Motilal Oswal

A TRAINING REPORT ON

SUBMITTED TO: MAHARISHI DAYANAND UNIVERSITY, ROHTAK in the partial fulfillment of the requirements for the award of the degree of MASTER OF BUSINESS ADMINISTRATION (INDUSTRY INTEGRATED) (II Semester) Submitted by PIYUSH KAPAHI Regn. No.-1073901752 GURUGRAM BUSINESS SCHOOL ELC CODE: 151012055 Plot no 467, Near H B Town, Old Paradi Naka, Bhandara Road, Nagpur, Maharashtra

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DECLARATION I, hereby declare that the Training Report conducted at MOTILAL OSWAL SECURUTIES LTD., JABALPUR

Under the guidance of Mr. Ajay Patole Submitted in Partial fulfillment of the requirements for the Degree of MASTER OF BUSINESS ADMINISTRATION (Industry Integrated) TO MAHARISHI DAYANAND UNIVERSITY, ROHTAK Is my original work and the same has not been submitted for the award of any other Degree/diploma/fellowship or other similar titles or prizes.

Date:

Piyush Kapahi

Place:

Regn. No.:1073901752

CERTIFICATE Gurugram Business School, Nagpur

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This is to certify that Mr. Piyush Kapahi, a student of the Maharishi Dayanand University Rohtak, has prepared his Project Report entitled on Motilal Oswal Securities Ltd. under my guidance. He has fulfilled all requirements leading to award of the degree of MBA (Industry Integrated). This report is the record of bonafide training undertaken by him and no part of it has been submitted to any other University or Educational Institution for award of any other degree/diploma/fellowship or similar titles or prizes.

I wish him all success in life.

(Signature) Mr. Ajay Patole

Gurugram Business School, Nagpur

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CERTIFICATE This is to certify that Mr. Piyush Kapahi who is pursuing MBA (Industry Integrated) course of Maharishi Dayanand University, Rohtak at Gurugram Business School has undergone management training at our organization. His performance during the training period was found to be good. We wish him success for his future endeavors.

Ms. Nidhi Tiwari

Gurugram Business School, Nagpur

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ACKNOWLEGDEMENTS Sometimes words fall short to show gratitude, the same happened with me during this project. The immense help and support received from Motilal Oswal Securities Ltd overwhelmed me during the project. My sincere gratitude to Ms. Nidhi Tiwari Product Head for providing me with an opportunity to work with Motilal Oswal Securities Ltd. I am highly indebted to her for provided me with the necessary information and his valuable suggestion and comments on bringing out this report in the best possible way. I am grateful to Mr. Vijaybhai Patel (Branch Head, Motilal Oswal Securities Ltd) and all of the members of mass consultancy, who have helped me in the successful completion of this project, special mention of Mr. Kiranbhai Patel, Mr. Parthbhai Raval, Mr.Vishalbhai Patel, Mr.Sanjaybhai Patel and Mr.Hirenbhai Patel. I also thankful to my peers, Palkesh Prajapati, Dimes Panchal , Dipak Prajapati and Priyanka Contractor who help me to complete this project on time. I also thank Prof. Ajay Patole, faculty guide, GGBS, Nagpur who has sincerely supported me with the valuable insights into the completion of this project. Last but not the least; my heartfelt love for my friends, whose constant support and blessings helped me throughout this project.

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INDEX SR.NO

PARTICULARS

PAGE NO

1

Cover Page

1

2

Declaration

2

3

Certificate of the College

3

4

Certificate of the Organization

4

5

Acknowledgement

5

PROJECT CONTENTS 1

INTRODUCTION 1.1

General Introduction about the sector

1.2

Industry Profile

11-16 11

b. Growth and present status of the industry

14

Profile of Motilal Oswal Securities Ltd.

2.1

8

a. Origin and development of the industry

C. Future of the Industry 2

8-16

Origin of the MOSL

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19 Page 6

2.2

Growth and development of MOSL

19

2.3

Present status of MOSL

23

2.4

Functional Departments of MOSL

25

2.5

Structure of MOSL

27

2.6

Product and Service profile of MOSL

38

2.7

Market Profile of MOSL

43

3

DISCUSSIONS ON TRAINING

45-49

3.1

Key Learnings

45

3.2

SWOT analysis of MOSL

46

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1.1 INTRODUCTION OF FINANCIAL SECTOR

Financial Sector of India is intrinsically strong, operationally sundry and exhibits competence and flexibility besides being sensitive to India’s economic aims of developing a market oriented, industrious and viable economy. An established financial sector assists greater standards of endowments and endorses expansion in the economy with its intensity and exposure. The fiscal sector in India entails banks, financial organization, markets and services. The sector is classified as organized and conventional sector that is also recognized as unofficial finance market. Fiscal transactions in an organized industry are executed by a number of financial organizations which are commercial in nature and offer monetary services to the society. Further classification includes banking and non-banking enterprises, often recognized as activities that are client specific. The chief controller of the finance in India is the Reserve Bank of India (RBI) and is regarded as the supreme organization in the fiscal structure. Other significant fiscal organizations are business banks, domestic rural banks, cooperative banks and development banks. Non-banking fiscal organizations entail credit and charter firms and other organizations like Unit Trust of India, Provident Funds, Life Insurance Corporation, Mutual funds, GIC, etc. Financial Sector of India – Eligibility for government autonomy Mentioned below are certain criterions that are required to be fulfilled for acquiring government autonomy in India: •

