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Project Report
On
INVESTORS BEHAVIOUR FOR INVESTING IN EQUITY
MARKET IN VARIOUS SECTORS
(Conducted on Sharekhan Limited Jalgaon)
SUBMITTED TO
University of Pune
SUBMITTED BY
Aslam K. Alam
Roll No. 39
UNDER THE GUIDANCE OF
Prof :Dr. Mayanka Sharma
In Partial Fulfillment of
MASTER OF BUSINESS ADMINISTRATION
(MBA)
ALLANA INSTITUTE OF MANAGEMENT SCIENCES, PUNE.
2012-2014
I Aslam
DECLARATI
ON
K. Alam, Roll No: 39, here by declare that the project report entitled
Investors Behaviour for Investing in Equity Market in Various Sectors
Conducted on behalf of SHAREKHAN LIMITED, under the guidance of Prof
Place:
Date:
Aslam K. Alam
ACKNOWLEDGE
MENT
I
express
my
deep
sense
of
gratitude
towards
my
guide,
Prof :Dr. Mayanka Sharma without whose kind help this project study would
have been extremely difficult. She has helped me with her valuable suggestions
right from the beginning till the final draft of the report. The sheer mention of my
project study shall ever commemorate her kind guidance.
I am also grateful to Finance faculty of the Allana Institute Of
Management Sciences for M.B.A. for his kind effort to make all the required
facilities available and gave his valuable suggestions in preparing this project
report. The library facility of the college has been of immense use to me for
reference of books and old project reports.
I am also thankful to Mr. Jitendra Kolhe (BM) of Sharekhan Ltd. Jalgaon,
for giving me an opportunity for getting in valuable experience in such reputed
organization.
Finally, I would like to record my special thanks to my parents, friends,
and colleagues help me directly or indirectly in preparation of project work.
Aslam K. Alam
MBA
Roll No. 39
INDEX
NO.
PERTICULARS
1.
EXECUTIVE SUMMERY
2.
3.
COMPANY PROFILE
4.
5.
RESEARCH METHODOLOGY
6.
7.
FINDINGS
8.
9.
CONCLUSION
10.
RECOMMONDATIONS
11.
BIBLIOGRAPHY
12.
ANNEXTURE
PAGE.NO.
EXECUTIVE SUMMAR
Days were gone when people only invest their money in Post offices or in
Banks and another safely fixed return investment. Today people have several
choices for the investment alternatives. Now a day, one of the most emerging
choices is to invest in equities shares. To get good return on investment, people
are ready to take risks. Law always says that investors get HIGHER RETURN if
they take HIGH RISK. For high risk there is one avenue to invest and that is
Equity Market.
This Project Focused On INVESTORS BEHAVIOUR FOR INVESTING IN
EQUITY MARKET IN VARIOUS SECTORS. Objectives behind this project are to
know investors behavior for investing in various sectors regarding equity market,
to know their preference of investment in equity market, and to know whether
potential growth of equity market is there or not.
I have used Descriptive Research Design because answers the questions
who, what, where, when and how. This study is complex and determines high
degree scientific skill to study the problem. Questionnaires are used for survey
purpose and before going to actual survey pilot testing were also done.
Sample size is of 175 respondents who are the actual and potential
investors from whole of the equity market of and also from Sharekhan Securities
Pvt. Ltd. Here, each sample has the chance to be selected on an equal basis
because I have used simple random sampling method for surveying purpose.
From research I found that 68% of investors are investing in Equity
Market. While 36% of investors are not investing in Equity Market as per my
sample size 175.
Means most of the customers are aware about Equity Market. There are
certain customers who are also aware about equity market but, they not want to
invest in equity market, Reasons for not investing in equity market is high risk and
there are no any fixed returns criteria and Investors age also affect in risk factor.
Means old persons risk bearing capacity is law so, investors also select
investment avenue as per his/her risk bearing capacity
Equity share holder is real owner of the company in spite of their priority in
getting dividend is comes last.
Major
Investors
are
investing
in
equity
market
only
due
to
earn high return and hedge the risk by investing their 5%-10% of income in
Equity Market. 28% of investors invest in Equity market for the period of
1 to 3 Months and the same proportion of investors are invest for
long period more than year.
On the basis of research I found that, major investors have selected
Oil & gas sector as a 1st Rank, IT sector as a 2nd Rank, Banking sector as a 3 nd
Rank, Automobile sector as a 4th Rank and Infrastructure sector as a 5nd Rank.
Most of investors have considered Market trend, Price Earning Ratio,
Dividend and Profitability as a most important factor while selecting the Sector
and company under the sector.
I have used SPSS software (Statistical Package for the Social Sciences)
for analysis purpose and in that I have used graphical representation &
interpretation with each graphs and charts and Microsoft Office is used for data
typing formatting and analyzing the data.
company profile
COMPANY PROFILE
Company Name:
Parental Company:
SHAREKHAN LIMITED
SSKI Group
(Shripal Sevantilal Kantilal Ishwarlal Pvt. Ltd)
Establishment year:
CEO of the
company:
Head Office:
Work Done
Telephone No:
1922
Mr. Tarun Shah
Online division as
Sharekhan
Web Site:
Email:
jitendrak@branch.sharekhan.com
Offices(Network):
INTRODUCTION OF SHAREKHAN
Share khan is one of the leading share broking and retail brokerage firms
in the country. It is the retail broking arm of the Mumbai-based SSKI Group
which has more than 88 years of experience in the stock broking business. SSKI
is a veteran equities solutions company with more than 8 decades of trust and
credibility in the Indian stock markets. It helps the customers/people to make
informed decisions and simplifies investing in stocks.
