THA FINAL.doc1

8/7/2019 THA FINAL.doc1

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1.1

INDUSTRY PROFILE

The Indian broking industry is one of the oldest trading industries that have been around

even before the establishment of the BSE in 1875. Despite passing through number of

changes in the post liberalization period, the industry has found its way onwards sustainable

growth. With the purpose of gaining a deeper understanding about the role of the Indian

stock broking industry in the countrys economy, we present in this section some of the

industry insights gleaned from analysis of data received through primary research.

For the broking industry, we started with an initial database of over 1,800 broking

firms that were contacted, from which 464 responses were received. The list was further

short listed based on the number of terminals and the top 210 were selected for profiling.

394 responses, that provided more than 85% of the information sought have been included

for this analysis presented here as insights. All the data for the study was collected through

responses received directly from the broking firms. The insights have been arrived at

through an analysis on various parameters, pertinent to the equity broking industry, such as

region, terminal, market, branches, sub brokers, products and growth areas.

Some key characteristics of the sample 394 firms are:

On the basis of geographical concentration, the West region has the maximum

representation of 52%. Around 24% firms are located in the North, 13% in the South

and 10% in the East

3% firms started broking operations before 1950, 65% between 1950-1995 and 32%

post 1995.

On the basis of terminals, 40% are located at Mumbai, 12% in Delhi, 8% in

Ahmedabad, 7% in Kolkata, 4% in Chennai and 29% are from other cities

From this study, we find that almost 36% firms trade in cash and derivatives and 27%

are into cash markets alone. Around 20% trade in cash, derivatives and commodities

In the cash market, around 34% firms trade at NSE, 14% at BSE and 52% trade at

both exchanges. In the derivative segment, 48% trade at NSE, 7% at BSE and 45% at

both, whereas in the debt market, 31% trade at NSE, 26% at BSE and 43% at both

exchanges


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Majority of branches are located in the North, i.e. around 40%. West has 31%, 24%

are located in South and 5% in East

In terms of sub-brokers, around 55% are located in the South, 29% in West, 11% in

North and 4% in East

Trading, IPOs and Mutual Funds are the top three products offered with 90% firms

offering trading, 67% IPOs and 53% firms offering mutual fund transactions

In terms of various areas of growth, 84% firms have expressed interest in expanding

their institutional clients, 66% firms intend to increase FII clients and 43% are

interested in setting up JV in India and abroad

In terms of IT penetration, 62% firms have provided their website and around 94%

firms have email facility

A BRIEF HISTORY

India Infoline was originally incorporated on October 18, 1995 as Probity Research

and Services Private Limited at Mumbai under the Companies Act, 1956 with Registration

No. 11 93797. India Infoline commenced operations as an independent provider of

information, analysis and research covering Indian businesses, financial markets and

economy, to institutional customers. India Infoline became a public limited company on April

28, 2000 and the name of the Company was changed to Probity Research and Services

Limited. The name of the Company was changed to India Infoline.com Limited on May 23,

2000 and later to India Infoline Limited on March 23, 2001.

In 1999, India Infoline.com identified the potential of the Internet to cater to a mass

retail segment and transformed our business model from providing information services to

institutional customers to retail customers. Hence India Infoline launched Internet portal,

www.indiainfoline.com in May 1999 and started providing news and market information,

independent research, interviews with business leaders and other specialized features.


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In May 2000, the name of India Infoline was changed to India Infoline.com Limited

to reflect the transformation of our business. Over a period of time, India Infoline.com has

emerged as one of the leading business and financial information services provider in India.

In the year 2000, India Infoline leveraged its position as a provider of financial

information and analysis by diversifying into transactional services, primarily for online

trading in shares and securities and online as well as offline distribution of personal financial

products, like mutual funds and RBI Bonds. These activities were carried on by our wholly

owned subsidiaries.

India Infoline broking services was launched under the brand name of 5paisa.com

through our subsidiary, India Infoline Securities Private Limited and www.5paisa.com, the e-

broking portal, was launched for online trading in July 2000. It combined competitive

brokerage rates and research, supported by Internet technology besides investment advice

from an experienced team of research analysts, India Infoline also offer real time stock

quotes, market news and price charts with multiple tools for technical analysis.

Facilities

India Infolines main offices are located in approximately 4,000 square feet of

office space located in Mumbai, India. India Infoline Branches collectively occupy an

additional 10,000 square feet of office space located throughout India, As on March 31, 2005,

India Infoline has 73 branches across 36 locations in India.

Terminals

Almost 52% of the terminals in the sample are based in the Western region of India,

followed by 25% in the North, 13% in the South and 10% in the East. Mumbai has got the

maximum representation from the West, Chennai from the South, New Delhi from the North

and Kolkata from the East.


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Branches & Sub-Brokers

The maximum concentration of branches is in the North, with as many as 40% of all

branches located there, followed by the Western region, with 31% branches. Around 24%

branches are located in the South and East constitutes for 5% of the total branches of the

total sample.

In case of sub-brokers, almost 55% of them are based in the South. West and North

follow, with 30% and 11% sub-brokers respectively, whereas East has around 4% of total

sub-brokers.


