'High

Potentials' at all levels

(3) Investment in technology to deliver state-of-the-art HR processes across the

organization in a time and cost efficient manner.


23

The key initiatives towards implementation of the strategy have been:

Balanced Scorecard and KRA implementation:

Leadership Development:

Style and competency assessment for the top tier management of the Company was carried

out and an intensive Executive Coaching programme based on Individual Development Plans

has been started for 13 of the top leaders of the organization.

Technology:

The recruitment process has been enabled and implemented using the existing HR software

of My Zone. This has been implemented in Mumbai during the current year and will be rolled

out across all regions during this year.


24

1.2.8 Awards and Accolades :


25

1.2.9 Services offering by MOSL:

International & local

International capital Acquisition finance

market arrangement, LBO etc,

International & domestic

SYNDICATION

STRUCTURED

FINANCE

DOMESTIC

IPOs

RESTRUCTURING

CORPORATE

FINANCE

ADVISORY

PRIVATE EQUITY

PLACEMENT

M&A ADVISORY

FCCBs & GDRs


26

PRODUCT

PROFILE


27

1.3.1 Product and services

In keeping with its tradition of personalized service, Motilal Oswal Securities Limited

provides Customized Equity Advisory Group to clients based on their profile. Equity

Research is an inherent strength of MOSL. Converting that research to advice is the main

function of Equity Advisory. Investors are presented with well researched opportunities in

companies which will grow in both market perceived value and growth. Along side, the

trading fraternity is catered to with ideas induced by Technical analysis and news flow

analysis. The investment ideas identified by the research team are presented and

communicated with conviction to our clients by our advisory team.

Our advisory team has highly trained equity professionals, who act as your Equity Advisor.

MOSL Equity Advisor proactively helps you take informed equity investment decisions and

build a healthy portfolio giving the best fit to your investment and trading needs.

The MOSL Equity Advisory Group is based in Mumbai at largest dealing and advisory floor

of India. This centralized advisory team caters to peculiar Investment need of every HNI &

MNI client and business partner; in a seamless, speedy and reliable manner using state-of-

the-art technology and telecommunication infrastructure.

MOSL Equity Advisors are equipped with the knowledge and prudence making sure that

every rupee deployed works the hardest it can. Your advisors play the part of a guide

ushering you on a swift wealth creation ride. The sheer strength of our advisory creates

synergy for seamless flow of Investment support.

To improve the overall experience while the clients interact with our advisors, MOSL have

implemented a contact center solution, Drishti, in our dealing room. Among other benefits,

this solution helps advisors to manage their client base more efficiently and effectively. The

system provides a single number contact to all our clients as well as a single click auto-dial

for advisors without having to remember their contact details.


28

1. Wealth Management and Broking & Distribution :

MOSL offer Wealth Management Services, Broking & third party products to retail

customers through MOFSL, MOSL and MOCBPL. MOSL also provide financing services,

investment advisory, financial planning and portfolio management services (PMS) to our

clients. As at June 30, 2009, MOSL had 5, 57,373 registered customers, to whom MOSL

provide equity & commodities brokerage and PMS.

As at June 30, 2010, MOFSL had a total of 4, 86,571 depository clients. MOSL classify our

clients into two segments - 'mass retail' and 'high net worth' (addressed by a separate offering

called 'Purple'). MOSL offer our clients investment products across the major asset classes

including equities, derivatives, and commodities and distribute third-party products such as

mutual fund schemes and primary equity offerings. MOSL distribute these products through

our business locations and our online channel.


29


30

2. Institutional Broking

MOSL offer equity broking services in the cash and derivative segments through MOSL to

institutional clients in India and overseas.

These clients include companies, mutual funds, banks, financial institutions, insurance

companies, and FIIs. As at June 30, 2009, MOSL were empanelled with over 300

institutional clients including 200 FIIs.

MOSL service these clients through dedicated sales teams across different time zones.

3. Investment Banking

MOSL offer financial advisory services relating to mergers and acquisitions (domestic and

cross-border), divestitures, restructurings and spin-offs through MOIAPL.

MOSL also offer capital raising and other investment banking services such as the

management of public offerings, private placements (including qualified institutional

placements), rights issues, share buybacks, open offers/delisting and syndication of debt and

equity.

MOIAPL has closed 48 transactions in 2008-09.


31

4. Private Equity

In 2006, our private equity subsidiary, MOPEAPL was appointed as the investment manager

and advisor to a private equity fund, India Business Excellence Fund, which was launched

with a target of raising US$100 million. The fund is aimed at providing growth capital to

small and medium enterprises in India, with investments typically in the range of US$3

million to US$7 million. In its final closing, in December 2007, the fund obtained

commitments of US$125 million (Rs.4, 875 million) from investors in India and overseas.

US$31 million of these funds have already been deployed across six deals and the fund is in

advanced stages of closing three more deals, aggregating to US$30 million.

MOFSL is sponsoring India Reality Excellence Fund (”IREF”), an INR 750 crores Private

Equity Real Estate Fund. MOPEAPL will be the investment manager and advisor to the fund.


32

5. Asset Management

Our Portfolio Management Services (PMS) are offered through MOSL. As on 30th June,

2009, assets under management for this business were Rs. 6.8 bn. For the PMS business,

MOSL have a 5 member fund management team; they are supported by MOSL Research

Team of 27research analysts.

MOSL have received an in-principle approval from Securities Exchange Board of India

(SEBI) to set up a mutual fund business in India, through our promoter company, Passionate

Investment Management Private Ltd.

MOSL feel that there is a huge opportunity for new entrants as the industry is still in its

nascent stage in terms of AUM size, number of players and number of schemes, when

analyzing and comparing it with countries like Brazil and other emerging economies. MOSL

will grow our asset management business by leveraging our existing investment management

capabilities in managing funds, our strong research and a large in-house retail franchise

network to spread our reach and capture the investment potential in India and abroad.

6. Broking & Distribution services

Equity (cash and derivatives)

Commodity Broking

Portfolio Management Services

Distribution of financial products

Financing

Depository Services

IPO distribution

MOSL offer these services through our branches, Business Partner locations, the internet and

mobile channels. MOSL also have strategic tie-ups with State Bank of India and IDBI Bank

to offer our online trading platform to its customers.


