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INDUSTRY OVERVIEW
In most industrialized countries, a substantial part of financial wealth is not managed directly by savers, but through a financial intermediary, which implies the existence of an agency contract between the investor and a broker or portfolio manager. Therefore, delegated brokerage management is arguably one of the most important agency relationships intervening in the economy, with a possible impact on financial market and economic developments at a macro level. In most of the metros, people like to put their money in stock options instead of dumping it in the banklockers. Now, this trend pick pace in small but fast developing cities like Chandigarh, Gurgaon, Jaipur etc. Organized financial markets have existed in India for more than a century. Today, markets of varying maturity exist in equity, debt, commodities and foreign exchange. There are 23 stock markets all over the country, the most important of which, are the Bombay Stock Exchange and the National Stock Exchange.

International Comparison
India's total market capitalization touched $1209.59 billion by BSE listed and $1189.34 billion by NSE, The number of companies listed on the BSE at the end of March 2012 with 5163. This was more than the aggregate total of companies listed in 11 emerging markets (Malaysia, S. Africa, Mexico, Taiwan, Korea, Philippines, Thailand, Brazil and Chile). The number of companies was also more than in developed markets of Japan, UK, Germany, France, Australia, Switzerland, Canada

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and Hong Kong. India's capital market features a wide variety of capital market instruments. Internationally compared only 10 stock exchanges are having more market capitalization than Indian stock exchanges. Stock exchanges in America having the largest market capitalization in the world.

Capital Markets: Previous Year Scenario

The Capital markets remained subdued through most of 1995-96 and the bear phase which began in October 1994, continued through most part of 1995-96. There was a slowdown in Foreign Institutional Investors (FIIs) inflow and domestic liquidity conditions were relatively tight. Notably, between April to December 1995, the value of primary issues was marginally higher than the corresponding period last year, despite a downtrend in stock prices and low turnover in stock exchanges.The process of reforms in the capital markets, including the money markets, was further strengthened. Securities and Exchange Board of India (SEBI), was empowered to regulate all market intermediaries. An Ordinance to establish depositories was announced, thus addressing one of the major lacunae in the system. The National Stock Exchange expanded rapidly, providing an incentive to other stock exchanges to accelerate computerization.

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ABOUT SUDHA STOCKS:

Navi Mumbai is millennium city for upper middle class earners; shown tremendous growth in last 5-6 years, and only nearby 20 stock brokers, mutual funds distributors in Navi Mumbai shows huge potential for mutual funds investments Large no. of NRI in Navi Mumbai needs personal assistance, then any newly started business organization choose Vashi for their corporate office shows huge potentials for business.

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Sudha Stocks is leading stock broking company, sub broker with ISE Ltd. in Vashi, Navi Mumbai, running by entrepreneur Mr. S.P.Dhanapal who has experience of 12 years in SBI as a branch Manager and running business from last 18 years, giving various kinds of bundle of services to customers. Sudha stocks is leading stock broking, mutual funds distribution, PMS, and other services provider for retail investors and corporate investors in navi mumbai, majorly having market share in Vashi.

Vision statement:
Maximum Happiness to Maximum Customers by Maximum times

Missions: To get 100 crore Asset under Management. To have 100 cropre pati customers To get 1000 SIP.

Sudha stocks main area of business is stock broking and mutual funds distributions, large share of profit comes from mutual funds distributions, entrepreneur running this business from last 18 years. Working with SBI as branch manager, posting during one year of joining to abroad (Kuwait) was a proud thing for sir, sir worked with SBI for 12 years started from probationary officers and ended with branch manager,

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But he is interested majorly in Spirituality and socialism, as working for someone sir wasnt able to spend time with family and for society, he wanted to do something by our self, he wanted to earn for our self rather than earning for someone. Another major reason for starting venture is confidence generated from huge work experience with SBI. Sir had that knowledge level, passion and trust on our self for starting business. Nature of Business: Services: 1. Stock broking: the main business area, sir helps to open Demat account to new investors, and helps him in investments activities.

2. Mutual Funds Distribution: Sudha stocks is a registered with top AMC like ICICI prudential, sundaram, HDFC mutual funds, UTI, etc and helps investors to identify top schemes as per requirement for investments.

3. Portfolio Management services: Sudha stocks has some premier customers, whose portfolio is managed by Sir S.P.Dhanapal (CEO), efficient and effective portfolio is managed by Sudha stocks, whose gives better chances for good returns.

4. Specialized NRI Consultancy services for their tax management, wealth management and other assistance.

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5. Tax management services to residence and NRI

Organization structure:
Sudha stocks is established by Mr. S.P.Dhanapal in 1994, owned and managed by him and one full time employee working from establishment.

Target market

Middle class people who prefer to save in banks for future needs. Newly started venture who wants consultations for their financial management. Peoples who wants personal portfolio management services. NRIs who needs tax consultations, and other services.

Reasons to choose Sudha stocks

1. Experience: The biggest strength of Sudha Stocks is the experience got from his working as a branch manager and being in financial market from last more than 20 years. Sudha stocks has more than a decades of trust and credibility in the Indian stock market. Since launch it has been providing institutional-level research and broking services to individual investors.

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2. Technology: With their online trading account one can buy and sell shares in an instant from any PC with an internet connection. Customers get access to the powerful online trading tools that will help them to take complete control over their investment in shares.

3. Knowledge: in a business organization where the right information at right time can translate in to profit. With huge experience in Indian financial market Sudha stocks owner posses high knowledge level, which helps its customers to keep updated and rip the advantage from market movement.

4. Customer services: Another major strength of Sudha stocks is personal services to its customers. Its customer service assist their customer for any help that they need relating to transactions, billing, demat and other queries. Treating every customer different makes Sudha stocks USP. This customers service is the result that no one customer has left from Sudha stocks.

5. Investment Advice: Sudha stocks has dedicated entrepreneur who research and track more than 100 of stock behavior. His analysis constantly track the pulse of the market and provide timely investment advice to customer in the form of daily research emails, online chat, printed reports etc

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Benefits

1 .Easily DEMAT opening 2. Personalized services 3. Multiple services to same customer. 4. Buy and sell even single share. 5. Any other kind of personal or financial management services. 6. Get regular updates about transactions, trades, profits, statements, investments etc 7. Free to take assistance at any time. 8. Personal attention given to each customer. 9. Regular investments advices, time to time research, portfolio management services.

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SWOT Analysis Strength Reliability Huge Experience Personalized services Threat Competition institution ie HDFC,ICICI, sharekhan etc from large financial Weakness Not aggressive, as a result his

business is not too big.

Opportunity Lack of awareness of Mutual Fund and there is a huge scope of growth.

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Project details
What is a mutual fund?
The Indian mutual fund industry has witnessed significant growth in the past few years driven by several favorable economic and demographic factors such as rising income levels, and the increasing reach of Asset Management Companies and distributors. However, after several years of relentless growth, the industry witnessed a fall of 8% in the assets under management in the financial year 2008-2009 that has impacted revenues and profitability. Whereas in 2009-10 the industry is on the road of recovery.

Concept of Mutual Fund

A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. The money thus collected is then invested in capital market instruments such as shares,

debentures and other securities. The income earned through these investments and the capital appreciations realized are shared by its unit holders in proportion to the number of units owned by them. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost. The flow chart below describes the working of a mutual fund: Mutual funds are considered as one of the best available investments as compare to others. They are very cost efficient and also easy to invest in, thus by pooling money together in a mutual fund, investors can purchase stocks or bonds with much lower

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trading costs than if they tried to do it on their own. But the biggest advantage to mutual funds is diversification, by minimizing risk & maximizing returns.

History of Mutual funds Industry in India

The mutual fund industry in India started in 1963 with the formation of Unit Trust of India, at the initiative of the Government of India and Reserve Bank of India. The history of mutual funds in India can be broadly divided into four distinct phases First Phase 1964-87 Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It was set up by the Reserve Bank of India and functioned under the Regulatory and administrative control of the Reserve Bank of India. In 1978 UTI was de-linked from the RBI and the Industrial Development Bank of India (IDBI) took over the regulatory and administrative control in place of RBI. The first scheme launched by UTI was Unit Scheme 1964. At the end of 1988 UTI had Rs.6,700 crores of assets under management.

Second Phase 1987-1993 (Entry of Public Sector Funds) 1987 marked the entry of non- UTI, public sector mutual funds set up by public sector banks and Life Insurance Corporation of India (LIC) and General Insurance Corporation of India (GIC). SBI Mutual Fund was the first non- UTI Mutual Fund established in June 1987 followed by Canbank Mutual Fund (Dec 87), Punjab National

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Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund (Nov 89), Bank of India (Jun 90), Bank of Baroda Mutual Fund (Oct 92). LIC established its mutual fund in June 1989 while GIC had set up its mutual fund in December 1990.

Third Phase 1993-2003 (Entry of Private Sector Funds)

With the entry of private sector funds in 1993, a new era started in the Indian mutual fund industry, giving the Indian investors a wider choice of fund families. Also, 1993 was the year in which the first Mutual Fund Regulations came into being, under which all mutual funds, except UTI were to be registered and governed. The erstwhile Kothari Pioneer (now merged with Franklin Templeton) was the first private sector mutual fund registered in July 1993.

The 1993 SEBI (Mutual Fund) Regulations were substituted by a more comprehensive and revised Mutual Fund Regulations in 1996. The industry now functions under the SEBI (Mutual Fund) Regulations 1996.