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Financial Markets

The financial markets have been classified as cash market, derivatives market, debt

market and commodities market. Cash market, also known as spot market, is the most

sought after amongst investors. Majority of the sample broking firms are dealing in the cash

market, followed by derivative and commodities. 27% firms are dealing only in the cash

market, whereas 35% are into cash and derivatives. Almost 20% firms trade in cash,

derivatives and commodities market. Firms that are into cash, derivatives and debt are 7%.

On the other hand, firms into cash and commodities are 3%, cash & debt market and

commodities alone are 2%. 4% firms trade in all the markets.

In the cash market, around 34% firms trade at NSE, 14% at BSE and 52% trade at

both exchanges. In the equity derivative market, 48% of the sampled broking houses are

members of NSE and 7% trade at BSE, while 45% of the sample operate in both stock

exchanges. Around 43% of the broking houses operating in the debt market, trade at both

exchanges with 31% and 26% firms uniquely at NSE and BSE respectively.


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Products

The survey also revealed that in the past couple of years, apart from trading, the firms

have started offering various investment related value added services. The sustained growth

of the economy in the past couple of years has resulted in broking firms offering many

diversified services related to IPOs, mutual funds, company research etc. However, the core

trading activity is still the predominant form of business, forming 90% of the firms in the

sample. 67% firms are engaged in offering IPO related services. The broking industry seems

to have capitalized on the growth of the mutual fund industry, which was pegged at 40% in

2006. More than 50% of the sample broking houses deal in mutual fund investment services.

The average growth in assets under management in the last two years is almost 48%.

Company research is another lucrative area where the broking firms offer their services;

more than 33% of the firms are engaged in providing company research services.

Additionally, a host of other value added services such as fundamental and technical

analysis, investment banking, arbitrage etc are offered by the firms at different levels.


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Of the total sample of broking houses providing trading services, 52% are based in the West,

followed by 25% from North, 13% from South and 10% from the East. Around 50% of the

firms offering IPO related services are based in the West as compared to 27% in North, 13%in South and 10% in East. In providing mutual funds services, the Western region was

dominant amounting to 49% followed by 27% from North; The South and the East are

almost at par with 13% and 11% respectively.


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Future Plans

68% of the firms from the sample have envisaged strategies for future

growth. With the middle class Indian investor as well as foreign investorwilling to invest in the stock market, majority of the firms preferred expansion

of institutional and the Foreign Institutional Investor clients in their areas of

growth. Around 84% have shown interest in expanding their institutional client

base. Nearly 51% of such firms are located in the West, 25% in North, 15% are

from South and 9% from East. Since the past couple of years, India, along with

Korea and Taiwan, has been one of the preferred destinations for the FIIs. With

corporate restructuring, rising market capitalization and sectoral friendly

policies helping the FIIs, more than two thirds of the firms are interested in

increasing their FII client base. Amongst these firms, west again has maximum

representation of 53%, followed by North with 22%. South has 15% firms and

East makes up for 9%.


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1.2 BACK GROUND TO THE STUDY

Equities

IIFL is a member of BSE and NSE registered with NSDL and CDSL as a depository

participant and provides broking services in the cash, derivatives and currency segments,

online and offline. IIFL is a dominant player in the retail as well as institutional segments of

the market. It recently became the first Indian broker to get a membership of the Colombo

Stock Exchange and is also the first Indian broker to have received an in-principle approval

for membership of the Singapore Stock Exchange.

COMMODITIES

IIFL offers commodities trading to its customers vide its membership of the MCX and theNCDEX. Our domain knowledge and data based on in depth research of complex paradigms

of commodity kinetics, offers our customers a unique insight into behavioral patterns of these

markets. Our customers are ideally positioned to make informed investment decisions with a

high probability of success.

CREDIT AND FINANCE

IIFL offers a wide array of secured loan products. Currently, secured loans (mortgage loans,

margin funding, loans against shares) comprise 94% of the loan book. The Company has

discontinued its unsecured products. It has robust credit processes and collections mechanism

resulting in overall NPAs of less than 1%. The Company has deployed proprietary loan-

processing software to enable stringent credit checks while ensuring fast application

processing. Recently the company has also launched Loans against Gold.

INSURANCE

IIFL entered the insurance distribution business in 2000 as ICICI Prudential Life Insurance

Co. Ltds corporate agent. Later, it became an Insurance broker in October 2008 in line with

its strategy to have an open architecture model. The Company now distributes products ofmajor insurance companies through its subsidiary India Info line Insurance Brokers Ltd.

Customers can choose from a wide bouquet of products from several insurance companies

including Max New York Life Insurance, MetLife, Reliance Life Insurance, Bajaj Allianz

Life, Birla Sun life, Life Insurance Corporation, Kotak Life Insurance and others.


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WEALTH MANAGEMENT SERVICE

IIFL offers private wealth advisory services to high-net-worth individuals (HNI) and

corporate clients under the IIFL Private Wealth brand. IIFL Private Wealth is managed by a

qualified team of MBAs from IIMs and premier institutes with relevant industry experience.The team advises clients across asset classes like sovereign and quasi-sovereign debt,

corporate and collateralized debt, direct equity, ETFs and mutual funds, third party PMS,

derivative strategies, real estate and private equity. It has developed innovative products

structured on the fixed income side.

INVESTMENT BANKING

IIFLs investment banking division was launched in 2006. The business leverages upon its

strength of research and placement capabilities of the institutional and retail sales teams. Ourexperienced investment banking team possesses the skill-set to manage all kinds of

investment banking transactions. Our close interaction with investors as well as corporate

helps us understand and offer tailor-made solutions to fulfill requirements.