Availability of sufficient fund of up to 8%

•

Accessibility of total non-performing wealth of below 9%

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•

Minimum net possessed funds of more than USD 2.5 million and net revenues

of minimum past three years. •

Financial institutions that satisfy the abovementioned requirements will be

authorized functional independence in almost all managerial areas.

Financial Sector of India – RBI guidelines for NBFC's The Reserve Bank of India has relaxed its guidelines for the operation of non-bank finance companies (NBFCs) in India considering the various investments from the investors. It has also permitted leasing of machinery and rent-buying credit firms with endowment level rankings to avail public savings increase the maximum limit on the amount of public investments on these NBFCs that may allow and expand the closing date for observance on its norms by two years. The fiscal competitiveness of several NBFCs persists to be of importance to the administration and reserve bank of India controllers. There is a significant merging activity in this industry as NBFCs are regulated by stringent yardsticks that are obligatory to fulfill. In addition, India has entered into new agreements with WTO in the area of fiscal services in Geneva on December 1997. Financial Sector of India – Chief Characteristics Some of the major characteristics of Financial Sector of India are: •

The financial sector of India allows Most Favored Nation (MFN) reputation to

all international banks and firms offering financial facilities. •

The sector has relaxed previous MFN tax exemption on banking activities.

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•

Allows 12 new financial bank division authorizations every year to

international banks, that is higher as compared to the existing 8 every year. •

Raises the 10% limit of reinsurance by insurance firms in India.

•

Permits 51% foreign endowment in fiscal advisory, issuing, hiring, business

enterprise capital, business banking and non-banking credit firms.

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1.2 CAPITAL MARKET PROFILE (a)Origin and development There are 22 stock exchanges in India, the first being the Bombay Stock Exchange (BSE), which began formal trading in 1875, making it one of the oldest in Asia. Over the last few years, there has been a rapid change in the Indian securities market, especially in the secondary market. Advanced technology and online-based transactions have modernized the stock exchanges. In terms of the number of companies listed and total market capitalization, the Indian equity market is considered large relative to the country’s stage of economic development. The number of listed companies increased from 5,968 in March 1990 to about 10,000 by May 1998 and market capitalization has grown almost 11 times during the same period. The debt market, however, is almost nonexistent in India even though there has been a large volume of Government bonds traded. Banks and financial institutions have been holding a substantial part of these bonds as statutory liquidity requirement. The portfolio restrictions on financial institutions’ statutory liquidity requirement are still in place. A primary auction market for Government securities has been created and a primary dealer system was introduced in 1995. There are six authorized primary dealers. Currently, there are 31 mutual funds, out of which 21 are in the private sector. Mutual funds were opened to the private sector in 1992. Earlier, in 1987, banks were allowed to enter this business, breaking the monopoly of the Unit Trust of India (UTI), which maintains a dominant position. Before 1992, many factors obstructed the expansion of equity trading. Fresh capital issues were controlled through the Capital Issues Control Act. Trading practices were not transparent, and there was a large amount of insider trading. Recognizing the importance of increasing investor protection, several measures were enacted to improve the fairness of the capital market. The Securities and Exchange Board of India (SEBI) was established in 1988. Despite the Gurugram Business School, Nagpur

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rules it set, problems continued to exist, including those relating to disclosure criteria, lack of broker capital adequacy, and poor regulation of merchant bankers and underwriters. There have been significant reforms in the regulation of the securities market since 1992 in conjunction with overall economic and financial reforms. In 1992, the SEBI Act was enacted giving SEBI statutory status as an apex regulatory body. And a series of reforms was introduced to improve investor protection, automation of stock trading, integration of national markets, and efficiency of market operations. India has seen a tremendous change in the secondary market for equity. Its equity market will most likely be comparable with the world’s most advanced secondary markets within a year or two. The key ingredients that underlie market quality in India’s equity market are: • exchanges based on open electronic limit order book; • nationwide integrated market with a large number of informed traders and fluency of short or long positions; and • no counterparty risk. Among the processes that have already started and are soon to be fully implemented are electronic settlement trade and exchange-traded derivatives. Before 1995, markets in India used open outcry, a trading process in which traders shouted and hand signaled from within a pit. One major policy initiated by SEBI from 1993 involved the shift of all exchanges to screen-based trading, motivated primarily by the need for greater transparency. The first exchange to be based on an open electronic limit order book was the National Stock Exchange (NSE), which started trading debt instruments in June 1994 and equity in November 1994. In March 1995, BSE shifted from open outcry to a limit order book market. Currently, 17 of India’s stock exchanges have adopted open electronic limit order. Before 1994, India’s stock markets were dominated by BSE. In other parts of the country, the financial industry did not have equal access to markets and was unable to participate in forming prices, compared with market participants in Mumbai(Bombay). As a result, the prices in markets outside Mumbai were often different from prices in Mumbai. These pricing errors limited order flow to these markets. Explicit nationwide Gurugram Business School, Nagpur