The number of mutual fund houses went on increasing, with many foreign mutual funds setting up funds in India and also the industry has witnessed several mergers and acquisitions. As at the end of January 2003, there were 33 mutual funds with total assets of Rs. 1,21,805 crores. The Unit Trust of India with Rs.44,541 crores of assets under management was way ahead of other mutual funds. Fourth Phase since February 2003

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In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI was bifurcated into two separate entities. One is the Specified Undertaking of the Unit Trust of India with assets under management of Rs.29,835 crores as at the end of January 2003, representing broadly, the assets of US 64 scheme, assured return and certain other schemes. The Specified Undertaking of Unit Trust of India, functioning under an administrator and under the rules framed by Government of India and does not come under the purview of the Mutual Fund Regulations. The second is the UTI Mutual Fund, sponsored by SBI, PNB, BOB and LIC. It is registered with SEBI and functions under the Mutual Fund Regulations. With the bifurcation of the erstwhile UTI which had in March 2000 more than Rs.76,000 crores of assets under management and with the setting up of a UTI Mutual Fund, conforming to the SEBI Mutual Fund Regulations, and with recent mergers taking place among different private sector funds, the mutual fund industry has entered its current phase of consolidation and growth. The graph indicates the growth of assets over the years.

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700000 600000 500000 400000 300000 200000 100000

GROWTH OF ASSETS UNDER MANAGEMENT

613979 505152 417300 326388 AUM 231862 139616 149554 4564 25 Mar/65Mar/87Mar/83Mar/03Mar/04Mar/05Mar/06Mar/07Mar/08Mar/09Mar/10Mar/11 47000 79464 592250

In some advanced countries like US mutual funds AUM is a multiple of bank deposits. But compare to India mutual funds is not even 10% of bank deposits. This is major indicator of immense potential for growth of industry. The high proportion of AUM in Debt, largely from institutional investors is not in line with the role of mutual funds, which is to channelized retail money into the capital market. various regulatory measures to reduce the cost and increase convenience for investor are aimed at performing mutual funds into truly retail vehicle of capita mobilization for larger benefit of economy.

Regulatory Authority:

In India SEBI is the regulatory authority for mutual

fund industry. SEBI regulates mutual funds, depositories, custodians and registrar & transfer agents. All the rules and regulation for mutual fund industry is framed by SEBI and amended till date. But wherever applicable any other authority can come into picture like if investment in abroad then one has to take permission from RBI.

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AMFI:

association of Mutual fund industry is created to promote the interest of

investor and company. AMFI is not a self regulatory authority. Every mutual fund company is a member of AMFI. AMFI framed some guidelines, ethics, code for smooth working of industry.

Types of Mutual Fund schemes in INDIA

Wide variety of Mutual Fund Schemes exists to cater to the needs such as financial position, risk tolerance and return expectations.

Classification of Mutual Funds

By Structure

By Nature

BY STRUCTURE

Open - Ended Schemes: An open-end fund is one that is available for subscription all through the year. These do not have a fixed maturity. Investors can conveniently buy and sell units at Net Asset Value ("NAV") related prices. The key feature of open-end schemes is liquidity.

Close - Ended Schemes: A closed-end fund has a stipulated maturity period which generally ranging from 3 to 15 years. The fund is open for subscription only during a specified period. Investors can invest in the scheme at the time of the initial public issue and thereafter they can buy or sell the units of the scheme on the stock exchanges where they are listed. In order to provide an exit route to the investors,

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some close-ended funds give an option of selling back the units to the Mutual Fund through periodic repurchase at NAV related prices. SEBI Regulations stipulate that at least one of the two exit routes is provided to the investor.

Interval Schemes: Interval Schemes are that scheme, which combines the features of open-ended and close-ended schemes. The units may be traded on the stock exchange or may be open for sale or redemption during pre-determined intervals at NAV related prices.

BY NATURE

Equity fund: These funds invest a maximum part of their corpus into equities holdings. The structure of the fund may vary different for different schemes and the fund managers outlook on different stocks. The Equity Funds are sub -classified depending upon their investment objective, as follows: -Diversified Equity Funds -Mid-Cap Funds -Sector Specific Funds -Tax Savings Funds (ELSS) Equity investments are meant for a longer time horizon, thus Equity funds rank high on the risk-return matrix.

Debt funds: The objective of these Funds is to invest in debt papers. Government authorities, private companies, banks and financial institutions are some of the major issuers of debt papers. By investing in debt instruments, these funds ensure low risk and provide stable income to the investors.

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Gilt Funds: Invest their corpus in securities issued by Government, popularly known as Government of India debt papers. These Funds carry zero Default risk but are associated with Interest Rate risk. These schemes are safer as they invest in papers backed by Government.

Income Funds: Invest a major portion into various debt instruments such as bonds, corporate debentures and Government securities.

Monthly income plans ( MIPs): Invests maximum of their total corpus in debt instruments while they take minimum exposure in equities. It gets benefit of both equity and debt market. These scheme ranks slightly high on the risk-return matrix when compared with other debt schemes.

Short Term Plans (STPs): Meant for investment horizon for three to six months. These funds primarily invest in short term papers like Certificate of Deposits (CDs) and Commercial Papers (CPs). Some portion of the corpus is also invested in corporate debentures.

Liquid Funds: Also known as Money Market Schemes, These funds provides easy liquidity and preservation of capital. These schemes invest in short-term instruments like Treasury Bills, inter-bank call money market, CPs and CDs. These funds are meant for short-term cash management of corporate houses and are meant for an investment horizon of 1day to 3 months. These schemes rank low on risk-return matrix and are considered to be the safest amongst all categories of mutual funds.

Balanced funds: They invest in both equities and fixed income securities, which are in line with pre-defined investment objective of the scheme. These schemes aim to

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provide investors with the best of both the worlds. Equity part provides growth and the debt part provides stability in returns.

Further the mutual funds can be broadly classified on the basis of investment parameter. It means each category of funds is backed by an investment philosophy, which is pre-defined in the objectives of the fund. The investor can align his own investment needs with the funds objective and can invest accordingly.

By investment objective:
Growth Schemes: Growth Schemes are also known as equity schemes. The aim of these schemes is to provide capital appreciation over medium to long term. These schemes normally invest a major part of their fund in equities and are willing to bear short-term decline in value for possible future appreciation.

Income Schemes: Income Schemes are also known as debt schemes. The aim of these schemes is to provide regular and steady income to investors. These schemes generally invest in fixed income securities such as bonds and corporate debentures. Capital appreciation in such schemes may be limited.

Balanced Schemes: Balanced Schemes aim to provide both growth and income by periodically distributing a part of the income and capital gains they earn. These schemes invest in both shares and fixed income securities, in the proportion indicated in their offer documents.

Money Market Schemes: Money Market Schemes aim to provide easy liquidity, preservation of capital and moderate income. These schemes generally invest in safer,

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short-term instruments, such as treasury bills, certificates of deposit, commercial paper and inter-bank call money.

Other schemes

Tax Saving Schemes: Tax-saving schemes offer tax rebates to the investors under tax laws prescribed from time to time. Under Sec.80C of the Income Tax Act, contributions made to any Equity Linked Savings Scheme (ELSS) are eligible for rebate.

Index Schemes:

Index schemes attempt to replicate the performance of a particular index such as the BSE Sensex or the Nifty 50. The portfolio of these schemes will consist of only those stocks that constitute the index. The percentage of each stock to the total holding will be identical to the stocks index weightage. And hence, the returns from such schemes would be more or less equivalent to those of the Index.

Sector Specific Schemes:

These are the funds/schemes which invest in the securities of only those sectors or industries as specified in the offer documents. Ex- Pharmaceuticals, Software, Fast Moving Consumer Goods (FMCG), Petroleum stocks, etc. The returns in these funds are dependent on the performance of the respective sectors/industries. While these funds may give higher returns, they are more risky compared to diversified funds. Investors need to keep a watch on the performance of those sectors/industries and must exit at an appropriate time.

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Advantages of Mutual Funds

Diversification It can help an investor diversify their portfolio with a minimum investment. Spreading investments across a range of securities can help to reduce risk. A stock mutual fund, for example, invests in many stocks .This minimizes the risk attributed to a concentrated position. If a few securities in the mutual fund lose value or become worthless, the loss may be offset by other securities that appreciate in value. Further diversification can be achieved by investing in multiple funds which invest in different sectors.

Professional Management- Mutual funds are managed and supervised by investment professional. These managers decide what securities the fund will buy and sell. This eliminates the investor of the difficult task of trying to time the market.

Well regulated- Mutual funds are subject to many government regulations that protect investors from fraud.

Liquidity- It's easy to get money out of a mutual fund.

Convenience- we can buy mutual fund shares by mail, phone, or over the Internet.

Low cost- Mutual fund expenses are often no more than 1.5 percent of our investment. Expenses for Index Funds are less than that, because index funds are not actively managed. Instead, they automatically buy stock in companies that are listed on a specific index

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Transparency- The mutual fund offer document provides all the information about the fund and the scheme. This document is also called as the prospectus or the fund offer document, and is very detailed and contains most of the relevant information that an investor would need. Choice of schemes there are different schemes which an investor can choose from according to his investment goals and risk appetite. Tax benefits An investor can get a tax benefit in schemes like ELSS (equity linked saving scheme)

Fund Management
Actively managed funds:

Mutual Fund managers are professionals. They are considered professionals because of their knowledge and experience. Managers are hired to actively manage mutual fund portfolios. Instead of seeking to track market performance, active fund

management tries to beat it. To do this, fund managers "actively" buy and sell individual securities. For an actively managed fund, the corresponding index can be used as a performance benchmark. Is an active fund a better investment because it is trying to outperform the market? Not necessarily. While there is the potential for higher returns with active funds, they are more unpredictable and more risky. From 1990 through 1999, on average, 76% of large cap actively managed stock funds actually underperformed the S&P 500.

Actively managed fund styles:

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Some active fund managers follow an investing "style" to try and maximize fund performance while meeting the investment objectives of the fund. Fund styles usually fall within the following three categories.

Value: The manager invests in stocks believed to be currently undervalued by the market.

Growth: The manager selects stocks they believe have a strong potential for beating the market.

Blend: The manager looks for a combination of both growth and value stocks.

To determine the style of a mutual fund, consult the prospectus as well as other sources that review mutual funds. Don't be surprised if the information

conflicts. Although a prospectus may state a specific fund style, the style may change. Value stocks held in the portfolio over a period of time may become growth stocks and vice versa. Other research may give a more current and accurate account of the style of the fund.

