Summer Training Report by Deepak Dhingra

A
SUMMER TRAINING REPORT

ON
“ANALYSIS OF INDIAN STOCK MARKET AND

COMPARISON OF CORPORATE STOCK BROKERS”
SUBMITTED TO
ROYAL INSTITUTE OF MANAGEMENT & TECHNOLOGY,
CHIDANA
IN PARTIAL FULFILLMENT OF REQUIREMENT OF
M.B.A. DEGREE COURSE
(2009-11)
Submitted by:
Deepak Dhingra
M.B.A. (3rd Sem.)
Roll No…………..
R.I.M.T., Chidana
1 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

DECLARATION
I Deepak Dhingra declare that the project done by me contains the original work and I have
not copied from anywhere, the portion which at some places in the report that has been copied by me I
have declare that in the end of the project report and that portion is the originally belongs to its original
writer and I don’t claim over it. It will be purely used for the academic purpose.
Place: ………….. Signature

ACKNOWLEDGEMENT
The beatitude, bliss that accompanies the successful completion of any task would not be complete
with expression of simple virtue to the people who made it possible. So, with the reverence honour we
acknowledge all those guidance and encouragement has made successful in winding up this opus.
I wish to express my deep sense of gratitude to Mr. Sandeep Nagpal (Branch Manager), Anagram
Capital Ltd. for help, guidance and for assisting me with valuable suggestions during the project.
He not only infused in me best skill and guidance in the fields but also invoked in me a spirit to
undertake the project in his prospective and to complete it successfully. The pleasant and fruitful
discussions, which had given me valuable training will help me in my future career.
I would like to thank Mrs. Poonam Luthra, H.O.D. (M.B.A.) and all the lecturers who support and
helps me a lot during the project and by which I am able to complete this project.
Finally I wish to thank all my fellow trainees and my parents for supporting me all the time and my
heartiest thanks to Anagram Capital Ltd. for providing me exposure to the corporate world.
Deepak Dhingra

PREFACE
Indian stock exchanges host the most number of listed companies after United States. About 2500
companies are listed in the Bombay Stock Exchange and the National Stock Exchange. Apart from
foreign institutional investors, Indian stock market has some 30 million domestic investors.
The working of stock markets has started in India as early as 1875, when 318 persons coming together
to Native Share and Stock Brokers Association, with Re.1 for membership free.
Closest to BSE is National Stock Exchange, also located at Bombay. Nifty is the market index of NSE.
Indian stock market has seen many ups and downs, but now is flying high, crossing every previous
record and zoom to even further heights. BSE-Sensex crossed the four-figure mark of 1000 in 1990
and had a smooth bull ride till 1992, when the big-full of Indian stock market, Harshad Mehta became
a villain in the in famous Harshad Mehta scam broke out. The sensex lost 570 points in no time and
some eight to 12 million investors were pushed to bankruptcy.
After that incidence, came the Securities and Exchanges Board of India. With the enforcement of
several regulations and strict guidelines, the confidence of investors was somewhat regained. With the
present technology and practices, it is next to impossible to commit a fraud in Indian Stock market. So
claims the SEBI.
Under the watchful eyes of SEBI, Indian Stock markets once again gained momentum. The sensex
crossed reached and crossed 6000 mark in 2000 and crossed the 7000 and 8000 marks in 2005.
Foreign Institutional Investors are pumping in money into the market.
The FIIs are confident of a sustainable momentum. The momentum in the stock market can be
associated with the growth in the fields of export, IT, ITES, telecommunication, education, energy
sector, agriculture etc. The reformist policies being pursued by the government is also a factor for this
growth.
Due to large scale outsourcing by American and European countries, a large number of jobs also went
to India, resulting in more affluent youth who are only happy to spend out their money. This helped in

the growth of telecommunication, FMCG and manufacturing sectors. The steady growth of GDP is
also a critical factor in the upward movement of Indian stock market.
Apart from FIIs, the non-resident Indians also invest hugely in the stock market. Diminishing returns
from bank deposits and the facilities of online trading made them turn to stock markets and with the
current bull-run many have made a good fortune from stock markets. The stockbrokers also chip in on
and open offices in foreign countries, aimed at him NRIs there.
The initial public offers by Tata Consultancy Services, Maruti Udyog Limited, ONGC etc. were big
events in Indian stock market. Not only did they put a great show, but also took the stock market to
newer heights. TCS is a big weight in the stock market from the day it was listed. Traditional heavy
weights are Reliance, Tata, and Bharati etc. Now new entrants like Biocon are also play significant
roles in the market.
Growth directed at sky is visible everywhere. The biggest growth opportunity lies in the stock market
itself. The population of India is well above one billion. The number of investors is just above 40
million. That is just 4% of the total population. The measures for a 10% growth are sought.

TABLE OF CONTENTS
• INDUSTRY STUDY (BSE & NSE)
• INTRODUCTION OF ACL
• PRODUCT OFFERINGS
• INTORDUCTION OF INDIAN STOCK MARKET
• MARKET BASICS
• COMPARISON OF CORPORATE STOCKBROKERS
• RESEARCH METHODOLOGY
• ANALYSIS & INTERPRETATION
• CONCLUSION
• LIMITATIONS
• SUGGESTIONS
• ANNEXURE
- Questionnaire
- Bibliography

BOMBAY STOCK EXCHANGE
]
Bombay Stock Exchange is the oldest stock exchange in Asia What is now popularly known as the
BSE was established as "The Native Share & Stock Brokers' Association" in 1875. Over the past 135
years, BSE has facilitated the growth of the Indian corporate sector by providing it with an efficient
capital raising platform.
Today, BSE is the world's number 1 exchange in the world in terms of the number of listed companies
(over 4900). It is the world's 5th most active in terms of number of transactions handled through its
electronic trading system. And it is in the top ten of global exchanges in terms of the market
capitalization of its listed companies (as of December 31, 2009). The companies listed on BSE
command a total market capitalization of USD Trillion 1.28 as of Feb, 2010.
BSE is the first exchange in India and the second in the world to obtain an ISO 9001:2000
certifications. It is also the first Exchange in the country and second in the world to receive
Information Security Management System Standard BS 7799-2-2002 certification for its BSE On-Line
trading System (BOLT). Presently, we are ISO 27001:2005 certified, which is a ISO version of BS
7799 for Information Security.
The BSE Index, SENSEX, is India's first and most popular Stock Market benchmark index. Exchange
traded funds (ETF) on SENSEX, are listed on BSE and in Hong Kong. Futures and options on the
index are also traded at BSE.
With its tradition of serving the community, BSE has been undertaking Corporate Social
Responsibility (CSR) initiatives with a focus on Education, Health and Environment. BSE has been
awarded by the World Council of Corporate Governance the Golden Peacock Global CSR Award for
its initiatives in Corporate Social Responsibility (CSR).
Vision

"Emerge as the premier Indian stock exchange by establishing global benchmarks"
Base Year- 1978-79
Base Index Value- 100
Date of launch- 1/1/1986
Method of calculation- Launched on full market capitalization method and effective
September 01, 2003, calculation method shifted to free-float market capitalization.

NATIONAL STOCK EXCHANGE
The National Stock Exchange of India Limited has genesis in the report of the High Powered Study
Group on Establishment of New Stock Exchanges. It recommended promotion of a National Stock
Exchange by financial institutions (FIs) to provide access to investors from all across the country on
an equal footing. Based on the recommendations, NSE was promoted by leading Financial Institutions
at the behest of the Government of India and was incorporated in November 1992 as a tax-paying
company unlike other stock exchanges in the country.
On its recognition as a stock exchange under the Securities Contracts (Regulation) Act, 1956 in April
1993, NSE commenced operations in the Wholesale Debt Market (WDM) segment in June 1994. The
Capital Market (Equities) segment commenced operations in November 1994 and operations in
Derivatives segment commenced in June 2000.
The following years witnessed rapid development of Indian capital market with introduction of
internet trading, Exchange traded funds (ETF), stock derivatives and the first volatility index -
IndiaVIX in April 2008, by NSE.
August 2008 saw introduction of Currency derivatives in India with the launch of Currency Futures in
USD INR by NSE. Interest Rate Futures was introduced for the first time in India by NSE on 31st
August 2009, exactly after one year of the launch of Currency Futures.
With this, now both the retail and institutional investors can participate in equities, equity derivatives,
currency and interest rate derivatives, giving them wide range of products to take care of their
evolving needs.