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connectivity and implicit movement toward one national market has changed this situation. NSE has established satellite communications which give all trading members of NSE equal access to the market. Similarly, BSE and the Delhi Stock Exchange are both expanding the number of trading terminals located all over the country. The arbitrages are eliminating pricing discrepancies between markets. Despite these big improvements in microstructure, the Indian capital market has been in decline during the last three years. The amount of capital issued has dropped from the level of its peak year,1994/95, and so have equity prices. In 1994/95, Rs276 billion was raised in the primary equity market. This figure fell to Rs208 billion in 1995/96 and to Rs142 billion in 1996/97. The BSE-30 index or Sensex, the sensitive index of equity prices, peaked at 4,361 in September 1994 and fell during the following years. A leading cause was that financial irregularities and overvaluations of equity prices in the earlier years had eroded public confidence in corporate shares. Also, there was a reduced inflow of foreign investment after the Mexican and Asian financial crises. In a sense, the market is now undergoing a period of adjustment. Thus, it is time for regulatory authorities to make greater efforts to recover investors’ confidence and to further improve the efficiency and transparency of market operations. The Indian capital market still faces many challenges if it is to promote more efficient allocation and mobilization of capital in the economy. First, market infrastructure has to be improved as it hinders the efficient flow of information and effective corporate governance. Accounting standards will have to adapt to internationally accepted accounting practices. The court system and legal mechanism should be enhanced to better protect small shareholders’ rights and their capacity to monitor corporate activities. Second, the trading system has to be made more transparent. Market information is a crucial public good that should be disclosed or made available to all participants to achieve market efficiency. SEBI should also monitor more closely cases of insider trading. Third, India may need further integration of the national capital market through consolidation of stock exchanges. The trend all over the world is to consolidate and merge existing stock exchanges. Not all of India’s 22 stock exchanges may be able to justify their existence. There is a pressing need to develop a uniform settlement cycle and Gurugram Business School, Nagpur

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common clearing system that will bring an end to unnecessary speculation based on arbitrage opportunities. Fourth, the payment system has to be improved to better link the banking and securities industries. India’s banking system has yet to come up with good electronic funds transfer (EFT) solutions. EFT is important for problems such as direct payments of dividends through bank accounts, eliminating counterparty risk, and facilitating foreign institutional investment. The capital market cannot thrive alone; it has to be integrated with the other segments of the financial system. The global trend is for the elimination of the traditional wall between banks and the securities market. Securities market development has to be supported by overall macroeconomic and financial sector environments. Further liberalization of interest rates, reduced fiscal deficits, fully marketbased issuance of Government securities and a more competitive banking sector will help in the development of a sounder and a more efficient capital market in India.

(b) Growth and present status of the industry

The growth of financial sector in India at present is nearly 8.5% per year. The rise in the growth rate suggests the growth of the economy. The financial policies and the monetary policies are able to sustain a stable growth rate. The reforms pertaining to the monetary policies and the macroeconomic policies over the last few years have influenced the Indian economy to the core. The major step towards opening up of the financial market further was the nullification of the regulations restricting the growth of the financial sector in India. To maintain such a growth for a long term the inflation has to come down further. The financial sector in India had an overall growth of 15%, which has exhibited stability over the last few years although several other markets across the Asian region were going through turmoil. The development of the system pertaining to the financial sector was the Gurugram Business School, Nagpur

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key to the growth of the same. With the opening of the financial market variety of products and services were introduced to suit the need of the customer. The Reserve Bank of India (RBI) played a dynamic role in the growth of the financial sector of India.

The growth of financial sector in India was due to the development in sectors

Growth of the banking sector in India The banking system in India is the most extensive. The total asset value of the entire banking sector in India is nearly US$ 270 billion. The total deposits is nearly US$ 220 billion. Banking sector in India has been transformed completely. Presently the latest inclusions such as Internet banking and Core banking have made banking operations more user friendly and easy. Growth of the Capital Market in India •

The ratio of the transaction was increased with the share ratio and deposit

system •

The removal of the pliable but ill-used forward trading mechanism

•

The introduction of infotech systems in the National Stock Exchange (NSE) in

order to cater to the various investors in different locations •

Privatization of stock exchanges

Growth in the Insurance sector in India •

With the opening of the market, foreign and private Indian players are keen to

convert untapped market potential into opportunities by providing tailor-made products.