Passively Managed Funds:

Passively managed mutual funds are an easily understood, relatively safe approach to investing in broad segments of the market. They are used by less experienced investors as well as sophisticated institutional investors with large portfolios. Indexing has been called investing on autopilot. The metaphor is an appropriate one as

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managed funds can be viewed as having a pilot at the controls. When it comes to flying an airplane, both approaches are widely used.

A high percentage of investment professionals, find index investing compelling for the following reasons:

Simplicity.

Broad-based

market

index

funds

make asset

allocation and diversification easy.

Management quality. The passive nature of indexing eliminates any concerns about human error or management tenure.

Low portfolio turnover. Less buying and selling of securities means lower costs and fewer tax consequences.

Low operational expenses. Indexing is considerably less expensive than active fund management.

Asset bloat. Portfolio size is not a concern with index funds. Performance. It is a matter of record that index funds have outperformed the majority of managed funds over a variety of time periods.

How to Pick the Right Mutual Fund

Identifying Goals and Risk Tolerance
Before acquiring shares in any fund, an investor must first identify his or her goals and desires for the money being invested. Are long-term capital gains desired, or is a current income preferred? Will the money be used to pay for college expenses, or to supplement a retirement that is decades away. One should consider the issue of risk

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tolerance. Is the investor able to afford and mentally accept dramatic swings in portfolio value? Or, is a more conservative investment warranted? Identifying risk tolerance is as important as identifying a goal. Finally, the time horizon must be addressed. Investors must think about how long they can afford to tie up their money, or if they anticipate any liquidity concerns in the near future. Ideally, mutual fund holders should have an investment horizon with at least five years or more.
Style and Fund Type

If the investor intends to use the money in the fund for a longer term need and is willing to assume a fair amount of risk and volatility, then the style/objective he or she may be suited for is a fund. These types of funds typically hold a high percentage of their assets in common stocks, and are therefore considered to be volatile in nature. Conversely, if the investor is in need of current income, he or she should acquire shares in an income fund. Government and corporate debt are the two of the more common holdings in an income fund. There are times when an investor has a longer term need, but is unwilling or unable to assume substantial risk. In this case, a balanced fund, which invests in both stocks and bonds, may be the best alternative.
Charges and Fees

Mutual funds make their money by charging fees to the investor. It is important to gain an understanding of the different types of fees that you may face when purchasing an investment. Some funds charge a sales fee known as a load fee, which will either be charged upon initial investment or upon sale of the investment. A entry load/fee is paid out of the initial investment made by the investor while a exit load/fee is charged when

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an investor sells his or her investment, usually prior to a set time period. To avoid these sales fees, look for no-load funds, which don't charge a entry- or exit load/fee. From 2009 onwards entry load has been demolished by SEBI. Exit load are applicable on certain schemes. However, one should be aware of the other fees in a no-load fund, such as the management expense ratio and other administration fees, as they may be very high.

The investor should look for the management expense ratio. The ratio is simply the total percentage of fund assets that are being charged to cover fund expenses. The higher the ratio, the lower the investor's return will be at the end of the year.

Evaluating Managers/Past Results Investors should research a fund's past results. The following is a list of questions that perspective investors should ask themselves when reviewing the historical record:

Did the fund manager deliver results that were consistent with general market returns?

Was the fund more volatile than the big indexe.

This information is important because it will give the investor insight into how the portfolio manager performs under certain conditions, as well as what historically has been the trend in terms of turnover and return. Prior to buying into a fund, one must review
the investment company's literature to look for information about anticipated trends in the market in the years ahead.

Fund Transactional Activity

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Portfolio Turnover Measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by taking either the total amount of new securities purchased or the amount of securities sold -whichever is less - over a particular period, divided by the total net asset value (NAV) of the fund. The measurement is usually reported for a 12-month time period Fund Performance Metrics Historical Performance The investor should see the past returns of the fund and should compare it with the peer group fund. Whatever the objective, the mutual fund is an excellent medium to accumulate financial assets and grow them over time to achieve any of these goals.

Systematic investment plan(SIP)

SIP is similar to a Recurring Deposit. Every month on a specified date an amount you choose is invested in a mutual fund scheme of your choice. The dates currently available for SIPs are the 1st, 5th, 10th, 15th, 20th and the 25th of a month. There are many benefits of investing through SIP. Benefit 1

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Become

Disciplined

Investor

Being disciplined - Its the key to investing success. With the Systematic Investment Plan you commit an amount of your choice (minimum of Rs. 500 and in multiples of Rs. 100 thereof*) to be invested every month in one of our schemes. Think of each SIP payment as laying a brick. One by one, youll see them transform into a building. Youll see your investments accrue month after month. Its as simple as giving at least 6 postdated monthly cheques to us for a fixed amount in a scheme of your choice. Its the perfect solution for irregular investors. Benefit 2 Reach Your Financial Goal

Imagine you want to buy a car a year from now, but you dont know where the down payment will come from. SIP is a perfect tool for people who have a specific, future financial requirement. By investing an amount of your choice every month, you can plan for and meet financial goals, like funds for a childs education, a marriage in the family or a comfortable postretirement life. Benefit 3 Take Advantage of Rupee Cost Averaging Most investors want to buy stocks when the prices are low and sell them when prices are high. But timing the market is time consuming and risky. A more successful investment strategy is to adopt the method called Rupee Cost Averaging. We can reap this benefit by investing the amounts through a SIP .

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Benefit 4 Grow Your Investment With Compounded Benefits

It is far better to invest a small amount of money regularly, rather than save up to make one large investment. This is because while you are saving the lump sum, your savings may not earn much interest.

With HDFC MF SIP, each amount you invest grows through compounding benefits as well. That is, the interest earned on your investment also earns interest. The following example illustrates this. Imagine As is 20 years old when he starts working. Every month he saves and invests Rs. 5,000 till he is 25 years old. The total investment made by him over 5 years is Rs. 3 lakhs . B also starts working when he is 20 years old. But he doesnt invest monthly. He gets a large bonus of Rs. 3 lakhs at 25 and decides to invest the entire amount. Both of them decide not to withdraw these investments till they turn 50. At 50, As Investments have grown to Rs. 46,68,273* whereas Bs investments have grown to Rs. 36,17,084*. As small contributions to a SIP and her decision to start investing earlier than B have made her wealthier by over Rs. 10 lakhs.

Figures based on 10% p.a. interest compounded monthly. Benefit 5 Do All This Effortlessly Investing with SIP is easy. Simply give us post-dated cheques or opt for an Auto Debit from your bank account for an amount of your choice (minimum of Rs. 500 and in multiples of Rs. 100 thereof*) and well invest the money every month in a fund

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of your choice. The plans are completely flexible. You can invest for a minimum of six months, or for as long as you want. You can also decide to invest quarterly and will need to invest for a minimum of two quarters.

All you have to do after that is sit back and watch your investments accumulate.

Mantra of Mutual Fund Investments Start Early + Invest Regularly + patience

Performance charts of various investments.

Year 1979-80 1984-85 1989-90 1994-95 1999-00 2004-05 2009-10 2011-12

Gold return 46% 7% 2% 3% 3% 7% 22% 34%

Fixed deposits rate 7% 8% 9% 11% 8.5% 5.25% 6% 9%

Sensex return 29% 44% 9% -14% 34% 16% 81% -11%

If you invest Rs. 100000 in gold in 1979 80 then today value of investments could be Rs. 32, 51,055 If you invest Rs. 100000 in Bank F.D. in 1979-80 then todays value of investment could be Rs. 14, 22,214

Page 30 If you invest Rs. 100000 in SENSEX in 1979-80 then todays value of investment could be Rs. 1, 74, 04,000

Above performance chart for investments has clearly shows that Sensex returns are the best as compare to others. The lowest return shows by Bank F.D., but then also Indians prefers to save in it. Gold investment gave best return in last Five years, because of slow pace in global economy investors preferred gold for their investments in past, but current global economic conditions are showing everything is coming on track, which means market will boost more. Comparison clearly shows that short term investment are riskier in stock market, but if investor having time horizon more than 5 years stock market investments are best.
Now just compare some tax saving mutual funds schemes which are related to stock market investments, below chart shows some top mutual funds ELSS schemes

Performance of Top Tax Saving Schemes As On 31st May 2013 Scheme 6m 1yr 2yr 3yr 5yr Since inception CAGR ICICI Pru Tax plan HDFC Tax saver -4.3% -3.5% 17.3% 13.3% 18.4% 3.21% -0.3% 5.7% 5.3% 2.9% 6.3% 9.7% 10.1% 13.5% 21.70% 26.82% 17.15%

Canara Robbeco Tax -2.1% plan IDFC Tax advantage -2.5%

25.0%

6.1%

6.7%

--

19.13%

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Franklin shield

India

tax -0.2%

20.6%

6.6%

9.0%

10.4%

20.76%

DSPBR Tax saver SBI tax gain Sundaram Tax saver UTI Tax saving plan

-0.9% -1.5% -3.2% 0.1%

24.6% 20.0% 18.8% 19.5%

5.5% 6.0% 4.2% 3.5%

5.2% 4.7% 4.1% 4.5%

7.9% 6.0% 7.0% 4.3%

9.42% 16.60% 17.8% 14.85%

This peer comparison clearly shows that shorter time horizon for mutual funds investments could be dangerous. Longer the time for investment will give better returns, and reduces the chances for losses. ELSS always played a big role in Indian mutual funds industry. The leading ELSS schemes are provided by HDFC and ICICI mutual funds Company. Since the internship period was tax payment period i.e. March month, so we decided to market these ELSS schemes and try to create awareness about Tax savings investments in India and its returns. While marketing of these schemes, we carried all required data along with us; the main aim is to provide knowledge to peoples regarding investment avenues in India and its comparison with one another. The main task in Sudha stocks was to create awareness in Vashi area related to investments avenues and tax savings plans. By looking current data, investments in ELSS schemes are too low in respect of bank deposits. Publics are facing problem to invest in mutual funds, we have to motivate them to invest and save your tax.