1.3 STATEMENT OF THE PROBLEM

The online brokerages currently account for about 15-30% of all US stock trades, dependingon definitions used. More than 5 million investors trade online and analysts expect that

number to almost double in 1999 (Bicknell, 1998). The number of online-brokers in the US is

rapidly increasing and at present the number is more than 120 (Warner 1998;

http://www.gomez.com). James Marks a Credit Suisse First Boston analysts has taken an in-

depth study of the Charles Schwabs on-line brokerage business, and he says that most of the

online-brokerages increased market-share will be stolen from the full-service, full-

commission brokers (Weisul, 1997). A Yankee Group Study found that while 40% of bank

customer felt loyalty to their bank, only 12% of brokerage customers felt the same way

(Pennsburg, 1997).

The online-trading will most likely continue to be an alternative to the traditional brokering.The number of online-accounts has reached unexpected highs, and it is believed to grow even

further. At the same time it has been shown that the on-line brokers gains market-shares on

behalf of the traditional full-commission brokers. In addition there seems to be little loyalty

among the customers. All this indicates that traditional brokerage-firms that still do not offer

on-line trading should take the threat from this emerging new way of buying stocks,

seriously. Merrill Lynch on the other hand has a different view on the on-line trading, being

skeptic and very averse to jump on the "hype" as they call it. In this term paper we will take a

closer look at the on-line trading from Merrill Lynchs point of view, and present a strategy

of how they should position themselves.


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1.4 NEED AND IMPORTENTS OF MARKATING STRATAGIS

To know about the kind of brokerage they are charge

and the way they portfolios of the client

To know how they handle the risk


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1.5

EXPECTED CONTRIBUTION FROM THE STUDY

For the Research work, I have taken India info line and others into consideration. A

comparative analysis of both the brokerage is done in terms of risk and return. Also the

research work includes the return which the investors would get by investing in these

brokerages and which will provide greater returns to the investor is the purpose of the

research.

OBJECTIVES OF THE STUDY

To study India info line in detail.

To study the basics of other brokerages

To analyze the amount of risk involved in brokerage.

To know the risk and return from the brokerage

To know how brokerages provide better returns to the investors.


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2.0 INTRODUCTION TO INDIAINFOLINE

India Infoline founded in 1995 by Mr. Nirmal Jain (Chairman and Managing Director) as an

independent business research and information provider. We gradually evolved into a one-

stop financial services solutions provider. Our strong management team comprises competent

and dedicated professionals.

We are a pan-India financial services organization across 1,361 business locations and a

presence in 428 cities. Our global footprint extends across geographies with offices in New

York, Singapore and Dubai. We are listed on the Bombay Stock Exchange (BSE) and the

National Stock Exchange (NSE).

We offer a wide range of services and products comprising broking (retail and institutional

equities and commodities), wealth management, credit and finance, insurance, asset

management and investment banking.

We are registered with the BSE and the NSE for securities trading, MCX, NCDEX and

DGCX for commodities trading, CDSL and NSDL as depository participants. We are

registered as a Category I merchant banker and are a SEBI registered portfolio manager. We

also received the FII license in IIFL Inc. IIFL Securities Pte Ltd received approval from the

Monetary Authority of Singapore to carry out corporate advisory and dealing in securities

operations. Two subsidiaries India Infoline Investment Services and Moneyline Credit

Limited are registered with RBI as non-deposit taking non-banking financial services

companies. India infoline Housing Finance Ltd, the housing finance arm, is registered with

the National Housing Bank.


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HISTROY OF INDIAINFOLINE

The IndiaInfoline Group was originally incorporated on October 18, 1995 as Probity

Research and Services Private Limited at Mumbai under the Companies Act, 1956 with

Registration No. 11 93797. The IndiaInfoline Group commenced its operations as an

independent provider of information, analysis and research covering Indian businesses,

financial markets and economy, to institutional customers. We became a public limited

company on April 28, 2000 and the name of the Company was changed to Probity Research

and Services Limited. The name of the Company was changed to India Infoline.com Limited

on May 23, 2000 and later to India Infoline Limited on March 23, 2001.

In 1999, The IndiaInfoline Group identified the potential of the Internet to cater to a

mass retail segment and transformed our business model from providing information services

to institutional customers to retail customers. Hence we launched our Internet portal,

www.indiainfoline.com in May 1999 and started providing news and market information,

independent research, interviews with business leaders and other specialized features.

In May 2000, the name of our Company was changed to India Infoline.com Limited

to reflect the transformation of our business. Over a period of time, we have emerged as one

of the leading business and financial information services provider in India.

In the year 2000, The India Infoline Group leveraged its position as a provider of

financial information and analysis by diversifying into transactional services, primarily for

online trading in shares and securities and online as well as offline distribution of personal

financial products, like mutual funds and RBI Bonds. These activities were carried on by our

wholly owned subsidiaries.

The India Infoline Groups broking services was launched under the brand name of

5paisa.com through our subsidiary, India Infoline Securities Private Limited and

www.5paisa.com, the e-broking portal, was launched for online trading in July 2000. It

combined competitive brokerage rates and research, supported by Internet technology

Besides investment advice from an experienced team of research analysts, we also offer real

time stock quotes, market news and price charts with multiple tools for technical analysis.