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•

The insurance market is filled up with new players which has led to the

introduction of several innovative insurance based products, value add-ons, and services. Many foreign companies have also entered the arena such as Tokio Marine, Aviva, Allianz, Lombard General, AMP, New York Life, Standard Life, AIG, and Sun Life. •

The competition among the companies has led to aggressive marketing, and

distribution techniques. •

The active part of the Insurance Regulatory and Development Authority

(IRDA) as a regulatory body has provided to the development of the sector.

Growth of the Venture Capital market in India •

The venture capital sector in India is one of the most active in the financial

sector inspite of the hindrances by the external set up. •

Presently in India there are around 34 national and 2 international SEBI

registered venture capital funds.

(C) FUTURE OF THE CAPITAL MARKET The financial sector has witnessed changes in many respects. Banking has seen many changes in the last two decades, as has the mutual fund business. During the first three decades after independence, the financial sector and changes in it were largely dominated by SBI, IDBI, IFCI, UTI, ICICI, and LIC but the last two decades saw a significant contribution by many other players, smaller in size, but faster on their feet. Each one of these large players was created with very specific mandates, but with sector-wide responsibilities. For example formation of SBI was the result of the Rural Credit Survey Committee recommendation to create an entity that among other things would help the Gurugram Business School, Nagpur

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government in stimulating banking in the entire country. Similarly, the UTI was created in 1964 with the explicit objective of stimulating investment in the stock market. In other words, these organizations were created with specific purposes and a vision for the future. They have significantly served the purposes that drove them all these years, and delivered on the agenda set for them. The present day financial sector has been built on the achievements of these organisations. However, in the last few years, we see organisations like SBI and UTI endeavoring to compete with every player in the market. As a consequence, these organisations are trying to become everything to everybody. The negative image associated with a public enterprise has only added to their attempt to emulate private enterprise behavior. Survival has become the objective of these pioneers. In sum, these organisations are fast losing their initial identity without gaining a new one! These organisations are trying to respond by tinkering with their organization design or by changing the ownership pattern. Such interventions are likely to be inappropriate given the status of these organisations. A comprehensive relook at the existence of these organisations is an imperative. They will have to introspect on their relevance in the present context. For example, SBI will have to contemplate on the role it can play in the market given the state of the market today and a desirable state in the future. Similarly, UTI may have to examine its role in the mutual fund sector. Organisations, which have played defining roles in economies, have often found themselves at such crossroads because they reach there first. The genius of the organisation is in identifying the moment as such and in reinventing itself to play a similar pivotal role again although in a different context. AT&T was one such organisation, which during the early seventies went through an elaborate exercise of reinventing itself for the future state of communications business that it envisioned. The task was not just about being prepared for the future but about preparing to shape the future of the industry. The major players of the financial markets in India will have to do something similar; they need to envision the desirable future state of the market and define their role in shaping the future. This would mean playing a pioneering role once again in a new context; any other role would probably be insignificant for these organisations. The finance ministry as Gurugram Business School, Nagpur

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the de facto owner of these organisations needs to encourage their managements to undertake this critical task immediately

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2.1 ORIGIN OF MOTILAL OSWAL SECURITIES LTD.

Motilal Oswal Securities Ltd. (MOSL) was founded in 1987 as a small sub-broking unit, with just two people running the show. Focus on customer-first-attitude, ethical and transparent business practices, respect for professionalism, research-based value investing and implementation of cutting-edge technology has enabled us to blossom into an almost 2000 member team. 2.2 GROWTH AND DEVELOPMENT OF MOTILAL OSWAL SECURITIES LTD. 2011:  At the second ASIA’s BEST EMPLOYER BRAND AWARDS held in Singapore on 22nd July, 2011, Motilal Oswal Financial Services bagged awards in two categories: Award for Excellence in HR through Technology & Award for Managing Health at Work.  Motilal Oswal in association with Zee Business, hosted the first of its series of seminars under its investors education initiative called Investor Ki Kahani Usi Ki Zubani on July 2, 2011 at BSE in Mumbai. The seminar saw a colossal turnout with more than 750 investors attending the session.  Motilal Oswal AMC organized the first edition of Motilal Oswal MOSL Shares ETF Conclave 2011 at NSE, Mumbai on 15th June, 2011. The event was telecast LIVE via webcast and the panel discussion was telecast LIVE by CNBC TV18.  Mr. Raamdeo Agrawal was honored with an award for Special Contribution to Indian Capital Market by Zee Business at the ‘INDIA’S BEST MARKET ANALYST AWARDS 2011 on April 29, 2011. Gurugram Business School, Nagpur