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Marketing of mutual Funds

Mutual fund industry in India has come a long way. Significant spurts in size were noticed in late 80s, when public sector mutual funds were first permitted, and then in mid 90s, when private sector mutual funds commenced operations. In the last few years, institutional distributors increased their focus on mutual funds. The emergence of stock broker as an additional channel of distribution the continuing growth in convenience arising out of technology developments, and higher financial literacy in the market should drive the growth of mutual funds in future. AUM of the industry as on March 31, 2012 has touched Rs.587, 217 from 1309schemes offered by 44 AMCs. This immense upward trend shows the marketing activities efforts taken by AMCS and other distributors. The same project was assigned to me in Sudha Stocks I have to market the tax savings schemes to retail investors. Marketing of these schemes was not an easy task, as retail investors had fear in mind for losses. Because of year ending every investor have to pay tax before particular date, so we have decided to try to market the Tax saving i.e. ELSS schemes. ELSS scheme is a closed ended scheme, where investors have to block money for three years. In ELSS investors can save tax on an up to Amount Rs. 100000/For marketing of these schemes we adopted various ways like

Personal visits to offices :

Page 33

Here we personally visited offices in nearby location like Vashi, Belapur CBD, Kharghar, Rabale, etc and presented the past performance of various tax saving schemes, its importance, its benefits to staff members and owners. As the period was year ending most of the offices shows that they are busy in their work, but we took an appointment whenever they were free and presented our schemes. More than 200 offices in nearby location visited by me, more than 100 visiting cards received, more than 25 presentations given. Various strategies was adopted to give the presentation, like mutual funds awareness program, AMFI initiated program, tax saver etc.

E-Mails:
E-mails is a fastest mode of communication, thats why I have decided to send the mails to publics and corporate. After visits, corporate gave their card which mentions email address of relationship manager or some other important persons. For making an effective presentation I had made one power point presentation which will attract investors. But while presentations most of corporate had the problem of presenter. So I had to manage with factsheets and other important materials. But once you get email address of some important person in organization, you can send those PPT to that person, this was one of the most important strategy was adopted.

Page 34

Email marketing has its own benefits; I just collected 1000 of email id from various sources, and send those PPTs to those persons. Some of them have respond to emails but some of them didnt.

Post in facebook and linked in:

Facebook and linked in are two largest social networking sites are available in India. These plays big role in marketing activities, I just posted the benefits of tax savings schemes on facebook and linked in wall, and asked friends to share it maximum times. This was the unique strategy liked by company guide.

Mobile SMS Marketing:

We have sent nearby 1000 of SMS to family, friends, relatives, business entrepreneurs of all group members. just stating that do you want to save your tax upto Rs.100000/- then contact to Sudha stocks etc.

Pamphlets/fact sheets distributions:

We have distributed the pamphlets and factsheets of various AMCs to nearby locations, residential areas, corporate offices, etc. the factsheets and pamphlets are given by AMCs at free of costs.

Advertisements in OLX and Quicker :

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Leaving no ways for marketing we gave advertisements on quicker and OLX websites, for reaching to people who wants to save the taxes and interested in mutual funds investments.

Just Dial services:

Sudha stocks is a paid and registered customer of just dial, we gave our reference to just dial as mutual funds distributor in navi Mumbai. So, this ways customer can find us for their investments.

Results of Marketing activities:

In spite of adopting the different marketing strategies, we acquired no single customer from market; this might be because of our inefficiency in marketing activities and other factors. 2008s global crises have created very bad sentiments towards the markets in investors mind. Once business tycoon Warren Buffet says India is a nation of Savers, not the investors, Most people are interested to keep their amount in PPF and bank F.D. for tax saving purpose even if the fact that showing mutual funds gave the better returns as compare to any other kind of investments. Last five years has shown great volatility

Page 36

in the market, so making profits was a difficult task for investors, thats why investors are not showing any interest towards mutual funds investments.

Just Dial services only help us to find out some customers for business, except just dial no other strategy worked properly. While giving presentations peoples shows interest in investments but they were not ready to invest because of fear of loss of money. Some of the visited offices really showed that they are interested in investments but showing any causes they just avoids. These are some of the response come from visits They are not interested in any kind of stock investments They dont want to invest via intermediaries They are already paid their taxes Send Emails for further communication They are already doing mutual funds investments. Concern person is not here Busy Difficult as trust on any students

My Learnings during period

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1. India is a nation of savers, not the investors truly said by Mr. Warren Buffet, India in a nation of middle class earners, prefers safety in investments rather than returns. 2. Changing those sentiments are very difficult, For selling mutual fund it is very essential that the investor should have complete trust in you otherwise they wont invest and this trust will acquire over a period of time. 3. One should need a unique strategy to acquire customers, because by doing lot of efforts no one is interested to invest in mutual funds. Strategy and confidence only can give place in market. 4. Convincing customers is not an easy task. 5. To convince customers one should need full and up to date knowledge of products this is the main learning of this period. 6. To become a good player in market one should have perfect knowledge about markets. 7. Experience gives the best knowledge. 8. Any presentation starting is very much important then only he shows interest in presentations.

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CONCLUSION
At lastly I want to conclude that mutual funds industry is very much important to any economy specially developing like India. Because of it is professionally managed probability of losses is reduces. Mutual fund industry in India is

capable to grow on its own. Systematic investment plans gives chance to small investor who wants to invest. In India financial regulator are the best as compare to others. Regulators have full control towards market, each and every regulator playing its important role. With these strict regulation chances of fraud and scams gets reduced. On the basis of study done in Sudha Stocks, I can conclude that 2008s global recession has been greatly impacted mutual fund industry. Mutual funds investment always has been an important part of an economy. Because of global crises people are neglecting mutual funds investments. SEBI is playing its important role as regulator, but one has to take effort to motivate investors for mutual funds. AMFI is not an SRO but its main aim is to creating advertisements

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and create market for mutual fund industry, but I believe these efforts are not enough. It should have try more for motivate investor and show again growing path to mutual fund industry.

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SUMMER INTERNSHIP PROJECT REPORT DURATION: 1st April to 10th June

Report title: Comparative research Study for Equity Investments

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Indian Capital Markets

Since 2003, Indian capital markets have been receiving global attention, especially from sound investors, due to the improving macroeconomic fundamentals. The presence of a great pool of skilled labour and the rapid integration with the world economy increased Indias global competitiveness. No wonder, the global ratings agencies Moodys and Fitch have awarded India with investment grade ratings, indicating comparatively lower sovereign risks. The Securities and Exchange Board of India (SEBI), the regulatory authority for Indian securities market, was established in 1992 to protect investors and improve the microstructure of capital markets. In the same year, Controller of Capital Issues (CCI) was abolished, removing its administrative controls over the pricing of new equity issues. In less than a decade later, the Indian financial markets acknowledged the use of technology (National Stock Exchange started online trading in 2000), increasing the trading volumes by many folds and leading to the emergence of new financial instruments. With this, market activity experienced a sharp surge and rapid progress was made in further strengthening and streamlining risk management, market regulation, and supervision. The securities market is divided into two interdependent segments:

Page 42

The Primary market provides the channel for creation of funds through issuance of new securities by companies, governments, or public institutions. In the case of new stock issue, the sale is known as Initial Public Offering (IPO).

The Secondary Market is the financial market where previously issued securities and financial instruments such as stocks, bonds, options, and futures are traded.

In the recent past, the Indian securities market has seen multi-faceted growth in terms of:

The products traded in the market, viz. equities and bonds issued by the government and companies, futures on benchmark indices as well as stocks, options on benchmark indices as well as stocks, and futures on interest rate products such as Notional 91-Day T-Bills, 10-Year Notional Zero Coupon Bond, and 6% Notional 10-Year Bond.

The amount raised from the market, number of stock exchanges and other intermediaries, the number of listed stocks, market capitalization, trading volumes and turnover on stock exchanges, and investor population.

The profiles of the investors, issuers, and intermediaries.

Broad Constituents in the Indian Capital Markets Fund Raisers are companies that raise funds from domestic and foreign sources, both public and private. The following sources help companies raise funds: Fund Providers are the entities that invest in the capital markets. These can be categorized as domestic and foreign investors, institutional and retail investors. The list includes subscribers to primary market issues, investors who buy in the secondary

Page 43

market, traders, speculators, FIIs/ sub accounts, mutual funds, venture capital funds, NRIs, ADR/GDR investors, etc. Intermediaries are service providers in the market, including stock brokers, subbrokers, financiers, merchant bankers, underwriters, depository participants, registrar and transfer agents, FIIs/ sub accounts, mutual Funds, venture capital funds, portfolio managers, custodians, etc. Organizations include various entities such as MCX-SX, BSE, NSE, other regional stock exchanges, and the two depositories National Securities Depository Limited (NSDL) and Central Securities Depository Limited (CSDL). Market Regulators include the Securities and Exchange Board of India (SEBI), the Reserve Bank of India (RBI), and the Department of Company Affairs (DCA).

Participants

in

the

Securities

Market

SAT, regulators (SEBI, RBI, DCA, DEA), depositories, stock exchanges (with equity trading, debt market segment, derivative trading), brokers, corporate brokers, subbrokers, FIIs, portfolio managers, custodians, share transfer agents, primary dealers, merchant bankers, bankers to an issue, debenture trustees, underwriters, venture

Page 44

capital funds, foreign venture capital investors, mutual funds, collective investment schemes.

EQUITY MARKET History of the Market

With the onset of globalization and the subsequent policy reforms, significant improvements have been made in the area of securities market in India. Dematerialization of shares was one of the revolutionary steps that the government implemented. This led to faster and cheaper transactions, and increased the volumes traded by many folds. The adoption of the market-oriented economic policies and online trading facility transformed Indian equity markets from a broker-regulated market to a mass market. This boosted the sentiment of investors in and outside India and elevated the Indian equity markets to the standards of the major global equity markets. The 1990s witnessed the emergence of the securities market as a major source of finance for trade and industry. Equity markets provided the required platform for companies and start-up businesses to raise money through IPOs, VC, PE, and finance from HNIs. As a result, stock markets became a peoples market, flooded with primary issues. In the first 11 months of 2007, the new capital raised in the global public equity markets through IPOs accounted for $107 billion in 382 deals out of the total of $255 billion raised by the four BRIC countries. This was a sizeable growth from $90 billion raised in 302 deals in 2006. Today, the corporate sector prefers external sources for meeting its funding requirements rather than acquiring loans from financial institutions

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or

banks.