INTRODUCTION
Anagram Capital Ltd. (Anagram) is amongst the leading retail broking houses in India. It is engaged in
offering comprehensive personal finance solutions since 1994. The company is a part of the of the Rs
20 bn Lalbhai Group. The group companies in the capital and commodities market area include
Anagram Capital Ltd and Anagram Comtrade Ltd. Anagram offers a wide range of services for the
discerning equity investor, in addition to online account access and real time trading, Insurance
Services, Wealth Management Services, Mutual Fund and Advisory Services
The firm has its roots in Western India especially Gujarat where it is the biggest player. But it has
expanded considerably.
Anagram is positioned amongst the top retail broking houses in the country. An achievement indeed
for a company that's been providing comprehensive personal finance solutions since 1994. Anagram
Capital Ltd. (Anagram), promoted by Edelweiss Group. Anagram Stock broking Ltd. and Anagram
Comtrade Ltd. are the other group companies in the capital market area.
Anagram is a member of all leading stock and commodities exchange in India –National Stock
Exchange (NSE), Bombay Stock Exchange (BSE), National Commodities Exchange of India Ltd.
(NCDEX) and multi Commodities Exchange Market of India (MCX) and a depository participant with
NSDL. Our current offerings include trading in cash and derivative segment through our branches and
sub-brokers high-speed anywhere trading through the net, Online Depository Services, Commodities
trading, PMS, Currency Future Trading, Distribution of Mutual Funds, IPO’s and other financial
products.

DIVISIONS
We have a nationwide presence with 150 plus branches, 1400 plus Sub Brokers & Business
Associates, 3000 plus terminals and a professionalized team of 1400 plus employees spread across 200
plus cities. Our well - qualified staff will always be ready to fulfill your Stock Broking needs or solve
your queries over the telephone, or at the branches themselves.

HIERARCHY

PRODUCT OFFERINGS
Anagram has divided its product & service offering under three broad interface categories: - “Retail
Spectrum”, “Wealth Spectrum” and “Institutional Spectrum” as per following details:-
Retail Spectrum Wealth Spectrum Institutional Spectrum

Caters to a large number To provide customized To forge and build strong
of retail clients by offering all wealth advisory services to relationships with
products under one roof high net worth individuals corporate and institutional
through our branch network & clients
online mode
• Equity & Commodity • Wealth Advisory Services • Institutional Equity Broking

Trading • Portfolio Management • Investment Banking
• Personal Financial Services Services • Merchant Banking
• Online Investment • International Equity • Transaction Advisory
• Loans against Shares • Arts Initiative Services
• Distribution of Mutual • Priority Client Equity
Funds Services
• Personal Credit
• Personal Loan Services
• Distribution of Saving
Products
Schemes Related to Equity Trading are as follows:
Product Offering: Classic Scheme – Equity Segment
Anagram Capital Ltd.
Classic Scheme Variable Brokerage (%) A/C Opening Client’s Option
Charges For the scheme

Pay INR Delivery Intraday F&O Mark

(each leg) (each leg)
2758 0.30 0.03 0.03 Nil
5515 0.30 0.03 0.03 Nil
11030 0.25 0.025 0.025 Nil
27575 0.20 0.02 0.02 Nil
55150 0.15 0.015 0.015 Nil
110300 0.10 0.01 0.01 Nil
Terms & Conditions:
1. All statutory Charges like STT, Exchange charges, Stamp duty & any other charges will be charged
separately.
2. Minimum brokerage as prescribed by SEBI will be charged in the option Segment. However, there
will be minimum brokerage applicable for all other segments.
3. Margins on the trades would be as per the norms of the Exchange/s.
4. The cheque has to be drawn in the name of “Anagram Capital Ltd”.
5. After payment for the Classic scheme, the client account will be marked against the respective
Variable brokerage structure.
6. Client will be charged at agreed brokerage rate as herein specified for a period of 12 months from
subscription payment or till the complete utilization of subscription paid under the scheme, whichever is
earlier. Any Adjustments in respect of Auction brokerage shall not be made against the subscription
amount paid under the scheme since auction brokerage is not a part of this scheme
7. In case the client executes trades on various Exchange/s, through Anagram group Company/ies [being
member/ s of other Exchange/s], Anagram shall adjust/reverse the appropriate amount, from time to
time, across the trading account/s of the client maintained with Anagram group company/ies.
8. In case the above scheme is discontinued by Anagram, the client will charged the variable brokerage
slab of 0.50% in delivery transaction, 0.05% (each leg) in intraday transaction & in F&O/derivative
segment.

Declaration from Client/s:
1. I/We understand that Classic Scheme will be valid for maximum period of 1 year from enrolment in
scheme.
2. I/We understand Classic Scheme once paid for, by me/us will not be refunded to me/us in any
circumstances.
3. I/We understand that after payment of the Classic Scheme, my/our trading/investment account will be
marked against the respective Variable brokerage structure, marked above.
4. I/We understand that this Classic Scheme will be adjusted (to the extent of the Classic Scheme
amount paid by me/us), on a monthly basis against brokerage earned by Anagram (Anagram Capital Ltd
& Anagram Stock broking Ltd) on the trades executed by me/us in my/our trading/investment account.
5. I/We hereby confirm that I/We have understood the above schemes and that I/We willfully agree to
the terms and conditions of the scheme herein provided and the same shall be binding upon me/us.
6. I/We also agree that Anagram shall have unconditional rights to discontinue this scheme anytime
without notice. However, in case where Anagram opts to amend the scheme, it shall arrange an advance
notice of 7 days to me/us to intimate the amendments.
Kindly Find enclosed my cheque of Rs ________________, Chq No.____________ , Drawn

On____________, Dt._________ favoring Anagram Capital Ltd , towards the Classic Scheme – Equity
as above.
Client Code: _____________Client Name: __________________ Mobile No:_____________________
Client Signature……………………………… Email:…………………………………………
List of Corporate Stock Brokers that are the Competitors of Anagram Capital Ltd.
Karvy Consultants Ltd Centrum
Prabhudas Lilladher Century invest
Sharekhan Chona Financial Services (P) Ltd.
AnandRathi CIL Securities Ltd

JM Financial Ltd Competent Finman Pvt Ltd
Kotak Securities Ltd Composite Investments Private Ltd
Motilal Oswal Securities Ltd Consortium Securities Pvt Ltd
Ambit Holdings Crimson Financial Services Ltd/ Crimson
Commodity Ltd
Indiabulls Crosseas Capital Services
Moneypore Crown Group
RBS Broking India Dani Shares & Stocks Pvt Ltd
5Paisa.com Dawnay Day AV Securities Pvt Ltd
Edelweiss Dynamic
Enam Securities Pvt Ltd Elite Stock Management Ltd (ESML)
HSBC InvestDirect (India) Limited (HIL) Eureka Stock & Share Broking Services
Ltd
Kisan Ratilal Choksey Shares & Securities Farsight Group
Pvt Ltd
Mathew Easow Financial Services Fortune Financial Services (India) Ltd
DJS Stock and Shares Ltd Globe Group
Hybrid Financial Services Ltd Gogia International Securities Ltd India

Modern Shares & Stock Brokers Ltd Gupta Equities Pvt Ltd
Munoth Financial Services Ltd (MFSL) Hem Group
Pioneer Investcorp Ltd (PINC) ICDS Securities Ltd
Ratnabali Capital Markets Ltd ICICI Securities
16anna.com IDBI Capital Market Services Ltd
A.G. Shares & Securities Ltd IDFC-SSKI Group
Abhipra India Infoline
Adroit Financial Services Pvt Ltd Indira Group
Ajay Natavarlal Securities Pvt. Ltd. Innovate Securities Pvt. Ltd.
Amit Nalin Securities Pvt Ltd (ANSec) ITI Financial Services Limited
Angel Broking Ltd Jaypee Capital Services Ltd.
Anugrah Stock & Broking Pvt Ltd Jhaveri Securities Pvt. Ltd.
Anush Shares and Securities Pvt Ltd JRG Securities Ltd
Apeejay Securities Private Limited JV Capital Services (P) Ltd
Apollo Sindhoori Capital Investments Ltd Kassa Finvest Pvt Ltd
ASL Capital Holdings Private Ltd Khambatta Securities Ltd
Astha Credit & Securities (P) Ltd Khandwala Group
Bharat Bhushan & Company Labdhi Finance Corporation

Microsec Macquarie Securities Pvt Ltd
Modex International Securities Ltd Magnum.co.in
MSB Group Marfatia Stock Broking Pvt. Ltd.
Navia Markets Ltd MG Group of Companies
Padmakshi Financial Services Pvt. Ltd Shah Investors Home Ltd
Parsoli Corporation Limited Shardul Securities Ltd
Pee Aar Securities Limited Share Mart
PKJ Share Brokers Ltd. Shree Naman Developers Limited
Prayas Securities Pvt. Ltd. Shreepati Holdings & Fin. Pvt. Ltd
PSJ Securities Pvt. Ltd. Shreyas Stocks Pvt Ltd
R. Wadiwala Securities Pvt. Ltd. Shri Parasram Holdings Pvt Ltd
R.K. Global Shares & Securities Ltd SKP Securities Ltd
Reliance Money Sumedha Fiscal Services Ltd
Religare Enterprises Ltd Sushil Finance
Bonanza Portfolio Ltd Swastika Investmart Ltd
Amrapali Capital and Finance Services Ltd Unicon Investment Solutions
Aryan Share and Stockbrokers Ltd Ventura Securities Ltd

