kamal tetri

Report of Summer Training Conducted at SHAREKHAN Ltd.

Comparative analysis of Sharekhan ltd. with other Stock Broking Firms

Submitted in partial fulfillment of the requirements for the award of the degree of

Master of Business Administration (International Business)

To

Guru Gobind Singh Indraprastha University, Delhi

Guide Name: Submitted by: Ms Anamika Sharma Student Name: Kamal Tetri (Assistant professor) GIBS Roll No: 02819114314

Gitarattan International Business School New Delhi 110085

Batch 2014-16

i

Certificate

I, Mr. Kamal Tetri, Roll No. 02819114314 certify that the Summer Training Report (Paper

Code MIB201 entitled Comparative analysis of Sharekhan ltd. with other Stock Broking Firms is done by me and it is an authentic work carried out by me at Sharekhan limited. The matter embodied in this Report has not been submitted earlier for the award of any degree

or diploma to the best of my knowledge and belief.

Signature of the Student

Date:

Certified that the Summer Training Report (Paper Code MIB-201) entitled Comparative analysis of Sharekhan ltd. with other Stock Broking Firms done by Mr. Kamal Tetri, Roll No. 02819114314, is completed under my guidance.

Signature of the Guide

Date:

Name of the Guide: Ms Anamika Sharma

Designation: Assistant professor

Countersigned

Director/Project Coordinator

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Acknowledgement

The satisfaction of the successful completion of any task wouldnt be complete without the expression of gratitude to the people who made it possible.

I express my gratitude to Mr. Amit Garg (Assistant Manager) Sharekhan ltd. who spared his

most valuable time and provided with all the necessary details regarding the company.

I am very thankful to Ms Anamika Sharma (Assistant professor), Faculty of GITARATTAN

INTERNATIONAL BUSINESS SCHOOL, for the guidance and interest evinced throughout the

preparation of this project.

My thanks and appreciation also goes to Mr. Baljeet Singh Hothi (Academic Co-ordinator) of

GITARATTAN INTERNATIONAL BUSINESS SCHOOL.

I also extend my heartfelt gratitude and thanks to Dr. S. Chaturvedi (Director) of

GITARATTAN INTERNATIONAL BUSINESS SCHOOL.

I also extend my gratitude to the respondents of my survey for their kind co-operation.

Finally I wish to extend my sincere acknowledgement to my parents for their moral and financial

support.

Name: Kamal Tetri

Enrolment No: 02819114314

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CONTENTS

S No Topic Page No

1 Title Page

2 Certificate (s) I

3 Acknowledgements ii

4 List of Tables iv

5 List of Figures v

6 List of Abbreviations vi

7 Executive Summary 1

8 Chapter-1: Profile of the Firm/Company 2

9 Chapter-2: SWOT Analysis of the Company 10

10 Chapter-3: Data Presentation & Analysis 17

11 Chapter-4: Summary & Conclusions 41

12 References/Bibliography 44

13 Appendices 45

iv

LIST OF TABLES

Table No

Title Page No

1 Profile of the company 3

2 Stock Broker Charges 19

3 Brokerage Charges 20

4 Services offered by Sharekhan 23

5 Awareness of share market 31

6 Investment preferences 32

7 De-mat & Trading account 33

8 Reason behind trading with the present company 34

9 Company preferred by customers 35

10 firm preferred as a first time investor 39

11 Customers switching over to sharekhan 40

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LIST OF FIGURES

Figure No

Title Page No

1 Porters Five Force Model of Competition 11

2 Product Mix 19

3 Buying and Selling Process 27

4 Awareness of share market 31

5 Investment preferences 32

6 De-mat & Trading account 33

7 Reason behind trading with the present company 34

8 Brokerage Structure 35

9 Quality Research report 36

10 Brand Name 36

11 Software 37

12 AMC plan 38

13 Customer Service 38

14 firm preferred as a first time investor 39

15 Customers switching over to sharekhan 40

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LIST OF ABBREVIATIONS

S No Abbreviated Name Full Name

1 BSE Bombay Stock Exchange

2 NSE National Stock Exchange

3 De-mat Dematerialized Account

4 DP Depository Participant

5 MCX Multi-Commodity Exchange

6 NSDL National Securities Depository Limited

7 AMC Annual Maintenance Charges

8 F&O Futures and Options

9 IPO Initial Public Offering

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Executive Summary

Sharekhan is one of the leading retail brokerage firms in the country. It is the retail broking arm

of the Mumbai-based SSKI [S.S Kantilal Ishwarnath Limited].It has one of the largest networks

in the country with 1800+ share shops in 550 cities. Sharekhan provides services like Portfolio

management, trade execution in equities, derivatives and commodities.

Sharekhan Ltd. is a brokerage firm which is established on 8th February 2000 and now it is

having all the rights of SSKI. The company was awarded the 2005 Most Preferred Stock Broking

Brand by Awaaz Consumer Vote. It is first brokerage Company to go online. The Company's

online trading and investment site www.sharekhan.com was also launched on Feb 8, 2000.

Chapter 1 includes the profile of Sharekhan ltd. along with its address, vision and mission. The

product range, size of the company, companys organizational structure and source of data collection had also been discussed.

Chapter 2 includes SWOT analysis of the company and also Porters Five forces Model to analyse the level of competition faced by the company.

Chapter 3 includes data collection, presentation and analysis. Firstly, the primary data is

collected through questionnaire. The collected data is also represented in tabular and graphical

form for easier understanding and interpretations. It also includes functional analysis of different

functional areas that have been done through theoretical concepts.

Chapter 4 includes findings and conclusions of the project. The analysis is divided into 2 sub

categories i.e. finding /results and suggestions. This includes the learning, result out of practical

experience gained and suggestions that can be considered related.

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Chapter 1

Profile of the Company

1.1 Introduction

Sharekhan is one of the leading retail broking House of SSKI Group which was running

successfully since 1922 in the country. It is the retail broking arm of the Mumbai-based SSKI

Group, which has over eight decades of experience in the stock broking business. Sharekhan was

established by Morakhia family in 1999-2000 and Morakhia family, continues to remain the

largest shareholder. It is the retail broking arm of the Mumbai-based SSKI [Shripal Shewantilal

Kantilal Ishwarnath Limited] Group.