Derivative Markets

Emergence of the market for derivative products such as futures and forwards can be traced back to the willingness of risk-averse economic agents to guard themselves against uncertainties arising out of price fluctuations in various asset classes. By their very nature, the financial markets are marked by a very high degree of volatility. Through the use of derivative products, it is possible to partially or fully transfer price risks by locking in asset prices. However, by locking in asset prices, derivative products minimize the impact of fluctuations in asset prices on the profitability and cash flow situation of risk-averse investors. This instrument is used by all sections of businesses, such as corporates, SMEs, banks, financial institutions, retail investors, etc. According to the International Derivatives Association, more than 90 percent of the global 500 corporations use derivatives for hedging risks in interest rates, foreign exchange, and equities.
Currently Indian markets showing significant growth in derivatives market trading, In India following derivatives products are available in market

1. Futures contract. 2. Forward Contract.

3. Options Trading. 4. Currency trading.

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What are futures contracts?

Futures contracts are standardized derivative instruments. The instrument has an underlying product (tangible or intangible) and is impacted by the developments witnessed in the underlying product. The quality and quantity of the underlying asset are standardized. Futures contracts are transferable in nature. Three broad categories of participantshedgers, speculators, and arbitragerstrade in the derivatives market.

Hedgers face risk associated with the price of an asset. They belong to the business community dealing with the underlying asset to a future instrument on a regular basis. They use futures or options markets to reduce or eliminate this risk.

Speculators have a particular mindset with regard to an asset and bet on future movements in the assets price. Futures and options contracts can give them an extra leverage due to margining system.

Arbitragers are in business to take advantage of a discrepancy between prices in two different markets. For example, when they see the futures price of an asset getting out of line with the cash price, they will take offsetting positions in the two markets to lock in a profit.

Distinction between Forward and Futures Contracts: Futures Contracts Meaning: A futures contract is a Forward Contracts A forward contract is a contractual

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contractual

agreement

between

two

agreement between two parties to buy or sell an asset at a future date for a predetermined mutually agreed price while entering into the contract. A forward contract is not traded on an exchange.

parties to buy or sell a standardized quantity and quality of asset on a specific future date on a futures exchange.

Trading

place: A

futures

contract

is

A forward contract is traded in an OTC market.

traded on the centralized trading platform of an exchange. Transparency in contract price: The contract price of a futures contract is transparent as it is available on the centralized exchange. Valuations of open position and margin requirement: In a futures contract, trading screen of the

The contract price of a forward contract is not transparent, as it is not publicly disclosed.

In a forward contract, valuation of open position is not calculated on a daily basis and there is no requirement of MTM on daily basis since the settlement of contract is only on the maturity date of the contract. A forward contract is less liquid due to its customized nature.

valuation of open position is calculated as per the official closing price on a daily basis and mark-to-market (MTM) margin requirement exists. Liquidity: Liquidity is the measure of frequency of trades that occur in a

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particular

futures

contract.

futures

contract is more liquid as it is traded on the exchange. Counterparty default risk: In futures In forward contracts, counterparty risk is high due to the customized nature of the transaction.

contracts, the exchange clearinghouse provides trade guarantee. Therefore,

counterparty risk is almost eliminated. Regulations: A regulatory authority and the exchange regulate a futures contract. A forward contract is not regulated by any exchange.

Options Trading: speculators prefers to get the quick gain from market but they dont want to take the risk, at a limited risk investor wants to get high returns. This kind of need in market has generated the options trading. Options are the contracts created by two different parties where by seller of a option is ready to take unlimited risk at a premium payment. There are two options are available for trading Call Options: where a buyer gets the right to buy the shares at specific decided price. Put Options: where buyer of these options gets right sell the stock at specific decided price. Buyer of any options secures its loss by agreeing at specific price and paying certain premium to seller, but seller can have unlimited loss. Benefits of Derivatives

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a. Price Risk Management: The derivative instrument is the best way to hedge risk that arises from its underlying. Suppose, A has bought 100 shares of a real estate company with a bullish view but, unfortunately, the stock starts showing bearish trends after the subprime crisis. To avoid loss, A can sell the same quantity of futures of the script for the time period he plans to stay invested in the script. This activity is called hedging. It helps in risk minimization, profit maximization, and reaching a satisfactory risk-return trade-off, with the use of a portfolio. The major beneficiaries of the futures instrument have been mutual funds and other institutional investors. b. Price Discovery: The new information disseminated in the marketplace is interpreted by the market participants and immediately reflected in spot and futures prices by triggering the trading activity in one or both the markets. This process of price adjustment is often termed as price discovery and is one of the major benefits of trading in futures. Apart from this, futures help in improving efficiency of the markets. c. Asset Class: Derivatives, especially futures, offer an exclusive asset class for not only large investors like corporates and financial institutions but also for retail investors like high networth individuals. Equity futures offer the advantage of portfolio risk diversification for all business entities. This is due to the fact that historically it has been witnessed that there lies an inverse correlation of daily returns in equities as compared to commodities. d. High Financial Leverage: Futures offer a great opportunity to invest even with a small sum of money. It is an instrument that requires only the margin on a contract to be paid in order to commence trading. This is also called leverage buying/selling. e. Transparency: Futures instruments are highly transparent because the underlying product (equity scripts/index) are generally traded across the country or even traded

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globally. This reduces the chances of manipulation of prices of those scripts. Secondly, the regulatory authorities act as watchdogs regarding the day-to-day activities taking place in the securities markets, taking care of the illegal transactions. f. Predictable Pricing: Futures trading is useful for the genuine investor class because they get an idea of the price at which a stock or index would be available at a future point of time.

EXCHANGE PLATFORM Domestic Exchanges

Indian equities are traded on three major national exchanges: MCX Stock Exchange Limited (MCX-SX), Bombay Stock Exchange Limited (BSE) and National Stock Exchange of India Limited (NSE). MCX Stock Exchange

MCX Stock Exchange Limited (MCX-SX), Indias new stock exchange, is recognized by the Securities and Exchange Board of India (SEBI) under Section 4 of the Securities Contracts (Regulation) Act, 1956. The Exchange was granted the status of a recognized stock exchange by the Government of India on December 19, 2012. In line with global best practices and regulatory requirements, clearing and settlement of trades is conducted through a separate clearing corporation-MCX-SX Clearing Corporation Limited (MCX-SX CCL).

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MCX-SX commenced operations in Currency Futures in the Currency Derivatives segment on October 7, 2008 under the regulatory framework of SEBI and Reserve Bank of India (RBI). The Exchange commenced trading in Currency Options on August 10, 2012. The Exchange received permissions to deal in Interest Rate Derivatives, Equity, Futures and Options on Equity and Wholesale Debt segments, vide SEBIs letter dated July 10, 2012. The Exchange further received permission to commence trading in these new segments, vide SEBIs letter dated December 19, 2012. The Exchange commenced trading in the Equity segment on February 11, 2013.

Bombay Stock Exchange (BSE)

BSE is the oldest stock exchange in Asia. The extensiveness of the indigenous equity broking industry in India led to the formation of the Native Share Brokers Association in 1875, which later became Bombay Stock Exchange Limited (BSE).

BSE is widely recognized due to its pivotal and pre-eminent role in the development of the Indian capital market.

In 1995, the trading system transformed from open outcry system to an online screen-based order-driven trading system.

The exchange opened up for foreign ownership (foreign institutional investment).

Allowed Indian companies to raise capital from abroad through ADRs and GDRs.

Expanded the product range (equities/derivatives/debt).

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Introduced the book building process and brought in transparency in IPO issuance.

T+2 settlement cycle (payments and settlements). Depositories for share custody (dematerialization of shares). Internet trading (e-broking). Governance of the stock exchanges (demutualization and corporatization of stock exchanges) and internet trading (e-broking).

BSE has a nation-wide reach with a presence in more than 450 cities and towns of India. BSE has always been at par with the international standards. It 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 Online Trading System (BOLT). Benchmark Indices futures: BSE 30 SENSEX, BSE 100, BSE TECK, BSE Oil and Gas, BSE Metal, BSE FMCG

National Stock Exchange (NSE)

NSE was recognized as a stock exchange in April 1993 under the Securities Contracts (Regulation) Act. It commenced its operations in Wholesale Debt Market in June 1994. The capital market segment commenced its operations in November 1994, whereas the derivative segment started in 2000. NSE introduced a fully automated trading system called NEAT (National Exchange for Automated Trading) that operated on a strict price/time priority. This system enabled efficient trade and

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the ease with which trade was done. NEAT had lent considerable depth in the market by enabling large number of members all over the country to trade simultaneously, narrowing the spreads significantly.

The derivatives trading on NSE commenced with S&P CNX Nifty Index futures on June 12, 2000. The futures contract on NSE is based on S&P CNX Nifty Index. The Futures and Options trading system of NSE, called NEAT-F&O trading system, provides a fully automated screen based trading for S&P CNX Nifty futures on a nationwide basis and an online monitoring and surveillance mechanism. It supports an order-driven market and provides complete transparency of trading operations. Benchmark Indices futures: Nifty Midcap 50 futures, S&P CNX Nifty futures, CNX Nifty Junior, CNX IT futures, CNX 100 futures, Bank Nifty futures

REGULATORY AUTHORITY

There are four main legislations governing the securities market:

a. The SEBI Act, 1992 establishes SEBI to protect investors and develop and regulate the securities market. b. The Companies Act, 1956 sets out the code of conduct for the corporate sector in relation to issue, allotment, and transfer of securities, and disclosures to be made in public issues. c. The Securities Contracts (Regulation) Act, 1956 provides for regulation of transactions in securities through control over stock exchanges. d. The Depositories Act, 1996 provides for electronic maintenance and transfer of ownership of demats securities.