OTHER INFORMATION ABOUT ANAGRAM
Edelweiss to acquire Anagram Capital:
Edelweiss has entered into an agreement to acquire Anagram Capital for Rs. 164 crore in an all-cash
transaction. With a nation-wide network of more than 150 branches and over 1,400 sub-brokers,
Anagram has one of the widest geographical reach among retail broking firms.
The company has more than 1.80 lakh clients and estimated total revenue of Rs. 100 crore for the nine
months ended December 31, 2009. The company’s average daily equity trading volume is about Rs.
800 crore. Edelweiss plans to operate Anagram as a 100 per cent subsidiary with clear focus on
continuity and building on the current business and people with investments in research, products,
training and technology.
“This acquisition is in synch with Edelweiss’ plan to expand the retail broking business. The
acquisition of Anagram, with its reach and large, high quality and diversified client base, will give
impetus to Edelweiss’ retail broking and distribution businesses.
What makes this transaction exciting is the minimal overlap between the broking operations of both
companies. We are also impressed with Anagram’s professional management team and the consistent
focus on client service and risk management. I welcome all employees, Anagram’s clients and partners
to the Edelweiss family,” said Rashesh Shah, Chairman, Edelweiss Group, said.
With a view to focussing on its core business of textiles, Gujarat-based Lalbhai group on Wednesday
exited its domestic broking business by selling its firm, Anagram Capital, to Edelweiss Capital.
“The Lalbhai group’s core business is textiles and it is a global leader in denim. It is also diversifying
into other businesses and since finance does not form a core business for the group, it was decided to
sell-off the business,” Anagram Capital’s CEO, Mayank Shah, told PTI here. In the late-1990s, ICICI
had acquired Anagram Finance, another Lalbhai group company.

REGISTERATION DETAILS
Anagram Stockbroking Limited
• BSE Cash SEBI Regn. No.: INB011257152, BSE F&O SEBI Regn. No.: INF010808537
• PMS Regn. No.: INP000002031, NSDL DP SEBI Regn. No.: IN-DP-NSDL-180-2000,
• Mutual Fund: ARN 3068
Anagram Capital Limited
• NSE Cash SEBI Regn. No.: INB230597630, NSE F&O SEBI Regn. No.: INF230597630
• NSE Currency Derivative SEBI Regn. No: INE230597630
Anagram Comtrade Limited
• MCX-10425; NCDEX-00205; NMCE- CL0126, National Spot Exchange Limited – 11270
Registered Office
• Anagram House, H. L. Commerce College - Stadium Road Near Commerce Six Circle,
Navrangpura, Ahmedabad 380 009

LIST OF STOCK EXCHANGES IN INDIA
• OTC Exchange of India

• Madras Stock Exchange Ltd.
• The Uttar Pradesh Stock Exchange Association Ltd.
• Cochin Stock Exchange Ltd.
• Jaipur Stock Exchange Ltd.
• Bangalore Stock Exchange Ltd.
• National Stock Exchange of India Ltd.
• Gauhati Stock Exchange Ltd.
• The Ludhiana Stock Exchange Ltd.
• The Calcutta Stock Exchange Association Ltd
• Bhubaneshwar Stock Exchange Ltd.
• The Delhi Stock Exchange Ltd.
• Vadodara Stock Exchange Ltd.
• Madhya Pradesh Stock Exchange Ltd.
• Bombay Stock Exchange Ltd.
• Magadh Stock Exchange
• Ahmedabad Stock Exchange Ltd.
• Pune Stock Exchange Ltd.
• Mangalore Stock Exchange
• MCX Stock Exchange Ltd
• Hyderabad Stock Exchange
• Saurashtra Kutch Stock Exchange (SKSE)
• Coimbatore Stock Exchange

Analysis of Indian Stock Market
In general, the financial market divided into two parts, Money market and capital market. Securities
market is an important, organized capital market where transaction of capital is facilitated by means of
direct financing using securities as a commodity. Securities market can be divided into a primary
market and secondary market.
PRIMARY MARKET
The primary market is an intermittent and discrete market where the initially listed shares are traded
first time, changing hands from the listed company to the investors. It refers to the process through
which the companies, the issuers of stocks, acquire capital by offering their stocks to investors who
supply the capital. In other words primary market is that part of the capital markets that deals with the
issuance of new securities. Companies, governments or public sector institutions can obtain funding
through the sale of a new stock or bond issue. This is typically done through a syndicate of securities
dealers. The process of selling new issues to investors is called underwriting. In the case of a new
stock issue, this sale is called an initial public offering (IPO). Dealers earn a commission that is built
into the price of the security offering, though it can be found in the prospectus.
SECONDARY MARKET

The secondary market is an on-going market, which is equipped and organized with a place, facilities
and other resources required for trading securities after their initial offering. It refers to a specific place
where securities transaction among many and unspecified persons is carried out through
intermediation of the securities firms, i.e., a licensed broker, and the exchanges, a specialized trading
organization, in accordance with the rules and regulations established by the exchanges.
A bit about history of stock exchange they say it was under a tree that it all started in 1875.Bombay
Stock Exchange (BSE) was the major exchange in India till 1994.National Stock Exchange (NSE)
started operations in 1994.
NSE was floated by major banks and financial institutions. It came as a result of Harshad Mehta scam
of 1992. Contrary to popular belief the scam was more of a banking scam than a stock market scam.
The old methods of trading in BSE were people assembling on what is called a ring in the BSE
building. They had a unique sign language to communicate apart from all the shouting. Investors
weren't allowed access and the system was opaque and misused by brokers. The shares were in
physical form and prone to duplication and fraud.
NSE was the first to introduce electronic screen based trading. BSE was forced to follow suit. The
present day trading platform is transparent and gives investors prices on a real time basis. With the
introduction of depository and mandatory dematerialization of shares chances of fraud reduced further.
The trading screen gives you top 5 buy and sell quotes on every scrip.
A typical trading day starts at 9.00 am ending at 3.30 pm. Monday to Friday. BSE has 30 stocks which
make up the Sensex .NSE has 50 stocks in its index called Nifty. FII s Banks, financial institutions
mutual funds are biggest players in the market. Then there are the retail investors and speculators. The
last ones are the ones who follow the market morning to evening; Market can be very addictive like
blogging though stakes are higher in the former.

ORIGIN OF INDIAN STOCK MARKET
The origin of the stock market in India goes back to the end of the eighteenth century when long-term
negotiable securities were first issued. However, for all practical purposes, the real beginning occurred
in the middle of the nineteenth century after the enactment of the companies Act in 1850, which
introduced the features of limited liability and generated investor interest in corporate securities.
An important early event in the development of the stock market in India was the formation of the
native share and stock brokers 'Association at Bombay in 1875, the precursor of the present day
Bombay Stock Exchange. This was followed by the formation of associations/exchanges in
Ahmedabad (1894), Calcutta (1908), and Madras (1937). In addition, a large number of ephemeral
exchanges emerged mainly in buoyant periods to recede into oblivion during depressing times
subsequently.
Stock exchanges are intricacy inter-woven in the fabric of a nation's economic life. Without a stock
exchange, the saving of the community- the sinews of economic progress and productive efficiency-
would remain underutilized. The task of mobilization and allocation of savings could be attempted in
the old days by a much less specialized institution than the stock exchanges. But as business and
industry expanded and the economy assumed more complex nature, the need for 'permanent finance'
arose. Entrepreneurs needed money for long term whereas investors demanded liquidity – the facility
to convert their investment into cash at any given time. The answer was a ready market for
investments and this was how the stock exchange came into being.

Stock exchange means anybody of individuals, whether incorporated or not, constituted for the
purpose of regulating or controlling the business of buying, selling or dealing in securities. These
securities include:
(i) Shares, scrip, stocks, bonds, debentures stock or other marketable securities of a like nature in or of
any incorporated company or other body corporate;
(ii) Government securities; and
(iii) Rights or interest in securities.
The Bombay Stock Exchange (BSE) and the National Stock Exchange of India Ltd (NSE) are the two
primary exchanges in India. In addition, there are 22 Regional Stock Exchanges. However, the BSE
and NSE have established themselves as the two leading exchanges and account for about 80 per cent
of the equity volume traded in India. The NSE and BSE are equal in size in terms of daily traded
volume. The average daily turnover at the exchanges has increased from Rs 851 crore in 1997-98 to Rs
1,284 crore in 1998-99 and further to Rs 2,273 crore in 1999-2000 (April - August 1999). NSE has
around 1500 shares listed with a total market capitalization of around Rs 9, 21,500 crore. Analysis of
Indian Stock Market and Comparison of Corporate Stock Brokers
The BSE has over 6000 stocks listed and has a market capitalization of around Rs 9, 68,000 crore.
Most key stocks are traded on both the exchanges and hence the investor could buy them on either
exchange. Both exchanges have a different settlement cycle, which allows investors to shift their
positions on the bourses. The primary index of BSE is BSE Sensex comprising 30 stocks. NSE has the
S&P NSE 50 Index (Nifty) which consists of fifty stocks. The BSE Sensex is the older and more
widely followed index.
Both these indices are calculated on the basis of market capitalization and contain the heavily traded
shares from key sectors. The markets are closed on Saturdays and Sundays. Both the exchanges have
switched over from the open outcry trading system to a fully automated computerized mode of trading
known as BOLT (BSE on Line Trading) and NEAT (National Exchange Automated Trading) System.