Sharekhan Ltd. is a brokerage firm which is established on 8th February 2000 and now it is

having all the rights of SSKI. The company was awarded the 2005 Most Preferred Stock Broking

Brand by Awaaz Consumer Vote. It is first brokerage Company to go online. The Company's

online trading and investment site www.sharekhan.com was also launched on Feb 8, 2000. This

site gives access to superior content and transaction facility to retail customers across the

country. Known for its jargon-free, investor friendly language and high quality research, the

content-rich and research oriented portal has stood out among its contemporaries because of its

steadfast dedication to offering customers best-of-breed technology and superior market

information

Share khan is a market leader in providing broking services and has a top turnover in trading and

the high turnover makes it the no. 1 in the market. The main difference is the services that they

provide to the investors who really need it. the services are discussed in more detail in the

marketing activities. The clients are managed with a friendly corporate culture to give him more

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benefited investment ideas and motivate him whenever he needs. The company is providing as

many tips to the clients for more and more trading ideas and the manager helps each client to

concentrate on a few scripts so that he can manage the profit/lose.

To sum up, Sharekhan brings to you a user- friendly online trading facility, coupled with a

wealth of content that will help you stalk the right shares.

Name of the company Sharekhan ltd.

Owner Shripal Morakhia

Year of Establishment 2000

Headquarter

ShareKhan SSKI A-206 Phoenix House Phoenix Mills Compound Lower Parel

Mumbai - Maharashtra, India- 400013

Website www.sharekhan.com

Phone 022-66621111, 1-800-22-7500

Email [email protected]

Tagline Your Guide to The Financial Jungle

Table No 1: Profile of the company

1.11 Regional Offices

Branch Manager

Bangalore-jayanagar Mr. Channaraj k.j.

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Bangalore-gandhinagar Mr. Basappa d.m.

New delhi Mr. Hemendra Agarwal

Kochi Mr. Dinsena Kallidil

Chennai Mr. V.Krishnamurthy

Coimbatore Mr. V.Mohankrishnan

1.2 Nature of the Business

Sharekhan offers its customers a wide range of equity related services including trade execution

on BSE, NSE, Derivatives, depository services, online trading, investment advisory, Mutual

Fund Advisory etc. With their research expertise, customer commitment and superior

technology, they provide investors with end-to-end solutions in investments. Sharekhan facilitate

purchase and sale of securities of companies and the securities or bonds issued by the

government in the course of its borrowing operation. They provide trade execution services

through multiple channels - an Internet platform, telephone and retail outlets.

1.3 Companys vision & mission 1.31 Vision

To be the best retail brokering Brand in the retail business of stock market 1.32 Mission

To educate and empower the individual investor to make better investment decisions through quality advice and superior service

1.4 Product range of the company

1.41 Demat account

Dematerialization is the process of converting physical shares (share certificates) into an

electronic form. Shares once converted into dematerialized form are held in a De-mat account.

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Sharekhan is a depository participant. This means that we can keep the shares in dematerialized

form in Sharekhan. But for this one has to purchases the Demat account in Sharekhan.

1.42 Trading account

A trading account works as an intermediary between the savings account and Demat account.

When you want to buy shares, first the money is transferred from your savings account to trading

account. After that required amount of shares are purchased and finally shares are stored in

electronic form in the Demat account. It works just in opposite way during the time of selling

shares.

1.43 Classic account

This account allows the client to trade through the website www.sharekhan.com and is suitable

for the retail investor who is risk-averse and hence prefers to invest in stocks or who do not trade

too frequently. It allows investor to buy and sell stocks online along with the following features

like multiple watch lists, Integrated Banking, De-mat and Digital contracts, Real-time portfolio

tracking with price alerts and Instant money transfer.

1.44 Trade Tiger

Trade tiger is an internet-based software application which is the combination of equity

&commodities that enables you to buy and sell share and well as commodities item instantly. It

is ideal for every client of sharekhan ltd.

1.45 Dial & Trade

Along with enabling access for your trade online, the classic and trade tiger account also gives

you our Dial-n-trade services. With this service, all you have to do is dial their dedicated phone

lines which are 1800-22-7500, 3970-7500.

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1.46 Fundamental Research

Research and in-depth knowledge of markets provide better analysis than speculations or

reacting to rumors. Sharekhan research team of dedicated analysis is therefore, constantly at

work to track performance and trends and determine the winners.

1.47 Relationship Manager

Sharekhan provides personal relationship manager to its customer. The work of relationship

manager in Sharekhan ltd is to punch in trades for clients, communicate intra-day trading calls

and investment ideas to customers, monitoring day to day operations at branch etc

1.5 Size of the Organization Over 3500 employees are working in Sharekhan all over India in 1800 offices which includes

branches & franchises in over 550 cities across India. As of Dec 2014, Sharekhan has over 13

lakh customers and has annual turnover more than Rs400 crores

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1.6 Organizational Structure

AREA SALES MANAGER

CEO

DIRECTORS

VICE PRESIDENT

REGIONAL HEAD

SALES SIDE DEALING SIDE

REGIONAL SALES MANAGER

TERRITORY MANAGER

CLUSTER HEAD

DEPUTY MANAGER

BRANCH MANAGER

ASSISTANT SALES MANAGER

ASSISTANT BRANCH MANAGER

SENIOR SALES EXECUTIVES

SENIOR RELATIONSHIP MANAGER

SALES EXECUTIVES

RELATIONSHIP MANAGER

SUPER TRAINEES

DEALER

TRAINEES

JUNIOR DEALER

BUSINESS DEVELOPMENT EXECUTIVES

EQUITY ADVISOR

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1.7 Market share & position of the company in the industry. Incorporated in February 2000, Sharekhan is India's 3rd largest stock broker (after ICICI Direct

and HDFC Securities). Sharekhan provides brokerage services through its online trading website

Sharekhan.com and 1800 offices which includes branches & franchises in over 550 cities across

India. Sharekhan has seen incredible growth over last 10+ years though it's very successful

online trading platform and the chain of franchises located in almost every part of India.