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 Analysts Mr. Dhirendra Tiwari & Mr. Harshad Borawake won the Best Market Analyst Award for the categories Equity-Sectoral-Infrastructure and Equity– Sectoral–Energy respectively at ‘INDIA’S BEST MARKET ANALYST AWARDS 2011 organized by Zee Business on April 29, 2011.  Motilal Oswal Asset Management Company becomes India’s 1st AMC to ring The NASDAQ Stock Market Opening Bell on 30 March 2011, to celebrate the launch of Motilal Oswal MOSL Shares NASDAQ 100 - India’s First US Equities Based ETF.  Motilal Oswal MOSL Shares NASDAQ 100 - India’s First US Equities Based ETF gets listed on NSE and BSE on 31st March, 2011  Motilal Oswal Securities won 4 awards at the ET Now Star mine Analyst Awards 2010-2011. This puts MOSL amongst the Top 3 Award winning Brokers at the ET NOW Star mine Analyst Awards 2010-2011

2010:  The 15th Motilal Oswal Wealth Creation Study presentation was held in Mumbai on 15th December 2010 and was covered live on CNBC TV18  Motilal Oswal Securities bagged the Best Performing Equity Broker (National) Award at CNBC TV18 Financial Advisor Awards 2010 held in Mumbai. CNBC TV18 organized Financial Advisor Awards 2010, in partnership with UTI MF. These awards are authoritative evaluation backed by a robust methodology powered by India’s leading rating house, ICRA.

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 Motilal Oswal Securities entered into a strategic alliance with Barclays Bank, for an equity trading platform for its (Barclays) customers. This alliance provides Barclays customers with the option to invest in equities, derivatives and IPOs, through MOSL.  Motilal Oswal Securities Limited bagged the QualTech Prize for Improvement 2010 in the Services Category on September 24, 2010. The Award winning project was a DMAIC project done in Account Opening Department to reduce Account Opening Turnaround Time.

2009:  Motilal Oswal Financial Services purchased its new corporate office building based in Prabhadevi, the heart of Mumbai city with a planned usable area of over 2,00,000 sq ft  The 14th Motilal Oswal Wealth Creation Study presentation held in Mumbai in December 2009 and was covered live on CNBC TV18  MOSL ranked No. 2 (Best Local brokerage) in the Asia Money Brokers Poll 2009 and No. 2 (Best Indian Brokerage House) category by Institutional Investor  Motilal Oswal Private Equity's India Reality Excellence Fund achieved its final closing of INR 1.64 bn  Motilal Oswal Investment Advisors facilitates the first cross border acquisition by an Indian company in the sugar sector in Brazil

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 Motilal Oswal Securities Ltd. rated as No.1 Broker in ET Now - Star mine Analyst Awards 2009  Motilal Oswal 5th Annual Global Investor Conference was held in Mumbai where around 80 Indian Corporate participated and over 400 investors from all over the world attended  Motilal Oswal Securities Ltd. enters 'Limca Book of Records' for creating India's largest dealing room in Mumbai  MOSL was 'Rated No.1 – Best recommendations Mid & Small Caps' and won awards in 3 out of 4 categories at the Star mine India Broker Rankings 2009 from Thomson Reuters

2.3 PRESENT STATUS OF MOTILAL OSWAL SECURITIES LTD.

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Today company is a well diversified financial services firm offering a range of financial products and services such as



Wealth Management



Broking & Distribution



Commodity Broking



Portfolio Management Services



Fixed Deposits and Bonds



Institutional Equities



Private Equity



Investment Banking Services and



Principal Strategies

Company has a diversified client base that includes retail customers (including High Net worth Individuals), mutual funds, foreign institutional investors, financial institutions and corporate clients. Company’s headquarter is in Mumbai and as of March 31st, 2011, had a network spread over 548 cities and towns comprising 1,289 Business Locations operated by its Business Partners and it. As at March 31st, 2011, company had 5, 41,372 registered customers.

In 2006, the Company placed 9.48% of its equity with two leading private equity investors based out of the US – New Vernon Private Equity Limited and Bessemer Venture Partners. The company got listed on BSE and NSE on September 9, 2007. The issue which was priced at Rs.825 per share (face value Rs.5 per share) got an overwhelming response and was subscribed 27.18 times in turbulent market conditions. The issue gave a return of 21% on the date of listing. Gurugram Business School, Nagpur

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As of end of financial year 2008, the group net worth was Rs.7 bn and market capitalization as of March 31, 2008 was Rs.19 bn. For year ended March 2008, the company showed a strong top line growth of 91% to Rs.7 bn as compared to Rs.3.68 bn, last year. New businesses like investment banking, asset management and fund based activities have contributed to this growth. Credit rating agency Crisis has assigned the highest rating of P1+ to the Company’s shortterm debt program.

Motilal Oswal Financial Services Limited is the holding company of the following five subsidiaries:

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2.4 FUNCTIONAL DEPARTMENTS OF MOTILAL OSWAL SECURITIES LTD.

MARKETING In this department where the demat account as well as Mutual Funds is marketed, marketing executives are seeks for prospective customers, they helps in opening of an account and also these executives collects AMCs and provide other services.