33

7. Commodity Broking

Through Motilal Oswal Commodities Broker (P) Ltd our fully owned subsidiary; we provide

commodity trading facilities and related products and services on MCX and NCDEX.

Besides access to the best of research in the form of Daily Fundamentals & Technical

Reports on highly traded commodities, our clients also get access to our exclusive

Customized Trading Advice on both the trading platforms. MOSL offer these services

through our branches, Business Partner locations, the internet and mobile channels.

8. Mutual Fund

At Motilal Oswal Securities Ltd, they understand the importance of financial goals of their

privileged clients and provide them comprehensive solutions to all your financial needs.

Through their tailor made portfolios, they serve clients needs better and help them and make

informed investment decisions. Their dedicated Mutual fund desk gives clients Solid advice

backed services thus giving them the edge that they always wanted.

9. IPO’s

Book Building and Fixed Price Issue are the two types of Initial Public Offerings (IPO‟s)

through which a public company can raise money in the capital market.

10. My Broker

Motilal Oswal Securities Limited provides a platform of becoming our own broker with

complete research support from MOSL which helps us to make right decision at right time.

MOSL can choose our trading a/c which suits our trading habit‟s & preference and trade

anywhere, anytime. Buying and selling is as easy as click of a button.

http://www.motilaloswal.com/Commodity

http://www.motilaloswal.com/MOSL/IPO/

http://www.motilaloswal.com/MOSL/IPO/


34

1.3.2 NEW OFFERINGS:

MOST SHARES M 50 (Act like funds and trade like shares)

Motilal Oswal has launched India‟s first fundamentally weighted ETF based on S&P CNX

NIFTY Index – An open ended exchange traded fund.

MOST Shares M 50 takes the NIFTY 50 constituents and remixed them in a different

proportion using Motilal AMC‟s pre-defines methodology; based on fundamental

performance and valuation

MOST Share M 50 is an open ended exchange traded fund giving the investors the benefits of

investing in a mutual fund that trade like a share i.e. a diversified blue chip portfolio, real

time liquidity and prices.

Exchange Traded Fund:

ETFs are just what their name implies: baskets of securities that are traded, like

Individual stocks, on an exchange. Unlike regular open-end mutual funds, ETFs can be

bought and sold throughout the trading day like any stock.

Advantages of Most M50:

Higher allocation to stocks with superior fundamentals and reasonable valuation.

Combines the benefits of passive allocation and active execution

Lower cost structure (apprx 1% against 2%) as compared to the traditional investment

product.

No entry/exit load

Tax efficient exposure to the “market”.

Complete transparency with daily portfolio exposure.

Available at low denomination of less than Rs. 100/-


35

Uses of Most Shares M50:

All types of investors i.e. Retail or Institutional, Long term or short term can use the Most

shares M50 for the following strategies:-

1. Investing

2. Trading

3. Hedging

4. Arbitrage


36

1.3.3 STOCK MARKET REVIEW

MOSL is known for its equity research ideas. Asia Money Broker's Polls have

consistently rated our research as one of the best in the industry. Our annual Study on

Wealth Creation , authored by Mr. Raamdeo Agrawal, is keenly awaited by investors

across the globe. While „Winner Category and Category Winners‟ was the theme for

the 2009 study, the 2010 study talked about „Creating Wealth from the Unknown and

Unknowable‟.

Bargains are found when markets are blind to large business opportunity, positive

changes or sustained growth; losses are guaranteed when one grossly overpays

India‟s next trillion dollar journey will see distinctly buoyant corporate profits, and

boom in savings and investment

At current valuations, margin of safety in the market is low. However, very high

liquidity can lift the market to rich levels of valuation for quite some time

Our Quarterly Results Preview Compendium, which MOSL also publish in the form

of a pocket size book, is immensely popular. Published well before the first results

announcements hit the market, it serves as a useful guide through the results season.

Some of the noteworthy features that make it a unique product offering are:

A clearly spelt-out India Strategy

Updates on all the sectors under our coverage

Quarterly and annual estimates on all companies under MOSL coverage

Tear-away ready reckoners

MOSL Results Updates are amongst the most comprehensive on the street and are yet

amongst the quickest to reach MOSL clients.

MOSL have a universe of over 225 stocks. While MOSL service our clients regularly

through updates on each company under MOSL coverage, MOSL have also been

helping them create wealth by identifying trends early and uncovering interesting

wealth creation ideas. MOSL have analysts covering 25+ sectors and commodities.

http://motilaloswal.com/Retail/RetailContents.aspx?ReportID=DE09E872-F1C9-44A5-A990-0E11F61CBE6B


37

Thematic Sector Company Market Analysis

Regular Expert Speak Industry Update Initiating Coverage

EcoScope Travelog Company Updates

Ground Reality Wall of Worry

Re-initiating Coverage

Conferences /

Events Corner Office

Elections

InSites

Policy Maker

Annually Budget

Annual Report Update

Wealth Creation

Study

Quarterly India Strategy

Report Results Preview

Results Update /

Review

Holding Report

Monthly

MPower AMC Holdings MOSL Wealth

Auto Dasboard

Derivatives Roll Over

Tele Talk Time

Indian Airports

Ports

Power

Generation

Gasoline

Weekly Pivot Metals Weekly MOSL 3X3 Commodity Weekly

Week in a Nutshell

Valuation Guide MOSL LongShort

MOSL Weekly

Daily

MOSL Derivatives Daily

Margin Update

Commodity Daily

Corporate News

Market Diary

MOSL Market Action


38

THEORITICAL

ASPECT OF

STUDY


39

1.4.1 Percentage of sub – brokers present in each region

Interpretation

Here the above graph indicates the presence of sub-brokers in Ahmedabad region. MOSL

can see that here 60% of the sub-broker are in south region, 31% of the sub-broker are in

west region, 8% of the sub- broker are in north region, and 1% of the sub-broker are in

east region.