Sharekhan also has international presence in the UAE and Oman.

Sharekhan offers its services to all kinds of customers including individual investors and traders,

corporate, institutional and NRI's. As of Dec 2014, Sharekhan has over 13 lakh customers.

1.8 People with whom I have interacted during the summer training.

Name Designation

Mr. Raman Goel Territory manager

Mr. Amit Garg Assistant manager

Mr. Amit Gupta Assistant manager

Mr. Rajesh Antil Assistant manager

Mr. Sumit Goel Assistant manager

1.9 Source of data collection

1.91 Primary data

Primary data is data, which is collected by the researcher themselves. This kind of data is new,

original research information. A primary source reflects the individual viewpoint of a participant

or observer. Trainee used:

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a) Questionnaires

1.92 Secondary data

Secondary research is using information that has already been produced by other people. A

secondary source is used by a person usually not present at the event and relying on primary

source documents for information. Trainee used:

a) Internet

b) Books

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Chapter 2

SWOT Analysis A study undertaken by an organization to identify its internal strengths and weaknesses, as well

as its external opportunities and threats.

Helpful Harmful

Internal origin

External origin

The SWOT Analysis of internal as well as external environment provides a clear picture of what

strength & weakness are possessed by the company, what are the various opportunities and

threats available to be grabbed.

2.1 Porter Five Forces Model

Porter five forces analysis is the framework for industry analysis and business strategy. Porter

five forces analysis is a framework to analyze level of competition within an industry and

business strategy development. It draws upon industrial organization (IO) economics to derive

five forces that 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 in which the combination of these five forces acts to drive down overall

Strength Weakness

Opportunity threats

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profitability. A very unattractive industry would be one approaching "pure competition", in

which available profits for all firms are driven to normal profit. This analysis is associated with

its principal innovator Michael E. Porter of Harvard University

Figure No 1: Porters Five Force Model of Competition

Potential Entrants

(a) Threat of New Entrants Competition Capital Requirement

Competition in the industry

(a)Number of firms & Relative market share.

(b)State of growth of industry (c)Diverse Competitors

Buyer Power

(a)Number of Buyer relative to sellers.

(b)Buyer switching (c)Product Differentiation

Supplier Power

(a) Bargaining power (b) Switching Cost

Threat of Substitute Products

(a)Low risk product

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2.11 Competition in the industry

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

provide facility for offline trading while the national players like ICICI direct, Kotak Securities

and HDFC Securities provide online trading services

There are also other big names like Indiabulls, Motilal Oswal and 5 paisa encircles the company

from both the sides by providing online and offline trading with competitive services.

2.12 Potential of new entrants

The market for Non Banking Financial Companies or rather broking houses are flourishing. This

new trend poses for new threats also; this may be either the entry of local players who can

provide lower rates or a very big player who can enter into a price war. Threat of new entry is

high when:

a) Capital requirements to start the business are less

b) Few economies of scale are in place

c) Customers can easily switch (low switching cost)

d) Your key technology is not hard to acquire or isnt protected well

e) Your product is not differentiated

2.13 Power of suppliers

Sharekhan has very high profile corporate suppliers, who for obvious reasons have great

bargaining power and offers from competitors also. The operations largely depend on these

supplies. Bargaining Power of supplier means how strong is the position of a seller. Suppliers are

more powerful when:

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a) Suppliers are concentrated and well organized

b) Few substitutes available to suppliers

c) Their product is most effective or unique

d) Switching cost, from one suppliers to another, is high

e) You are not an important customer to Supplier

2.14 Power of customers

Customer is the king of the market. They have a lot of options while planning to purchase

products. Products offered by Master trust are unsought in nature and are industry dependent.

The threats which lies here are:

a) Too many goods chasing too few consumers.

b) Buyer purchases in bulk quantities and are mostly corporate clients.

c) Product is not much differentiated.

d) Buyers cost of switching to a competitors product is low.

e) Shopping cost is low.

f) Credible Threat of integration.

2.15 Threat of substitutes

Master Trust poses great threat of substitutes like people of low risk appetite would like to invest

in bank rather than in share market, real estate, commodities, etc. Its products can very well be

substituted by substitutes offered by competitors

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2.2 An overview of the four factors (Strengths, Weaknesses, Opportunities and Threats)

2.21 Strengths - Strengths are the qualities that enable us to accomplish the organizations mission. These are the basis on which continued success can be made and sustained. Strengths

can be either tangible or intangible. Strengths are the beneficial aspects of the organization or the

capabilities of an organization, which includes human competencies, process capabilities,

financial resources, products and services, customer goodwill and brand loyalty. Examples of

organizational strengths are huge financial resources, broad product line, no debt, committed

employees, etc.

a) Well-maintained infrastructure.

b) Dedicated, Intelligent and Loyal staff.

c) Big client base of over 1 million customers.

d) On-line as well as offline Trading products.

e) Dedicated research teams for fundamental and technical research, which constantly track the

pulse of the market.

f) The best investment advice correct up to 70-90% through dedicated research and reports.

g) Wide product range to enable the clients to choose the best alternative.

h) A positive image in the mind of existing clients.

i) SSKI has more than eight decades of trust and credibility in the Indian stock market.

2.22 Weaknesses - Weaknesses are the qualities that prevent us from accomplishing our mission

and achieving our full potential. These weaknesses deteriorate influences on the organizational

success and growth. Weaknesses are the factors which do not meet the standards we feel they

should meet. Weaknesses in an organization may be depreciating machinery, insufficient

research and development facilities, narrow product range, poor decision-making, etc.

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Weaknesses are controllable. They must be minimized and eliminated. For instance - to

overcome obsolete machinery, new machinery can be purchased. Other examples of

organizational weaknesses are huge debts, high employee turnover, complex decision making

process, narrow product range, large wastage of raw materials, etc.

a) Time consuming process for account opening, resolving the problems of the customers, etc.

b) Service quality is not maintained accordingly how they are promoted.

c) Lesser emphasis on customer retention.

d) Higher brokerage charges.

e) Focuses more on HNIs than retail investors which results in meager market-share as

compared to close competitors.