It facilitates more efficient processing, automatic order matching, faster execution of trades and
transparency; the scrip's traded on the BSE have been classified into 'A', 'B1', 'B2', 'C', 'F' and 'Z'
groups. The 'A' group shares represent those, which are in the carry forward system (Badla). The 'F'
group represents the debt market (fixed income securities) segment. The 'Z' group scrip's are the
blacklisted companies. The 'C' group covers the odd lot securities in 'A', 'B1' & 'B2' groups and Rights
renunciations. The key regulator governing Stock Exchanges, Brokers, Depositories, Depository
participants, Mutual Funds, FIIs and other participants in Indian secondary and primary market is the
Securities and Exchange Board of India (SEBI) Ltd.
BACKGROUND OF STOCK EXCHANGE IN INDIA
The emergence of stock market can be traced back to 1830. In Bombay, business passed in the shares
of banks like the commercial bank, the chartered mercantile bank, the chartered bank, the oriental bank
and the old bank of Bombay and shares of cotton presses. In Calcutta, Englishman reported the
quotations of 4%, 5%, and 6% loans of East India Company as well as the shares of the bank of
Bengal in 1836. This list was a further broadened in 1839 when the Calcutta newspaper printed the
quotations of banks like union bank and Agra bank. It also quoted the prices of business ventures like
the Bengal bonded warehouse, the Docking Company and the storm tug company.
Between 1840 and 1850, only half a dozen brokers existed for the limited business. But during the
share mania of 1860-65, the number of brokers increased considerably. By 1860, the number of
brokers was about 60 and during the exciting period of the American Civil war, their number increased
to about 200 to 250. The end of American Civil war brought disillusionment and many failures and the
brokers decreased in number and prosperity. It was in those troublesome times between 1868 and 1875
that brokers organized an informal association and finally as recited in the Indenture constituting the
“Articles of Association of the Exchange”. On or about 9th day of July,1875, a few native brokers
doing brokerage business in shares and stocks resolved upon forming in Bombay an association for
protecting the character, status and interest of native share and stock brokers and providing a hall or
building for the use of the members of such association.

As a meeting held in the broker’ Hall on the 5th day of February, 1887, it was resolved to execute a
formal deal of association and to constitute the first managing committee and to appoint the first
trustees. Accordingly, the Articles of Association of the Exchange and the Stock Exchange was
formally established in Bombay on 3rd day of December, 1887. The Association is now known as
“The Stock Exchange”.
The entrance fee for new member was Re.1 and there were 318 members on the list, when the
exchange was constituted. The numbers of members increased to 333 in 1896, 362 in 1916and 478 in
1920 and the entrance fee was raised to Rs.5 in 1877, Rs.1000 in 1896, Rs.2500 in 1916 and Rs.
48,000 in 1920. At present there are 23 recognized stock exchanges with about 6000 stock brokers. 14
stock exchanges are organized as public limited companies, 6 as companies limited by guarantee and 3
are non-profit voluntary organization. Of the total of 23, only 9 stock exchanges have been permanent
recognition. Others have to seek recognition on annual basis.
These exchange do not work of its own, rather, these are run by some persons and with the help of
some persons and institution. All these are down as functionaries on stock exchange. These are
1. Stockbrokers
2. Sub-broker
3. Market makers
4. Portfolio Consultants etc.
1.) Stockbrokers:
Stock brokers are the members of stock exchanges. These are the persons who buy,
sell or deal in securities. A certificate of registration from SEBI is mandatory to act as a broker. SEBI
can impose certain conditions while granting the certificate of registrations. It is obligatory for the
person to abide by the rules, regulations and the buy-law. Stock brokers are commission broker, floor
broker, arbitrageur etc.
2.) Sub-broker:
A sub-broker acts as agent of stock broker. He is not a member of a stock exchange.
He assists the investors in buying, selling or dealing in securities through stockbroker. The broker and
sub-broker should enter into an agreement in which obligations of both should be specified. Sub-
broker must be registered SEBI for a dealing in securities. For getting registered with SEBI, he must
fulfill certain rules and regulation.
3.) Market Makers:
Market maker is a designated specialist in the specified securities. They make

both bid and offer at the same time. A market maker has to abide by bye-laws, rules regulations of the
concerned stock exchange. He is exempt from the margin requirements. As per the listing
requirements, a company where the paid-up capital is Rs. 3 crore but not more than Rs. 5 crore and
having a commercial operation for less than 2 years should appoint a market maker at the time of issue
of securities.
4.) Portfolio Consultants:
A combination of securities such as stocks, bonds and money market

instruments is collectively called as portfolio. Whereas the portfolio consultants are the persons, firms
or companies who advise, direct or undertake the management or administration of securities or funds
on behalf of their clients.

ABOUT NSE AND BSE
Formation:
The National Stock Exchange of India was promoted by leading financial institutions at the
behest of the Government of India, and was incorporated in November 1992 as a tax-paying company.
In April 1993, it was recognized as a stock exchange under the Securities Contracts (Regulation) Act,
1956. NSE commenced operations in the Wholesale Debt Market (WDM) segment in June 1994. The
Capital Market (Equities) segment of the NSE commenced operations in November 1994, while
operations in the Derivatives segment commenced in June 2000.
Bombay Stock Exchange Limited is the oldest stock exchange in Asia with a rich heritage. Popularly
known as "BSE", it was established as "The Native Share Stock Brokers Association" in 1875.
It was the first stock exchange in the country to obtain permanent recognition in 1956 from the
Government of India under the Securities Contracts (Regulation) Act, 1956. Earlier an Association of
Persons (AOP), the Exchange is now a demutualised and corporatized entity incorporated under the
provisions of the Companies Act, 1956, pursuant to the BSE (Corporatization and Demutualization)
Scheme, 2005 notified by the Securities and Exchange Board of India (SEBI).Bombay Stock
Exchange Limited received its Certificate of Incorporation on 8th August, 2005 and Certificate of
Commencement of Business on 12th August, 2005. The Exchange has succeeded the business and

operations of BSE ongoing concern basis and its recognition as an Exchange has been continued by
SEBI.
Members:
While the BSE has over 874 members-brokers across the country, NSE has more than 1000 members.
In NSE, a prospective trading member is admitted to any of the following combinations of market
segments: Wholesale Debt Market segment, Capital Market (CM) and the Futures and Options
segments, CM Segment and the WDM segment, or CM Segment, the WDM and the F and O segment.
There is no such thing at BSE and members join as any of the following: Trading Members, Trading
cum Clearing Members, Professional clearing member, Limited trading member and Self Clearing
member.
For NSE: In order to be admitted as a trading member, the individual trading member/at least two
partners of the applicant firm/at least two directors of the applicant corporate must be graduates and
must possess at least two years' experience in securities markets. The applicant for trading
membership/any of its partners/shareholders/directors must not have been declared defaulters on any
stock exchange, must not be debarred by SEBI for being associated with capital market as
intermediaries and must not be engaged in any fund-based activity. The trades executed on the
Exchange may be cleared and settled by a clearing member.
The initial joining fee for a member at BSE is Rs. 90 Lakhs while that for an NSE member is between
100 to 300 Lakh depending on the kind of membership one chooses.
In addition to annual fees, NSE members are required to pay transaction charges on trades undertaken
by them. They pay transaction charge at the rate of Rs. 3.5 for every Rs. 1 lakh of turnover in the CM
segment. The transaction charges payable to the exchange by the trading member for the trades
executed by him on the F&O segment are fixed at the rate of Rs. 2 per lakh of turnover (0.002%)
subject to a minimum of Rs. 1, 00,000 per year. At BSE, these fees differ according to the various
types of members.
For BSE: The requirements to becoming a member are:

1. Authorized By NSC as A Brokerage House
2. Authorization of BSE
3. Negotiation from NSC
4. Trained Staff at BSE (Brokers, Traders, Accountants)
5. Data on Member Registration
6. Company By-Laws
7. Membership Fee
8. Financial Statements
9. Company Mission Statements
10. Handbook on Internal Operations & Control
11. Personal Information File for Management and Specialized Staff
12. Contribution to the Guarantee Fund
13. Payment for the Licensed Access to Use the Operating System
Listing:
Listing means formal admission of a security to the trading platform of the Exchange. In BSE, the
securities may be of any public limited company, Central or State Government, quasi governmental
and other financial institutions/corporations, municipalities, etc. The objectives of listing are mainly to
provide liquidity to securities; mobilize savings for economic development; protect interest of
investors by ensuring full disclosures. The Exchange has a separate Listing Department to grant
approval for listing of securities of companies in accordance with the provisions of the Securities
Contracts (Regulation) Act, 1956, Securities Contracts (Regulation) Rules, 1957, Companies Act,