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Acquisition of Agri Marketing Services Limited ("Agri")

In March 2000, The IndiaInfoline Group acquired 100% of the equity shares of Agri

Marketing Services Limited, from their owners in exchange for the issuance of 508,482 of

our equity shares. Agri was a direct selling agent of personal financial products including

mutual funds, fixed deposits, corporate bonds and post-office instruments. At the time of our

acquisition, Agri operated 32 branches in South and West India serving more than 30,000

customers with a staff of, approximately 180 employees. After the acquisition, we changed

the company name to India Infoline.com Distribution Company Limited.

The India Infoline group, comprising the holding company, India Infoline Ltd (NSE:

INDIAINFO, BSE: 532636) and its subsidiaries, is one of the leading players in the Indianfinancial services space. India Infoline offers the entire gamut of financial services covering

investment products ranging from Equities and derivatives, Commodities, Portfolio

Management Services, Mutual Funds, Life Insurance, Fixed deposits, Loans, Investment

Banking, GoI bonds and other small savings instruments. It owns and manages the website,

www.indiinfoline.com, which is one of Indias leading online destinations for personal

finance, stock markets, economy and business.

A forerunner in the field of equity research, IndiaInfolines research is acknowledged by none

other than Forbes as Best of the Web and a must read for investors in Asia.

IndiaInfolines research is available not just over the internet but also on international wire

services like Bloomberg (Code: IILL), Thomson First Call and Internet Securities where it is

amongst the most read Indian brokers.

A network of 753 business locations spread over 346 cities across India, facilitates the

smooth acquisition and servicing of a large customer base. All these offices are connected

with the corporate office in Mumbai with cutting edge networking technology.
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Stock Option details: whether to be issued at discount as well as the period over which to be

accrued and over which exercisable. - To conduct discussions with the HR department and

form suitable remuneration policies.

Share Transfer and Investor Grievance Committee

Details of the Members, Compliance Officer, No of Complaints received and pending and

pending transfers as on close of the financial year. The committee functions under the

Chairmanship of Mr Kranti Sinha, a Non-executive independent Director. The other

Members of the committee are Mr Sanjiv Ahuja, Independent Director and Mr R

Venkataraman, Executive Director. Ms Komal Parikh, Company Secretary is the Compliance

Officer of the Company.


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COMPANY STRUCTURE

IndiaInfoline Limited is listed on both the leading stock exchanges in India, viz. the Stock

Exchange, Mumbai (BSE) and the National Stock Exchange (NSE) and is also a member of

both the exchanges. It is engaged in the businesses of Equities broking, Wealth Advisory

Services and Portfolio Management Services. It offers broking services in the Cash and

Derivatives segments of the NSE as well as the Cash segment of the BSE. It is registered withNSDL as well as CDSL as a depository participant, providing a one-stop solution for clients

trading in the equities market. It has recently launched its Investment banking and

Institutional Broking business.

A SEBI authorized Portfolio Manager; it offers Portfolio Management Services to clients.

These services are offered to clients as different schemes, which are based on differing

investment strategies made to reflect the varied risk-return preferences of clients


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CHALLENGES FACES BY INDIAINFOLINE

Category related - the market is skewed primarily to the metros with Mumbai, Ahmedabad,

and New Delhi accounting for major bulk of the trading.

Competition related - due to high brand proliferation, the market from a consumer standpoint

has become commoditized given product parity in terms of offerings.

Brand related - challenge being to maintain high decibel and impactful communication on asustained basis.

Key executives

S.No Name Designation

1 Mr. Nirmal Jain Chairman and Managing director

2 Mr. A K Purwar Director

3 Mr. R Venkataraman Executive Director

4 Mr. Nilesh Vikamsey Independent Director

5 Mr. Kranti Sinha Independent Director

6 Mr. Sat Pal Khattar Non Executive Director


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PRODUCT & SERVICES

Equities

India Infoline provided the prospect of researched investing to its clients, which was

hitherto restricted only to the institutions. Research for the retail investor did not exist prior

to India Infoline. India Infoline leveraged technology to bring the convenience of trading to

the investors location of preference (residence or office) through computerized access.

India Infoline made it possible for clients to view transaction costs and ledger updates in

real time.

Over the last five years, India Infoline sharpened its competitive edge through the

following initiatives:

Multi-channel delivery model :

The Company is among the few financial intermediaries in India to offer a complement of

online and offline broking. The Companies network of branches also allows customers to

place orders on phone or visit our branches for trading.

Integrated middle and back office :

The customer can trade on the BSE and NSE, in the cash as well as the derivatives segment

all through the available multiple options of Internet, phone or branch presence.

Multiple-trading options :

The Company harnessed technology to offer services at among the lowest rates in the

business.

Membership:

The Company widened client reach in trading on the domestic and international exchanges.

Technology :

The Company provides a prudent mix of proprietary and outsourced technologies, which

facilitate business growth without a corresponding increase in costs.


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Content :

The Company has leveraged its research capability to provide regular updates and

investment picks across the short and long-term.

Service :

Clients can access the customer service team through various media like toll-free lines,

emails and Internet- messenger chat for instant query resolution. The Companies customer

service executives proactively contact customers to inform them of key changes and

initiatives taken by the Company. Business World rated the Companies customer service as

Best in their survey of online trading sites carried out in December 2003.