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In India, the responsibility of regulating the securities market is shared by DCA (the Department of Company Affairs), DEA (the Department of Economic Affairs), RBI (the Reserve bank of India), and SEBI (the Securities and Exchange Board of India). The DCA is now called the ministry of company affairs, which is under the ministry of finance. The ministry is primarily concerned with the administration of the Companies Act, 1956, and other allied Acts and rules & regulations framed there-under mainly for regulating the functioning of the corporate sector in accordance with the law. The ministry exercises supervision over the three professional bodies, namely Institute of Chartered Accountants of India (ICAI), Institute of Company Secretaries of India (ICSI), and the Institute of Cost and Works Accountants of India (ICWAI), which are constituted under three separate Acts of Parliament for the proper and orderly growth of professions of chartered accountants, company secretaries, and cost accountants in the country.

SEBI protects the interests of investors in securities and promotes the development of the securities market. The board helps in regulating the business of stock exchanges and any other securities market. SEBI is also responsible for registering and regulating the working of stock brokers, sub-brokers, share transfer agents, bankers to an issue, trustees of trust deeds, registrars to an issue, merchant bankers, underwriters, portfolio managers, investment advisers, and such other intermediaries who may be associated with securities markets in any manner. The board registers the venture capitalists and collective investments like mutual funds. SEBI helps in promoting and regulating self regulatory organizations.

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RBI is also known as the bankers bank. The central bank has some very impor tant objectives Objectives

and

functions

such

as:

Maintain price stability and ensure adequate flow of credit to productive sectors.

Maintain public confidence in the system, protect depositors' interest, and provide cost-effective banking services to the public.

Facilitate external trade and payment and promote orderly development and maintenance of the foreign exchange market in India.

Give the public adequate quantity of supplies of currency notes and coins in good quality.

Functions

Formulate implements and monitor the monetary policy. Prescribe broad parameters of banking operations within which the country's banking and financial system functions.

Manage the Foreign Exchange Management Act, 1999. Issue new currency and coins and exchange/destroy currency and coins not fit for circulation.

Perform a wide range of promotional functions to support national objectives.

What Is Equity Research?

Equity research is a study of equities or stocks for the purpose of investments.

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Equities or common stock comprises a big chunk in any companys capital and shareholders need to know whether to stay invested in the company or sale the shares and come out. As an individual, it is time consuming to do equity research that is to study the company, its financial statements, products, management and take a decision about investment. Exactly for the same reason there are people working in research companies whose job is to do equity research and recommend companies for investment.

Purpose Purpose of equity analysis is to study companies, analyze financials, and look at quantitative and qualitative aspects mainly for decision whether to invest or not. Equity research process Equity research process comprises of multiple steps. 1. Economic Analysis 2. Industry Analysis 3. Company Analysis 4. Financial Statement Analysis 5. Financial and Valuation Modeling 6. Report writing 7. Presentation or recommendation

Application Equity research is used in many areas. Primarily, the research is used for the following purposes:

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1. Investment evaluation 2. In Mutual Fund industry 3. For M&A deals 4. Financial Publications

Role of Research Analyst

Research and the Stock Market

The role of research is to provide information to the market. A lack of information creates inefficiencies that result in stocks being misrepresented (over- or undervalued). Analysts use their expertise and spend a lot of time analyzing a stock, its industry and its peer group to provide earnings and valuation estimates. Research is valuable because it fills information gaps so that each individual investor does not need to analyze every stock. This division of labor makes the market more efficient.

Research in Bull and Bear Markets

If the role of research has always been so "noble," why is it in such a state of illrepute? There are two reasons: firstly, the current bear market gives us a new perspective to evaluate the excesses of the last bull market; secondly, investors need to blame somebody.

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In every bull market, there are excesses that become apparent only in the bear market that follows. Whether it is tulips or transistors, each age has its mania that distorts the normal functioning of the market. In the rush to make money, rationality is the first casualty. Investors rush to jump on the bandwagon and the market overallocates capital to the "hot" sector(s). This herd mentality is the reason why bull markets have funded so many "me-too" ideas throughout history.

Research is a function of the market and is influenced by these swings. In a bull market, investment bankers, the media and investors pressure analysts to focus on the hot sectors. Some analysts morph into promoters as they ride the market. Those analysts that remain rational practitioners are ignored and their research reports go unread. During the late 1990s, the business media catered to the audience's demands and gave the spotlight to the famous talking heads that are now under investigation. Seeking to blame someone for investment losses is a normal event in bear markets. It happened in the 1930s and the 1970s, and it's occurring today. Some of the criticisms are deserved, but the need to provide information has not changed.

Research in Today's Market

To discuss the role of research in today's market, we need to differentiate between Wall Street research and other research. Wall Street research is provided by the major brokerage firms, both on and off Wall Street. Other research is produced by independent research firms and small boutique brokerage firms.

This differentiation is important. First, Wall Street research has become focused on big cap, very liquid stocks and ignores the majority (over 60% based on research)

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of publicly-traded stocks. This myopic focus on a small number of stocks is the result of deregulation and industry consolidation. In order to remain profitable, Wall Street firms have focused on big-cap stocks to generate highly lucrative investment banking deals and trade profits.

Other research is filling the information gap created by Wall Street. Independent research firms and boutique brokerage firms are providing research on the stocks that have been orphaned by Wall Street. Investors, now educated in the benefits of electronic trading, may not be willing to support boutique brokerage firms for their research by opening an account and paying higher commissions.

This means that independent research firms are becoming the main source of information on the majority of stocks, but investors are reluctant to pay for research, because they don't really know what they are paying for until well after the purchase. Unfortunately, not all research is worth buying. I have purchased reports from reputable sources only to find them inaccurate and misleading.

Who Pays for Research? Big Investors Do!

The ironic thing is that while research has proven to be valuable, individual investors do not seem to want to pay for it. This may be because, under the traditional system, brokerage houses provided research in order to gain and keep clients. Investors just had to ask their brokers for a report and retained it at no charge. What seems to have gone unrealized is that the commissions pay for that research.

A good indicator of the value of research is the amount institutional investors are willing to pay for it. Institutional investors hire their own analysts to gain a competitive edge over other investors. They also pay (often handsomely) independent research

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firms for additional research All this amounts to big money, but the institutions realize that research is integral to making successful investment decisions.

The Growing Role of Fee-Based Research

Fee-based research increases market efficiency and bridges the gap between investors who want research (without paying) and companies who realize that researcher is not likely to provide research on their stock. This research provides information to the widest possible audience at no charge to the reader because the subject company has funded the research.

It is important to differentiate between objective fee-based research and research that is promotional. Objective fee-based research is analogous to the role of your physician. You pay a physician not to tell you that you feel good, but to give you his or her professional and truthful opinion of your condition. Legitimate fee-based research is a professional and objective analysis and opinion of a company's investment potential. Promotional research is short on analysis and full of hype. One example of this is the fax and email reports about the penny stocks that will supposedly Legitimate 1.They triple fee-based provides research in firms have not a the short following promotional time. characteristics: services.

analytical,

2. They are paid a set annual fee in cash; they do not accept any form of equity, which may cause conflicts of interest.

3. They provide full and clear disclosure of the relationship between the company and the research firm so investors can evaluate objectivity.

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Companies who engage a legitimate fee-based research firm to analyze their stock are trying to get information to investors and improve market efficiency. Such a company is making the following important statements:

1. That it believes its shares are undervalued because investors are not aware of the company. 2. That it believes that its investment potential can withstand objective analysis. 3. Company can perform because of these factors etc.

The Bottom Line

The reputation and credibility of a company and the research firm depends on the efforts they make to inform investors. A company does not want to be tarnished by being associated with disreputable research. Similarly, a research firm will only want to analyze companies that have strong fundamentals and long-term investment potential.

Basics of Technical Analysis

In finance, technical analysis is a security analysis methodology for forecasting the direction of prices through the study of past market data, primarily price and volume Behavioral economics and quantitative use many of the same tools of technical analysis, which, being an aspect of active management, stands in contradiction to much of modern portfolio theory. The efficacy of both technical

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and fundamental analysis is disputed by the efficient-market hypothesis which states that stock market prices are essentially unpredictable. Fundamental analysts examine earnings, dividends, new products, research and the like. Technicians employ many methods, tools and techniques as well, one of which is the use of charts. Using charts, technical analysts seek to identify price patterns and market trends in financial markets and attempt to exploit those patterns. Technicians using charts search for archetypal price chart patterns, such as the wellknown head and shoulders or bottom reversal patterns, study technical

indicators, moving averages, and look for forms such as lines of support, resistance, channels, and more obscure formations such as flags, pennants, balance days and cup and handle patterns. Technical analysts also widely use market indicators of many sorts, some of which are mathematical transformations of price, often including up and down volume, advance/decline data and other inputs. These indicators are used to help assess whether an asset is trending, and if it is, the probability of its direction and of continuation. Technicians also look for relationships between price/volume indices and market indicators. Examples include the relative strength index, and MACD. Other avenues of study include correlations between changes in Options (implied volatility) and put/call ratios with price. Also important are sentiment indicators such as Put/Call ratios, bull/bear ratios, short interest, Implied Volatility, etc. There are many techniques in technical analysis. Adherents of different techniques (for example, candlestick charting, Dow Theory) may ignore the other approaches, yet many traders combine elements from more than one technique. Some technical analysts use subjective judgment to decide which pattern a particular instrument

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reflects at a given time and what the interpretation of that pattern should be. Others employ a strictly mechanical or systematic approach to pattern identification and interpretation. Technical analysis is frequently contrasted with fundamental analysis, the study of economic factors that influence the way investors price financial markets. Technical analysis holds that prices already reflect all such trends before investors are aware of them. Uncovering those trends is what technical indicators are designed to do, imperfect as they may be. Fundamental indicators are subject to the same limitations, naturally. Some traders use technical or fundamental analysis exclusively, while others use both types to make trading decisions. In simply I can say Technical analysis is not an astrology for predicting the future prices, but its an art of studying the charts and applying the pattern on it. Technical analysis mostly done for short term investments. Technical analyst believes that the price will behave same as it performs last time in same conditions. Identifying patterns and behavior is basics of technical analysis, patterns like any shape, head and shoulder, hanging man, hammer, moving average methods are the tools used by an analyst.