2.23 Opportunities - Opportunities are presented by the environment within which our

organization operates. These arise when an organization can take benefit of conditions in its

environment to plan and execute strategies that enable it to become more profitable.

Organizations can gain competitive advantage by making use of opportunities.

a) Open interest of the people to enter in stock market for investing.

b) Awareness campaigns about online trading create new market.

c) Bullish phase of the market attracts investing public.

d) Large potential market for delivery and intra-day transactions.

e) Attract the customers who are dissatisfied with other brokers & DPs.

f) An indirect opportunity generated by the market from its bullishness.

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2.24 Threats - Threats arise when conditions in external environment jeopardize the reliability

and profitability of the organizations business. They compound the vulnerability when they relate to the weaknesses. Threats are uncontrollable. When a threat comes, the stability and

survival can be at stake. Examples of threats are - unrest among employees; ever changing

technology; increasing competition leading to excess capacity, price wars and reducing industry

profits; etc.

a) Decreasing rates of brokerage in the market.

b) Increasing competition against other brokers & DPs.

c) Aggressive promotional strategies by close competitors like Religare, Angel Broking and

India bulls.

d) A threat of losing clients for any kind of weakness of the company.

e) Indirect threat from instable stock market, i.e., low/no profit of Sharekhans clients would lead them to go for other broker/DP.

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Chapter 3

Data Presentation & Analysis

A. Data Collection

3.1 Marketing

The main aim or marketing activities at Sharekhan is that the customer should get enough

guidance to join the company and how he can get the best service than any other stockbroker.

There is an officer for handling the marketing activities followed by two executives and it is not

limited to them but the other people are also having some responsibilities to increase the no. of

clients and retain them by providing them the services needed by them.

There are many services those are designed such that the specific target segments of the

customers are covered and the products are positioned in the minds of customers as the best one

in India. The services are as given below:

Sharekhan is Indias leading national network of stock-broking outlets. It is having the largest retail distribution chain in India. Sharekhan is not only a share-broking firm, but it avails of

various services and other financial products to its clients.

a) Offline Trading facility

b) Online BSE and NSE executions (through BOLT, i.e. BSE Online Trading and NEAT, i.e.

National Exchange Automated Trading)

c) Free access to investment advice from Sharekhans Research team. d) Depository services: Demat and Remat transactions (Sharekhan is registered with NSDL,

i.e. National Securities Depository Ltd., as a Depository Participant)

e) Derivatives trading, i.e. Futures and Options (through NEAT F&O)

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f) Internet based online trading.

g) Other investment products: Mutual Funds, RBI Bonds, Insurance, etc

3.11 Marketing Mix

The marketing mix of Sharekhan is an excellent example we have seen in the industry because

no other stock brokering organization has such products to target the investors of different

minds, incomes and aims. There is an objective of satisfying the customer as to make him

delighted with affordable prices and convenient services. The four Ps of the marketing mix is the

best at Sharekhan in India because the total no. of share shops are widespread all over to have the

maximum contacts and awareness about Sharekhan, and we can say that it has achieved that

because it is having the maximum turnover than any other broker in India.

The marketing is done based on leads generated through the web contact, tele-contact and

personal contact with the customer and is a planned procedure to find out new customers. The

marketing management is carried out in an excellent way at Sharekhan.

3.12 Service (Product)

Service is an act or performance that one party offers to another for sell and it is not a physical

product that you can touch but it is that one can feel. It is not likely to result into the ownership

of anything. A service can be a fully service or a mixture of service and physical product.

The trading products of Sharekhan are such a mixture of services like DP service (managing the

demat account), providing reports for investment advice etc. and thus we can define its service

mix as a hybrid product mix of different physical products with accompanying services.

Therefore, the two types of accounts offered by Sharekhan i.e., Offline and Online are the two

main product lines in the product mix of the company. The offline a/c with Sharekhan is defined

as the account having which you can trade anywhere in the share shop of Sharekhan and the

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online a/c is that you can trade on your PC through the software provided by Sharekhan and it

also offers tele-trading in both the cases but the major difference is of the service and prices for

opening an account. The product mix is as shown below:

Sharekhan

Figure No 2: Product Mix

The product mix is showing the products offered by Sharekhan to its customers and it is one type

of a tree structure diagram that shows the products of a company.

The products are actually services and are at the completion of the second stage of Product-Life-

Cycle, i.e., Growth and are entering into maturity stage. So there should be some changes in the

marketing strategies of the company.

3.13 Price

Prices for the trading products are as given below:

Stock Broker Charges

Trading Account opening fees Rs.750

Trading Account AMC Free

Demat Account opening fees Free

Demat Account AMC Rs.400

Table No.2: Stock Broker Charges

Offline Account

Classic Account

Trade Tiger

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Brokerage charges

Equity Intraday Brokerage 0.10%

Equity Delivery Brokerage 0.50%

Equity Futures Brokerage 0.1.%

Equity Options Brokerage Rs 100/- per lot or 2.5% on premium (whichever is higher)

Commodity Trading Brokerage 0.10%

Table No 3: Brokerage Charges

3.14 Promotion

Promotional activities at Sharekhan are done by web, e-mails and personal contact. Sharekhan is

also organizing seminars and presentations and promotes its services to the clients. It is spending

Rs.20000 per month for promotional activities.

As explained earlier, Sharekhan is having the largest distribution chain of retail outlets of share

shops. And it can be seen also because there are 1800 share shops in 500 cities, which gives the

maximum awareness to Sharekhan. The distribution of Sharekhan is also proved by its turnover

and awareness among the investors in the stock market.

The marketing strategies followed by Sharekhan at this point are as given below:

The excellent marketing mix i.e., the Product-Price-Place-Promotion and for services additional

3Ps viz. People, Process and Physical evidence, are managed according to the needs of the

customers and try the best to deliver the maximum value to the customers for what they pay a

price.