Share khan brings to you a user- friendly online trading facility, coupled
with a wealth of content that will help you stalk the right shares. SSKI named its
online division as a Share khan and it is into retail broking. The business of the
company overhauled 10 years ago on February 8, 2000. It acts as a discount
brokerage house to a full service investment solution provider. It has specialized
research product for the small investors and day traders.
Share
khans
online
trading
and
investment
site
We
are
proud
to
be
in
the
industry.
This
We
profusely
thank
our
ABOUT SHAREKHAN
SSKI named its online division as SHAREKHAN and it is into retail broking.
The business of the company overhauled 10 years ago on February 8,
2000.
It acts as a discount brokerage house to a full service investment solutions
provider.
It has specialized research product for the small investors and day traders.
Largest chain of 640 shares shops in 280 cities across India.
The site was also launched on February 8, 2000 and named it as
www.sharekhan.com.
The Speed Trade account of Sharekhan is the next generation technology
product launched on April 17, 2002.
It offers its customers with the trade execution facilities on the NSE and BSE,
for cash as well as derivatives, depository services.
Ensures convenience in Trading Experience: Sharekhans trading services are
designed to offer an easy, hassle free trading experience, whether trading is
done daily or occasionally. Sharekhan providing the customers with a multichannel access to the stock markets.
It gives advice based on extensive research to its customers and provides
them with relevant and updated information to help him make informed about
his investment decisions.
Sharekhan offers its customers the convenience of a broker-DP.
It helps the customers meet his pay in obligations on time thereby reducing the
possibility of auctions. And execute the instruction immediately on receiving it
and thereafter the customer can view his updated account statement on
Internet.
Sharekhan depository services offer D-mat services to individual and corporate
investors. A customer can avail of D-mat, repurchase and transmission
facilities at any of the Sharekhan branches and business partners outlets.
BRAND NAME:
The company as a whole in its offline business has named itself as SSKI
VISION
To be the best retail broking brand in the Indian equities market.
ROLE OF SHAREKHAN:
Interface between the stock exchange and the investor.
Assistance to investors in precise allocation of funds.
Building awareness amongst general public about stock market.
Fundamental Research
8.
Technical Research
9.
Portfolio Management
10. Free access to investment advice from Sharekhans Research team
11. Sharekhan Value Line (a monthly publication with reviews of
recommendations, stocks to watch out for etc)
12. Daily research reports and market review (High Noon & Eagle Eye)
13. Pre-market Report (Morning Cuppa)
14. Daily trading calls based on Technical Analysis
15. Cool trading products (Daring Derivatives and Market Strategy)
16. Personalized Advice
17.
1. Online Services:
Online BSE and NSE executions (through BOLT & NEAT terminals
Mutual Funds
Commodity Futures
Technical PMS
Demat Services
Share shops
2. Offline Services:
DTOCT
Special
website for Offline Clients: www.mysharekhan.com
irfnlY
aflaP
Physical
contract notes
ldisE
einsS
NTneiO
It provides various On-line trading services through various account:
iecF
gAD
TeAcAE
rccM
aAcocA
dcouoT
ecunuA
ontnC
uttC
nsO
tU
N
The company provided mainly two types of services to their customers for
the Demate Accounts.
(1) Online Account and
(2) Offline Account
1. Online Account: In the Online account, the company simply provides the terminal to the
customers or clients and the clients can do trading himself/herself when he/she
wants. The charges of online account is Rs. 750 /-, which is varies from company
to company. Online accounts are most popular than the Offline accounts.
In the Online A/C, the company provides 3 types of facilities to their clients
as per the requirements.
A. Classic Accounts
A. Classic Accounts:
Streaming Quotes
B.
Earlier it was known as Speed Trade and now it is known as Tiger Trade.
This account is same as fast trade account. But, difference between these
two accounts is that in the Tiger Trade Account the client can access more than
25 scripts at a time and buy and sell the share from wherever they wants. This
account also provides the charts and graphs, so that the clients can easily
understand about the stock of the company. This is only for big clients and dealer
kind of customers. This account is mainly for active traders who trade frequently
during the trading session.
F
e
at
ur
e
s
of
A single platform for multiple exchange BSE & NSE (Cash & F&O), MCX,
lines
User can save his own defined screen as well as graph
Calculator
Shortcut key for FAST access to order placements & reports
Online fund transfer activated with 12 Banks
C.Dial-n-trade:
Features of Dial-n-trade:
TWO dedicated numbers for placing your orders with your cell phone or
landline. Toll free number: 1-800-22-7050. For people with difficulty in
accessing the toll-free number, we also have a Reliance number (Your
Local STD Code) 30307600 which is charged at as a local call.
After hours order placement facility between 9.00 am and 9.30 am (timings
to be extended soon)
2. Offline Account: This is simple way to do trading. In the offline account, the client
can place the order by telephone or through personal visit in the office.
The client who is very busy in their jobs or business, they can directly
place the order by the telephone or the client who are not much busy; they
can come to the office of Sharekhan.
Demat
Account
Opening
&
Brokerage
Charges: -
Charges
Classic Account
Brokerage
Free
Intra-day :
Free
0.10
%
Delivery :
Trade Tiger
Account
Intra-day : 0.10 %
Delivery : 0.50 %
0.50
%
Annual Maintenance
Charges
Next time when you are on move, you need not worry about your favorite
stocks price movement. You can carry stock market terminal with you
anywhere anytime.
