We would like to express our regards and thanks to Mr. Gyanesh kumar, for giving us the opportunity to work on this project and learn something new. We are indebted to him for clarifying our concepts by sharing his valued experience in teaching, research and training which have thereby become an unconscious part of our ideas and thoughts while analyzing the brokerage industry. A special thank to the Almighty for giving us the opportunity and strength to complete this project. Lastly we would like to thank our families and friends for their continuing support, blessings and encouragement.
INDEX |S. no. |Contents |Page no. |Remarks | |1. |EXECUTIVE SUMMARY |4 | | |2. |RESEARCH METHODOLOGY |5-6 | | |3. |COMPANY PROFILE |7-10 | | |4. COMPANY’S PRODUCTS |11-13 | | |5. |OVERVIEW OF EQUITY BROKERAGE INDUSTRY |14-18 | | |6. |INDIAN BROKERAGE INDUSTRY |19-24 | | |7. |STATISTICAL DATA AND GRAPHS |25-30 | | |8. |MAJOR PLAYERS IN THE INDIAN BROKERAGE MARKET |31-33 | | |9. PRODUCT GRID FOR BROKERAGE INDUSTRY |34-36 | | |10. |RECENT DEVELOPMENTS GOVERNING REGULATION OF STOCK MARKETS |37 | | | | | | | | | | | | | | | | | | | | | Executive Summary This report analyzes the Indian retail brokerage industry taking into account the health of the capital markets and the intensity of competition among the brokeragecompanies. The major growth drivers for brokerage revenue and trading volume are: • Continuous fall in brokerage fees Adoption of technology — screen-based trading, electronic matching, and paperless securities • Centralized operations, effective risk management, and control on large interconnected operations spanning multiple locations, which is enabled by telecom connectivity and low costs • Increasing access to capital and the ability to provide margin finance Though the Indian brokerage industry has been consolidating steadily over the last 10 years, the share of the top 10 brokers has risen to only around one-fourth of the total industry revenues.
In this fragmented market, leading players like ICICI Direct, Kotak Securities, Indiabulls, Sharekhan, and 5 Paisa, apart from many small players, compete on the basis of low brokerage fees and customer service. RESEARCH METHODOLOGY Research Methodology is a way to systematically solving the research problem. It may be understood as a science of studying how research is done scientifically. Here we talk of Research Methodology we not only talk of Research Methods adopted to get the desired results but also consider the ogic behind these methods. The well defined Methodology means all the methods to views of the business profile, market segmentation to analyses the data. SOURCES OF DATA This research is based mostly on secondary sources . Methodology –(OTJ-On the job) Methodology of the project starts with – • In the first phase we are trained and they teach us different things about market. • After that they conduct a mock viva, in this they ask about the real life problem faced by the customers. • They provide leads and after that we make calls. Then after that we have to provide details of product and convince them • Then we have to visit them and get the formed filled from them. • Maintaining diary of clients and contacting them at regular basis. The next part is knowing the pattern of the banking sectors scripts. How they move with the correspondence to the market movement and also the economy. • Get the knowledge of technical as well as fundamental methods. • Observe the patterns of the scripts. COMPANY PROFILE Introduction Aditya Birla Group US$28 billion, diversified business conglomerate led by Mr. Kumar Mangalam Birla with a Decades of track record in building and acquiring global and scalable businesses ? Experience in multiple businesses across 25 countries with a Conservative management, strong governance and rigorous financial discipline Aditya Birla Money Limited formerly known as Apollo Sindhoori Capital Investments is a leading player in the broking space with nearly 15 years of experience. It became a part of Aditya Birla Group in March 2009, when the group acquired 76% of the company.