1956, Guidelines issued by SEBI and Rules, Bye-laws and Regulations of the Exchange. A company
intending to have its securities listed on the Exchange has to comply with the listing requirements
prescribed by the Exchange.
At NSE, the following criteria’s are to be fulfilled when one applies to be listed:
• Approval of Memorandum and Articles of Association

• Approval of draft prospectus
• Submission of Application
• Listing conditions and requirements
Once a company fulfils these criteria’s then they have to submit the following to the board:
1. A brief note on the promoters and management.
2. Company profile.
3. Copies of the Annual Report for last 3 years.
4. Copies of the Draft Offer Document.
5. Memorandum & Articles of Association.
The listing fees depend on the companies paid up capital at both NSE and BSE. While the initial
listing fee at NSE is Rs.7500, it is Rs.20, 000 at BSE. The annual listing fees for a company with a
paid up capital up to Rs. 5 Crores is Rs. 10,000 at BSE while it is Rs. 8,400 at NSE. For a company
with paid up capital between 5 to 10 crores, BSE charges Rs. 15,000 while NSE charges Rs. 10,000.
Indices:
The main Index of BSE is SENSEX while that of NSE is CNX Nifty. The other indices at BSE are:
BSE 500, BSE 100, BSE 200, BSE PSU, BSE MIDCAP, BSE SMLCAP, BSE BANKEX, BSE Teck,
BSE Auto, BSE Pharma, BSE Fast Moving Consumer Goods (FMCG), BSE Consumer Durables
(SYMBOL: Cons Dura), BSE Metal. NSE also set up as index services firm known as India Index

Services & Products Limited (IISL) and has launched several stock indices, including: S&P CNX
Nifty, CNX Nifty Junior, CNX 100 (= S&P CNX Nifty + CNX Nifty Junior), S&P CNX 500 (= CNX
100 + 400 major players across 72 industries), CNX Midcap (introduced on 18 July 2005 replacing
CNX Midcap 200).
CALCULATION OF SENSEX
SENSEX is calculated using a "Market Capitalization-Weighted" methodology. As per this

methodology, the level of index at any point of time reflects the total market value of 30 component
stocks relative to a base period. (The market capitalization of a company is determined by multiplying
the price of its stock by the number of shares issued by the company). An index of a set of combined
variables (such as price and number of shares) is commonly referred as a 'Composite Index' by
statisticians. A single indexed number is used to represent the results of this calculation in order to
make the value easier to work with and track over time. It is much easier to graph a chart based on
indexed values than one based on actual values.
The base period of SENSEX is 1978-79. The actual total market value of the stocks in the Index
during the base period has been set equal to an indexed value of 100. This is often indicated by the
notation 1978-79=100. The formula used to calculate the Index is fairly straightforward. However, the
calculation of the adjustments to the Index (commonly called Index maintenance) is more complex.
The calculation of SENSEX involves dividing the total market capitalization of 30 companies in the
Index by a number called the Index Divisor. The Divisor is the only link to the original base period
value of the SENSEX. It keeps the Index comparable over time and is the adjustment point for all
Index maintenance adjustments. During market hours, prices of the index scrip’s, at which latest trades

are executed, are used by the trading system to calculate SENSEX every 15 seconds and disseminated
in real time.
CLOSURE OF SENSEX
The closing SENSEX is computed taking the weighted average of all the trades on SENSEX
constituents in the last 15 minutes of trading session. If a SENSEX constituent has not traded in the
last 15 minutes, the last traded price is taken for computation of the Index closure. If a SENSEX
constituent has not traded at all in a day, then its last day's closing price is taken for computation of
Index closure. The use of Index Closure Algorithm prevents any intentional manipulation of the
closing index value.
MAINTAINENCE OF SENSEX
One of the important aspects of maintaining continuity with the past is to update the base year average.
The base year value adjustment ensures that additional issue of capital and other corporate
announcements like bonus etc. do not destroy the value of the index. The beauty of maintenance lies in
the fact that adjustments for corporate actions in the Index should not per se affect the index values.
The Index Cell of the Exchange does the day-to-day maintenance of the index within the broad index
policy framework set by the Index Committee. The Index Cell takes special care to ensure that
SENSEX and all the other BSE indices maintain their benchmark properties by striking a delicate

balance between high turnover in Index scrip’s and its representative character. The Index Committee
of the Exchange has experts from different field of finance related to the capital markets. They include
Academicians, Fund-managers from leading Mutual Funds, Finance - Journalists, Market Participants,
Independent Governing Board members, and Exchange administration.
SENSEX UPDATION
During market hours, prices of the index scrip’s, at which trades are executed, are automatically used
by the trading computer to calculate the SENSEX every 15 seconds and continuously updated on all
trading workstations connected to the BSE trading computer in real time.
COMPANIES LISTED IN NIFTY
As on Friday, July 16th, 2010
• ABB ltd.
• ACC ltd.
• Ambuja cements
• BHEL
• Axis bank ltd.
• Bharat petroleum corporation ltd.
• Bharti Airtel ltd.
• Cairn India ltd.
• Cipla ltd.
• DLF ltd.
• GAIL
• HCL tech ltd.
• HDFC bank ltd.
• Hero Honda motors ltd.
• Hindalco Industries ltd.

• Hindustan Unilever ltd.
• HDFC finance corporation ltd.
• ITC ltd.
• ICICI Bank ltd.
• Idea cellular ltd.
• Infosys Technologies ltd.
• Infrastructure Development Finance Co.ltd.
• Jaiprakash associates ltd.
• Jindal Steel and Power ltd.
• Kotak Mahindra bank ltd.
• Larsen and Tubro ltd.
• Mahindra and Mahindra ltd.
• Maruti Suzuki India ltd.
• NTPC ltd.
• ONGC
• Power grid corporation of India ltd.
• PNB
• Ranbaxy Laboratories ltd.
• Reliance Capital ltd.
• Reliance Infrastructure ltd.
• Reliance Communications ltd.
• Reliance Industries ltd.
• Reliance Power ltd.
• Siemens ltd.
• SBI
• SAIL
• Sterlite Industries ltd.
• Sun Pharmaceuticals Industries ltd.

• Suzlon Energy ltd.
• TCS
• Tata Motors ltd.
• Tata Power co. ltd.
• Tata Steel ltd
• Unitech ltd.
• Wipro ltd.
COMPANIES LISTED IN SENSEX
As on Friday, 16th July
• HDFC
• DLF
• ONGC
• Reliance Infra
• Sterlite India
• Mahindra and Mahindra
• Tata Motors
• Reliance Communications
• Wipro
• Tata Power

• Tata Steel
• Reliance
• NTPC
• Jaiprakash Associates
• Maruti Suzuki
• Jindal Steel
• SBI
• Larsen
• ICICI Bank
• Infosys
• Bharti Airtel
• TCS
• HDFC Bank
• Hindalco
• BHEL
• Hero Honda
• Cipla
• ACC
• HUL
• ITC

DIFFERENCE BETWEEN BSE AND NSE
Basis BSE NSE

Market capitalization of listed Rs. 4,670,227 crore Rs. 3,367,350 crore.
companies
Number of members 951 (Oct 2007) 1,009 as on March 2007

Number of listed companies 4,867 OCT(2007) 1,288 (March 2007)
Geographical spread Presence in 417 cities Presence in 1,486 cities
Website www.bseindia.com www.nse-india.com
Main Index BSE Sensex S & P CNX Nifty

Owner Bombay Stock Exchange National Stock Exchange of India
Limited
Key people Rajnikant Patel (CEO) R.H. Patil (Founder, MD)
Claim to fame Oldest stock exchange in Asia. Third largest stock exchange
in the world in terms of volumes.
Established in 1875 1993

Name Bombay Stock Exchange National Stock Exchange
Location Mumbai Mumbai
Index value 17,326.01 ( 2009) 6,097 (2007)
No. of trader workstations 15,151(Oct 2007)

MARKET BASICS
• Electronic Trading:
Electronic trading eliminates the need for physical trading floors. Brokers
can trade from their offices, using fully automated screen-based processes. Their workstations are
connected to a Stock Exchange's central computer via satellite using Very Small Aperture Terminus
(VSATs). The orders placed by brokers reach the Exchange's central computer and are matched
electronically.
• Exchanges in India:

The Stock Exchange, Mumbai (BSE) and the National Stock Exchange (NSE)
are the country's two leading Exchanges. There are 20 other regional Exchanges, connected via the
Inter-Connected Stock Exchange (ICSE). The BSE and NSE allow nationwide trading via their VSAT
systems.
• Index:
An Index is a comprehensive measure of market trends, intended for investors who are
concerned with general stock market price movements. An Index comprises stocks that have large
liquidity and market capitalization. Each stock is given a weight age in the Index equivalent to its
market capitalization. At the NSE, the capitalization of NIFTY (fifty selected stocks) is taken as a base
capitalization, with the value set at 1000. Similarly, BSE Sensitive Index or Sensex comprises 30
selected stocks. The Index value compares the day's market capitalization vis-à-vis base capitalization
and indicates how prices in general have moved over a period of time.
• Execute an Order:
Select a broker of your choice and enter into a broker-client agreement and fill
in the client registration form. Place your order with your broker preferably in writing. Get a trade
confirmation slip on the day the trade is executed and ask for the contract note at the end of the trade
date.
• Need a Broker:
As per SEBI (Securities and Exchange Board of India.) regulations, only registered
members can operate in the stock market. One can trade by executing a deal only through a
registered broker of a recognized Stock Exchange or through a SEBI-registered sub-broker.
• Contract Note:
A contract note describes the rate, date, time at which the trade was transacted
and the brokerage rate. A contract note issued in the prescribed format establishes a legally
enforceable relationship between the client and the member in respect of trades stated in the contract

note. These are made in duplicate and the member and the client both keep a copy each. A client
should receive the contract note within 24 hours of the executed trade.
• Split:
A Split is book entry wherein the face value of the share is altered to create a greater number of
shares outstanding without calling for fresh capital or altering the share capital account. For example,
if a company announces a two-way split, it means that a share of the face value of Rs 10 is split into
two shares of face value of Rs 5 each and a person holding one share now holds `two shares.
• Buy Back:
As the name suggests, it is a process by which a company can buy back its shares from
shareholders. A company may buy back its shares in various ways: from existing shareholders on a
proportionate basis; through a tender offer from open market; through a book-building process; from
the Stock Exchange; or from odd lot holders. A company cannot buy back through negotiated deals on
or off the Stock Exchange, through spot transactions or through any private arrangement.
• Settlement Cycle:
The accounting period for the securities traded on the Exchange. On the NSE, the
cycle begins on Wednesday and ends on the following Tuesday, and on the BSE the cycle commences
on Monday and ends on Friday. At the end of this period, the obligations of each broker are calculated
and the brokers settle their respective obligations as per the rules, bye- laws and regulations of the
Clearing Corporation. If a transaction is entered on the first day of the settlement, the same will be
settled on the eighth working day excluding the day of transaction. However, if the same is done on
the last day of the settlement, it will be settled on the fourth working day excluding the day of
transaction.
• Rolling Settlement:
The rolling settlement ensures that each day's trade is settled by keeping a fixed
gap of a specified number of working days between a trade and its settlement. At present, this gap is
five working days after the trading day. The waiting period is uniform for all trades. In a Rolling

Settlement, all trades outstanding at end of the day have to be settled, which means that the buyer has
to make payments for securities purchased and seller has to deliver the securities sold. In India, we
have adopted the T+5 settlements cycle, which means that a transaction entered into on Day 1 has to
be settled on the Day 1 + 5 working days, when funds pay in or securities pay out takes place.
Advantages of Rolling Settlements
As mentioned earlier, this is the system practiced in developed countries. Pay outs are quicker than in
weekly settlements, and investors will benefit from increased liquidity. The other benefit of the
modified system is that it keeps cash and forward markets separate. In the current system, the trader
has five days to square off his transaction which leads to a high level of speculation as people even
without funds tend to "play" the market. During volatile markets, especially in a bearish market, this
often leads to a payment problem which has dogged the Indian stock exchanges for a long time. It
provides for a higher degree of safety, and once mechanisms such as futures and stock-lending become
popular, it would result in quality speculation and genuine investor interest.
• Short Selling:
Short selling is a legitimate trading strategy. It is a sale of a security that the seller does
not own, or any sale that is completed by the delivery of a security borrowed by the seller. Short
sellers take the risk that they will be able to buy the stock at a more favorable price than the price at
which they "sold short."
The selling of a security that the seller does not own, or any sale that is completed by the delivery of a
security borrowed by the seller, Short sellers assume that they will be able to buy the stock at a lower
amount than the price at which they sold short.
• Auction:
An auction is conducted for those securities that members fail to deliver/short deliver
during pay-in. Three factors primarily give rise to an auction: short deliveries, un-rectified bad
deliveries, and un-rectified company objections.
• Separate Market for Auctions:

The buy/sell auction for a capital market security is managed
through the auction market. As opposed to the normal market where trade matching is an on-going
process, the trade matching process for auction starts after the auction period is over. If the shares are
not bought at the auction i.e. if the shares are not offered for sale, the Exchange squares up the
transaction as per SEBI guidelines. The transaction is squared up at the highest price from the relevant
trading period till the auction day or at 20 per cent above the last available Closing price whichever is
higher. The pay-in and pay-out of funds for auction square up is held along with the pay-out for the
relevant auction.
• Bad Delivery:
SEBI has formulated uniform guidelines for good and bad delivery of documents. Bad
delivery may pertain to a transfer deed being torn, mutilated, overwritten, defaced, or if there are
spelling mistakes in the name of the company or the transfer. Bad delivery exists only when shares are
transferred physically. In "Demat" bad delivery does not exist.
• Dematerialization:
Dematerialization in short called as 'demat' is the process by which an investor can

get physical certificates converted into electronic form maintained in an account with the Depository
Participant. The investors can dematerialize only those share certificates that are already registered in
their name and belong to the list of securities admitted for dematerialization at the depositories.
• Depository:
The organization responsible to maintain investor's securities in the electronic form is

called the depository. In other words, a depository can therefore be conceived of as a "Bank" for
securities. In India there are two such organizations viz. NSDL and CDSL. The depository concept is
similar to the Banking system with the exception that banks handle funds whereas a depository
handles securities of the investors. An investor wishing to utilize the services offered by a depository
has to open an account with the depository through Depository Participant.
• Depository Participant:

The market intermediary through whom the depository services can be
availed by the investors is called a Depository Participant (DP). As per SEBI regulations, DP could be
organizations involved in the business of providing financial services like banks, brokers, custodians
and financial institutions. This system of using the existing distribution channel (mainly constituting
DPs) helps the depository to reach a wide cross section of investors spread across a large geographical
area at a minimum cost. The admission of the DPs involves a detailed evaluation by the depository of
their capability to meet with the strict service standards and a further evaluation and approval from
SEBI. Realizing the potential, all the custodians in India and a number of banks, financial institutions
and major brokers have already joined as DPs to provide services in a number of cities.

COMPARISON OF CORPORATE STOCKBROKERS
Criteria Offer Provided

Types of Account 2
A/C Opening Fees(Trading + Demat) 900/-
Brokerage Intraday 0.03% - 0.10%
Delivery 0.25% - 0.50%
AMC None

Lead Time 1 Week
Margin Intraday 3 times
Delivery 12 times
Interest Rate None
Sauda Expiry T+5
Software Power Indiabulls (750/-)

Types of Account 2
A/C Opening Fees(Trading + Demat) 555/- + 300/-
Brokerage Intraday 0.05%
Delivery 0.5%
AMC 300/-
Lead Time 1 Week
Delivery 12 times
Interest Rate 18%
Sauda Expiry T+5
Software ODIN

Types of Account 2
Delivery 0.10%
AMC 300/-
Lead Time 4-5 days
Delivery 10 times
Interest Rate 18%

Sauda Expiry Never
Software ODIN

Types of Account 2
A/C Opening Fees(Trading + Demat) 2520/-
Delivery 0.30%
AMC 2000/-
Lead Time 7-8 days
Delivery 10 times
Interest Rate 18%
Sauda Expiry T+3
Software GOTX

Types of Account 2
Brokerage Intraday 0.01% to 0.03%
Delivery 0.10% to 0.30%
AMC 350/-
Lead Time 1 week
Delivery 10 times
Interest Rate 18%
Sauda Expiry T+5
Software ODIN

STATEMENT OF PROBLEM
To select a corporate broker that is rated highest on customer satisfaction level.
OBJECTIVE
• To conduct a study on awareness level of people about stock brokers in Panipat city.
• To study the market share of Anagram Capital Ltd in the Panipat city.
• What factors should Anagram Capital Limited consider to become a market leader?
• To find out the problems faced by clients while trading with Anagram Capital Ltd.
• To identify the drawbacks in the current system of trading and suggesting improvements in
the same.
• To get practically exposed to the trading market.
 Steps in Research Methodology are as follows:-
 Research Problem:
I was trying to study the Corporate Stock Brokers. Under this the problem is
that I had to know the factors on the basis of which client takes decision to open Demat account.
 Research Design:
A good research design is that design which is made keeping in view the objective
of research and availability of staff, time, & money. I have also selected Exploratory Research studies
which are as follows:
Area of Study - The area of my research project was Panipat.
 Sample Design:

A sample design is a definite plan for obtaining a sample for a given population. It
refers to the technique or the procedure and the researcher would adopt in selecting items of sample.
Sample design may as well lay down the number of items to be included in the sample i.e. the size of
the sample. Sample design is determined before data is collected.
Sampling Area - Panipat
Sampling Size - 20 clients of Anagram Capital Ltd. and 50 clients of other corporate
brokers.
 Data Collection:
Data collection is most important part of research because the research is based on it.
There are several ways of collecting data which differs considerably in terms of cost, time and other
resources at the disposal of the researchers. The data collection method for this research work is from
primary source as well as secondary. The survey is carried out through a non probability convenience
sampling in Panipat through a structured questionnaire.
Type of Data:
There are two types of Data:
1) Primary
2) Secondary
Primary Source: Source from where first hand information gathered directly are called primary
source and thus information collected is called Primary data. In case of above study the primary source
was consumer.
Primary Data: - The techniques available for collecting primary data are:
• Observation method
• Questionnaire method

• Interview method
Secondary Source: - The source of information already gathered for some other purpose are available
is called secondary data, with regard to my study secondary sources of my study where records of the
company, magazines and papers. The Secondary data was collected on the basis of requirement,
conveniences and reliability of the data.
Out of these I have chosen questionnaire method to collect the data because of low cost, free from the
bias of other interviewer and respondent.
Collection of data through Questionnaire:
This method of data collection is quite popular

particularly in case of big enquires, private individuals, research workers, private and public
organizations and even is adopting it by governments. In this method I went to the clients personally
and asked them to fill the questionnaire.
 Findings and Analysis:
Interview
This study was conducted to find out corporate broker that is rated highest on customer
satisfaction level. The people undergoing the test were divided into 7 categories.
1. Clients of Anagram Capital Ltd.
2. College Students
3. Working Professionals (Desk Work)
4. Servicemen
5. Businessmen

 For the purpose of research project I had applied the following process:

ANALYSIS & INTERPRETATION

Brokerage Charged
Name of Companies

Interpretation:
On an average Indiainfoline is rated highest on brokerage while on the other hand
es Angel Stock Broking Limited is the company that charges the least brokerage on both intraday and
pe delivery transactions.
Ru
in
.
mt
A
3000
A/C Opening Charges
2500
2000
1500 A/COpening Charges

AMC
1000
500
0
Indiabulls Indiainfoline Angel Broking Karvy Anagram
Name of Companies
Interpretation:
Karvy Securities charges the maximum account opening fees and the Annual
Maintenience Charges while Angel Stock broking is on the other extreme.

ANALYSIS & INTERPRETATION (CLIENTS OF ACL)
es
pe
Ru
in Q1: Who are you?
No. of Respondents Percentage
.
mt
A (a) Trader 15 75%
(b) Investor 5 25%
Name of Companies
Interpretation:
After survey, it is found that 75% of the respondents are traders and the rest 25%
are investors.

Q2: What is your favorite instrument of saving?
(a) Stock Market 16 80%
(b) Others (specify)……. 4 20%
Interpretation:
After survey, it is found that 80% of the respondents like stock market whereas 20%
like others instruments like insurance, mutual funds, etc.

Q3: What is the basic purpose of your investment?
(a) Returns 14 70%
(b) Capital Appreciation 3 15%
(c) Tax Benefits 1 5%
(d) Others (specify)……. 2 10%
Interpretation:
After survey, it is found that the purpose of 70% of the respondents are returns & of
15% of the respondents are capital appreciation & of 5% of the respondents are tax benefits & the rest
are others.

Q4: What is the time horizon of your investment?
(a) 1-30 days 3 15%
(b) 1-6 months 1 5%
(c) More than 6 months 1 5%
(d) Depend upon profits 15 75%
Interpretation:
After survey, it is found that the time horizon of 15% of the respondents are 1-30
days & of 5% of the respondents are 1-6 months & of 5% of the respondents are more than 6 months
& for the rest 75% are depend upon profits.

Q5: Your source of information of Anagram Capital Limited is
(a) Newspaper 3 15%
(b) Internet 2 10%
(c) Friends/Relatives 2 10%
(d) Existing clients of ACL 13 65%
Interpretation:
After survey, it is found that the source of information of 15% of the respondents are
newspaper & of 10% of the respondents are internet & of 10% of the respondents are more
friends/relatives & for the rest 65% are existing clients of ACL.

Q6: How would you rate the following elements of Anagram Capital Limited?
Excellent Very good Good Poor
(a) Knowledge of employees 15% 35% 40% 10%
you deal with
(b) Ability to resolve problems 20% 40% 35% 5%
(c) Quality of advice 20% 30% 45% 5%
Interpretation:

After survey, it is found that 40% of the respondents feel that knowledge of
employees of ACL are good and 40% of the respondents feel that ability to resolve problems of ACL
are very good and 45% of the respondents feel that quality of advice of ACL are good.
Q7: Based on your experience with ACL, use a tick to indicate how you feel about
the online services (software provided and back office support) of ACL?
(a) Friendly 13 65%
(b) Unfriendly 7 35%
Interpretation:

After survey, it is found that 65% of the respondents feel that online services
(software) provided by ACL are friendly whereas 35% of the respondents feel that online services
(software) provided by ACL are unfriendly.
ANALYSIS & INTERPRETATION (NON-CLIENTS)
Q1: Do you have a pan card?

(a) Yes 48 96%
(b) No 2 4%
Interpretation:

After survey, it is found that 96% of the respondents (non-clients of ACL) have pan
card whereas 4% of the respondents don’t have pan card.
Q2: Who are you?

(a) Trader 40 80%
(b) Investor 10 20%
Interpretation:
After survey, it is found that 80% of the respondents are traders and the rest 20% are
investors.

Q3: What is the time horizon of your investment?
(a) 1-30 days 9 18%
(b) 1-6 months 6 12%
(c) More than 6 months 4 8%
(d) Depend upon profits 31 62%
Interpretation:

After survey, it is found that the time horizon of 18% of the respondents are 1-30
days & of 12% of the respondents are 1-6 months & of 8% of the respondents are more than 6 months
& for the rest 62% are depend upon profits.
Q4: What is your preferred medium of receiving research report and tips from your
dealer?
(a) SMS Facility 35 70%
(b) Instant messaging 7 14%
(c) E-mail 5 10%
(d) others 3 6%

Interpretation:
After survey, it is found that for 70% of the respondents preferred SMS facility as a
medium of receiving tips whereas14 % & 10% respondents preferred instant messaging & e-mail
respectively.
Q4: In which company you have d-mat and trading account?

(a) Karvy Securities 6 12%
(b) India Infoline Security Pvt. Ltd. 18 36%
(c) Indiabulls Securities Ltd. 14 28%
(d) Others 12 24%
Interpretation:
After survey, it is found that 12% of the respondents have d-mat & trading account
in Karvy Securities whereas 36% of the respondents are in India Infoline & 28% of the respondents
are in Indiabulls.
Q6: Are you satisfied with you present broking firm?

No. of Respondents
(a) Yes 36
(b) No 14
Interpretation:
After the survey, it is found that India Infoline is the company whose clients are most
satisfied with the services of the company and other column signifies that some other company(s) is
rated as the least preferred companies of the respective clients

Q7: State the reason for your satisfaction?
(a) Services 15 30%
(b) Brokerage 20 40%
(c) Operating Expenses 9 18%
(d) Others 6 12%
Interpretation:

After the survey, it is found that brokerage is the most convenient factor on which the
respondents are satisfied. The brokerage chart (mentioned above) also displays that Angel Stock
Broking has the least brokerage charged from its clients.

CONCLUSION
• According to the survey most of the clients of “Anagram Capital Ltd.” say that the research data
provided is sufficient for them to take intelligent trading decisions.
• Anagram Capital Limited takes much in to account the budget of their clients and then takes any
investment decisions.
• People pay more emphasis on brokerage than service provided by brokerage houses.
• Angel stock broking Ltd. came out to be a leading company on the following points:
 Brokerage
 Fees charged
 Awareness
• Anagram Capital Ltd. is also an upcoming challenging competitor to Angel Stockbroking Ltd.

LIMITATIONS
• Size of the research may not be substantial.

• There was lack of time on the part of respondents.
• There may be biasness in information by market participant.
• Due to limitation of time a sample size of only 50 respondents were chosen.
• The sample for research was chosen only from a limited area.
• Some of the respondents may be biased in giving responses.
• Complete data was not available due to company privacy and secrecy.

SUGGESTIONS TO ANAGRAM CAPITAL LTD.
• Improvement in the time delay of account opening is required.