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The HR and Operations are one of the best at Sharekhan to help the customers for getting the

needs fulfilled with a family culture and atmosphere of harmony, peace and brotherhood and it is

focusing on the specific segments like HNI, Delivery-based and Intra-day traders

3.2 Human Resource Management

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

employees. HRM activities at Sharekhan start form induction to the specific job training and are

done by H/O at Mumbai. H/O takes a written test and selection interview for filling up vacancies

in branches but the recruitment is done by the branch itself and the selection is performed by

H/O from the screened applicants.

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

under HRD and T&D programs makes employees aware about all the activities/jobs within the

department he/she is to be recruited. Suppose if, I would be recruited for finance department then

the finance related employees are known to me with their work profiles, that is, what they really

do?

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

concerned department at H/O on internet because he/she has t solve many conflicts arising in the

investors mind and to have an up-to-date information regarding the procedures and any new facilities or policies to resolve the problems of the clients. It is a must for each employee because

the employee is the people by whom the company gets its customers and retains them.

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

Selection, Career planning and development, Assessment & development of employees for

Performance appraisal, etc. activities of managing the HR at Sharekhan is maintained in a way to

meet the requirements.

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

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

additional Rs.10000 is provided for each outlet of Sharekhan to motivate its employees by

performance appraisal and also the heads of each departments and branches has to go through a

3606 performance appraisal for maintaining the consistency in growth of the company.

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

continuous growth and development of the company for its future plans to be achieved time-to-

time.

3.3 Production and operations

3.31 Inputs

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

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

deposited by the customers) and the most important input, i.e., management functions carried out

at national, regional and branch level in Sharekhan.

3.32 Conversion Process

The main aim of it is to make profit with customer satisfaction. The conversion of inputs works

as the Sharekhan earn brokerage from the customers. The profits are generated from getting a

higher return on the invested amount of money than the amount payable to the customers. The

process is facilitated by a centralized computer system in which the data is stored and recovered

for the whole India and it is having the CPU at the H/O in Mumbai, Sharekhan is regulating the

brokerage rates all over India by keep watch on each transaction done from the branch office.

The data of a customer will be stored in the central computer and all facilities such as bills,

credit/debit reports etc. are provided by that computer to all customers on-line on the internet

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

fluctuations are also handled in the process and lastly the monitoring of the process is done and a

feedback is given to do the adjustments for the process as indicated in the figure given.

3.33 Outputs

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

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

Services Consumer Services

Retail brokering Fundamental and Technical

Research

Financial

advisory Services

Complain resolvance

Corporate Broker Capital markets

advisor Nationwide electronic data transfer

Depository

participant

Others

Table No 4: Services offered by Sharekhan

3.34 Operations Strategy at Sharekhan Operations strategies are implemented in Sharekhan as shown in the chart given above and the

main points of consideration are Efficiency, Dependability, Quality and Flexibility.

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

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

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

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

should be high and consistent in delivering services; Flexibility is related with fast introduction

of new services and providing a wide range to select an option to the customer. This is facilitated

by the process of operations, capacity/ability of the organization, competitive advantages,

vertical integration and the infrastructure created by the firm.

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

to-bottom level, i.e., national level, regional level, divisional level and the branch level planning

is carried out by the managers.

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

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

company with excellence.

3.35 Account opening process

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

to open an account with Sharekhan Ltd.:

a) One need to call them at phone number provided below and asks that he want to open an

account with them. One can call on the Toll Free Number: 1-800-22-7500 to speak to a

Customer Service executive

b) One can visit any one of Sharekhan Limiteds branch. Sharekhan has a huge network all over India. one can also log on to http://www.sharekhan.com/ContactUS/ContactUS.aspx link to find out the nearest branch.

c) One can send them an email at [email protected] to know about their products and

services.

d) One can also visit the site www.sharekhan.com and click on the option Open an Account to fill a small query form which will ask the individual to give details regarding his name,

city he lives in, his email address, phone number, pin code of the city, his nearest Sharekhan

Ltd. shop and his preferences regarding the type of account he wants.

These information are compiled in the headquarter of the company that is in Mumbai from where

it is distributed throughout the countrys branches in the form of leads on the basis of cities and

25

nearest share shops. After that the executives of the respective branches contact the prospective

clients over phone or through email and give them information regarding the various types of

accounts and the documents they need to open an account and then fix appointment with the

prospective clients to give them demonstration and making them undergo the formalities to open

the account. After that the forms that has collected from the clients, is scrutinized in the branch

and then it is sent to Mumbai for further processing where after a few days the clients account are generated and activated. After the accounts are activated, a Welcome Kit is dispatched from

Mumbai to the clients address mentioned in the documents provided by them. As soon as the clients receive the Welcome Kit, which contains the clients Trading ID and Trading Password, they can start trading and investing in shares.

3.36 Documents required to open Trading and Demat Account

Apart from two passport size photographs, one needs to provide with the following documents in

order to open an account with Sharekhan Limited.:

a) Photocopy of the clients PAN Card which should be duly attached b) Photo copy of any of the following documents duly attached which will serve as

correspondence address proof:

i. Passport (valid)

ii. Voters ID Card iii. Ration Card

iv. Driving License (valid)

v. Electricity Bill (should be latest and should be in the name of the client)

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

vii. Flat Maintenance Bill (should be latest and should be in the name of the client)

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

26

ix. Lease or Rent Agreement.

x. Bank Statement (should be latest)

c) Two cheques drawn in favor of Sharekhan Limited, one for the Account Opening Fees and

the other for the Margin Money (the minimum margin money is Rs. 500).

3.4 Finance Department

Like blood is the most important factor in our body, Finance is the blood of any business.