Sharekhan brings your freedom of being Mobile. Yes, its so easy with Share
Mobile to track your favorite stocks price movement tick-by-tick.
1.
2.
Software (Technology) Used In Sharekhan: Sharekhan is using different technology for the running of their daily
transactions.
Mainly for the trading, the company using three software.
1. ODIN (VSAT Based)
2. Trade Tiger (WEB Based)
3. Classic/Fast Trade (WEB Based)
And also NEAT System Used for making transaction in NSE listed
company & same way BOLT System Used for making transaction BSE listed
company.
And for the client information or customer service, the company using two
software.
1. CIS Client Information System.
2. BOC Back Office.
Employees Strength
35
Offices
5000
Trading A/c
3000
Head office
Mumbai
Working Capital
Special Features
Seven
Reasons
as its retail broking division in February 2000, it has been providing institutionallevel research & broking services to investors.
2. TECHNOLOGY:
With Sharekhan online trading account you can buy and sell shares in an
instant from any PC with an internet connection. You will get access to our
powerful online trading tools that will help you take complete control over your
investment in shares.
3. KNOWLEDGE:
In a business where the right information at the right time can translate
into direct profits, you get access to a wide range of information on Sharekhans
website www.sharekhan.com. You will also get a useful set of Knowledge-based
tools that will empower you to take informed decisions.
4. ACCESSIBILITY:
In addition to Sharekhan online and phone trading services also very
useful. Sharekhan also have a ground network of 640 share shops across 280
Cities in India where you can get personalize Services.
5. CONVENIENCE:
You can call Sharekhans Dial-n-Trade number to get investment advice
and execute your transactions. Sharekhan have a dedicated Call Center to
provide this service via a toll-free number from anywhere in India.
6. CUSTOMER SERVICE:
Sharekhans customer service team will assist you for any help that you
need relating to transactions, billing, d-mat and other queries. Sharekhans
7. INVESTMENT ADVICE:
Sharekhan has dedicated research teams for fundamental and technical
research. Sharekhans analysts constantly track the pulse of the market and
provide timely investment advice to you in form of daily research e-mail, online
chat, printed reports and SMS on your phone.
WEAKNESSES:
Less informative website
Does not have slab rate brokerage which is provided by competitors
Problems due to network crash
Unawareness Among Investors
OPPORTUNITY:
THREATS:
Competitors develops
New Entrants.
Best
Financial
Website
Award.
INDUSTRY
PROFILE
OF BROKING FIRMS
Motilal Oswal Securities - Online trading, live BSE and NSE quotes
Sivan Securities - offers services related investment banking & stock broking
with a focus on South India.
Etc..etc..
Lots of brokerage companies are moving towards consolidation with the
smaller ones becoming either franchisee for the larger brokers or closing
operations. There is an increasing demand for online trading due to consumers
growing preference for Internet as compared to approaching the brokers.
New forms of trading including T+2 settlement system, dematerialization
etc. are strengthening the retail brokerage market and attracting foreign
companies to enter the Indian industry Various alternative forms of investment
including fixed deposits with banks and post offices etc act as substitutes to retail
broking products and services.
Stock Market
Stock markets refer to a market place where investors can buy and sell
stocks. The price at which each buying and selling transaction takes is
determined by the market forces (i.e. demand and supply for a particular stock).
A stock market is a public market for the trading of company stock and
derivatives at an agreed price; these are securities listed on a stock exchange as
well as those only traded privately.
The size of the world stock market was estimated at about $36.6 trillion
USD at the beginning of October 2008.
The stock market is one of the most important sources for companies
to raise money. This allows businesses to be publicly traded, or raise additional
capital for expansion by selling shares of ownership of the company in a public
market.
In fact, the stock market is often considered the primary indicator of a
country's economic strength and development. Rising share prices, for instance,
tend to be associated with increased business investment and vice versa.
In this way, investing in stock market, the stock exchanges also play
importance role. Exchanges also act as the clearinghouse for each transaction,
meaning that they collect and deliver the shares, and guarantee payment to the
seller of a security. This eliminates the risk to an individual buyer or seller that the
counterparty could default on the transaction. So, here we also understand about
Stock Exchanges as follows.
Stock exchange
A stock exchange is an entity which provides "trading" facilities for stock
brokers and traders, to trade stocks and other securities.
The Bombay Stock Exchange Limited is the oldest stock exchange not
only in the country, but also in Asia with a rich heritage of over 133 years of
existence. In the early days, BSE was established as "The Native Share &
Stock Brokers Association."
It was established in the year 1875 and became the first stock exchange
in the country to be recognized by the government. In 1956, BSE obtained a
permanent recognition from the Government of India under the Securities
Contracts (Regulation) Act, 1956.
Today, BSE is the world's number 1 exchange in terms of the number of
listed companies and the world's 5th in handling of transactions through its
electronic trading system.
The companies listed on BSE command a total market capitalization of
USD Trillion 1.06 as of July, 2009.
BSE reaches to over 400 cities and town nation-wide and has around
4,937 listed companies, with over 7745 scripts being traded as on
31st July 09.
The BSE Index, SENSEX, is India's first and most popular stock market
benchmark index. The BSE SENSEX (Sensitive index), also called the "BSE
30", is a widely used market index in India and Asia. Sensex is tracked
worldwide. It constitutes 30 stocks representing 12 major sectors. The SENSEX
is constructed on a 'free-float' methodology, and is sensitive to market
movements and market realities. Apart from the SENSEX, BSE offers 23 indices,
including 13 sectoral indices.