The Company has a strong distribution network of over 800 own branches and franchisee network, a large customer base in excess of 1,80,000, a strong technology backbone and a range of products delivered through a robust online and offline model. The Company boasts of immense talent pool and vertical specialists which add to its positioning as a major player in this segment. Aditya Birla Money is listed on National Stock Exchange of India Limited [NSE] and The Bombay Stock Exchange Limited [BSE]. It is also registered as Depository Participant with both NSDL and CDSL ABFSG is the umbrella brand for the financial services business of the Aditya Birla Group ? Vision : To be a leader and a role model in a broad based and integrated financial services business ? Includes seven businesses: ? Aditya Birla Capital Advisors Private Limited ? Aditya Birla Money Limited ? Aditya Birla Finance Limited ? Birla Insurance Advisory & Broking Services Limited ? Birla Sun Life Asset Management Company Limited ? Aditya Birla Money Mart Limited ? Birla Sun Life Insurance Company Limited
Aditya Birla Money is a leading player in broking space with nearly 15 years of experience. Incorporated in 1995, the Company became a part of Aditya Birla Group in March 2009. The Aditya Birla Group is a household name in India, a US $28 billion conglomerate that is in the league of the Fortune 500 companies. The Aditya Birla Group has a strong presence across various financial services verticals as a part of the Aditya Birla Financial Services Group (ABFSG) that include life insurance, fund management, distribution & wealth management, security based lending, insurance broking and private equity.
Company has a strong network of 600 sub brokers & Direct Selling Agents in 416 cities and towns across India, sub brokers and direct selling agents are focused business people with a drive to succeed, equipped with expertise and support provided by us. We have seen many success stories in the past and hope to continue to the same path of growth. Aditya Birla Money Limited offers you immense scope as a Direct Selling Agent (DSA) to generate attractive revenues, without any upper ceiling by marketing our bouquet of products including, Internet Equity and Derivative Trading Accounts • Internet Commodity Trading Accounts • Gold Harvest Scheme Equity & Derivative trading account – Internet & Branch Introduce clients to trade online and earn a share of the brokerage. Clients will be able to trade on both NSE and BSE simultaneously across equity and derivatives segments. We have state-of-the art technology and a dedicated team of staff to support clients. Our clients enjoy highly competitive brokerage and excellent trading inputs from our accomplished Research team. Commodity trading account – Internet & Branch
Commodity trading has immense scope in view of the improving international commodity trading scenario. Aditya Birla Money Limited has an excellent trading platform for trading on NCDEX & MCX, at branch level and also on Internet. Clients also benefit from the research reports offered by us. GOLD HARVEST SCHEME This scheme enables investors to derive the benefits of buying gold (Minimum 100 grams and multiples thereof) in futures on commodity exchanges by locking in the price at the current level. This is a highly beneficial scheme for investors who plan to invest in gold on an installment basis.
The clients can enter into this scheme by paying just Rs. 25,000/- as initial margin along with duly filled in application form. The balance payment towards the 100 grams of gold can be made in installments of Rs. 10000/- or Rs. 5,000/- or Rs. 3,500/- depending on the scheme duration. ABML’S PRODUCTS EQUITY ? Provides online investing along with Secure Electronic Integrated Broking Service and a seamless and rich online trading experience to customers, offers a choice of 2 trading platforms customized on the basis of investment needs i. . SpeedEx and Classic EQUITY TRADING ON THE BASIS OF: ? DELIVERY: In this type of trading the investors have to pay the full price of the stock and the stocks are deposited in their demat account. There is no predefined time limit in case of the delivery based trading for selling the stocks ? INTRADAY: In this type of trading the investors have to pay the full price of the stock and the stocks are deposited in their demat account. There is no predefined time limit in case of the delivery based trading for selling the stocks DERIVATIVES
Derivatives are investments which have no value of their own and derive their value from underlying assets or stock They mainly have three features which differentiate them from shares • They have a particular lot size • A time period associated with them • Right and possession with the holder COMMODITIES Commodity is raw or primary products and is traded on regulated commodities exchanges, in which they are bought and sold in standardized contracts. It comprises of: ? Oil ? Agro-products ? Seeds ? Metals ? gold The indices for commodities are: ? MCX ? NCDEX CURRENCY
Foreign exchange rates, like any other asset class move depending on various factors, like demand supply, interest rate parity, trade and capital flows, speculators taking positions, clients hedging risk arising from their trade and capital flows etc. Introduction of Currency Futures complete the suite of instruments available for trading and hedging to the Indian resident. The strong correlation that foreign exchange has to interest rates, equity flows and commodities translate to opportunities to trade currency futures independently or in conjunction with equities, commodities like gold or oil etc OVERVIEW
The Indian retail brokerage industry consists of companies that primarily act as agents for the buying and selling of securities (e. g. stocks, shares, and similar financial instruments) on a commission or transaction fee basis. It has two main interdependent segments: Primary market and the Secondary market. Evolution of the Indian Brokerage Market The Indian broking industry is one of the oldest trading industries that had been around even before the establishment of the BSE in 1875. Despite passing through a number of changes in the post liberalization period, the industry has found its way towards sustainable growth.