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

The finance department directly influences all the functions of the other departments. Also

finance has to give equal importance to all departments. Finance is that administrative area or set

of administrative function in an organization may have the means to carry out its objective as

satisfactorily as possible. Sharekhan has special accounts department for separate calculation of

pay-in and pay-out of funds according to the clients Proft/Loss. Finance management is done at Sharekhan by managing the stocks in the demat accounts and funds in the margin & trading

accounts

Finance

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

at Sharekhan can be divided into two major parts viz. DP (Depository Participation) and

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

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

covers two major terminologies viz. settlements and the auctions which are a part of managing

DP Accounts

27

demat account. Settlements as defined by SEBI are T+2, currently and it means that the demat

account of the clients are prone to be sufficient for selling a script with no debit at all, i.e., the

account must have the sold amount of stock to fulfill the settlement after 2 days from trade-day.

Generally, the timings are 9:30 and 3:00 as a deadline for the client and he must provide the

stock for giving a delivery to the buyer.The chart shows the total transaction between two clients:

Figure No 3: Buying and Selling Process

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

respective clients and finally the exchanges like SKSE (Saurashtra Kutch Stock Exchange)

becomes the controlling intermediary for the delivery of stocks and this process is done in two

days. Nowadays, as banks are becoming fast for E-Fund Transfer (EFT) and Phone-banking is

getting more popularity, SEBI is thinking to make the financial market of India to have a

maximum speed of transactions just like the other nations in the world and proposing for T+1

settlement scheme but the system is not enough competent for that thing. But soon or later we

will have such a settlement system in India, as said by Mr. J. N. Bajpai, chairman of SEBI. The

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

initiated by the exchanges and the client has to pay for the price prevailing in the market with 4-

5% penalty. The penalty can go on maximum to 20% more than the market price of the sold

stock. Generally, it is known as a buying auction and a same kind of auction is for selling the

stock for which the buyer was proved unable to pay the price is carried out by exchange, known

as the selling auction. And a debit or credit note is provided in the respective case of auction to

the clients, i.e., for buying auction debit note is given on the T+4 basis and in case of selling

C DP(Sharekhan) E DP (anyone) C

28

auction the credit note is given on T+5 basis. There are two types of auctions called as Internal

auctions & Market auctions, the internal auctions are defines as the auctions carried out between

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

carried out in the market.

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

Sharekhan. The accounts are different that is the margin a/c for deposits of the client and trading

a/c for which Profit/Loss are settled. The collection of funds from the clients who had a debit

balance or made a loss are made on the next day of trading and the payments to the profiting

traders are made after two days of trading because the cheques are received from H/O and then

pay-out is done and Pay-in is as explained that amounts to be taken from the clients. In this way,

accounts are managed but in case if the client is unable to pay, the deposit from the margin a/c is

cut down to the payments and in case if a client is having a credit balance in F&O trading though

he had a debit balance in cash-NSE & BSE trading, a JV request is sent to H/O for totaling the

three balances. The main aim for accounts management is that the clients must have a credit or

no debit on the next day.

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

Securities Depository Limited) and CDSL (Central Depository Services Limited), organizations

governed by SEBI to regulate the depository services in the interest of the investors. So, the

financial market in India is governed by Ministry of finance under which two major bodies viz.

SEBI & RBI are covered and under RBI the banks and other financial institutions are covered

while SEBI covers the exchanges, NSDL & CDSL and the whole DP service providers with the

brokers to the investors.

29

In this way we have gained a meaningful knowledge about Indias financial market and its structure from this training at Sharekan. In this way, the finance function is carried out at

Sharekhan by following the guidelines given by SEBI. And the company is a private limited one

with its own policies for disclosing its financial statements

3.5 Information Technology

In the past, investors had no option but to contact their broker to get real time access to market

data. The information technology brings data to the investor online and net broking enables him

to trade on a click. Now information has become easily accessible to both retail as well as big

investors. The development of broking in India can be categorized in 3 phases:

a) Stock brokers offering on their sites features such as live portfolio manager, live quotes,

market research and news to attract more investors.

b) Brokers offering on line broking and relationship management by providing and offering

analysis and information to investors during broking and non-broking hours based on their

profile and needs, that is, customized services.

c) Brokers (now e-brokers) will offer value management or services such as initial public

offerings on line, asset allocation, portfolio management, financial planning, tax planning,

insurance services and enable the investors to take better and well-considered decisions.

In the US, 82 per cent of the deals are done on line. The European on line broking market is

expected to be of $8 billion and is likely to raise fivefold by 2020. In India, presently Internet

trading can take place through the order routing system, which will route client orders to

exchanges trading systems for execution of trades on stock exchanges (NSE and BSE). This will

also require interface with banks to facilitate instant cash debit or credit and the depository

system for debit or credit of securities.

30

3.6 International Business

Sharekhan has international presence through its branches in Dubai, Abu Dhabi & Muscat in

Middle East. All NRIs from UAE can invest in Indian share markets, Mutual funds, Insurance

products and portfolio management services in Indian market. These services are backed by

quality investment advice from an experienced research team which offers investment and

trading ideas based on fundamental and technical research respectively.

B. Data presentation

3.7 Data Sources

The study is mainly based on the data collection from primary sources.

3.8 Sample size

A sample of 30 customers was selected from the target population for the study.

3.9 Objective

Objective of the study is to understand the factors that influence the preferences of the customer.

3.10 Research Methodology

Research design : descriptive in nature.

Data source : data collected from primary sources.

Primary data : primary data is collected from the respondent through

Structured questionnaire.

31

1. Awareness of share market.

Options Number of % of

Respondents Respondents

Partial 56 70%

Complete 16 20%

Nil 8 10%

Table No.5 Awareness of share market

Figure No. 4 Awareness of share market

Interpretation

70% of respondents have partial knowledge about share market where as 20% of respondent

have complete knowledge about share market. So majority of the people who were contacted

have got partial knowledge of share market.

Partial

71%

Complete

19%

Nil

10%

Partial

Complete

Nil

32

2. Sector preferred for investing in share market

Options Number of % of Respondents Respondents

Equity & Cash 25 31%

Derivative 18 22%

Mutual Fund 14 18%

IPO 12 15%

PMS 3 4%

Commodities 8 10%

Table No.6 Investment preferences

Figure No. 5 Investment preferences

Interpretation

Most of the customer prefers investing in Equity and Cash i.e 31% and 22% would like to invest

in derivatives followed by mutual fund (18%). People like to invest more in equity sector rather

than any other sector. This is because of the stability and easy liquidity as well as they seeks to

reap potentially higher gains from the equity market.