BSE provides an efficient and transparent market for trading in equity, debt
instruments and derivatives.
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).
BSE continues to innovate. In 2006, it became the first national level stock
exchange to launch its website in Gujarati and Hindi and now Marathi to reach
out to a larger number of investors.
BSE Vision
The vision of the Bombay Stock Exchange is -
BSE Profile
Address
Telephone
:-91-22-227212334
Website
:-www.bseindia.com
Trading hours
Securities
Trading System
:-Electronic
MD & CEO
:-Mr.Madhu Kannan
History of BSE
The Bombay Stock Exchange is known as the oldest exchange in Asia. It
traces its history to the 1850s, when stockbrokers would gather under banyan
trees in front of Mumbai's Town Hall. The location of these meetings changed
many times, as the number of brokers constantly increased. The group eventually
moved to Dalal Street in 1874 and in 1875 became an official organization known
as 'The Native Share & Stock Brokers Association'. In 1956, the BSE became the
first stock exchange to be recognized by the Indian Government under the
Securities Contracts Regulation Act.
The Bombay Stock Exchange developed the BSE Sensex in 1986, giving
the BSE a means to measure overall performance of the exchange. In 2000 the
BSE used this index to open its derivatives market, trading Sensex futures
contracts. The development of Sensex options along with equity derivatives
followed in 2001 and 2002, expanding the BSE's trading platform.
Indices of BSE:
Sensex
BSE 100(This covers Banking Sector)
BSE 200(This covers Capital goods)
BSE 500(This covers Consumer goods)
BSE mid-cap index
BSE small-cap index
BSE mid-cap index covers the FMCG sector and BSE small-cap index
covers the IT, Metal, Oil & gas, Power industry, PSUs, etc.
BSE
BSE has won the Asia - Pacific HRM awards for its efforts in employer
based stock exchange. It is the largest stock exchange in India in terms of daily
turnover and number of trades, for both equities and derivative trading.
NSE has a market capitalization of around Rs 47,01,923 crore
(7 August 2009) and is expected to become the biggest stock exchange in India
in terms of market capitalization by 2009 end. Though a number of other
exchanges exist, NSE and the Bombay Stock Exchange are the two most
significant stock exchanges in India, and between them are responsible for the
vast majority of share transactions.
NSE is mutually-owned by a set of leading financial institutions, banks,
insurance companies and other financial intermediaries in India but its ownership
and management operate as separate entities.
There are at least 2 foreign investors NYSE Euro next and Goldman
Sachs who have taken a stake in the NSE. As of 2006, the NSE VSAT terminals,
2799 in total, cover more than 1500 cities across India.
In October 2007, the equity market capitalization of the companies listed
on the NSE was US$ 1.46 trillion, making it the second largest stock exchange
in South Asia.
NSE is the third largest Stock Exchange in the world in terms of the
number of trades in equities. It is the second fastest growing stock exchange in
the world with a recorded growth of 16.6%.
Origins:
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.
Markets:
Currently, NSE has the following major segments of the capital market:
Equity
Futures and Options
Retail Debt Market
Wholesale Debt Market
Currency futures
NSE became the first stock exchange to get approval for Interest rate
futures as recommended by SEBI-RBI committee, on 31 August,2009, a futures
contract based on 7% 10 Year GOI bond (NOTIONAL) was launched with
quarterly maturities.
Hours:
NSE's normal trading sessions are conducted from 9:00 am India Time to
3:30 pm India Time on all days of the week except Saturdays, Sundays and
Official Holidays declared by the Exchange (or by the Government of India) in
advance.
The exchange in association with BSE (Bombay Stock Exchange Ltd.,)
thinking to revise its timings from 9.00 am India Time till 5.00 pm India Time.
However, on Dec 17, 2009, after strong protests from brokers, the
Exchange decided to postpone the change in trading hours till Jan 04, 2010.
NSE new market timing from Jan 04, 2010 is 9:00 am till 3:30 pm India
Time.
NSE Group:
History of N.S.E
Capital market reforms in India and the launch of the Securities and
Exchange Board of India (SEBI) accelerated the incorporation of the second
Indian stock exchange called the National Stock Exchange (NSE) in 1992. After a
few years of operations, the NSE has become the largest stock exchange in
India.
Three segments of the NSE trading platform were established one after
another. The Wholesale Debt Market (WDM) commenced operations in June
1994 and the Capital Market (CM) segment was opened at the end of 1994.
Finally, the Futures and Options segment began operating in 2000. Today the
NSE takes the 14th position in the top 40 futures exchanges in the world.
In 1996, the National Stock Exchange of India launched S&P CNX Nifty
and CNX Junior Indices that make up 100 most liquid stocks in India. CNX Nifty
is a diversified index of 50 stocks from 25 different economy sectors. The Indices
are owned and managed by India Index Services and Products Ltd (IISL) that has
a consulting and licensing agreement with Standard & Poor's.
In 1998, the National Stock Exchange of India launched its web-site and
was the first exchange in India that started trading stock on the Internet in 2000.
The NSE has also proved its leadership in the Indian financial market by gaining
many awards such as 'Best IT Usage Award' by Computer Society in India (in
1996 and 1997) and CHIP Web Award by CHIP magazine (1999).
Indices of N.S.E
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(Standard & Poor's CRISIL NSE Index)
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)
Mission of N.S.E.