40

1.4.2 BUSINESS MODELS

Hybrid Models:

At MOSL MOSL believe in treating their sub-brokers business as if were their own. In

this true spirit of partnership MOSL have set up a dedicated team of Business

Development Manager (BDM) who function as part of the sub-broker team.The BDM

would help sub-brokers in the following ways:-

- Joint sales meeting for acquiring HNI customers

- Establishing Systems & Processes

- Conducting Seminars & Investors meet

- Business Plan Preparation

- Dealers - Relationship Managers - MOSL Business Development officers - Customer Service - Infrastructure - Dealing Terminals - Connectivity - Regional MOSL support Team

-Brand -Marketing Support - Advisory Support -Dedicated Advisors -Investment Ideas -Inactive to Active -Business Development -Sales Support -Training -Systems & Process Dev -Performance Training -Back office -Centralized RMS

Cu

sto

me

r

Products offered: - Equity, Commodity, PMS and Mutual Fund

MOSL Franchise

e


41

A person with good track record &

reputation in financial services/other

business/social circles with a good client

base

Minimum 2-3 years’ experience in

selling financial products as main

broker/sub broker/Remise/Mutual fund

distributor/Insurance advisor/Financial

planner or an employee of existing

broker/sub broker

Capacity to invest minimum 5-10 lacs

initially and ability to invest continuously

in infrastructure and people.

Willingness to design office premises in

accordance with the policies laid down by

MOSL

A person with a good track record & reputation

in financial services/other business/social

circles with a good client base

Minimum 2-3 years of experience in selling

financial products

Capacity to invest minimum 2 lacs

Sub broker Remisier/sub

broker

Business model


42

BSE,NSE,NSE F&O, BSE

F&O, NCDEX, NDSL,

CDSL, E trading PMS

Mutual fund

One relationship manager

will be assigned to you for

your regular research advice

& market updates through

chat –phone-emails

Marketing and business

development support on a

regular basis

Start up kit comprising of

glow sign flex, visiting

cards, marketing broachers

etc will be provided by

MOSL to help kick start the

business.

One customer service

executive will be assigned

to you for your routine

queries through chat-phone-

emails

Centralized web based

back office access will be

provided

Offerings to

sub broker

Product support Marketing & sales

support

Service support


43

BSE,NSE,NSE

F&O, BSE F&O,

NCDEX, NDSL,

CDSL, E trading

PMS Mutual fund

Trading terminal with

Orion

software(BSE/NSE)

Dealing desk

Direct Landline Phone

Conference room

Research advice &

market updates

through chat phone

emails

Issuing contract

notes/bills to end

clients

Online risk

management software

& back office

software

Unique offerings for a special partnership

Multiple Products BSE,NSE,NSE F&O,BSE F&O,NCDEX,NSDL,CDSL,e broking,

PMS,MF(direct & exchange traded),Private

equity, margin funding**, distribution of IPO**,distribution of

insurance**

Infrastructure

Support

State of the art offices with experienced managers

Trading terminal NSE & BSE

Dealing desk

Direct landline phone

Conference facilities

Research Morning calls

Interaction with research desk

Sector specific reports

Research access thorou7gh uppermost portal

Advisory support Centralized advisory support

Dedicated advisor

Offerings to

Remisier

Product support Infrastructure

Support

Sales support Back office

support


44

Trading software Equity CTCL Id- orion

E broking CTCL Id: My broker

Commodities CTCL: ODIN

Business

development support

Dedicated team of business development managers who assist your

business growth

Business conversion

support

Dedicated team to provide operational training & helps in converting

business

Service support One customer executive will be assigned to you for your routine

queries through phone – emails

RMS Online risk management software & back office software

Single rms software for online and offline clients

Connectivity Thorough VPN

Through VSAT

Idea dashboard Unique online platform for daily dissemination of research

recommendation

Quarterly business

review

Comprehensive business review to under stand your business

progress and suggest suitable action points

Mini admin terminal clients Limits can be directly set by BA (Deposit based)

Digital services digital contract notes, Auction bills, Leon and SSTT Certificates

Rewards and

recognition

Unique business partner Fraternity Program- UPPERMOST

Technical analysis

software

Falcon Charting Software


45

CHAPTER 2

RESEARCH

METHODOLOGY


46

2.1 STATEMENT OF PROBLEM

What can be done towards sub-broker satisfaction and sub-broker loyalty?

How to capture new market segments and what are the needs and expectations of

these segments?

Despite of having well drawn plan on sub broker by qualified management team why

such kind of the problems arises between the sub-broker & Broker.

What do the existing franchisees feel about the overall product?

2.2 HYPOTHESIS

Ho: The number of years in a broking firms are not depended on revenue growth.

H1: The number of the years in a broking firms are depended on revenue growth

YEARS

REVENUE GROWTH TOTAL

LEAST

PREFERED

MOST

PREFERED

< 5 Years 17 75 92

6 to 10 Years 3 35 38

11 to 15 Years 3 7 10

>15 Years 3 7 10

TOTAL 26 124 150


47

Chi-Square Tests

Pearson Chi-

Square

Value Df

Asymp. Sig. (2-

sided)

4.686a 3 0.196

CONCLUSION

Here chi-square value is 0.196 , Which is greater than 0.05 ( P value)

So, 0.196 > 0.05

So, Here There is a significant relation between number of years in broking firm and revenue

growth.

So Ho is not rejected.

2.3 OBJECTIVE OF STUDY

To study the preferences of sub-brokers in Ahmedabad city, regarding wide range of

the products, services and support tools.

To understand whether sub-brokers are satisfied with the business developments and

supports being provided to them by their present main brokers in Ahmedabad.

To understand the gap between sub-brokers‟ expectations & main brokers‟

perceptions.


48

2.4 SIGNIFICANCE OF STUDY

This will also help MOSL to select right tools for approaching the prospects, to give

knowledge of the products & services and other business development supports.

This will also help MOSL to make out the brand awareness at regional level.

This study will provide the knowledge to MOSL to reframe the policies as per

requirements of the regional sub-brokers.

This study also helps MOSL to get knowledge of competitors strategy towards their

sub-brokers.