The evolution of the brokerage market is explained in three phases: pre1990, 1990-2000, post 2000. Early Years The equity brokerage industry in India is one of the oldest in the Asia region. India had an active stock market for about 150 years that played a significant role in developing risk markets as also promoting enterprise and supporting the growth of industry. The roots of a stock market in India began in the 1860s during the American Civil War that led to a sudden surge in the demand for cotton from India resulting in setting up of a number of joint stock companies that issued securities to raise finance.
This trend was akin to the rapid growth of securities markets in Europe and the North America in the background of expansion of railroads and exploration of natural resources and land development. Bombay, at that time, was a major financial centre having housed 31 banks, 20 insurance companies and 62 joint stock companies. In the aftermath of the crash, banks, on whose building steps share brokers used to gather to seek stock tips and share news, disallowed them to gather there, thus forcing them to find a place of their own, which later turned into the Dalal Street.
A group of about 300 brokers formed the stock exchange in Jul 1875, which led to the formation of a trust in 1887 known as the “Native Share and Stock Brokers Association”. A unique feature of the stock market development in India was that that it was entirely driven by local enterprise, unlike the banks which during the pre-independence period were owned and run by the British. Following the establishment of the first stock exchange in Mumbai, other stock exchanges came into being in major cities in India, namely Ahmedabad (1894), Calcutta (1908), Madras (1937), Uttar Pradesh and Nagpur (1940) and Hyderabad (1944).
The stock markets gained from surge and boom in several industries such as jute (1870s), tea (1880s and 1890s), coal (1904 and 1908) etc, at different points of time. Beginning of a new equity culture A new phase in the Indian stock markets began in the 1970s, with the introduction of Foreign Exchange Regulation Act (FERA) that led to divestment of foreign equity by the multinational companies, which created a surge in retail investing.
The early 1980s witnessed another surge in stock markets when major companies such as Reliance accessed equity markets for resource mobilisation that evinced huge interest from retail investors. A new set of economic and financial sector reforms that began in the early 1990s gave further impetus to the growth of the stock markets in India. As a part of the reform process, it became imperative to strengthen the role of the capital markets that could play an important role in efficient mobilisation and allocation of financial resources to the real economy.
Towards this end, several measures were taken to streamline the processes and systems including setting up an efficient market infrastructure to enable Indian finance to grow further and mature. The importance of an efficient micro market infrastructure came into focus following the incidence of market abuses in securities and banking markets in 1991 and 2001 that led to extensive investigations by two respective Joint Parliamentary Committees. The Securities and Exchange Board of India (SEBI), which was set up in 1988 as an administrative arrangement, was given statutory powers with the enactment of the SEBI Act, 1992.
The broad objectives of the SEBI include • to protect the interests of the investors in securities • to promote the development of securities markets and to regulate the securities markets The scope and functioning of the SEBI has greatly expanded with the rapid growth of securities markets in India in the last fifteen years. Following the recommendations of the High Powered Study Group on Establishment of New Stock Exchanges, the National Stock Exchange of India (NSE) was promoted by financial institutions with an aim to provide access to investors all over the country.
NSE was incorporated in Nov 1992 as a tax paying company, the first of such stock exchanges in India, since stock exchanges earlier were trusts, being run on no-profit basis. NSE was recognized as a stock exchange under the Securities Contracts (Regulations) Act 1956 in Apr 1993. It commenced operations in wholesale debt segment in Jun 1994 and capital market segment (equities) in Nov 1994. The setting up of the National Stock Exchange brought to Indian capital markets several innovations and modern practices and procedures such as nationwide trading network, electronic trading, greater transparency in rice discovery and process driven operations that had significant bearing on further growth of the stock markets in India. Faster and efficient securities settlement system is an important ingredient of a successful stock market. To speed the securities settlement process, The Depositories Act 1996 was passed that allowed for dematerialisation (and rematerialisation) of securities in depositories and the transfer of securities through electronic book entry. The National Securities Depository Limited (NSDL) set up by leading financial institutions, commenced operations in Oct 1996.