NSE's mission is setting the agenda for change in the securities markets in
India. The NSE was set-up with the main objectives of:
RESEARCH METHODOLOGY
Introduction:
Research is one of the best instruments to identify the investing pattern of
investors to invest in various sectors & to study different sectors of Capital
market.
Definition:
Research is careful inquiry or examination to discover new
information and relationship and to expand and to vary existing
knowledge.
Research always starts with question or any problem and finds answer of
problem by using scientific method. It gives complete knowledge about any
problem or question.
Primary Objective:
The primary objective of carrying out this research is:-Investors behavior for Investing in Equity Market in Various Sectors
Secondary Objectives:
To find out in which investment option people invests most.
To find out how investors are motivates for investing in Equity Market.
To know the peoples time horizon for investing in Equity Market and to
know the rate of return expected by them.
To study the interest of people for further investment in Equity Market.
BENEFITS OF STUDY:
The study carried out under the title of Investors Behaviour for
Investing in Equity Market in Various Sectors will give benefits as under:
The research will be help to know in which sector investors are investing
more.
The study will be helpful in knowing that what factors consider most
important while selecting the Sectors and company under the sectors.
The study will be helpful in knowing that how the investors are trade in
Equity market.
The study will be helpful in knowing responses regarding problems faced
by the investors while investing in Equity Market
The study will be helpful in knowing that what are the motivational factors
that encouraging to the investors for investing in Equity Market.
So, it
might possible that there can be some limitations in this report that may be due to
my knowledge level or some other factors.
According to me following limitations can be prevailing in my report:
Respondents might have felt hesitation in providing information related to
their age, income etc. So, there can be some data that might questionable
because of unwillingness of respondents to give right information.
Sample selected may not represent whole population, as sample size
selected is very small in proportion to population due to time and cost
constraints.
Even many of the respondents may give bias answer.
Research Design:
Research design is the plan structure and strategy if investigation
conceived so as obtain answers to research question and to control
variance
A research design is the master plan or model for the conduct of formal
investigation and survey. It is a specification of methods and procedures for
acquiring the information needs for solving the problem. It decides the source of
information and methods for gathering the data. A questionnaire and other forms
are tested to use the collection of data.
In the research study there is no perfect study to solve the problem. The
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1. Exploratory Research
I have used Descriptive Research
2. Descriptive Research
Design for research purpose.
3. Casual Research
2. Descriptive Research:
Descriptive research, also known as statistical research. It describes
data and characteristics about the population or phenomenon being studied.
Descriptive research answers the questions who, what, where, when
and how. This study is complex and determines high degree scientific skill to
study the problem.
The description is used for frequencies, averages and other statistical
calculations. Often the best approach, prior to writing descriptive research, is to
conduct a survey investigation. Qualitative research often has the aim of
description and researchers may follow-up with examinations of why the
observations exist and what the implications of the findings are.
In short descriptive research deals with everything that can be
counted and studied.
In this report, I have used this Descriptive Research Design for
conducting survey on Investors behaviour for Investing in Equity Market
in Various Sectors
Primary Data
Secondary Data
Primary Data:
Primary data means data collected directly from first-hand experience.
Means data collected for the first time by any researcher for any research use.
There are many methods of collecting primary data and the main methods
include:
Methods of collecting the primary data are:
Questionnaire method
Interviews method
Focus group interviews
Observation method
Case-studies method
Diaries method
I have used Questionnaire method for the Primary data collection for
the study.
Secondary Data:
Secondary data means data which are collected by any one for a
particular research purpose and which are used by others for different purpose.
I have also used the secondary data for the study like some company
resources like broachers, websites etc.
Sampling Plan:
Sampling is the process to analyze the whole population
by analyzing a part of it.
The effectiveness of the report depends on the sample size selected from the
population.
Sampling Unit:
Here, target population is decided who are the actual and potential
investors, each sample has the chance to be selected on an equal basis & this
research has been conducted through surveying the whole of the equity market
of Surat city
Sample Size:
For getting better result of the given problem I have to determine the
perfect sample size as on 90% confidence level which is calculated statically by
the given formula.
n = p*q (z /c) 2
Where,
n = sample size
p = percentage picking a choice (expressed as decimal)
q = (1 - p)
Z = Z value (e.g. 1.645 for 90% confidence level)
c = confidence interval, expressed as decimal
(e.g., 0.05 = 5)
For Example:
p = 0.80
q = 0.20
z = 1.645
c = 0.05
n = p*q (z /c) 2
= 0.80*0.20 (1.645/0.05)
= 173.1856
= 175
Therefore, I used sample size is 175
Confidence interval:
In statistics, a confidence interval (CI) is a particular kind of interval
estimate of a population parameter. Instead of estimating the parameter by a
single
value,
an
interval
likely
to
include
the
parameter
is
given.
Confidence level:
The confidence level tells you how sure you can be. It is expressed as
a percentage and represents how often the true percentage of the population
who would pick an answer lies within the confidence interval.
The confidence level associated with a confidence interval estimate is the
success rate of the method used to construct the interval.
The 90% confidence level means you can be 90% sure; When I put the
confidence level and the confidence interval together, I can say that I am 90%
sure that the true percentage of the population is between 20% and 80%.
So, I have taken 90% confidence level means I am 90% sure. As on
90% confidence level value of Z = 1.645
Here, I have calculated formula on the basis of 90% confidence level .