IPO analysis
A First sale of stock by a private company to the public. IPOs are often issued by smaller, younger companies seeking the capital to expand, but can also be done by large privately owned companies looking to become publicly traded.

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An initial public offering (IPO) or stock market launch is a type of public offering where shares of stock in a company are sold to the general public, on a securities exchange, for the first time. Through this process, a private

company transforms into a public company. Initial public offerings are used by companies to raise expansion capital, to possibly monetize the investments of early private investors, and to become publicly traded enterprises. A company selling shares is never required to repay the capital to its public investors. After the IPO, when shares trade freely in the open market, money passes between public investors. Although an IPO offers many advantages, there are also significant disadvantages. Chief among these are the costs associated with the process, and the requirement to disclose certain information that could prove helpful to competitors, or create difficulties with vendors. Details of the proposed offering are disclosed to potential purchasers in the form of a lengthy document known as a prospectus. Most companies undertaking an IPO do so with the assistance of an investment banking firm acting in the capacity of an underwriter. Underwriters provide a valuable service, which includes help with correctly assessing the value of shares (share price), and establishing a public market for shares. During internship period two big IPO was came out in market. One of which is situated in Bangalore and other one is from Mumbai. IPO could be a dangerous investment if dont do a research, we need to identify the intention behind raising funds. Lots of IPO was subscribed by later on company didnt show performance as expected. So, this is how retail investors mostly lose money in IPO markets. Here I made research as per my knowledge, reported to Company guide about their profile. 1. Scott garment Ltd.

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2. Just Dial Ltd.

Scott Garment IPO

About Scott Garments IPO Bangalore based Scott Garments is incorporated in 1992. Scotts Garments Ltd is engaged in the business of garment manufacturing. In addition to manufacture quality garments, company also provides additional facilities such as embroidery, printing, dyeing and washing. Scotts

Garments export their readymade knitted apparel to international

clients including Denmark, USA, Frankfurt, Germany etc. Mr. Naseer Ahmed is the promoter of the company.

Garments specialize in tailor made products for men, women and kids. Products manufactured by the Company includes Shirts (Cotton, Denim), Tops, Skirts, Trouser (Cotton, Denim), Shorts, Cargos, Knitted Garments, T-Shirts, Sweats and Jerseys. They export their quality products to several MNCs into more than 20 countries across the Globe. They have set up an exclusive display showroom at Apparel Export Promotion Council in Gurgaon.

The company has set up a 2.1 M.W capacity windmill at Bellary, Karnataka. The company has entered into Wheeling and Banking agreement with Gulbarga Electricity

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Supply Company Limited for the sale of the power generated through the wind mill. The company has also signed a Wheeling and Banking agreement with Tamil Nadu electricity board for the sale of power through wind mill at Tirunelveli district, Tamil Nadu.

Company's main suppliers of raw materials are Arthanari Loom Centre (Textile) Pvt. Ltd, Bombay Rayon Fashions Ltd, Shamlal Company (India) Pvt. Ltd, KG Denim Ltd, Arvind Ltd, Alok Industries Ltd and Nahar Industrial Enterprises Ltd.

Company Promoters: Mr. Naseer Ahmed aged 50 years is the Chairman and Managing Director of the company. Scotts Garments IPO Grading

CARE has assigned a IPO Grade 3/5 to the IPO of Scotts Garments Limited.

Bangalore based, Scott Garments is coming up for public issue for Rs. 136.60 to Rs. 138.70 Crores at a price band of Rs. 130 to Rs. 132 per share. Should we subscribe to Scott Garments IPO? Issue details:

IPO opens: 25-Apr-2013 IPO closes: 29-Apr-2013

Price band: Rs. 130 to Rs. 132 per share Face value: Rs. 10 Minimum bid: 100 shares and in multiples of 100 shares thereon with maximum shares of 1,500

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Minimum investment: Rs. 13,000 Lead managers: Canara Bank and Keynote corp services Ltd Registrar: Link Intime India Pvt Ltd Listing: BSE / NSE

Purpose of the IPO: The funds would be used for the following purposes.

Setting up of unit for Trouser manufacturing and Knitting and Fabric Processing at Doddaballapur, Karnataka;

Margin Money for working capital of new unit; General corporate purpose; and Meet the issue expenses Care has assigned this IPO grading as 3/5 which indicates average fundamentals

Company financials 1) Company has posted 13% to 18% annualized growth in terms of revenue in the last 5 years. The revenues have increased from Rs. 503 Crores (FY2010-11) to Rs. 566 Crores (FY2011-12). 2) Company has been operating around 7% margins up to FY 2010-11. For FY201112, the margins showed a steep jump to 14.84% due to increase in Other income. For 7 months ended Oct-12, the margins are at 6.09%. The margins are stabilized around 6% to 7% in the last 5 years. SCOTT GARMENT Financials 2008 2009 2010 2011 2012 7 mnth

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Revenues in Lacs) PAT Profit % Revenue Growth EPS 2010 2011 2012 Average

(Rs 33,275.95 37,443.57 43,435.98 50,374.88

56,613.29 33,533.31

2224.71 6.69 ---

2721.88 7.27 13%

2784.24 6.41 16%

3493.06 6.93 16%

8403.95 14.84 12%

2041.05 6.09 18%

Rs.10.41 Rs. 13.06 Rs 31.43 Rs. 21.80

The garment industry is doing well and would expect to grow in coming years. For the first seven months ended Oct-2012, Scott garments reported a turnover of Rs. 335.33 Crores with a net profit of Rs. 20.41 Crores. If we attribute the annualized earnings on the post IPO equity base of Rs. 38.98 Crores then the issue price is at a P/E of 14.5x. Its peers are trading between 10x to 16x which indicates that the issue price is aggressively priced. Though company has been doing well in terms of revenues and margins, due to its high issue price, one should go for company after listing to market at below IPO price.

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JUST DIAL IPO

Incorporated in 1996, Justdial Limited (Just Dial) is popular local search service provider in India. Just Dials search services are available to users through Int ernet, mobile Internet, telephone and text.

Just dial is a 24/7 Free Search service on a single national number 08888888888 that receives over 130 Million Calls every year. It provides reliable information about local businesses, products and services to the users in over 2000 cities in India. They have more than 300 million customers using JustDial Services.

Selling advertisement and qualified leads is the main source of earning for Justdial. They have more than 145,000 paid advertisers. Companies promote their brand across the Just Dial network and reach millions people who are actively looking for information about the products and services. There are 4 ways available to promote brand or advertise on JustDial including Listing on Web, Listing on Phone Search, Listing on Mobile Search and Placing Video Ads.

Company Promoters: Promoters of the Company are: 1. V.S.S. Mani, aged 46 years, is the Managing Director and Chief Executive Officer of the Company.

2. Anita Mani, aged 43 years, is a former Director of the

Company. 3. Ramani Iyer, aged 43 years,

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is

Non-Independent,

Executive

Director

of

the

Company.

4. V. Krishnan, aged 42 years, is a Non-Independent, Executive Director of the Company. Objects of the Issue: 1. Achieve the benefits of listing the Equity Shares on the Stock Exchanges and 2. Carry out the sale of 17,497,458 Equity Shares by the Selling Shareholders.

Issue Detail: Issue Issue Issue Issue Face Issue Market Minimum Size: Size: Value: Price: Rs. Open: May Type: 17,497,458 Rs. Rs. 470 Lot: Order Quantity: 20, 2013 100% Equity 822.38 10 Rs. Shares Per 543 25 25 Per May Book of 950.11 Equity Equity Rs. 22, 2013 Built 10 Crore Share Share Shares Shares

Listing At: BSE, NSE, MCX-SX

Just Dial IPO Grading CRISIL has assigned IPO Grade 5/5 to the IPO of Just Dial Ltd.

Just Dial IPO offers Safety Net to Retail investors Just dial IPO offers safety net mechanism which will be available to all retail individual investors applying in Just Dial IPO for up to Rs. 50,000. The safety net would trigger in case the price of the share fall over 20% from the issue price.

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Just Dial enjoys the first-mover advantage & strong mindshare among users in the local search space. In addition, it has shown dependence to the technological changes over the period and is planning to expand & deepen its presence into new territories & existing geographies respectively. On the growth front, as the business model continues to move more towards non-linearity through increased penetration in the high growth internet and mobile internet platform JDL should see expansion of operating margins and strong growth in earnings. Some key points: Lower entry barrier, high price, dependency on technology, criminal charges on promoters, reducing the promoters stake. Growth in last year more than double, lower debt, less fixed cost.

JDL may not be able to reduce its dependency on search engines to direct users to its website.

JDL demerged its IT testing operations to JD Global, which has resulted in a reduction in its capital and profit and loss account and net worth.

Some of the products or services of JDL has only recently been introduced and, as a result, it may be difficult to evaluate their performance and prospects.

JDL depends upon vendors and third party suppliers to provide it with hardware and software required for the development and provision of its products and services to its users and advertisers.

Average EPS : Rs 6.54

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Return on net worth: 39.43% Average P/E ratio : >50 Fixed assets: Rs 671.56 million increasing at on an average at 49.33% Profit margin: 20

Financial

view

On the financial view, Just Dial has posted a Sales of Rs 264.36 crore for nine months end of FY13 as against that of Rs 259.40 crore seen in FY12. On the operating front, the company has posted a profit of Rs 63.19 crore for nine months end of FY13 as against Rs 55.53 crore for FY12. In fact, the operating margins showed a consistent improvement until FY12. Its net profits for nine months of FY13 stood at Rs 47.08 crore as against Rs 50.58 crore for FY12. In the 2008-12 periods, the sales and eps witnessed a CAGR of 50 per cent and 136 per cent respectively, which is tremendous but does not look sustainable over a longer period. At the post issue capital and on an annualized profit of Rs 63 crore, the stock is likely to trade at a PE of 52.35x and 60.93x for the respective price bands. The only listed player in this space so far in the Indian context is Info Edge (India), which is trading at a trailing 12-month PE of around 39x. Even in the global context, Google Inc. is trading at a price-to-earnings multiple of 25x.