Regulations governing selection of various types of market intermediaries as depository participations were made. Subsequently, Central Depository Services (India) Limited promoted by Bombay Stock Exchange and other financial institutions came into being. Rapid Growth The last decade has been exceptionally good for the stock markets in India. In the back of wide ranging reforms in regulation and market practice as also the growing participation of foreign institutional investment, stock markets in India have showed phenomenal growth in the early 1990s.
The stock market capitalization in mid-2007 is nearly the same size as that of the gross domestic product as compared to about 25 percent of the latter in the early 2000s. Investor base continued to grow from domestic and international markets. The value of share trading witnessed a sharp jump too. Foreign institutional investment in Indian stock markets showed continuous rise reaching about USD10 bn in each of these years between FY04 to FY06. Stock markets became intensely technology and process driven, giving little scope for manual intervention that has been the source of market abuse in the past.
Electronic trading, digital certification, straight through processing, electronic contract notes, online broking have emerged as major trends in technology. Risk management became robust reducing the recurrence of payment defaults. Product expansion took place in a speedy manner. Indian equity markets now offer, in addition to trading in equities, opportunities in trading of derivatives in futures and options in index and stocks. ETFs are showing gradual growth. Within five years of introduction of derivatives, Indian stock markets now are ranked first in stock futures and fourth in index futures.
Indian stock markets are transaction intensive and thus rank among the top five markets in this regard. Stock exchange reforms brought in professional management separating conflicts of interest between brokers as owners of the exchanges and traders/dealers. The demutualisation and corporatisation of all stock exchanges is nearing completion and the boards of the stock exchanges now have majority of independent directors. Foreign institutions took stake in India’s two leading domestic stock exchanges.
While NYSE Group led consortium took stake in the National Stock Exchange, Deutsche Borse and Singapore Stock Exchange bought equity in the Bombay Stock Exchange Ltd. Indian Brokerage Industry India in Global Markets The stature and significance of India is growing in the world capital markets. India is not only attracting greater interest from world markets, but is also assuming increasing importance in global finance. • India is a major recipient of foreign institutional flows amongst the emerging markets. Since the opening up of domestic stock markets to foreign investors, cumulative net FII investments reached Rs 517 Bn by 2008 end. India is major destination of private equity flows into the emerging markets • India was host to the annual meetings/conference of the World Federation of Exchanges (2005) and International Organization of Securities Commission (IOSCO) (2007) • India emerged a trillion dollar market capitalisation market in 2007, and was among the top 10 stock exchanges in the world in terms of market capitalisation • India is amongst the top fifteen stock exchanges in the world in respect of equity turnover • India emerged as a leading player in commodities futures market • India is amongst the top five in the number of transactions • India is among the top five in respect of volume traded in Stock Index Futures and Stock Futures • India is one of the few markets with extensive dematerialisation of shares • India’s T+2 securities settlement cycle is at par with the global standards • Indian stock markets have the largest number of listings, with trading taking place in about 2,500-3,000 stocks • India’s most popular stock index (Sensex) is constructed on the basis of full float methodology, one of the firsts in the Asian region and a global