Key features :

Membership on the Bombay Stock Exchange Limited and the National Stock Exchange

Registered with the NSDL as well as CDSL as a depository participant, providing a

one-stop solution for clients trading in the equities market

Broking services in cash and derivative segments, online as well as offline.

Presence across 350 cities and towns with a network of over 850 business locations

Equity client base of over 500,000 clients

Provision of free and world-class research to all clients

Commodities

India Infolines extension into commodities trading reconciles its strategic intent to emerge

as a one stop solutions financial intermediary. Its experience in securities broking has

empowered it with requisite skills and technologies. Increased offering: The Companies

commodities business provides a contra-cyclical alternative to equities broking. The

Company was among the first to offer the facility of commodities trading in Indias young

commodities market (the MCX commenced operations only in 2003). Average monthly

turnover on the commodity exchanges increased from Rs 0.34 bn to Rs 20.02 bn. The

commodities market has several products with different and non-correlated cycles. On the

whole, the business is fairly insulated against cyclical gyrations in the business.


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IndiaInfoline distinguished its business through the interplay of knowledge and

technology:

Complete solution :

The Company provides a complete - advice to execution solution facilitated by information

and advice on likely commodity trends in the Indian and international environment.

Technology :

The Company has extended the trading terminal to the investors home/workplace reinforced

with real-time commodity information and ledger position.

Rates :

The Company harnessed technology to offer services at among the lowest rates in the

business. Membership: The Company widened client reach in trading on the domestic and

international exchanges.

Key Features :

Enjoys memberships with the MCX and NCDEX, two leading Indian commodities

exchanges

Recently acquired membership of the DGCX

Multi-channel delivery model, making it among the select few to offer online as well as

offline trading facilities

Extended commodity trading to retail investors, among the few Indian financial

intermediaries to do so

Online business at 80% of revenues dominates commodities trading revenues

Provides regular commodity updates pertaining to the Indian and international

environment


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INSURANCE

An entry into this segment helped complete the client's product basket; concurrently, it graduated

the Company into a one stop retail financial solutions provider. To ensure maximum reach to

customers across India, we have employed a multi pronged approach and reach out to customers

via our Network, Direct and Affiliate channels. Following the opening of the sector in 1999-2000,

a number of private sector insurance service providers commenced operations aggressively and

helped grow the market.

The Companies entry into the insurance sector derisked the Company from a predominant

dependence on broking and equity-linked revenues. The annuity based income generated from

insurance intermediation result in solid core revenues across the tenure of the policy.

Over the last five years, India Infoline sharpened its competitive edge in this business segment

through the following initiatives:

Client base :

Grew its 40,000 strong client base through knowledge-led analysis, translating into an attractive

opportunity to cross-sell products and generate referral business.

Distribution network :

Invested in a distribution network of 177 branches across 19 states, which provided it with an

unmatched reach within its segment.

Hands-on training :

Invested aggressively in training its field force more than 100 hours a year in product attributes

across the insurance sector - highlighting various product details and marketing skills apart from

regular meets where best practices are shared.

Technology :


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The Company provides a prudent mix of proprietary and outsourced technologies, which facilitate

business growth without a corresponding increase in costs.

Research and advice :

Provided clients with advice on diverse investment products based on the customers existing and

prospective financial profile.

Key features :

India Infoline was the first corporate in India to get the agency licence in early 2001

The Company is the biggest corporate agency in India for life insurance products

The Company operates multiple channels, namely branch network, preferred client

group, direct marketing, corporate tax advisory, walk-ins and seminars, to reach out to

customers.

INVEST ONLINE

India Infoline has made investing in Mutual funds and primary market so

effortless. All you have to do is register with us and thats all. No paperwork no

queues and No registration charges.

If you are 5p customer use your existing login ID and Ledger (fund transfer) password.

Indiainfoline offers you a host of mutual fund and IPO choices under one roof; backed by

in-depth information and research to help you invest effortlessly.

INVEST IN MF

Indiainfoline offers you a host of mutual fund choices under one roof, backed by in-depth

research and advice from research house and tools configured as investor friendly.

Investing in Mutual Funds has never been easier


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APPLY IN IPOs

You could also invest in Initial Public Offers (IPOs) online without going through the

hassles of filling ANY application form/ paperwork.

Know more about IPO

Get in-depth analyses of new IPOs issues (Initial Public Offerings) which are

about to hit the market and analysis on these recent IPO listings,

prospectus/offer documents, and IPO reports are few of the features, which help

you, keep on top of the IPO markets.

Loans

They say you mustn't trust a man till you know his house. Everyone likes hearing people say

Wow, what a beautiful house you have! From cave dwelling, we have evolved and now a

house provides far more than just shelter...it also becomes a source of pride. A Housing Loan

is used as finance to help you buy or modify that perfect home.

The different Housing Loan products can be classified as:

Home Loans & Home Extension Loans

NRI Loans

Land Loans

Home Equity Loans

What is a housing loan?