2.5 RESEARCH DESIGN

A research design is defined, as the specification of methods and procedures for acquiring the

Information needed. It is a plant or organizing framework for doing the study and collecting

the data. Designing a research plan requires decisions all the data sources, research

approaches, Research instruments, sampling plan and contact methods.

DESCRIPTIVE STUDIES

Descriptive research in contrast to exploratory research is marked by the prior

formulation of specific research Questions.

The investigator already knows a substantial amount about the research problem.

Descriptive research is also characterized by a Preplanned and structured design.


49

2.6 SAMPLING DESIGN

Sample size : 150

Sampling method: Convenient Sampling:

Because of limited time and money, I have selected convenient sampling method

(Non Random Sampling) But, MOSL have not found much difference in findings

gained from different areas. So it shows enough validity of the research.

Research Instruments : Questionnaire (attached in Annexure)

Geographical Scope: Ahmedabad city

Population: Equity Sub-Broker in Ahmedabad city

2.7 SOURCE OF DATA:

Primary: Primary data is collected by visiting various persons who are

connected with broking industry through surveys/questionnaires,

interviews.

Secondary: Company material, websites, research reports, yellow pages

2.8 Limitation of the study

People not give good response

We have to work under the company guidelines & task which has given to me

Only 150 people was as a sample size from actual population ,so it is may be wrong

decision to take.


50

2.9 DATA ANALYSIS & INTERPRETATION

1) Number of years of sub-broker in broking Business.

INTERPRETATION

The above graph indicates that 99 respondents out of 150 are from less than 5 years in this

business and only 8 respondents are in this business from last 15 years.

0

20

40

60

80

100

120

140

160

180

< 5 years 6 - 10 year 11 - 15 year > 15 years

99

36

7 8

0.66 %

0.24 %

0.045 % 0.05 %

No. of years of current setup

NO. OF YEARS RESPONDENT %

< 5 years 99 66

6 - 10 year 36 24

11 - 15 year 7 4.67

> 15 years 8 5.33

TOTAL 150 100


51

2) Products & Services provided to Sub-Broker by their main Broker.

PRODUCTS AND SERVICES RESPONDENT %

Equity 146 26.35

Commodity 82 14.80

Insurance 58 10.47

IPO 91 16.426

PMS 48 8.66

Currency 48 8.66

mutual fund 59 10.65

marin of funding 15 2.71

any other 7 1.27

TOTAL 554 100

INTERPRETATION

Out of 150 respondents 146 Sub-Broker were provided equity product by their broker.

And also only 15 Sub-Brokers are provided Margin of funding.

So, Motilal has the opportunity to focus on the products which are less popular products like

margin of funding, this provides MOSL potentials for acquiring more and more business.

0

20

40

60

80

100

120

140

160

180

146

82

58

91

48 48 59

15 7

26%

14.8%

10%

16%

9% 9% 11%

3% 1.2%

Product and services provided by broker


52

3) Services/facilities provided to sub-broker by their broker.

12%

9%

11%

6%

3% 3%

3% 8%

13%

12%

8%

3% 1%

3% 5%

Facilities provided by broker Different account openingscheme Depository services

Different online tradingsoftwareInvestment advices

Risk management desk

Account opening within 24hoursMutual fund research desk

Business DevelopmentsoftwareSMS configuration to franchisee’s clients

SERVICES AND FACILITIES RESPONDENT %

Different account opening scheme 124 12.01

Depository services 89 8.62

Different online trading software 111 10.75

Investment advices 61 5.91

Risk management desk 34 3.29

Account opening within 24 hours 30 2.90

Mutual fund research desk 35 3.39

Business Development software 80 7.75

SMS configuration to franchisee’s clients 138 13.37

CDSL-rights 123 11.91

Investment banking 81 7.84

Branding materials 31 3.00

online mutual fund platform 13 1.25

Customer service desk 32 3.10

HNI desk 50 4.84

TOTAL 1032 100


53

INTERPRETATION

From the 150 respondents almost 89 respondents were provided Depositary services

by their broker.

Only 13 Sub-Broker were provided Online Mutual Fund Platform. That is only a

1.25% in the research.

Motilal Oswal has to focus on the various services & facilities which is available In

the market & also which are having a less percentage in the survey like branding

materials, Account opening within 24 hours, online Mutual funds platform etc.


54

4) Main sources for getting new clients by Sub-Broker.

SOURCES NO. RESPONDENT %

Reference 148 64.63

Advertisement 35 15.28

Sales team 19 8.30

Others 27 11.79

TOTAL 229 100

INTERPRETATION

Main source of getting new clients for sub-broker is reference, Sub-brokers getting

information about the clients through references like existing clients,

65%

15%

8%

12%

Sources for getting client

Reference

Advertisement

Sales team

Others


55

5) Percentage of client dealing in following.

% CASH FUTURE OPTION COMMODITY

0 to 20 5 43 44

21 to 40 21 28 12

41 to 60 30 21 4

61 to 80 26 3 0

81 to 100 48 1 4

TOTAL 130 96 64

INTERPRETATION:

The above graph indicates that 20% of the Clients are dealing in cash 5 sub-brokers, dealing

in Future option with 43 sub-broker, dealing in commodity with 44 sub.broker.

0

20

40

60

80

100

0 to 20 21 to 40 41 to 60 61 to 80 81 to 100

5 21

30 26

48 43 28

21

3

1

44

12 4

0

4

CASH FUTURE OPTION COMMODITY


56

6) The qualities that attributed for Sub-broker to be a successful sub –

broker.

QUALITIES NO. OF

RESPONDENT %

The brand value of the company you are associated

with.

99 36.80

Higher ratio of successful trading calls generated. 96 35.69

A culture of properly researched Ideas coupled with

good infrastructure & client servicing.

70 26.02

Other please specify... 4 1.49

TOTAL 269 100

INTERPRETATION

36% of the respondents thinks that higher ratio of successful trading calls given to the

customer is the key to become a successful broker. Motilal Oswal being best for its Equity

research in the industry can approach these clients as they would like to take the research

services of Motilal Oswal Securities in order to give more successful calls to their customers.

And also almost 37% of the respondents thinks that‟s the brand value of the co. you are

associated with are concerned.