ACCOUNTS Maintaining the purchases of stores department Internal auditing Payments and receipts

HR & ADMINISTRATION PAY ROLL MAINTAINANCE: maintenance of employee details like salary incentives, bonus, and performance records etc RECRUITMENT DEPARTMENT: this department helps in assessing the needs of Labor force and recruiting the needs of Labor and giving the orientation programme to new employees

HRD: Maintain good relationship with the employees Identifying the less motivated employees and providing the necessary motivation Accepting problems of the workers and helps in solving them Gurugram Business School, Nagpur

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SUPPORT & FUNCTION FRONT OFFICE In front office the following services are done. · Account opening · Holding enquiries · Transfer of physical shares to demat form · Transfer of demat shares to physical form · Transformations of shares from demat to trading account etc.

BACK OFFICE · Maintenance of all demat account · Giving intimation related to the dues of AMC’s to their account holders · Sends quarterly information to the holders related to the holdings

ADVISORY SERVICES This is the main function done by the department, MOSL gives every financial advisory service to investors e.g.: portfolio management, equity tips, tax planning etc.

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2.5 ORGANIZATIONAL STRUCTURE OF MOTILAL OSWAL SECURITIES LTD.

ORGANIZATION PROFILE

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Mr. Motilal Oswal Chairman and Managing Director Mr. Motilal Oswal is the promoter of Motilal Oswal Securities Ltd. He is a member of Institute of Chartered Accountants of India and started the business along with the co-promoter Mr. Raamdeo Agrawal in 1987.Business Administration is his forte, Honesty, transparency and client goodwill form the core of his business practice. “Service is required in everything, in research, in execution and in settlement. It is going to be the key to survival. If you give good service and value to your clients, it ill translates into good business.” This has been a strong belief of Mr. Motilal Oswal and he has not only practiced it himself but also made efforts to inculcate similar values in the employees of the organization. He had been elected as a Director of BSE and joined its governing board in 1998. He is currently a member of various committees of CDSIL and SEBI. He is currently a member of the NSE committee for F&O.

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Mr. Raamdeo Agrawal Joint Managing Director Mr. Raamdeo Agrawal is the man behind the strong research capabilities at Motilal Oswal Financial Services Ltd. He is an Associate of Institute of Chartered Accountants of India and also a member of the National Committee on Capital Markets of the Confederation of Indian Industry. Mr. Agrawal specializes in equity research. He has been authoring the annual Motilal Oswal Wealth Creation Study since its inception in 1996. In 1986, he wrote the book ‘Corporate Numbers Game’, along with co-author, Mr. Ram K Piparia. He has also featured on 'Wizards of Dalal Street on CNBC TV 18'. Mr. Agrawal has received the "Rashtriya Samman Patra" awarded by the Government of India for being amongst the highest Income Tax payers in the country for a period of 5 years from FY95–FY99.

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Mr. Navin Agrawal Director

Mr. Navin Agrawal is on the Board of Motilal Oswal Financial Services Limited. He is a member of Institute of Chartered Accountants of India, Institute of Cost & Works Accountants of India, and Institute of Company Secretaries of India. He heads the Institutional Broking business and has been instrumental in building a market leading position with domestic and foreign institutional investors. Under his leadership, the firm has been rated as The Best Indian Brokerage House by Asia money 2005. Leveraging on the dominant positioning in institutional business, he has also been instrumental in building an Institutional Derivatives business when derivative products were introduced in the Indian markets. Here again, a market leading position has been established by MOSL.

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Mr. Ashutosh Maheshwari CEO – MOIAPL Mr. Ashutosh Maheshvari holds a bachelor's degree in technology (Chemical Engineering) from the Indian Institute of Technology, Kharagpur. He has also done his Masters in Business Administration from University of Delhi. Prior to joining our Company, he was the Executive Director with Rabo India Finance Private Limited. Mr. Maheshvari has 13 years of experience in the financial sector and has held various senior positions. Previously, he has worked with CRISIL and ICI India Limited.

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Mr. Vishal Tulsyan CEO - MOPEAPL

Mr. Vishal Tulsyan holds a bachelor's degree in commerce from St. Xavier’s College, Kolkata University, and is a professionally qualified Chartered Accountant from The Institute of Chartered Accountants of India. He is an all-India rank holder in Chartered Accountancy. Prior to joining MOFSL, Mr. Tulsyan was Director, Corporate Finance with Rabo India Finance Private Limited, a subsidiary of Rabo bank International. He has over 10 years of experience in corporate finance and has held various senior positions. Previously, he worked with SBI Capital Markets Limited, Mumbai and ANZ Grind lays Bank Limited, Kolkata

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Mr. Rajat Rajgarhia Director – Research Mr. Rajat Rajgarhia started his career with his family run broking business in equities. Post completing his CA and MBA, he joined India info line for a short stint in the research function. He joined Motilal Oswal in 2001 as a research analyst. Mr. Rajgarhia then went on to head the research team and now has been associated with MOSL for over 7 years.