Equity & Cash

31%

Derivative

22%

Mutual Fund

18%

IPO

15%

PMS

4%

Commodities

10%

Equity & Cash

Derivative

Mutual Fund

IPO

PMS

Commodities

33

3. Companies in which customers having De-mat & Trading account



Sharekhan 15 19%

Angel Broking 18 22%

India Infoline 12 15%

ICICI Direct 7 9%

Religare 13 16%

HDFC Sec. 9 11%

Others 6 8%

Table No.7 De-mat & Trading account

Figure No. 6 De-mat & Trading account

Interpretation

19% of respondents are the customers of sharekhan and 22% of respondents are trading with

Angel broking followed by 16% and 15% with Religare and India Infoline respectively. These

four companies are having major market share in terms of number of clients. Market share of

HDFC securities and ICICI direct is very less as compared to Sharekhan and Angel broking.

Sharekhan

19%

Angel Broking

22%

India Infoline

15%

ICICI Direct

9%

Religare

16%

HDFC Sec.

11%

Others

8%

Sharekhan

Angel Broking

India Infoline

ICICI Direct

Religare

HDFC Sec.

Others

34

4. Primary reason behind trading with the present company



Low brokerage 31 39% structure

Better 4

appreciation in 5% PMS

Quality of 8 10% research report

Comfort level 19 24% with software

Customer 18 22% Service

Table No.8 Reason behind trading with the present company

Figure No. 7 Reason behind trading with the present company

Interpretation

39% respondents are happy with the low brokerage structure whereas 24% & 22% respondents

are satisfied with the software and customer service respectively. Maximum number of people

prefers those stock broking companies who are having low brokerage structure.

Low brokerage

structure

39%

Better

appreciation in

pms

5%

Quality of

research report

10%

Comfort level

with software

24%

Customer

service

22%

Low brokerage structure

Better appreciation in

pms

Quality of research

report

Comfort level with

software

Customer service

35

5. Company preferred based on the following parameters

Brokerage Quality Brand Software AMC Customer Structure research Name Plan Service report Sharekhan 12 23 26 25 15 21 Angel Broking 28 19 18 19 24 18 Religare 18 13 14 16 17 15 India Infoline 14 15 15 12 15 16 ICICI Direct 8 10 7 8 9 10 Total 80 80 80 80 80 80

Table No.9 Company preferred by customers

5.1 Brokerage Structure

Figure No. 8 Brokerage Structure

Interpretation

Brokerage structure wise 35% respondents prefer Angel broking whereas 15% respondents

prefer Sharekhan. ICICI direct and Sharekhan is least preferred as far as brokerage structure is

concerned.

Sharekhan

15%

Angel Broking

35%

Religare

22%

India Infoline

18%

ICICI Direct

10%

Brokerage Structure

Sharekhan

Angel Broking

Religare

India Infoline

ICICI Direct

36

5.2 Quality Research report

Figure No. 9 Quality Research report

Interpretation

29% respondents think that ShareKhan provides quality research report where as 24%

respondents prefer Angel brokings research report over other broking firms. So majority of customers prefer Sharekhan and Angel brokings report where as ICICI Direct is least preferred by the customers.

5.3 Brand Name

Figure No. 10 Brand Name

Sharekhan

29%

Angel Broking

24%

Religare

16%

India Infoline

19%

ICICI Direct

12%

Quality Research report

Sharekhan

Angel Broking

Religare

India Infoline

ICICI Direct

Sharekhan

32%

Angel Broking

22%

Religare

18%

India Infoline

19%

ICICI Direct

9%

Brand Name

Sharekhan

Angel Broking

Religare

India Infoline

ICICI Direct

37

Interpretation

33% respondents prefer sharekhan as far as brand name is concerned whereas 23% prefer angel

broking and ICICI Direct is among least preferred. Results indicate that Sharekhan is rated as

first choice as far as brand name is concerned.

5.4 Software

Figure No. 11 Software

Interpretation

From the above data it is concluded that 31% respondent find software offered by Sharkhan is

user friendly and very easy to use and 24% respondents prefer the angel broking software

followed by 20% with Religares software.

Sharekhan

31%

Angel Broking

24%

Religare

20%

India Infoline

15%

ICICI Direct

10%

Software

Sharekhan

Angel Broking

Religare

India Infoline

ICICI Direct

38

5.5 AMC plan

Figure No. 12 AMC plan

Interpretation

Maximum number of respondents i.e.30% prefer AMC plan of Angel broking because it is less

expensive than other firm, 21% customers prefer AMC plan of Religare and 19% of customers

prefer AMC plan of Sharekhan and India Infoline.

5.6 Customer Service

Figure No. 13 Customer Service

Sharekhan

19%

Angel Broking

30%

Religare

21%

India Infoline

19%

ICICI Direct

11%

AMC plan

Sharekhan

Angel Broking

Religare

India Infoline

ICICI Direct

Sharekhan

26%

Angel Broking

22% Religare

19%

India Infoline

20%

ICICI Direct

13%

Customer Service

Sharekhan

Angel Broking

Religare

India Infoline

ICICI Direct

39

Interpretation

From the above data it is concluded that 26% respondents are happy with the sharkhans customer service where as 23% respondents like the customer service of angel broking and 20%

customers like customer service of India Infoline.

6. Broking firm preferred as a first time investor


Sharekhan 29 36%

Angel Broking 21 26%

India Infoline 14 18%

ICICI Direct 3 4%

Religare 9 11%

HDFC Sec. 4 5%

Table No.10 firm preferred as a first time investor

Figure No. 14 firm preferred as a first time investor

Interpretation

36% respondents said that they will prefer Sharekhan broking firm as a first time investor

because of their name and services provided and the quality of software they provide which is

free of cost. 26% and 18% customers prefer Angel broking and India infoline respectively.