They say you mustn't trust a man till you know his house. Everyone likes hearing people say

"Wow, what a beautiful house you have!" From cave dwelling, we have evolved and now a

house provides far more than just shelter...it also becomes a source of pride. A Housing Loan

is used as finance to help you buy or modify that perfect home. The different Housing Loan


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products can be classified as:

Home Loan

Home Extension Loans

Home Improvement Loans

Land Loans

NRI Loans

Home Equity Loans

Short term Bridging Loans

Balance Transfer

Who can apply?

As long as you want to buy a house in India, you can apply for a Home Loan. You could be a

Resident Indian or an NRI; you could want to buy a property now or in the future, but you

may still apply for a Home Loan. In case you go with the last option and want to wait before

you consider nests, all you have to be sure of is the amount you are willing to spend on this

property and the HfIs will let you know your eligibility based on your income which will help

you plan out your budget. To find out your eligibility, please use our calculator.

General Terms and Conditions of a Housing Loan Product

You are allowed to visit zoos on the condition that you do not feed the animals. When you're

18, you are allowed to go for that late night party on the condition that someone drops you

home before 12. Every step we take requires condition to be fulfilled. Similarly, these are the

general terms & conditions of a Home Loan. For more details, please refer to the individual

product.


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LTV Ratio will not exceed a particular percentage. This percentage differs from HFI

to HFI and the components of the value of property are covered in Cost of Property

Elastic can be stretched only to a certain extent. The loan tenure also will not go

beyond 20 years. However, HFIs do provide for different tenures with different terms

and conditions.

Your EMI normally does not exceed 50% of your Gross Monthly income.

The total monthly payment towards all the loans you have availed of, including the

present one, will normally not exceed 50% of your Gross Monthly Income.

Your loan eligibility is calculated using LTV, IIR and FOIR norms and the lowest

from the three is chosen.

Your profile is considered by the HFI before your repayment capacity is judged.

If the HFI insists on a personal guarantor, you need to provide one before the

disbursement of your loan.

Your property should be both technically and legally clear before your loan can get

disbursed by the HFI.

In case you have bought an under construction property, your loan will be partly

disbursed, as per the stages of construction and PEMI needs to be paid on it.

The disbursement, in most cases, will be in the name of the builder or the seller or the

society or the development authority unless you have made some payment to them.

Repayment of the loan is either via Deduction Against Salary, Post Dated Cheques,

standing instructions or by cash / DD.

You can either choose to repay the loan using the Annual rests or Monthly rests.

Charges applicable to Housing Loans

The different kinds of charges applicable to Home Loans are listed below:

Upfront Fees

Rate of Interest

Legal and Technical Charges

Stamp Duty and Registration Charges

Personal Guarantee from Charges

Cheque Bounce Charges


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Delayed Payment Charges

Additional Charges

Incidental Charges

Prepayment Charges

PDC Swapping Charges

Legal and technical charges :

Some HFIs charge you for the legal and technical checks undertaken on your documents and

property, by lawyers and the technical team of the HFI.

Stamp duty and registration charges:

If you go in for a registered mortgage, these charges incurred by the HFI are passed onto

you. Sometimes these charges are rather heavy depending on the State laws in the state from

where you purchase your property.

Personal Guarantee form charges:

A piece of paper signed does not have much value unless stamped and validated by the

concerned authority. That power of attorney document that you signed with your spouse

would not be credible unless signed on a Rs.100 stamp paper. Similarly, HFIs currently

charge you a minimum of Rs.100 to get the personal guarantee validated and stamped in the

eyes of the law.

PDC swapping charges:

In case you want to exchange the PDCs you gave the HFIs for EMI repayments because of a

change in bank accounts, a change in EMI amount, etc., the HFis might charge a flat fee for

it.

Repayment capacity

Your repayment capacity is judged according to your income and your income is considered

differently if you are salaried and differently if you are self-employed. Income is used to


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calculate the amount of money that you will be able to shell out every month towards your

loan installment using IIR and FOIR norms. FOIR calculation also takes into account the

installments of loans you are currently repaying. The lower between the IIR and FOIR is

chosen as your maximum repayment capacity. This is then compared to the loan amount that

you have requested for and the loan eligibility as per LTV norms and the lowest of these

would be your final loan eligibility.

Salaried Self-employed

Any extra income on your salary slip(including overtime, etc.) is subtracted

Any non-recurring income that affects profit(like sale of asset) is subtracted.

50% of the average variable income over the

last 6 months is added

Any non-recurring expense that adversely

affects profits and was not capitalized (like

repairs and maintenance) is added

Any fixed cash or voucher payment that can

be proved is added.

50% of the average depreciation of the last

two years is added.

HRA that can be received and is not being

received is added.

50% of the average annual income of the last

two years is added.

Credit Documentation

Would you trust any Tom, Dick or Harry with any matter at all? We all require a certain

assurance from people before we trust them; some sort of guarantee that they are trustworthy.

For HFIs this guarantee rests in the form of tangible documents. Credit documents are

required by all HFIs but vary in kind based on your occupation, employer, qualifications,

experience, etc. Credit documents can be classified as

Income documents:

Money money money...no one can take a chance on the credibility of money matters because

at the end of the day, business is business. Almost everything about your loan is based on


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your income and therefore proof regarding the same is required by the HFI to ensure that no

miscommunications occur.

Personal documents:

Previously, tribes and clans had passwords without which you could not enter into the

territory; as proof of who he was, King Solomon had a ring as identification. Throughout

history, proof of identity has been important as mistaken identity has never been uncommon.