standard • Indian market indices such as Sensex and CNX Nifty are listed in foreign exchanges for trading as ETFs. The year that was(2008)… ? Secondary market trading volumes down 33% YoY ? FII outflows of ~USD 12 bn ? Nifty down ~36% Advisory transactions stable though some ground lost ? PE deals had fallen to almost half ? ECM activity down ~90% ? DCM relatively stable, though activity level were lower in second half of the FY08 due to liquidity crunch and counterparty fears Recent Trends (2009)… ? Global risk aversion is unwinding and Confidence levels returning, being reflected in performance of the indices ? Liquidity and credit flows improving ? Political stability and India re-rating ? FII and Domestic Flows resuming, USD 7bn FII inflow in April & May ? Secondary volumes showing early signs of uptrend, average daily volumes of Rs 800 bn vs. 620 bn in previous year
Various important measures taken by the Indian Government to improve the condition of Indian stock market. |Measures |Objective |Status | |Allow foreign institutional investors to invest|Liberalization of stock market to attract |Foreign investment up to 49% will be allowed in these companies | |in equity and debt markets |foreign investment in order to boost economic |with a separate FDI cap of 26% and FII cap of 23% after approval | | |growth. from FIPB | | | |Outstanding limit for FII investment in debt securities raised | | | |from USD1. 75 bn to USD2. 0 bn and the same for the corporate debt | | | |raised from USD0. 5 bn to USD1. 5 bn | |Expanding the product range offered by the |Bring Indian market at par with the |SEBI approved new derivative products : mini-contracts on equity | |stock exchanges |international standards and diversify product |indices, options with longer life/tenure, volatility index and F| | |portfolio. contracts, Options on Futures, Bond Indices and F contracts, | | | |Exchange-Traded Currency (Foreign-Exchange) Futures and Options | | | |and Exchange Traded products to cater to different investment | | | |strategies | |Allowing Indian companies to issues ADRS and |Facilitate market integration and give freedom |Mutual funds were allowed to invest in ADRs/GDRs and foreign | |GDRS |to the companies. securities within the overall limit of USD4 bn | | |Access to more funds for investment |Venture capital funds were allowed to invest in foreign securities| |Allow Indian nationals and companies to invest | |Guidelines on issue of Indian Depository Receipts (IDRs) were | |abroad | |issued | |Divestment of government ownership |Facilitate growth through privatization |Providing minimum public shareholding of 25% in all listed | | | |companies | |Strengthening of institutional framework in |To ensure transparency |SEBI permitted listed companies to send abridged annual report to | |primary and secondary markets |Investor protection |the shareholders | | |Provide a standard framework for operations |Exclusive email ID to be iven by the primary market | |Demutualization |Deregulation |intermediaries for registering investor complaints | | |Reduces the conflict of interest |Stock exchanges advised to update the applicable VAR margin rates | | | |at least five times in a day | | | |SEBI approved and notified the Corporatization and Demutualization| | | |Schemes of 19 stock exchanges | |BSE and NSE to set up and maintain corporate |To capture all information relating to trading. |BSE and NSE began maintaining a reporting platform for corporate | |bond reporting platforms |Investor protection |bonds. | | | |BSE and NSE jointly launched a common portal at | | | |www. corpfiling. co. in to disseminate filings made by companies | | | |listed in both the exchanges. |Making PAN compulsory |Strengthening KYC (Know Your Client) |PAN made compulsory for all categories of investors for opening a | | | |DEMAT account with effect from Apr 1, 2006 | |Transactions necessarily settled through the |Investor protection and greater control. |It was made mandatory. | |clearing corporations/clearing house | | | |Permit Gold Exchange