Sharekhan

36%

Angel Broking

26%

India Infoline

18%

ICICI Direct

4%

Religare

11%

HDFC Sec.

5%

Sharekhan

Angel Broking

India Infoline

ICICI Direct

Religare

HDFC Sec.

40

7. Switching over to sharekhan If offered with better brokerage structure and Services


Yes 58 73%

No 12 28%

Table No.11 Customers switching to sharekhan

Figure No. 15 Customers switching to sharekhan

Interpretation

73% respondents said that they will prefer Sharekhan broking firm if better brokerage and

services offered. Majority of customers switching over to sharekhan might increase provided

they charge low brokerage

Yes

83%

No

17%

Yes

No

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Chapter 4

4.1 Summary & Conclusions

4.11 Findings

a) According to the data that has been collected, majority of the people who were contacted

have got partial knowledge of share market.

b) People like to invest more in equity sector rather than any other sector. This is because of the

stability and easy liquidity. Also, investors are exempt from tax in case of long term capital

gain and short term capital gain fall under 10% tax slab.

c) Majority of the first time investor prefers sharekhan over other brand. This is because of the

intensive sales promotion which they carry out and the kind of software and services being

offered to customers.

d) Sharekhan organizes seminars across the country from time to time in order to educate

investors in various subjects related to the stock, derivatives and commodities markets.

e) In terms of promotional activities sharekhan is much ahead of its competitors. It spends a

huge amount on advertisement on social networking sites like Facebook, Google+ etc.

f) Regular trader prefers Angel and India Infoline due to the low brokerage being charged by

them. Also the account maintenance cost is low as compare to others.

g) This study reveals probability of customers switching over to sharekhan might increase

provided they charge low brokerage and better AMC plan.

4.12 Lessons learnt

a) While acquiring clients for new demat accounts, I learned to converse and convince them by

offering investment solutions that best suits their requirement and objective.

b) Sharekhan gave me an opportunity to get into intricacies of share market.

42

c) In the course of research i gained knowledge about competitive edge of different leading

broking firms in India

d) I increased my knowledge of stock market. I learned various aspects of equity, derivatives

and commodities.

e) I learned about various products and services offered by sharekhan and their practical

applications.

f) Its a great experience to hear from clients their trading experience over the years and their perception about different firms.

g) In order to make clients familiar with the process of on-line trading, i got acquainted with

the entire procedure of demonstration of software.

h) The main and important thing is that we had a practical experience of working in a reputed

company.

4.13 Suggestions

a) The competitors are trying to get customers with better services than Sharekhan viz.,

account opening process time, low deposits with greater exposure for trading, more focus on

delivery-traders, etc. so Sharekhan must take care with developing fighter products to retain

old customers and gain new customers with competitive prices and services.

b) They should try to make some arrangements to reduce account opening time by verifying

documents at branch it selves.

c) The company should focus on creating new customers as well as on customer retension.

d) Since they are charging more in comparison to others, they should reduce the account

opening charges as well as brokerage charges.

e) The company should focus on the customer satisfaction not on just taking money from their

pocket.

43

f) Necessary steps should be taken by the exchange to deal with the situations arising due to

break down in online trading.

g) For controlling the operations of the company it is recommended that the employees should

be motivated for work and they should have a feeling of satisfaction for working in

Sharekhan, so that the investors get maximum service and satisfaction.

44

References

Books:

a) Kotler, P. (2012). Marketing Management. Pearson India.

b) Pandey, I.M. (2010). Financial Management. Vikas Publishing house pvt ltd.

c) Kothari C.R., (2004). Research Methodology. New age international pvt ltd.

d) Gupta, S.P. (2008). Statistical Methods. Sultan Chand & Sons.

Websites:

a) www.sharekhan.com (downloaded on 25th july 2015)

b) www.chittorgarh.com (downloaded on 14th aug 2015)

c) www.moneycontrol.com (downloaded on 14th aug 2015)

d) www.sebi.gov.in (downloaded on 22nd aug 2015)

e) www.sharekhanlearning.com (downloaded on 7th sept 2015)

f) www.nseindia.com (downloaded on 11th sept 2015)

g) www.bseindia.com (downloaded on 1th sept 2015)

45

Appendices

Appendix A: Questionnaire

I am a final year student currently pursuing my MBA in International Business at GITARATTAN INTERNATIONAL BUSINESS SCHOOL. I am conducting a research study on Comparative analysis of Sharekhan ltd. with other Stock Broking Firms. This research (project) is taken as a partial requirement for the completion of my MBA. I seek your kind assistance in completing the attached questionnaire which would take few minutes from your valuable time. Your responses will be treated as Strictly Confidential.

1. Do you have any knowledge of share markets? a) Partial b) Complete c) Nil

2. In which sector would you prefer investing? a) Equity or Cash Market b) Derivative Market c) Mutual funds d) Initial Public Offer (IPO) e) Portfolio Management System (PMS) f) Commodities

3. In which company you have Demat& Trading account? a) Sharekhan Ltd b) Angel Broking c) Indiainfoline d) ICICI direct e) Religare f) HDFC securities g) Others____________________

46

4. According to you which is the primary reason behind trading with the present company? a) Low brokerage structure b) Better appreciation in PMS c) Quality of research report d) Comfort level with software e) Customer Service

5. Which company would you prefer the most based on the following parameters?

Brokerage Quality Brand Software AMC Customer Structure research Name Plan Service report Sharekhan 12 23 26 25 15 21 Angel Broking 28 19 18 19 24 18 Religare 18 13 14 16 17 15 India Infoline 14 15 15 12 15 16 ICICI Direct 8 10 7 8 9 10 Total 80 80 80 80 80 80

6. Had you been a first time investor, which broking firm you would have preferred the most?

a) Sharekhan Ltd b) Angel Broking c) Indiainfoline d) ICICI direct e) Religare f) HDFC securities

7. If offered with better brokerage structure and Services would you like to switch over to sharekhan ?

a) Yes b) No

Report of Summer Training Conducted atSHAREKHAN Ltd.To

Certificate