• There should be a specific number of clients under each relationship manger, so that each client can
be attended properly and can be imparted desired time.
• Some promotional activities are required for the awareness of the customer, seminars should be held
for providing information to prospective and present customers.
• People at young age should be encouraged to invest in stock market.
• The company officials should maintain healthy relationship with their clients.

QUESTIONNAIRE FOR CLIENT OF ANAGRAM CAPITAL LIMITED
Dear Respondent,
This information revealed by you will be used for institutional work only. This will be a part of my
summer Training Project. No information will be disclosed to any outside party. Please spare
sometime to fill in this questionnaire.
Q1. Who you are?
(a)Trader (b) Investor
Q2. What is your favorite instrument of saving?
(a) Stock Market (b) Others (specify) _________
Q3. What is the basic purpose of your investment?

(a) Returns (b) Capital Appreciation
(c) Tax benefits (d) Others (specify) _________
Q4. What is the time horizon of your investment?
(a) 1-30 days (b) 1-6 months
(c) More than 6 months (d) depends upon the profit
Q5. Your source of information of Anagram Capital Limited is.
(a) Newspaper (b) Internet
(c) Friends/ Relatives (d) Existing clients of ACL
Q6. How would you rate the following elements of Anagram Capital Limited? (Please tick)
Excellent Very good Good Poor
Knowledge of employees you deal with
Ability to resolve problems
Quality of advice

Q7. Based on your experience with ACL, use a tick to indicate how you feel about the online services
(software provided and back office support) of ACL?
(a) Friendly (b) Unfriendly
Q8. Feedback (if any)
_________________________________________________________________________________
_________________________________________________________________________________
Please tell a little about yourself:
Name: -…………………………………………………………………
Age: - (a) 20-30years (b) 31-40years
(c) 40-50years (d) Above 50years
Contact No. : -………………………………………………………
Address: -………………………………………………………………………………….
Gender: - (a) Male (b) Female
Marital status: - (a) Married (b) Unmarried

Education: - (a) Under Graduate (b) Graduate
(c) Post Graduate (d) Other
Occupation: - (a) Business (b) Service
(c) Professional (d) Others
QUESTIONNAIRE FOR NON-CLIENTS
Dear Respondent,
This information revealed by you will be used for institutional work only. This will be a part of my
Summer Training Project. No information will be disclosed to any outside party. Please spare
sometime to fill in this questionnaire.

Q1. Do you have a pan card?
(a)Yes (b) No
Q2. Who you are?
(a) Trader (b) Investor
Q3. What is the time horizon of your investment?
(a) 1-30 days (b) 1-6 months
(c) More than 6 months (d) depends upon the profit
Q4. What is your preferred medium of receiving research report and tips from your dealer?
(a) SMS facility (b) Instant messaging
(c) E-mail (d) others (specify) ________
Q5. In which company you have d-mat and trading account?
(a) Karvy Securities (b) IndiaInfoline Security Private Limited
(c) Indiabulls Securities Limited (d) Others (specify) _________
Q6. Are you satisfied with you present broking firm?

(a)Yes (b) No
Q7. State the reason for your satisfaction?
(a) Services (b) Brokerage
(c) Operating expenses (d) Others
Q8. Feedback (if any)
___________________________________________________________________________
___________________________________________________________________________
Please tell a little about yourself:
Name: -………………………………………………
Age: - (a) 20-30years (b) 31-40years
(c) 40-50years (d) Above 50years
Contact No. : -…………………………………………..
Address: -…………………………………………………………
Gender: - (a) Male (b) Female

Marital status: - (a) Married (b) Unmarried
Education: - (a) Under Graduate (b) Graduate
(c) Post Graduate (d) Other
Occupation: - (a) Business (b) Service
(c) Professional (d) Others
ABBREVIATIONS USED
• BSE - Bombay Stock Exchange

• CSDL - Central Securities Depository Limited
• CARE - Credit Analysis & Research Limited
• CRISIL - Credit Rating Information Services of India Limited
• F&O - Futures and Options
• FPO - Follow up Public Offering
• IISL - India Index Services & Products Ltd.
• ICRA - Investment Information and Credit Rating Agency of India
• NCDEX - National Commodity and Derivatives Exchange Ltd.
• NSCCL - National Securities Clearing Corporation Limited
• CDSL - Central Depositories Services Ltd.
• DRF - Demat Request Form
• DCA - Department of Company Affairs
• DEA - Department of Company Affairs
• DP - Depository Participant
• FII - Foreign Institutional Investors
• FMC - Forward Markets Commission
• IPO - Initial Public Offer
• ISIN - International Securities Identification Number
• NEAT - National Exchange for Automated Trading
• NSDL - National Securities Depository Limited
• NAV - Net Asset Value
• NYSE - New York Stock Exchange
• NCFM - NSE’ Certification in Financial Markets
• OTC - Over The Counter
• RRF - Remat Request Form
• SBTS - Screen Based Trading System
• T+2 - Second day from the trading day

• SEBI - Securities and Exchange Board of India
• SAT - Securities Appellate Tribunal
• SCRA - Securities Contract (Regulation) Act
• SCRR - Securities Contract (Regulation) Rules
• S&P - Standard & Poor
• ICSE - Inter-Connected Stock Exchange
• VSAT’s - Very Small Aperture Terminus
• IBT - Internet-based Trading
• ACL - Anagram Capital Ltd.
BIBLIOGRAPHY

• Kothari. C. R, Research Methodology, New Age International (P) Ltd., New Delhi (2008
Edition).
• Marketing Research- Harper W. Boyd, Jr. Ralph Westfall, Stanley F. Stasch (2007 Edition).
• M.D. Rashikh Irfan - Stock exchanges in India.
WEBLIOGRAPHY
• http://www.anagram.co.in
• http://www.moneycontrol.com
• http://www.karvy.com
• http://www.bseindia.com
• http://www.nseindia.com
• http://www.nseindia.com/content/indices/ind_niftylist.csv
• http://www.tradersedgeindia.com/bse_sensex.htm
• http://www.indiahowto.com/what-is-sensex-nifty.html
• http://www.moneycontrol.com/sensex/bse/sensex-live
• http://www.google.com

Summer Training Report by Deepak Dhingra

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SUMMER TRAINING REPORT

“ANALYSIS OF INDIAN STOCK MARKET AND

1 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

Place: ………….. Signature

2 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

3 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

4 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

5 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

• INDUSTRY STUDY (BSE & NSE)

• INTORDUCTION OF INDIAN STOCK MARKET

• COMPARISON OF CORPORATE STOCKBROKERS

• ANALYSIS & INTERPRETATION

6 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

8 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

Base Year- 1978-79

Base Index Value- 100

Date of launch- 1/1/1986

Method of calculation- Launched on full market capitalization method and effective

September 01, 2003, calculation method shifted to free-float market capitalization.

9 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

10 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

12 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

13 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

14 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

Retail Spectrum Wealth Spectrum Institutional Spectrum

16 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

• Equity & Commodity • Wealth Advisory Services • Institutional Equity Broking

Schemes Related to Equity Trading are as follows:

Product Offering: Classic Scheme – Equity Segment

Anagram Capital Ltd.

Classic Scheme Variable Brokerage (%) A/C Opening Client’s Option

Charges For the scheme

17 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

5515 0.30 0.03 0.03 Nil

11030 0.25 0.025 0.025 Nil

27575 0.20 0.02 0.02 Nil

55150 0.15 0.015 0.015 Nil

110300 0.10 0.01 0.01 Nil

Terms & Conditions:

3. Margins on the trades would be as per the norms of the Exchange/s.

4. The cheque has to be drawn in the name of “Anagram Capital Ltd”.

18 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

Kindly Find enclosed my cheque of Rs ________________, Chq No.____________ , Drawn

Client Code: _____________Client Name: __________________ Mobile No:_____________________

Client Signature……………………………… Email:…………………………………………

Karvy Consultants Ltd Centrum

Prabhudas Lilladher Century invest

Sharekhan Chona Financial Services (P) Ltd.

AnandRathi CIL Securities Ltd

19 Analysis of Indian Stock Market and Comparison of Corporate Stock Brokers

Kotak Securities Ltd Composite Investments Private Ltd

Motilal Oswal Securities Ltd Consortium Securities Pvt Ltd

Ambit Holdings Crimson Financial Services Ltd/ Crimson

Indiabulls Crosseas Capital Services

Moneypore Crown Group

RBS Broking India Dani Shares & Stocks Pvt Ltd

5Paisa.com Dawnay Day AV Securities Pvt Ltd

Enam Securities Pvt Ltd Elite Stock Management Ltd (ESML)

Kisan Ratilal Choksey Shares & Securities Farsight Group

Mathew Easow Financial Services Fortune Financial Services (India) Ltd

DJS Stock and Shares Ltd Globe Group

Hybrid Financial Services Ltd Gogia International Securities Ltd India

Kindly Find enclosed my cheque of Rs ____, Chq No. , Drawn

Client Code: _Client Name: Mobile No:___________