Traded Funds |Generate options for companies and investors |SEBI allowed the launch of Gold Exchange Traded Funds (GEFTs) | |Introduction of mutual fund schemes |Minimize risk for investors and ensure returns. |Mutual unds were allowed to invest in ADRs/GDRs and foreign | | | |securities within the overall limit of USD4 bn | | | |Mutual fund trustees are required to certify that the scheme | | | |approved by them is a new product and is not a minor modification | | | |of an existing scheme/product | | | |SEBI Mutual Fund regulations were amended so as to permit the | | | |launch of Capital Protection Oriented schemes | | | |SEBI directed MFs to dispatch statement of accounts to unit | | | |holders under SIP/STP/SWP on every quarter. | FII & MF Activity in Equity Markets FY09 was the first fiscal in India’s history when FIIs were net sellers in Indian equities; secondary market FII outflows for the year were Rs. 479 billion. Interestingly, FY08 was the year of record net FII inflows of Rs. 517 billion. However, mutual funds continued to be net buyers for the sixth consecutive year. In FY09, mutual funds were net buyers to the tune of Rs. 66 billion, which is a 52% drop from Rs. 137 billion of net buying in FY08. [pic] [pic] Equity Market Volumes: The average daily equity market volumes for FY09 were Rs. 612 billion, down 16% from Rs. 26 billion in FY08. However, during the six years beginning FY03, the year when cash and derivatives were fully active on both the exchanges, total market volumes have grown by 50% compounded annually. During this period, volumes in the derivatives and cash segments have grown at a compounded annual growth rate (CAGR) of 72% and 27%, respectively. The notable trends in customer segmental volume mix that influence market volumes are as follows: 1. The contribution of retail volumes has declined from 61% in FY08 to 55% FY09; the retail contribution ratio has been more volatile than the other two market segments. 2. The contribution of institutional volumes, i. e. olumes from FII and domestic institutional investors (DIIs) such as mutual funds, banks and insurance companies has remained stable at 15% for FY08 and FY09. 3. The contribution of proprietary volumes, which include arbitrage and other proprietary volumes of stock brokers, has increased from 24% in FY08 to 30% in FY09. Growth in average daily volumes on the NSE & BSE from FY03 to FY09 (Rupees in billions) [pic] [pic] [pic] Source: NSE & BSE Segmental mix of total volumes (NSE & BSE combined) [pic][pic] Source: NSE & BSE Demat Accounts Increasing Equity penetration by growth in demat accounts (in millions) [pic] Source: CDSL & NSDL Note: 1. Number of demat accounts in million 2. FY09 figure includes figures of NSDL as on 31 March 2009 and figures of CDSL as on 28 February 2009 3.
All the above numbers indicate active accounts except of CDSL for the period between FY00 to FY05, which are total number of demat accounts with CDSL . The number of demat accounts in the country shows the depth of equity penetration. CDSL and NSDL together have over 15 million active demat accounts. [pic] ~INR 140 bn Figures in brackets indicate revenue size in INR bn Source: Edelweiss Capital – Investor Presentation Exchange-wise Brokers and Sub-Brokers in Indian Stock Exchanges |Stock Exchange |Brokers |Sub Brokers |% Corporate Brokers | |Ahmedabad |317 |119 |48 | |Bangalore |256 156 |49 | |Bombay |840 |10691 |79 | |Bhubaneshwar |219 |17 |9 | |Calcutta |962 |88 |21 | |Cochin |434 |42 |18 | |Coimbatore |135 |22 |36 | |Delhi |375 |343 |57 | |Gauhati |110 |4 |4 | |Hyderabad |304 |199 |40 | |Inter Connected |788 |3 |36 | |Jaipur |507 |34 |4 | |Ludhiana |293 |38 |29 | |Madhya Pradesh |174 |5 |20 | |Madras |182 |115 |39 | |Magadh |198 |3 |11 | |Mangalore |66 |1 |14 | |National SE |1014 |11359 |91 | |OTCEI |769 |19 |76 | |Pune |192 |161 |30 | |Saurashtra Kutch |426 | 20 | |UPSE |463 |19 |20 | |Vadaodara |311 |41 |21 | | | | Source: Securities and Exchange Board of India Major players Comparative Financials | |Rs. Crore |Rs. Crore |Rs.