Sampling frame:
Sampling frame is the actual set of units from which a sample has been
drawn. In sampling frame, I have used simple random sampling method for
conducting survey. In a simple random sample ('SRS') all units from the sampling
frame have an equal chance to be drawn and to occur in the sample.
Here, I have used sampling frame as an actual and potential investors
from whole of the equity market of Surat city and also from Sharekhan Securities
Pvt. Ltd. Here, each sample has the chance to be selected on an equal basis
because I have used simple random sampling method for surveying purpose.
Response Rate:
I have used SPSS software (Statistical Package for the Social Sciences)
for analysis purpose.
In that I have used Mean, Median, Mode, Frequency Table, and Cross
Tabulation, Graphical representation & interpretation with each graphs
and charts.
Microsoft Office is used for data typing formatting and analyzing the data.
Theoretical
aspect
abut topic
What is Investment?
The money you earn is partly spent and the rest saved for meeting future
Expenses. Instead of keeping the savings idle you may like to use savings in
Order to get return on it in the future. This is called Investment.
Investor:
of financial return.
The term has taken on a specific meaning in finance to describe the particular
types of people and companies that regularly purchase equity or debt
securities for financial gain in exchange for funding an expanding company.
following Uncertainty..!!!
A.
Meaning of Sector:
1
2
3
4
5
.
.
IT Sector
Agriculture Sector
Insurance Sector
Infrastructure Sector
Automobile Sector
Mining Sector
Aviation Sector
Banking Sector
Medical Sector
Cement Sector
Chemicals Sector
Paint Sector
Cigarettes Sector
Paper Sector
Construction Sector
Pharmaceutical Sector
Petrochemicals
Power Sector
Engineering Sector
Retail Sector
Sugar Sector
Service Sector
FMCG Sector
Shipping Sector
Fertilizer Sector
Steel Sector
Garment Sector
Textiles Sector
Capital
market is important as it plays an important role in bringing rapid industrial
development in a country. The savings are invested profitably for economic
development because of the services offered by capital market. Mobilization of
investable surplus and provision of expert services to investors and companies
are two significant activities undertaken by the capital market.
Capital market is importance due to: It enables the investors to adopt
their investment to their expectations which are constantly changing.
It acts as a link between those who want to save funds and those who
need funds and are in a position to invest them with safety and
reasonable return.
It provided the capital to those enterprises which can apply it profitably,
productively and increase the aggregate national income.
It provides proper flow of funds and brings about the rational allocation of
resources through the conversion of financial assets into physical assets.
Thus, the capital market facilitates capital formation.
It provides incentives to saving and facilitates capital formation by offering
suitable rate of interest as the price of capital.
It facilitated buying and selling of securities at listed price by providing
continuously marketability to the investors.
The securities offered in the capital market are transferable in character.
The changing business conditions in the economy are immediately
reflected on capital market. Booms and depression can be identified by
capital market. So suitable monitory and fiscal policies can be taken by
government.
Capital market supplies securities of different kinds with different maturity
and yields in unable the investors to diversify their risk by wider portfolio of
investment.
DATA ANALYSIS
ANALYSIS OF QUESTIONNAIRE
Particulars
Investing
Percentage
Yes
119
68%
No
56
32%
Total
175
100%
119
100
Investing
80
56
60
40
20
0
Yes
No
35%
Yes
No
65%
Interpretation:
] Equity Share
] IPO
] Mutual Funds
] Bonds
] Fixed Deposits
] If any other _________
Investment option
Investors in Percentage
Equity Share
53%
IPO
18%
Mutual Funds
8%
Bonds
7%
Fixed Deposits
4%
Other
10%
Interpretation:
According to the previous chart:
18% of investors believe that IPO (Primary Market) will provide the best
returns.
8% of investors think that Mutual Funds will provide the best returns.
7% of investors believe that Bonds Market will provide the best returns.
4% of investors trust that Fixed Deposits will provide the best returns.
] Return
] Liquidity
] Safety
] Capital Appreciation
] Other _____________
Motivation Factors
Investors in
Percentage
Return
49%
Liquidity
26%
Safety
7%
Capital Appreciation
17%
Other
1%
Interpretation:
According to the Previous Figure:
] Less than 5%
] 5%-10%
] 10%-15%
] 15%-20%
] 20%- 25%
] More than 25%
Percentage of Income
Investors in Percentage
Less than 5%
23%
5%-10%
45%
10%-15%
17%
15%-20%
7%
20%- 25%
5%
3%
Interpretation:
According to the Previous Figure:
23% of the investors are investing Less than 5% of their income in Equity
Market.
45% of the investors are investing 5%-10% of their income in Equity Market.
17% of the investors are investing 10%-15% of their income in Equity Market.
7% of the investors are investing 15%- 20% of their income in Equity Market.
While 3% of the investors are investing More than 25% of their income in
Equity Market.
] Intraday
] Delivery
] Speculation
] Arbitragers
] Hedging
] If any other please specify _____________
Types of Trade
Investors in Percentage
Intraday
13%
Delivery
31%
Speculation
26%
Arbitragers
17%
Hedging
11%
Other
2%
13%
11%
Delivery Speculation Arbitragers
Hedging
17%
31%
Other
26%
Interpretation:
According to the Previous Figure:
While 2% of the investors are trade in Equity Market for Other Purpose.