37%

36%

26%

1%

Qualities attributes to be a successful sub-broker

The brand value of the companyyou are associated with.

Higher ratio of successful tradingcalls generated.

A culture of properly researchedIdeas coupled with goodinfrastructure & client servicing.

Other please specify...


57

7) Factors according to Sub-Broker for having a satisfied client.

FACTORS NO. OF RESPONDENT % Prompt & timely addressing of client queries 79 43.41

Best technology in place 48 26.37

Thinking ahead of time 51 28.02

Any others…. 4 2.20

TOTAL 182 100

INTERPRETATION

From the 150 respondents, almost 43.4 % of the respondents think that mostly clients are

looking for prompt & timely services from them.

020406080

100120140

Prompt &timely

addressing ofclient queries

Besttechnology in

place

Thinkingahead of time

Any others….

79

48 51

4

43.4%

26.4% 28%

2.2%

Factors needed to satisfy clients


58

8) The immediate challenges for this industry & Sub-Broker’s plan

to tackle that challenges.

IMMEDIATE CHALLENGES RESPONDENT %

Lack of interest in the stock markets in the retail

category

97 44.09

Source for fresh capital drying up from both domestic

& foreign investors

60 27.27

Cut costs & wait for good times to come 58 26.36

Any other 5 2.27

TOTAL 220 100

INTERPRETATION

From the 150 respondents, the higher value is 44% into the lack of interest in the stock

market in the retail category, where the other is 26 % & 28% for the both cut cost and wait

for good time to come and also for the sources for the fresh capital drying up from both

domestic and foreign investors respectively.

This will mostly helpful to know the problems and also the challenges that will be tackle in

the share market

44%

28%

26%

2%

Immediate challenges

Lack of interest in the stockmarkets in the retail category

Source for fresh capital dryingup from both domestic &foreign investors

Cut costs & wait for goodtimes to come

Any other


59

9) The importance of following development criteria for

business. (Circle the one that is most suitable to your

Preference. Consider 5 as most preferred and 1 as the least

preferred)

[Note – Here consider 1 as not at all important and same as the 5 as the very important and

also 3 as the neutral]

INTERPRETATION

Client satisfaction is a most important development criteria for the business. The other

leading important factors or the criteria are revenue growth, client base, active ratio, etc

IMPORTANT OF BUSSINESS

DEVELOPMENT

NOT AT ALL IMPORTANT

NOT IMPORTANT

NEUTRAL IMPORTANT VERY IMPORTANT

TOTAL

Client Acquisition

5 8 26 50 61 150

Client base 5 2 10 75 58 150

Active Ratio 2 4 22 58 64 150

Client satisfaction

2 0 6 37 105 150

Revenue Growth 2 1 23 67 57 150

NOT AT ALLIMPORTANT

NOT IMPORTANT NEUTRAL IMPORTANT VERYIMPORTANT

5 8

26

50 61

5 2 10

75

58

2 4

22

58 64

2 6

37

105

2 1

23

67 57

Chart Title

Client Acquisition Client base Active Ratio Client satisfaction Revenue Growth


60

10) Please rank the following business development support as per their

importance in your business. (Rank from 1 as most imp. to 8 as least imp.)

INTERPRETATION

From the above table, it is said that the no. of the respondents are high into the centralize

customer services and same as the least one is the easy acess to the senior management.

The most of the respondents like the customer support, local marketing, etc.

This will let MOSL to know the requirement and support required by the sub-brokers for

their business development, which in other hand will be very helpful for future

correspondence with their prospects.

16.5 17.125 16.75 14.625

17.375

13.375 16.5 16.375

No. of responses

No. of responses

Business development Support No. of responses Rank

Centralized Advisory & Research Support 16.5 5.5

Local area Marketing & Business Support 17.125 2

Initial Training & Business migration 16.75 3.5

Easy access to senior management 14.625 8

Centralized customer services 17.375 1

Office look & feel 13.375 5.5

Seminar & Investor Meet 16.5 7

B-Plan Preparation & other support 16.375 3.5


61

11) What kind of support you require which will lead to next level.

(Please give rating from 1 to 4; first priority will be ranked 1 and so

on).

Supports Require To Lead The Next Level No. Of Resp. Rank

Marketing and business development support 33 2.5

Brand value of broker 33 2.5

Successful calls given by broker 33.25 1

Back office/customer care support 32.75 4

INTERPRETATION

From the above table, MOSL can see that the red line shows the rank and the blue one is for

the no. of respondents.

Here, the most of the respondents preferred the successful calls given by the broker and like

wise to all.

This will helpful to know or to go to the next level of the business and increase the growth.

33 33 33.25 32.75

2.5 2.5

1

4

Marketing and businessdevelopment support

Brand value of broker Successful calls given bybroker

Back office/customercare support

support require to lead the next level

no. of resp. rank


62

12) Please rate the importance of following criteria while selecting a broker

for Franchisee… (Circle the one that is most suitable to your preference.

Consider 5 as most preferred and 1 as the least preferred)

Criteria’s for Franchisee

Acquisition

NOT AT ALL IMPORTANT

NOT IMPORTANT

NEUTRAL IMPORTANT VERY IMPORTANT

TOTAL

Growth Opportunities 0 6 16 65 63 150

Revenue Sharing ratio 0 5 16 74 55 150

Brand Name 4 5 39 37 65 150

Business Model 2 3 35 37 73 150

Research Analysis 10 11 18 47 64 150

Products & services 0 10 33 63 44 150

Initial Deposit 4 8 31 79 28 150

Growth Opportunities

Revenue Sharing ratio

Brand Name

Business Model

Research Analysis

Products & services

Initial Deposit

4

2

10

4

6

5

5

3

11

10

8

16

16

39

35

18

33

31

65

74

37

37

47

63

79

63

55

65

73

64

44

28

Criteria’s for Franchisee Acquisition

NOT AT ALL IMPORTANT NOT IMPORTANT NEUTRAL IMPORTANT VERY IMPORTANT


63

INTERPRETATION

Out of 150 respondents, 74 have given “top importance” to Revenue sharing ratio; growth

opportunity and research analysis are marked as “important” by 65 and 64 respondents.