Crore | |Company Name | Total income | PAT | Net worth | |Apollo Sindhoori Capital Invsts. Ltd. (Now ABML) |122. 03 |21. 59 |45. 1 | |Arihant Capital Markets Ltd. |61. 24 |14. 18 |39. 07 | |Bajaj Capital Insurance Broking Ltd. |26. 05 |2. 87 |6. 99 | |Brics Securities Ltd. |68. 01 |48. 89 |111. 78 | |Edelweiss Securities Ltd. |384. 97 |186. 44 |258. 24 | |Emkay Global Financial Services Ltd. |131. 79 |23. 5 |132. 6 | |Geojit B N P Paribas Financial Services Ltd. |208. 52 |48. 23 |233. 61 | |India Infoline Ltd. |672. 45 |128. 69 |989. 85 | |Indiabulls Securities Ltd. |628. 31 |248. 66 |364. 02 | |L K P Securities Ltd. |59. 06 |3. 46 |15. 66 | |Motilal Oswal Financial Services Limited. |34. 79 |17. 18 |399. 92 | |Networth Stock Broking Ltd. |54. 22 |3. 05 |53. 89 | |Reliance Capital Ltd. |952. 76 |1039. 23 |5926. 7 | |Religare Commodities Ltd. |32. 31 |0. 88 |4. 93 | |Total |3436. 51 |1786. 85 |8582. 29 | Performance Highlites 1. Edelweiss Securities Ltd. |Segment sales (net) | | |Agency Business |370. 29 | |Capital Based Business |140. 16 | 2. Indiabulls Securities Ltd. Segment sales | | |Broking & Related Activities |618. 05 | | Others |0. 59 | 3. India Infoline Ltd. |Segment sales ( Net) | | |Commodities Brokerage & Related |3. 57 | |Equity Brokerage & Related Income |156. 36 | |Financing & Investing Income |105. 49 | |Life Insurance Agency Income |0. 5 | |Marketing & Online Media |3. 09 | 4. Motilal Oswal Financial Services Ltd. |Segment sales (net) | | |Equity Broking & Other Related Activities (Consolidated) | | | |593. 68 | |Financial Activity (Consolidated) |35. 58 | |Investment Banking (Consolidated) |62. 82 | 5. Reliance Capital Ltd. Segment Sales (Net) | | |Asset Management (Consolidated) |472. 92 | |Consumer Finance (Consolidated) |394. 58 | |Finance & Investments (Consolidated) |1742. 76 | |General Insurance (Consolidated) |2346. 12 | 6. Religare Enterprises Ltd. | |Segment sales | | | |Financial Advisory Services |1. 3 | | |Investment Operations |30. 73 | [pic] PRODUCT GRID FOR BROKERAGE INDUSTRY Product grid comprises of all the products offered by brokerage or securities industry. This industry is one of major emerging industry in the country as it helps in dealing with various financial aspects which help in building a good financial portfolio for an individual or corporate. Product grid, in simpler terms, can be explained as the whole basket of products offered by brokerage industry to its customers. This can further be explained by taking various companies operating in this sector and thereby comparing the products offered by these companies. |Motilal Oswal | |Multiples engines of growth- an integrated financial services platform |Lack of visible goodwill among minor players | |Well established and continuously expanding geographical footprints |Lack of trust on companies by customers | |Unique, stable and scalable business model |Psyche of people in India is converging | |Adoption of technology — screen-based trading, electronic matching, and |Companies are still running on selling concept | |paperless securities |Weak infrastructural facilities | |Centralized operations, effective risk management, and control on large |Compliance with strict rules and norms set by govt. |interconnected operations spanning multiple locations, which is enabled by| | |telecom connectivity and low costs | | |Accessibility of capital increases and margin finance increases | | |OPPORTUNITIES |THREATS | |Structure of the industry, market size, and growth rates-huge potential n|High degree competition | |Indian market |Fluctuations in government policies | |Government is continuously liberalizing the market |Political framework | |Proactive and progressive nature of Indian brokerage industry(India ranks |Developing Indian economy | |amongst top five globally in this segment) |Companies must develop and implement physical, administrative and | |Economy is still growing at healthy rate leading to investment / capital |technical safeguards to achieve the following | |requirement |goals: | |Huge market opportunity for wealth management service providers as Indian |Ensure the security and confidentiality of customer records and | |wealth management business is transforming from mere wealth safeguarding |information | |to growing wealth. Secure against any anticipated threats or hazards to the security or | |Leveraging technology to enable best practices and processes |integrity of such information | |Corporates looking at consolidation / acquisitions / restructuring opens |Secure against unauthorized access to or use of such information that | |out opportunities for the corporate advisory business. |could result in substantial harm or inconvenience to any customer | | |Corporate espionage | ———————– Others (Treasury, Financing, Trading etc. ) (25) Institutional Equities (Equities & Derivatives) (20) Investment Banking (Advisory, ECM) (12) Asset Management (Traditional and alternative) (20) Individual Clients (Broking and Distribution) (60) Capital Market Players