Time Horizon
Investors in Percentage
14%
1 to 3 Months
28%
3 to 6 Months
15%
6 to 12 Months
More than 12 Months
18%
25%
30%
25%
25%
20%
15%
15%
14%
18%
10%
5%
0%
Interpretation:
According to the Previous Figure:
28%
of
investors
invest
in
Equity
market
for
the
period
of
1 to 3 Months.
Que.7. What is the rate of return expected by you from Equity Market
in a year?
[
[
[
[
[
[
] 5% 10 %
] 10% 15 %
] 15% 20%
] 20% 25%
] 25% 30%
] 30% and above
Rate of Return
Investors in Percentage
5% 10 %
12%
10% 15 %
18%
15% 20%
32%
20% 25%
26%
25% 30%
8%
4%
Interpretation:
Que.8. Are you satisfied with the current performance of the Equity Market
in terms of expected return?
[
[
[
[
[
] Fully Satisfied
] Satisfied
] Neutral
] Unsatisfied
] Fully Unsatisfied
Rate of Return
No. of Investors
Percentage
Fully Satisfied
30
17%
Satisfied
73
42%
Neutral
49
28%
Unsatisfied
18
10%
Fully Unsatisfied
3%
Total
175
100%
73
49
30
18
5
Interpretation:
Equity market.
73 investors are Satisfied from Equity market.
49 investors are Neutral with current performance of Equity market.
18 investors are Unsatisfied from Equity market.
While 5 investors are Fully Unsatisfied from Equity market.
from
current performance
] Friends
] Relatives
] Advisers
] Media
] Research Report
] Magazines
] If any other ___________
Particulars
Investors in Percentage
Friends
28%
Relatives
12%
Advisers
25%
Media
17%
Research Report
10%
Magazines
5%
Other
3%
of
Interpretation:
Advisor.
Media motivate 17% of the investors to enter into the equity market.
Magazines motivate 10% of the investors to enter into the equity market.
5% of investors are motivates by Reading Magazines to enter in Equity
market.
While other factors like self-Study, their own View etc. motivate
3% of the investors to enter into the equity market.
] Market Trend
] Profitability
] Economic Condition
] Industry Condition
] Existence of well established Companies under Sectors
] Government Policy
] If any other please specify _____________
Particulars
Percentage
Market Trend
29%
Profitability
23%
Economic Condition
14%
Industry Condition
16%
12%
Government Policy
5%
Any Other
1%
Trend
Factors Consider byMarket
Investors
while selecting sector
(Investors in Percentage)
Profitability
29%
Existence of 16%
well established Companies under Sectors
Government Policy
Any Other
14%
23%
Interpretation:
According to the Previous Figure:
Sectors
Total
44
30
49
21
31
175
Banking Sector
26
24
53
42
30
175
IT Sector
20
40
47
35
33
175
Infrastructure Sector
37
32
33
28
45
175
Automobile Sector
35
30
28
52
30
175
Total
162
156
210
178
169
875
Sectors
Investo
rs
Rank
44
1st
IT Sector
40
2nd
Banking Sector
53
3rd
Automobile Sector
52
4th
Infrastructure Sector
45
5th
Interpretation:
On the basis of Previous Figures:
IT Sector:
20 Investors gave 1st rank, 40 Investors gave 2nd rank, 47 investors gave
3rd Rank, 35 Investors gave 4th Rank, & 33 Investors gave 5th Rank to this
sector.
Here, over all 40 investors have selected IT sector as a 2nd Rank in
comparison with 2nd Rank of all sectors.
Banking Sector:
26 Investors gave 1st rank, 24 Investors gave 2nd rank, 53 investors gave
3rd Rank, 42 Investors gave 4th Rank, & 30 Investors gave
5 th
Automobile Sector:
35 Investors gave 1st rank, 30 Investors gave 2nd rank, 28 investors gave
3rd Rank, 52 Investors gave 4th Rank, & 30 Investors gave 5th Rank to this
sector.
Here, over all 52 investors have selected Automobile sector as a 4th Rank
in comparison with 4th Rank of all sectors.
Infrastructure Sector:
37 Investors gave 1st rank, 32 Investors gave 2nd rank, 33 investors gave
3rd Rank, 28 Investors gave 4th Rank, & 45 Investors gave
5th
Que. 12. Mention the most important factors for selecting a company
of your choice.
[
[
[
[
[
[
[
Investors in
Percentage
19%
Dividend
17%
Brokers advise
15%
Market capitalization
7%
Performance of company
16%
P.E. Ratio
24%
Interpretat
Other
2%
ion:
While 15% of the investors are select a company under the sector of their
choice on the basis of Brokers advises.
last
2%
of
the
investors have
considered
Other Factors
like
FINDINGS
As the main objective of the research is to find out the
Investors behavior for Investing in Equity Market in Various Sectors in
Surat city. So, I have questionnaire method on 175 sample size for research
and found out the views of investors on various parameters.
From the research I found out that 68% of investors (119) are investing in
Equity Market. While 36% of investors (56) are not investing in Equity Market
investment option.
I found out that the 49% of investors who are dealing in equity market they
are motivated by return factor and 26% of investors are motivated by
Liquidity and some investor also consider capital appreciation and safety factor
I also found out that the 45% of the investors are ready or interested to
invest their 5%-10% of income in Equity Market. It means many investors trust
on the growth of equity market as they are ready to spend major proportion of
their income.
Going ahead I found out that very few investors want to deal in intraday
trading which shows that they consider safety factors while investing.
31% of
the investors are investing in Equity Market as a Delivery base Trading and
26% of the investors are trading in Equity Market as a Speculator. Means 26%
of investors who willingly take higher-than-average risk in return for a higher
the same proportion of investors are invest for long period more than year.