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Mr. Rajesh Dharamshi Director - Institutional Trading Mr. Rajesh Dharamshi started his career with Hemendra R Sheth (Member of BSE & NSE) and went on to a very long stint with group. He was Head of Institution of HRS from

2000-2002.

He than moved on as Sr. VP - Institution Sales Equity & Derivatives for Refco (Now MF Global).Mr. Dharamshi joined Motilal Oswal as Head of Institutional Derivatives in 2003. He currently heads Institutional Trading (Cash & Derivatives) at MOSL. He is also a Director on the board of Motilal Oswal Commodities Broker Pvt Ltd & Motilal Oswal Capital Markets Pvt Ltd. Gurugram Business School, Nagpur

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Mr. Jayesh Parekh Director - Institutional Sales Mr. Jayesh Parekh began his career with ICICI as a management trainee after securing ranks in Intermediate and Final exams of Chartered Accountancy. After ICICI, he joined Anand Rathi group and worked in different functions including corporate advisory and equity research. Post Anand Rathi Securities, he joined SMIFS Securities and worked for 5years as head of research. Mr. Parekh joined Motilal Oswal in 2003. He was rated #1 sales person for India in the Asia Money Brokers poll for 2 consecutive years in 2006 and 2007. Mr. Parekh is Head of Institution Sales for MOSL

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Mr. Manish Shah Associate Director, Business Strategy and Product Development Mr. Manish Shah is a graduate from the Institute of Cost and Work Accountants of India and a Certified Financial Analyst from the Institute of Chartered Financial Analysts of India. Mr. Shah had a brief stint with a proprietary firm KG Vora in 1991, where he was involved in developing the IPO Business. In June 1992, he joined Info -Invest Group as Research Analyst and later was responsible for developing the Institutional and Retail business. He then worked as a manager at Mafatlal Securities Ltd from July 1995.

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Mr. Shah joined MOSL in 1999. He currently heads the Equity business and is also responsible for Business Strategy and Product Development.

Mr. Nitin Rakesh CEO, Asset Management Business Mr. Nitin Rakesh has over 13 years of experience in the Financial Services industry. His last role was as the CEO and Executive Director of State Street Syntel Services, the JV between State Street Bank (NYSE: STT) & Syntel (NASD: SYNT). In addition, he has held various positions in organizations such as TCG Investments and Unit Trust of India (UTI Mutual Fund). Mr. Rakesh is a B.E. (Computers), Delhi College of Engineering & an MBA (Finance), NMIMS, Mumbai. Mr. Rakesh heads the Asset Management Business.

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2.6 SERVICES PROFILE OF MOSL

MOSL’S businesses and primary products and services are:  Wealth Management  Broking & Distribution  Commodity Broking  Portfolio Management Services  Fixed Deposits and Bonds  Institutional Equities  Private Equity  Investment Banking Services  Principal Strategies

Wealth Management:Financial planning for individual, family and business wealth creation and management needs. These are provided to customers through our Wealth Management service called ‘Purple’

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Broking & Distribution Services: Equity (cash and derivatives)  Commodity Broking  Portfolio Management Services  Distribution of financial products  Financing  Depository Services  IPO distribution We offer these services through our branches, Business Partner locations, the internet and mobile channels. We also have strategic tie-ups with State Bank of India and IDBI Bank to offer our online trading platform to its customers.

Commodity Broking:Through Motilal Oswal Commodities Broker (P) Ltd our fully owned subsidiary; we provide commodity trading facilities and related products and services on MCX and NCDEX. Besides access to the best of research in the form of Daily Fundamentals & Technical Reports on highly traded commodities, our clients also get access to our exclusive Customized Trading Advice on both the trading platforms. We offer these services through our branches, Business Partner locations, the internet and mobile channels

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Portfolio Management Services :Motilal Oswal Portfolio Management Services offer a range of investments solutions through discretionary services. We at Motilal Oswal have helped create wealth for our customers through our Portfolio Management Services. Our knowledge of the markets together with our understanding of our customers and their risk profiles has helped us design a range of portfolio offerings for our clients. These include the Value Strategy, Bulls Eye Strategy, Trillion Dollar Opportunity Strategy and Focused Strategy Series I. As of March 31st, 2009, the Assets Under Management of our various portfolio schemes stood at Rs.4.77 bn. Motilal Oswal group has applied to the regulatory bodies for a license to operate as a Domestic Asset Management Company (Mutual Fund) and we expect to begin operations soon.

Fixed Deposits and Bonds:Motilal Oswal group has worked on fixed deposits and bonds which have issued by the various companies. Such fixed deposits and bonds have used by the companies to fulfill their capital needs only. Motilal Oswal Securities Ltd. has offered safety and securities of the investment, invested by the investors. Anybody can enter/ exit in/from the fixed deposit and bonds schemes.