Business model, product & Services and Initial deposit are being marked as neutral by 37, 63,

79 respondents respectively.

MOSL has to give high importance to the “Revenue sharing ratio” followed by the other

criteria like Research Analysis and Growth Opportunity for acquiring the franchisee and for

future business expansion.


64

13) What kind of research analysis is provided by your broker?

INTERPRETATION

The majority of the respondent is in the daily email through. The least one is the daily &

weekly physical reports.

It helps to know the current situation and how to boost up the business.

Daily Weekly Monthly Quarterly Annually

0 0 7 5

21

89

13 4 0 0

15 24

11 0 0

Providing research reports

Physical Email Uploaded on Website

TIME Physical Email Uploaded on Website

Daily 0 89 15

Weekly 0 13 24

Monthly 7 4 11

Quarterly 5 0 0

Annually 21 0 0


65

14) Have ever change your sub-brokership in the past ?

ANSWER RESPONDENT %

Yes 19 12.67

No 131 87.33

TOTAL 150 100

INTERPRETATION

Out of the 150 respondents, the majority is NO.

Almost 87 % were not changing their broking business into the past.

The remaining 13 % have changed their sub – brokership into the past.

Yes

13%

No

87%

Changing of sub-brokership in the past


66

15) What is your initial investment for starting your business?

INITIAL INVESTMENT NO.RESPONDENT %

Less than 100,000 20 13.33

100,000 to 300,000 73 48.67

300,000 to 500,000 34 22.67

More than 500,000 23 15.33

TOTAL 150 100

INTERPRETATION

Out of 150 respondents, the most of the respondents are invest Rs. 100,000 to 300,000 as

initial investment. The Percentage is 49%

The least one is into the less than 100,000. The percentage is almost 13 %

0

20

40

60

80

100

120

140

Less than100,000

100,000 to300,000

300,000 to500,000

More than500,000

20

73

34 23

13%

49%

23%

15%

Initial investment


67

16) Please rate your satisfaction level with the services provided by your

present broker…

INTERPRETATION

From the above information, it is stated that the most of the respondent of 110 out of 150 feel

the satisfaction level high.

73%

20%

6%

0% 1%

Satisfication level

Verry satisfied

Satisfied

Neutral

Not satisfied

Not at all satisfied

Satisfactory level No. of respondent % Very satisfied 110 73.33

Satisfied 30 20

Neutral 9 6

Not satisfied 0 0

Not at all satisfied 1 0.67

TOTAL 150 100


68

CHAPTER 4

FINDINGS

&

RECOMMENDATON


69

RECOMMENDATIONS

MOSL have examined that different investors are giving priorities to investment instrument

as per their need. Accordingly, as per the needs of the client, a product can be recommended

to him. Motilal Oswal Financial Services Limited (MOSL) has strength in Top Quality

Research, Internet Trading, Investment Advisory Services, Value Added Back office services

and DP Services. The firm also deals in commodities and mutual funds to add more number

of clients.

Motilal Oswal should increase its promotional activities and it should make aware

people of Ahmedabad city about its product and services.

Motilal Oswal should turn the existing customer to trade or invest in other product,

which they are not aware about, or not investing in them.

Motilal Oswal should organize seminars and presentation of highly experienced

person. It should provide classroom training and literature to those who are eager to

learn about share market. It should distribute documents about product information.

Initial deposit, which quite high, should be reduced up to a considerable level. If not

possible than that should be an easy installment scheme option available.

One of the most important aspect while selecting a Broking firm is „Revenue Sharing

Ratio‟.

In fact many times just because of the above two factors (i.e. Initial deposit &

Revenue Sharing Ratio) a prospect remove the name of MOSL from the list while

choosing a broker.


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FINDINGS

From the study carried out and the analysis of the result obtain from the survey, the following

suggestions and recommendations were made to help the firm improve upon its product.

On the basis of my analysis MOTILAL OSWAL‟S best USP (Unique selling product

is their advice and research report provided to the clients in a weekly and monthly

form.

The time to time services for the clients like Account opening sms, daily research

report after the working hours of share market and before the opening bell of share

market for Sub-Brokers.

The brokerage charges also very reasonable for the clients, MOSL charges only 0.3%

for the intraday and 30% for the delivery base.

Providing technical software free of cost to the sub-broker is one of the main feature

of Motilal Oswal Securities Ltd.

Motilal Oswal Securities Ltd providing an UPPERMOST card to the employees to

motivate them.

Motilal Oswal Securities Ltd has invested 100 crores in just research programme

The nearest competitor of Motilal Oswal Securities Ltd is Kotak Securities Ltd in

terms of the revenue sharing ratio, brokerage, franchise acquisition etc.

Motilal Oswal Securities Ltd having strategy to keep only one franchise in one

territory.


71

STRATEGIC TOOLS

SWOT ANALYSIS OF MOTILAL OSWAL SECURITIES LIMITED


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Strengths:

Large and diverse distribution network

MOSL‟s financial products and services are distributed through a pan-India network. Its

business has grown from a single location to a nationwide network spread across 1568

business locations operated by their business associates or directly by us in 595 cities and

towns.

Strong research and sales teams

MOSL research teams are focused on cash equities, equity Derivatives and commodities. It

has been awarded „Asia Money Polls 2007‟ with 'Best Overall Country Research – Local

Brokerage'

Brand recognition

'Motilal Oswal' is a well-established brand among retail and institutional investors in India.

MOSL have been able to leverage its brand awareness to grow its businesses, build

relationships and attract and retain talented individuals.

Weakness:-

Very less exposure towards the retail business.

Most revenue generation from the franchisee business only.

No Establishment as Mutual Fund though have a strong research base.


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Opportunities:-

Growing Financial Services industry‟s share of wallet for disposable income.

Huge market opportunity for wealth management service providers as Indian

wealth management business transforming from mere wealth safeguarding to

growing wealth.

Regulatory reforms would aid greater participation by all class of investors.

Leveraging technology to enable best practices and processes.

Increased appetite of Indian corporate for growth capital.