As mentioned, this is an offer for sale providing an exit route to the investors. The offer has already seen issues related with valuation, and hence the company has lowered the same. However, it does not justify a price-to-earnings ratio of 50x. There is no doubt that the valuation of the company is still looking steep.

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The investors as well as two of the promoters are making an exit, booking partial profits from this venture. As this is an offer for sale, it has to be backed by institutions, and thus 75 per cent of the issue has been reserved for QIBs. At this juncture I suggest that the retail investors stay away from the issue.

Investment worth stock

Keeping long term time horizon for equity investment, one should first identify the stocks which are giving constant growth, risk associates with stock, company fundamental analysis, and comparison with its peer group. Everybody in the market wants their investments should be risk free or little risky. One has to identify which are those stocks are available in market which are worth able for long term investments. These stocks could from any sector, any process, from any nations, government controlled or public controlled, etc. Identifying these stocks is very important for investments. For this different different researcher adopts different different criteria. It depends upon how much an investor can tolerate the risk, accordingly strategies are made for investments. Companies past performance is very much important to decide the future. If company is showing growth constantly it means their management and administration are excellent. As start for the basics for research company guide has assigned this task to me. I have to find out those companies which are satisfying following criterias Total Sales Turnover > Rs.1000cr Total Net Profit > Rs.100cr Dividend Payout > Rs.100% EPS > Rs.20

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Share Capital > Rs.20cr According to these criteria I have to make a performance report of companies listed on NSE. No doubt these should be the top companies in India showing constant growth year on year. These companies are prestigious companies; management of these companies would not want to lose their good will in market. So, this is how the top companies in India showing little risk in investments. A detailed performance report of companies which are meeting those criteria is attached here

While finding those companies some interesting facts came out.

1. There are 523 companies in India whos having sales turnover more than 1000cr. 2. There are only 296 companies which are having net profit margin more than 10% 3. There are 170 companies which are having earning per share is Rs.20 or more 4. And there are only 71 companies which are satisfying those criteria.

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This finding clearly shows that most companies in India are not well managed. The reasons might be anything; their material cost is high, direct expenses are high, indirect expenses are not well manage, etc. Nearby top 200 companies are not able to manage their profit margins to 10%. In BSE, there are more than 5000 companies are listed, but only 71 companies are worth able stocks for long term investment with minimum risk.

Portfolio Management
Portfolio means the basket of various investments. Investing all money in one security can have a big risk; it is the art and science of making decisions about investment mix and policy, matching investments to objectives, asset allocation for individuals and institutions, and balancing risk against performance.

Portfolio management is all about strengths, weaknesses, opportunities and threats in the choice of debt vs. equity, domestic vs. international, growth vs. safety, and many other tradeoffs encountered in the attempt to maximize return at a given appetite for risk. For getting practical experience in stock market portfolio management I have to create one portfolio in virtual market. There are two ways to play in virtual market. NSE Pathshaala, it is a virtual gaming provides initial amount of Rs. 500000 for learning in stock market. This NSE pathshala shows the real trading price in market, one just has to start the trading by buying and selling the stocks.

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I have selected another way i.e. creating a virtual portfolio in moneycontrol.com. This website provides fastest access to create any portfolio. For creating an effective portfolio sir has gave me limit of Rs. 20,00,000/- for investment, and this amount is not available in NSE pathshala. I have selected those stocks for investment, on which I made research, the full risk and return calculation is shown below. Keeping the long term investment perspective I created following portfolio as on 31st may 2013
Stock Name Beta Quantit y ITC Procter and Gamble Ltd. State Bank of India 0.979 0.212 0.112 Asian Paints Infosys 2.653 0.241 TCS Bajaj auto 5.748 1.311 HCL tech Jaiprakash Associates 4.559 4.437 HDFC bank 2.324 Hero moto corp 1.738 10 1645 225 685 500 750 795 68 35 50 1373 1880 60 20 4670 2236 1000 35 20 Purchase d price 328 2626 2089
WACC%

Investme nts

Current price 339.9 2863.1 2076.5

Net Profit/loss 11900 8299 (250)

15.61% 4.40%

328000 91910 41780

1.22% 13.35%
280200 44720 4863.1 2411.7 11586 3515

2.13% 2.30%
48055 94000 1498.5 1820.5 4393 (2975)

4.50% 18.92%
397500 51000 745 65.65 (25000) (1763)

2.43%
154125 700.5 3488

7.35%
16450 1736.4 915

0.78%

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ICICI Bank 1.323 HDFC 1.134 Total 150 845 325 1161 377350 1154.5 (1950)

17.99%
126750 890.15 6773

6.1%
100 2100000 18931

Above portfolio was created by me considering the expected return (Xbar) in performance sheet. Ranking has been made for investment by greater the expected return. So, here HCL Tech gets more investments as compare to others because it gave highest expected returns in last year. Hoping the same growth will perform in future for this stock.

Bi
0.979 0.212 -0.112

Wi

Bi*Wi

15.61% 0.152822 4.40% 0.009328 1.22% 0.001366

2.653 -0.241

13.35% 0.354176 2.13% 0.005133 0.132204 4.50% 0.058995

5.748 -1.311

2.30%

4.559 -4.437

18.92% 0.862563 2.43% -

Page 78 I selected the ITC ltd share in highest quantity, because Indian FMCG sector showing extreme growth. All the companies in FMCG sector are growing 20% approximately and ITC has the best performance in last ten years. It is one of the fastest growing companies in India. The strong fundamentals of company attracted lots of investment in company. Now a days nearby every financial company has the investment in ITC ltd. It s the share which is quoting less price in market as compare to its fundamentals. in last decade ITC grew at huge pace, and same progress can be seen in market. Beta of portfolio
-1.134 -1.323 -1.738 -2.324

0.107819 7.35% 0.170814 0.78% 0.013556 17.99% 0.238008 6.10% 0.069174 0.846226

So, considering this was my portfolio, the risk and return on portfolio is expected to be The above calculation shows the beta of my portfolio. To take opportunity from market fluctuations, I kept Rs.50000/- as liquid cash. This portfolio created by me is made as per long time investment. Comparing portfolio on daily basis could be dangerous for returns. But to take the opportunity from I did several daily transactions, by keeping chart in mind I wanted to take advantage from fluctuations. So, purchased and sold several shares from market like JPASSOCIATE is the share which does not have any relationship with its companies income, company having the net debt of Rs 52000 crore, hence why company is not able to give profit to its owner, this kinds of company share is fully attracted by speculators or quick gainer, this kinds of share shows rapid growth and rapid decline. Keeping this in mind I adjusted

Jpassociates in my portfolio. I believe, the share price will definitely cross the purchase price within a year. The above tabulated data shows the amount of profit/ loss generated by my portfolio as on 31st may 2013. This portfolio clearly shows the how much research is important for any investment.

Page 79 This portfolio generated Rs. 18931 profit which means nearly 1% gain in one month on exact amount invested, where as market index Nifty is fall 0.23%. My portfolio gave me returns in declined of market index.

Hence, no further discussion is needed to highlight the importance of research in stock market. Here I can say that research does not only help to get good returns but also to reduce the probability of losses.

MY LEARNINGS To become a good player in market one should have perfect knowledge about markets. Experience only gives the best knowledge. Got to know some really worth able stocks and companies, some companies which are performing extra ordinary, giving the best returns. Constant growth is most important in investment in stocks. Companys behavior need to identify in different situations, as action needs to take for portfolio modification. While applying for any IPO the most important thing is its future prospects, their current needs and their expenses. Every investor should know what the risk factor is and return chances of any IPO investment.

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Global markets are linked with each other, one countrys data can affects another countries economy. Nations are dependence on each other, if one country fail to perform, then definitely other country will suffer. Technical analyst plays most important role in daily trading in market, because of extra advantage from day trading technical analyst can fluctuate the market and earn money. Regular evaluation and modifications are necessary to grab the market returns.

CONCLUSION
At lastly I can conclude that Sudha Stocks is better service provider than stock broker. Its personalized services and relationship management makes Sudha Stocks unique and leading player in Vashi. It helps to encourage and motivate the existing customers for investments. Just little more efforts can leads Sudha stocks to achieve its mission. The study done in Sudha Stocks in second period shows that Indian equity market is emerging market in world. The big developed countries like Japan, Europe, US etc also not able to manage the market efficiently. Because of

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global crises Indian equity market is not much affected. Still Indian markets have those potentials to capture the largest capitalization in the world. Study shows that outsiders are taking the advantage from Indian market. Huge Foreign investment in India clarifies that Indian are not a risk taker. Indians still need a huge knowledge and awareness in market investments. The awareness of equity market is not up to marks among the people for which people is not attracting in this market. Because of this low level of knowledge about market the research industry is not growing as it requires. Research analyst plays big role in any kind of investment, their big knowledge and experience is used by companies and not by real investors. Because all of these reasons Indian markets has not shown a great developments in last five years. But, I can see the bright future is coming for equity markets .If we do more and more activities regarding equity market and mutual funds then we can add more and more investments in our economy.

BIBLIOGRAPHY

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BOOKS: NISM-Mutual Funds Distributors Certification Workbook. NCFM-Technical Analysis Module Workbook. My iris plus wealth management Security Analysis and portfolio management Fact sheets of AMCs

Websites: www.moneycontrol.com www.valueresearchonline.com www.amfiindia.com www.sebi.gov.in www.tradingeconomics.com www.nseindia.com www.bseindia.com

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