To prevent any such shams, HFIs also require a set of documents, for a general Home Loan

Product, identifying who you are.

He following list out all the documents needed. {under this line will be placed the document

sent separately as an excel sheet}

Legal Documentation

We might be living in the electronic age but that doesn't take away the importance and

monopoly of paper as everything to do with law will always be on paper. To stick by this

unwritten rule, there are legal documents that need to be submitted by you to the HFI for

mortgaging and these differ from state to state and also depend on your property type. The

following form a broad outline of the documents required and a detailed list can be found

here.

Copy of the offer letter sent by the HFI, accepted by you.

Title documents of the property which include

-Duly registered sale agreement.

-Receipts of your own contribution.

-Allotment letter

-Registration receipt

-If needed, land documents indicating ownership.

-Possession letter

-Lease agreement, if the property is bought from a development authority

-Mortgage deed if the HFI opts for a registered mortgage.

No Objection Certificate from the developer, society or development authority Personal Guarantees, if required.


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Documents for alternate or additional security.

Post dated cheques for the EMIs.

These documents do NOT cover the entire list needed and if it is a resale property, the

pertaining agreements, etc. will also need to be attached.

Tax Benefits

Tax benefits are currently available only under Home Loans and Home Extension loans. The

details are given under the respective sections.

Property Insurance

Some events are not in our hands and are completely unavoidable. Floods, drought and

storms uproot trees and destroy the land. Along with this the birds lose their homes and while

building a nest may not be that bad and the loss is not that great, the money that you invest in

your cosy home might just be washed away. For this reason insuring your property is a good

idea as you safeguard the asset against damage or loss.. Property insurance is not compulsory

though some HFIs insist on a mortgage redemption life insurance policy and you will

therefore get a reduced interest rate. Some of the points that need to be noted regarding

property insurance are:

You can choose the tenure of your insurance.

The premium is charged up front

The longer your tenure, the greater the discounts insurance companies offer you.

News Letter

The Daily Market Strategy is your morning dose on the health of the markets. Five intra-

day ideas, unless the markets are really choppy coupled with a brief on the global markets

and any other cues, which could impact the market. Occasionally an investment idea from

the research team and a crisp round up of the previous day's top stories. That's not all. As a

subscriber to the Daily Market Strategy, you even get research reports of India Infoline


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research team on a priority basis.

The IndiaInfoline Weekly Newsletter is your flashback for the week gone by. A weekly

outlook coupled with the best of the web stories from India Infoline and links to importantinvestment ideas, Leader Speak and features is delivered in your inbox every Friday

evening.

Portfolio Management

You get recessions. You have stock market declines. If you don't understand that's going to

happen, then you're not ready; you won't do well in the markets. No need to worry. We atIndia Infoline would take care of all issues related to managing your hard earned money.

Our Portfolio Management Service is a product wherein an equity investment portfolio is

created to suit the investment objectives of a client. We at India Infoline invest your resources

into stocks from different sectors, depending on your risk-return profile. This service is

particularly advisable for investors who cannot afford to give time or don't have that expertise

for day-to-day management of their equity portfolio.

It is all about your money, being managed by the experts, while you continue with your

routine life. Isn't it simple and totally hassle free.

What's more, you can keep track of your dividends / bonus / rights issues with paperless

tracking. So you always know how fast your investment is growing. It basically means

assigning the right job to the right person.

Research

IIFL special research cell where some of India's finest financial analysts bring you

intensive research reports on how the stock market is faring, when is the right time to

invest, when to execute your order and more.

IIFL make sure that investors are always prepared to make own investment decision when

the opportunity arises.IIFL bring you intensive research reports - whether sectoral or company-wise or more - that


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tell you exactly when and where to invest. So whenever there is an exciting investment

opportunity, you are in the know and always ready to invest. Research reports IIFL will help

you choose your investments wisely, without wasting time. Presented in a lucid and easy-to-

understand format; these reports help you make informed decisions.

ASSET MANAGEMENT

India Infoline is a leading pan-India mutual fund distribution house associated with leading

asset management companies. It operates primarily in the retail segment leveraging its

existing distribution network to reach prospective clients. It has received the in-principle

approval to set up a mutual fund.

The group recently commenced its offshore asset management business under the IIFL

Capital brand. Also, IIFL Securities Pte Ltd received approval from the Monetary

Authority of Singapore to carry out global asset management operations. The Singapore arm

can now offer broking, asset management and investment banking services.

IIFL Inc received an FII license, thereby facilitating the investment of dedicated funds inIndia.

With offices in New York, Singapore and Dubai, IIFL Capital aims to offer India-focused

equity products, fund management and advisory services for offshore and domestic wealth

management customers.

MILESTONES ACHIEVED

1995

Incorporated as an equity research and consulting firm with a client base that included leading

FIIs, banks, consulting firms and corporates.

1999

Restructured the business model to embrace the internet; launched archives.indiainfoline.com

mobilised capital from reputed private equity investors.
http://archives.indiainfoline.com/http://archives.indiainfoline.com/


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2000

Commenced the distribution of personal financial products; launched online equity trading;

entered life insurance distribution as a corporate agent. Acknowledged by Forbes as Best of

the Web and ...must read for investors.

2004

Acquired commodities broking license; launched Portfolio Management Service.