Threats:-

Execution risk.

Slowdown in global liquidity flows.

Increased intensity of competition from local and global players.

Unfavorable economic conditions


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BCG Matrix of MOSL products

1. Stars = (high growth, high market share):

Use large amounts of cash and are leaders in the business so they should also generate

large amounts of cash.

Frequently roughly in balance on net cash flow. However if needed any attempt

should be made to hold share, because the rewards will be a cash cow if market share

is kept.

In the MOSL PMS, Investment banking & Private equity all are falling under the star.

Because they create high growth and high market share with more and more revenue.

PMS

Investment Banking

Private Equity

MF

AMC

Online Broking

Offline Broking

Insurance

Gro

wth

Ra

te

H

L

H L

Market Share


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2. Cash Cows = (low growth, high market share):

Profits and cash generation should be high, and because of the low growth,

investments needed should be low. Keep profits high

Foundation of a company

MOSL‟s offline broking falls under the cash cow covering high market share and low

growth.

3. Dogs =(low growth, low market share):

Avoid and minimize the number of insurance company.

Beware of expensive „turn around plans‟.

Deliver cash, otherwise liquidate

Insurance fall under the dog so, MOSL expands the product otherwise liquidate the

insurance.

4. Question Marks (= high growth, low market share):

Have the worst cash characteristics of all, because high demands and low returns due

to low market share

If nothing is done to change the market share, question marks will simply

Absorb great amounts of cash and later, as the growth stops, a dog.

Either invests heavily or sells off or invests nothing and generates whatever cash it

can. Increase market share or deliver cash

MOSL MF, AMC, Online broking fall under the Question Mark category.


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Porter’s Five Force Model

Porter's five forces analysis is a framework for the industry analysis and business

strategy development developed by Michael E. Porter of Harvard Business School in

1979. It uses concepts developed in Industrial Organization (IO) economics to derive

five forces which determine the competitive intensity and therefore attractiveness of a

market. Attractiveness in this context refers to the overall industry profitability. An

"unattractive" industry is one where the combination of forces acts to drive down

overall profitability. A very unattractive industry would be one approaching "pure

competition".

Porter refers to those forces close to a company that affect its ability to serve its

customers and make a profit. A change in any of the forces normally requires a

company to re-assess the marketplace. The overall industry attractiveness does not

imply that every firm in the industry will return the same profitability. Firms are able

to apply their core competences, business model or network to achieve a profit above

the industry average.


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Bargaining power of Buyers:

It is also described as the market of outputs. The ability of customers to put the

firm under pressure and it also affects the customer's sensitivity to price changes.

There are various types of investors who trade through stock broking houses like

MOSL, which includes investors like small investors, medium net worth

investors, business partners, institutional investors and mutual fund companies.

Here the bargaining power of stock broking houses depends on how big the

investor is. So here MOSL can say that bargaining power of stock broking houses

is high in case of small investors.

While the bargaining power is moderate in case of HNI (High New Worth

Investors)/ MNI‟s (Medium Net Worth Investors) and business partners.

But the in case of mutual fund companies and institutional investors bargaining

power is less.

There is competitive buzz in stock broking industry; competitors are offering low

brokerage and best services with added feature and switching cost is pretty much

less. So the bargaining power is more inclined towards the investors and they can

easily switch over to competitors product.


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The Intensity of Competitive Rivalry:

For most industries, this is the major determinant of the competitiveness of the

industry. Sometimes rivals compete aggressively and sometimes rivals compete in

non-price dimensions such as innovation, marketing, etc

The company is facing the competition from local as well as national level players.

The local players provide facility for off-line trading while the national players like

ICICIdirect.com and Kotakstreet.com, HDFC Security provide online trading

services.

There are also other big names like Indiabulls, Angel broking, Sharekhan, Marwadi

etc. encircles the company form both the sides by providing online and off-line

trading with competitive services.

As in broking and typically financial industry product innovation is not the major

determinant of competition as product can be easily imitate by other players the price

factor plays a major role in this industry.

Threat from Potential Entrants:

Profitable markets that yield high returns will attract new firms. This results in many

new entrants, which will effectively decrease profitability. Unless the entry of new

firms can be blocked by incumbents, the profit rate will fall towards a competitive

level (perfect competition).

Nationalized banks are also thinking to enter in this field by tying up with broking

houses. E.g. Bank Of Baroda.

The entry barriers to this industry are huge capital, Technological awareness,

regulatory constraints, Experience curve required, Network connectivity and Expected

Retaliation.


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Threat from Substitutes:

The existence of close substitute products increases the propensity of customers to

switch to alternatives in response to price increases (high elasticity of demand).

The instruments like Bank FD, post office etc. are major competitors for this

broking house and their products.

The companies and banks which are having these instruments can plunge into this

industry.


80

CHAPTER 3

CONCLUSION


81

CONCLUSIONS

Even though MOSL has less number of franchisees in Ahmedabad, it is considered a well-

reputed broking firm in the market. It has established itself as one of the leading brokerage

firm of India.

Motilal has the opportunity to focus on the products which are less popular products

like Private equity. Investment Banking too is lacking behind, this provides MOSL

potentials for acquiring more and more business.

When asked about support services 40% of respondents wants centralized advisory &

research reports support, 20% of respondents need easy access to centralize customer

service and 266% office look & feel, as primary requirements.

Equity with 26% & IPO 16% with & Commodity with 15% are the major trading

offering & contribute highly to gross brokerage

MOSL has to focus on the prospects from view point of services they are been

rendered by their present broker. This strategy will increase the market potential for

their business expansion.

MOSL has to focus on the prospects who are not satisfied with the services like

Business Development Software, Online mutual fund Platform, Different trading

software, MF research desk, Account opening within 24 hours etc.

MOSL has all the varied departments it will be easy for them to focus on the

competitors sub broker, prospects for business expansion.

MOSL to know the requirement and support required by the sub-brokers for their

business development, which in other hand will be very helpful for future

correspondence with their prospects.


82

CHAPTER 5

REFERENCE


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BIBLIOGRAPHY

BOOKS:

D.R.COOPER and P.S Schindler, (2006). “Business Research Methods”, Tata

McGraw-Hill, New Delhi.