I also found out that 32% of investors are expects 15%-20% return from
Equity market and 26% of investors are expects 20%-25% return from Equity
market. Here, investors are more expects from Equity market.
42% of investors are satisfied with the current performance of the Equity
Market in terms of expected return, while 28% of investors are Neutral about
equity market.
I found that most of investors are motivated by their friends to enter in the
equity market and some investors are motivated by Advisers, Media, Research
Report and other factors like and self study of current scenario of equity market.
Other thing I found out that 29% of the investors have considered market
trend and 23% of the investors have considered Profitability as a most
important factor as a most important factor while selecting the Sector. There are
also other factors like - government policy, industry condition, and economic
17%
view etc. are as an important factor while selecting a company from these
selected sectors.
CONCLUSI
ON
RECOMMENDATION
Recommendation to Investors:
Prefer investment for long term investment strategy that provides you
moderate return with liquidity.
Investors should not invest in only equity market but, also invest in other
Safe Securities Like- Fixed Deposits, Government Securities, Bonds,
Mutual fund and Insurance etc. which also provides
moderate
return.
For Example: One should prefer
o Equity 50%
o Other Safe Securities 50%
So, one can get moderate return with liquidity.
Investors should invest money at lower level price and sale the stock at
higher price.
Investors should select company on the basis of PE ratio, EPS, Current
Growth of Company and Market capitalization and many more. So,
investors can get higher return on their investment.
Recommendation to Company:
From my research, I found that only 68% of investors are investing in
equity market, so more focus should on 32% of investors who are not
investing in equity market.
Broking
firms
or
companies
should
promote
Equity
investment
Company should focus on students also because equity market has risk
and the younger generation likes to take risk.
Majority investors are investing in Oil & gas sector and IT sector.
So, Company should also suggest to investors for investing other sector
which is also profitable.
BIBLIOGRAPHY
@. BOOKS:
@. Websites:
www.sharekhan.com
www.nseinda.com
www.bseindia.com
www.moneycontrol.com
www.investopedia.com
www.wikipedia.com
www.autherstream.com
www.myrisis.com
@. NEWS PAPER:
ECONOMICS TIMES
TIMES OF INDIA
@. OTHER:
Sharekhans Broachers
NCFM Capital Market Dealers Module
Other Magazines for Capitals Markets
Questionnaire
On
INVESTORS BEHAVIOUR FOR INVESTING IN EQUITY
MARKET
IN VARIOUS
SECTORS IN SURAT CITY
Student of Vivekananda College for B.B.A. is conducting a survey on
Investors Behavior for Investing in Equity Market in Various Sectors
on behalf of Share khan Security Pvt. Ltd, Surat
for fulfillment of BBA programmed.
This information is purely for an academic purpose and will be kept completely
confidential. You are requested to fill the below QUESTIONNAIRE.
[ ] No
2. If you want to invest, which investment option will provide the best returns?
[ ] Equity Share
[ ] Bonds
[ ] Liquidity
[ ] Safety
[ ] If any other please specify _____________
[ ] 5%-10%
[ ] 20%- 25%
[ ] 10%-15%
[ ] More than 25%
[ ] Delivery
[ ] Speculation [ ] Arbitragers
[ ] If any other please specify _____________
[ ] 1 to 3 Months
[ ] More than 12 Months
[ ] 3 to 6 Months
7. What is the rate of return expected by you from Equity Market in a year?
[ ] 5% 10 %
[ ] 20% 25%
[ ] 10% 15 %
[ ] 25% 30%
[ ] 15% 20%
[ ] 30% above
8. Are you satisfied with the current performance of the Equity Market in terms
of expected return?
[ ] Fully Satisfied
[ ] Unsatisfied
[ ] Satisfied
[ ] Fully Unsatisfied
[ ] Neutral
[ ] Relatives
[ ] Magazines
[ ] Advisers
[ ] Media
[ ] If any other ___________
10. Which Factors do you consider most important while selecting the Sectors?
[ ] Market Trend
[ ] Industry Condition
[ ] Government Policy
[ ] Profitability
[ ] Economic Condition
[ ] well established Companies under Sectors
[ ] If any other please specify _____________
11. Which Sector do you prefer the most? (Give 1 to 5 Orders in given boxes)
Oil & Gas Sector
Banking Sector
IT Sector
Infrastructure Sector
Automobile Sector
If any other please specify _____________
12. Mention the most important factors for selecting a company of your choice.
[ ] Earning Per Share
[ ] Dividend
[ ] Brokers advise
[ ] Market capitalization
[ ] Performance of company
[ ] P.E. Ratio
Personal Information:-
Name:
Address: _______________________________________________
_______________________________________________
_______________________________________________
E-mail ID: ..
Contact No.: ..
Gender
Age:
[ ] Male
[ ] Below 20 Years
[ ] 41 TO 50 Years
[ ] Female
[ ] 21 TO 30 Years
[ ] 51 TO 60 Years
[ ] 31 TO 40 Years
[ ] Above 60 Years
Occupation:
[ ] Business
[ ] Student
[ ] Service
[ ] Employee
[ ] Other please specify _____________
Income (Yearly):
[ ] Less than 100000 Rs. [ ] 100000 to 200000 Rs. [ ] 200000 to 300000 Rs.
[ ] 300000 to 400000 Rs. [ ] 400000 to 500000 Rs. [ ] Above 500000 Rs.