2005

Listed on the Indian stock markets.

2006

Acquired membership of DGCX; launched investment banking services.

2007

Launched a proprietary trading platform; inducted an institutional equities team; formed a

Singapore subsidiary; raised over USD 300 mn in the group; launched consumer finance

business under the Moneyline brand.

2008

Launched wealth management services under the IIFL Wealth brand; set up India Infoline

Private Equity fund; received the Insurance broking license from IRDA; received the venture

capital license; received inprinciple approval to sponsor a mutual fund; received Best broker-

India award from FinanceAsia; Most Improved Brokerage- India award from Asiamoney.

2009

Received registration for a housing finance company from the National Housing Bank;

received Fastest growing Equity Broking House - Large firms in India by Dun & Bradstreet.

MARKET SHARES OF COMPANY

Retail broking :


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IndiaInfoline has around 3 lakh customers. It has a tie-up with Bank of Baroda

for e-broking.

Institutional broking :

IndiaInfoline has roped in Bharat Parajia, director of sales at CLSA inSingapore, H Nemkumar, CLSA's country head for India, Aniruddha Dange, CLSA's

head of research in India, and Vasudev Jagannath, CLSA's head of sales in India.

While Parajia will join as head of institutional sales at India Infoline, Dange will be

head of research and Nemkumar head of investment banking.

Each one of them is bringing in more than 10 years of experience with a

top institutional brokerage in Asia. The CLSA foursome will also pick up stakes in

India Infoline through the preferential allotment route. Their collective stake would

add up to around 15%. Parajia already holds a 2.88% stake in India Infoline. He will

subscribe to 25 lakh equity warrants at Rs 440 each.Nemkumar will pick up another

25 lakh, while Jagannath and Aniruddha Dange will subscribe to 20 lakh warrants

each. The preferential allotment includes the four men buying 90 lakh equity warrants

at a price of Rs 440 each, of which 10% will be paid up front as their sign-on bonus.

The remaining will be payable at the end of eighteen months when the warrants will

be convertible into shares.That is, all these guys will have to cough up about Rs 360

crore to convert their warrants into shares. Currently, the company's institutional

equities team has 35 people, including research analysts and dealers.

Consumer Finance:

During the quarter, it managed a book size of Rs 25 crore and has suffered a loss of

Rs 5.5 crore. It expects to break even in 2-3 quarters. NIM of 6-8% on personal loans

and 3-4% on home refinancing. It is looking at a Rs 200 crore private-equity funding

for its consumer finance subsidiary. It intends to leverage its extensive branch

network to expand its consumer finance division to tier-II and tier-III cities in the

coming quarters. IndiaInfoline is going slow as it has just started this business with a

robust risk management system. The company has roped in experts from Citi

Financial and other banks.


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Ticker: 532636

Exchanges: BOM

2009 Sales: 9,630,900,000

Major

Industry:

Financial

Sub

Industry:

Securities

Brokerage

Country: INDIA

Employees: 14105

4.1TYPE OF RESEARCH

There are types of research design:

1. Exploratory

2. Descriptive

3. Casual

To know the customer attitudes and preferences towards Retail Banking and their

behavior, descriptive research was undertaken

Descriptive research is focused on the accurate description of the variable in the problem

model. This research was undertaken to know the avenues preferred by the people, to know

the factors considered while investing, frequency of investment and how they plan their

investment.

QUESTIONNAIRE DESIGN

The questionnaire used for the research purpose is simply a formalized set of questions

for eliciting information. As such its function is measurement and it represents the most

common form of measurement technique in marketing research.

The questionnaire contains both open ended and closed ended questions to elicit required

information. Open ended questions were used to leave the respondents free to offer any

replies that seem appropriate in light of the questions. They were used where no pre-stated set

of responses categories could be given. They were used as they are easier for both respondent


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as well as researchers. The questions reduce the interviewers bias and bias caused varying

level of respondents articulateness.

Multiple choice questions were used to facilitate the respondents to choose any one, from

the given option. These kinds of questions were used in the questionnaire to know the top of

mind recall of the customer from the given set of avenues. These questions were essential for

securing adequate co-operation from respondents.

METHODOLGY:

The methodology adopted to achieve the objective of our study is by collecting

information from different sources.

There are two types of collection sources, they are

1. Primary Data

2. Secondary Data

Primary Data :

The Primary Data has been collected for the purpose of understanding customer

awareness about various products offered by the ING Vysya Bank and satisfaction towards

various bank services. This was done through interviews and by administering questionnaire

a. Customer Interview

b. Manager Interview

c. Questionnaire

Secondary Data :

The secondary data was collected to assist the research for analyzing the Retail Banking

awareness along with primary data, which was collected during the project time. The two

sources of secondary data that were used for research are as follows


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1. Internal Sources : In this project, the internal sources are Brochures of Retail

Banking products and information collected from the concerned staff and

internal expert of bank.

2. External Sources : The external sources, used for collecting data in the

research includes

Internet

Magazines

4.6 OTHER SOFTWARE USED FOR DATA ANALYSIS

The data for analysis was collected from primary and secondary sources. The data

thus collected during the interaction respondents were organized, processed and

edited before tabulating and drawing the inference from the, The data got was

analyzed using statistical methods, techniques, graphical representation of data

was done. Bar graph is used for graphical representation.