Kothari C.R, Research Methodology (2001) “Tata McGraw-Hill, New Delhi.

Ken Black, “Business Statistics”(2004) 4th

Edition, John Wiley & sons (Asia) Pte.

Ltd.

Newspapers:-

The Economic Times

Mint

The Business Standard

Websites:-

http://www.motilal.com/knowledge_center

http://www.nseindia

http://www.monycontrol.com

www.angelbroking.com

www.icicidirect.com

www.kotaksecurities.com

www.religaresecurities.com

www.shahinvestments.com

www.wikipedia.com

http://www.motilal.com/knowledge_center

http://www.nseindia/

http://www.monycontrol.com/

http://www.angelbroking.com/

http://www.icicidirect.com/

http://www.kotaksecurities.com/

http://www.religaresecurities.com/

http://www.shahinvestments.com/


84

CHAPTER 6

ANNEXURE


85

ANNEXURE

AN STYDY OF SATISFACTION LEVEL OF EQUITY SUB-BROKER

QUESTIONNAIRE

Disclaimer :-

I am an MBA student and as a part of our curriculum, we are here to analysis of sub-brokers and

financial products & services provided to sub-brokers by main brokers in Ahmedabad. We ensure

you that the data given by you would be totally confidential and will be used for project purpose

only. So kindly help us by giving your valuable time for filling this questionnaire.

Q-1 From how many years you are into the broking business ?specify ___________

< 5 years [ ], 6-10 years [ ], 11-15 years [ ], > 15 years [ ]

Q-2 Which are the products and services are provided to you by your broker/company ?

□ Equity [ ] □ Currency [ ]

□ Commodity [ ] □ Mutual fund [ ]

□ Insurance [ ] □ Margin funding [ ]

□ IPO [ ] □ Any other [ ]

□ PMS [ ]


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Q-3 Which of the following services/facilities are provided to you by your

broker/company?

[Please point out relevant options]

□ Different account opening scheme [ ] □ CDSL-rights [ ]

□ Depository services [ ] □ Investment banking [ ]

□ Different online trading software [ ] □ Branding materials [ ]

□ Investment advices [ ] □ online mutual fund platform [ ]

□ Risk management desk [ ] □ Customer service desk [ ]

□ Account opening within 24 hours [ ] □ HNI desk [ ]

□ Mutual fund research desk [ ]

□ Business Development software [ ]

□SMS configuration to franchisee’s clients[ ]

Q-4 which are your main sources for getting new clients ?

Reference [ ]

Advertisement [ ]

Sales team [ ]

Others [ ]

Q-5 what are the percentage of clients dealing in the followings…?

Cash ________, F/O _________, Commodity ________________

Q-6 what do you think are the qualities that attributed for you to be a successful sub - broker?

o The brand value of the company you are associated with. [ ]

o Higher ratio of successful trading calls generated. [ ]

o A culture of properly researched Ideas coupled with good infrastructure

& client servicing. [ ]

o All the above [ ]

o Other please specify... [ ]

__________________________________________________________


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Q-7 What are the factors according to you for having a satisfied client?

o Prompt & timely addressing of client queries [ ]

o Best technology in place [ ]

o Thinking ahead of time [ ]

o 1st and 2nd one [ ]

o 2nd and 3rd [ ]

o 1st and 3rd [ ]

o All the above [ ]

o Any others…. [ ]

___________________________________________________________

Q-8 What are the immediate challenges for this industry & your plan to tackle this?

o Lack of interest in the stock markets in the retail category [ ]

o Source for fresh capital drying up from both domestic & foreign

Investors [ ]

o Cut costs & wait for good times to come [ ]

o All of the above [ ]

o Any other , ___________________________________________[ ]

Q-9 Please rate the importance of following development criteria for your

business. (Circle the one that is most suitable to your preference. Consider 5 as

most preferred and 1 as the least preferred)

Client Acquisition 1 2 3 4 5

Client base 1 2 3 4 5

Active Ratio 1 2 3 4 5

Client satisfaction 1 2 3 4 5

Revenue Growth 1 2 3 4 5


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Q-10 Please rank the following business development support as per their importance

in your business. (Rank from 1 as most imp. to 8 as least imp.)

Q-11 What kind of support you require which will lead to next level.

(Please give rating from 1 to 4; first priority will be ranked 1 and so on)

o Marketing and business development support [ ]

o Brand value of broker [ ]

o Successful calls given by broker [ ]

o Back office/customer care support [ ]

Q-12 Please rate the importance of following criteria while selecting a broker for

Franchisee…

(Circle the one that is most suitable to your preference. Consider 5 as most preferred

and 1 as the least preferred)

Growth Opportunities 1 2 3 4 5

Revenue Sharing ratio 1 2 3 4 5

Brand Name 1 2 3 4 5

Business Model 1 2 3 4 5

Research Analysis 1 2 3 4 5

Products & services 1 2 3 4 5

Initial Deposit 1 2 3 4 5

Business Development Support Rank Business Development Support Rank

Centralized Advisory & Research Support Centralized customer services

Local area Marketing & Business Support Office look & feel

Initial Training & Business migration Seminar & Investor Meet

Easy access to senior management B-Plan Preparation& other support


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Q-13 What kind of research analysis is provided by your broker?

□ Daily □ Weekly □ Monthly □ Quarterly □ Annually

In which form is it provided?

□ Physical □ Email □ Uploaded on Website

Q-14 Have ever change your sub-brokership in the past ?

Yes [ ], _____________________________________

No [ ],

Q-15 What is your initial investment for starting your business?

Less than 100,000 [ ]

100,000 to 300,000 [ ]

300,000 to 500,000 [ ]

More than 500,000 [ ]

Q-16 Please rate your satisfaction level with the services provided by your present

broker…

High 1 2 3 4 5 Low


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Name :- ____________________________________________________________

Address :- __________________________________________________________

___________________________________________________________________

___________________________________________________________________

Contact no :-________________________________________________________

E-mail Id :- _________________________________________________________

Company name :-_________________________________________________

Personal Details

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