Institutional Equities:We offer equity broking services in the cash and derivative segments to institutional clients in India and overseas. These clients include companies, mutual funds, banks, Gurugram Business School, Nagpur

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financial institutions, insurance companies, and FIIs. As at March 31st, 2009, we were empanelled with over 300 institutional clients including 200 FIIs. We service these clients through dedicated sales teams across different time zones.

Investment

Banking:-

We offer financial advisory services relating to mergers and acquisitions (domestic and cross-border), divestitures, restructurings and spin-offs through Motilal Oswal Investment Advisors Private Ltd. (MOIAPL) We also offer capital raising and other investment banking services such as the management of public offerings, private placements (including qualified institutional placements), rights issues, share buybacks, open offers/delisting and syndication of debt and equity. MOIAPL has closed 23 transactions in 2007-08 worth US$ 1.8 billion and had 18 mandates in hand as at March 31, 2008.

Private Equity:In 2006, our private equity subsidiary, Motilal Oswal Private Equity Advisors Private Ltd (MOPEAPL) was appointed as the investment manager and advisor to a private equity fund, India Business Excellence Fund, which was launched with a target of raising US$100 mn. The fund is aimed at providing growth capital to small and medium enterprises in India, with investments typically in the range of US$3 mn to US$7 mn.

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MOPEAPL will manage and advise the fund and other private equity funds, which may be raised in the future. In its final closing, in December 2007, the fund obtained commitments of US$125 mn (Rs.4, 875 mn) from investors in India and overseas. The Fund has deployed/ committed $ 58 mn across 8 deals. MOPEAPL has recently launched an INR 750 crores domestic Real Estate Private Equity Fund called “India Realty Excellence Fund” sponsored by Motilal Oswal Financial Services Ltd. Principal Strategies Group:For effective management of treasury operations and to capitalize on market opportunities, the Group has set up a 30 member team which would be responsible for effective deployment of funds into different trading and arbitrage strategies.

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2.7 MARKET PROFILE OF MOTILAL OSWAL SECURITIES LTD. Motilal Oswal Securities Ltd. is a well diversified financial services company focused on wealth creation for customers, such as institutional, corporate, HNI and Retail. The company services and product offerings include wealth management, portfolio management, retail broking, institutional broking, assets management, investment banking etc. They distribute these product through 1289 business locations spread across 548 cities and the online medium to over 5,41,372 registered customers. Motilal Oswal capital market pvt. ltd. became the subsidiaries of Motilal Oswal Securities Ltd. and, in turn of the company. The company made a initial public offer(IPO) of 2,98,2710 equity shares of rs.5 each in the price band of Rs.725 to Rs.825 per share. The issue constituted 10.50% of the paid-up share capital. During the year 2009-10, the company, jointly with their subsidiary Motilal Oswal securities ltd. acquired an office building at Prabha Devi in Mumbai for a consideration of Rs. 164.58 crores. Also Motilal Oswal asset management company became 100% subsidiary of Motilal Oswal Securities Ltd, which is a subsidiary of the company. The head office of the subsidiary company of Motilal Oswal Securities Ltd.: Motilal Oswal Financial Services Ltd.

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3rd Floor, Hoechst House, Nariman Point, Mumbai - 400 021. Board: + 91 – 022 - 39825500/ 39825540. Fax: + 91 – 022 - 22823499  Motilal Oswal Securities Ltd. – Wealth Management 3rd Floor, Hoechst House, Nariman Point, Mumbai - 400 021. Board: + 91 – 022 - 39825500. Fax: + 91- 022- 22823499.  Motilal Oswal Securities Ltd. - Institutional Equity 4th Floor, Hoechst House, Nariman Point, Mumbai - 400 021. Board: + 91 – 022 - 39825550 Fax: + 91 – 022 - 22883821 / 22885038.  Motilal Oswal Private Equity Advisors Pvt. Ltd. 3rd Floor, Hoechst House, Nariman Point, Mumbai - 400 021. Board

: + 91–022-39825500/39825540.

Fax : +91–022-22823499.  Motilal Oswal Investment Advisors Pvt. Ltd. 112/113, 11th Floor, Bajaj Bhawan, Nariman Point, Mumbai - 400 021.

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Board :

+ 91 – 022 - 39804380

Fax: + 91 – 022 - 39804315.  Motilal Oswal Commodities Broker Pvt. Ltd. 81/82, Bajaj Bhawan, Nariman Point, Mumbai - 400 021. Board: + 91 – 022 - 39804200/ 01 Fax: + 91 – 022 - 22816161.

3.1 Key Learnings  This project has given me a insight about financial sector and a true vision about Motilal Oswal Securuties Ltd.  I have got a deeper knowledge about mutual funds, portfolio management, bonds and online trading etc.  Working with Motilal Oswal Securities Ltd. was an great experience as working with this organization helped me a lot to know about securities and stock market.  By working on this project, I also gain the knowledge about the service profile of the company and its way of working.  Commodity Broking was a new term for me which I learned through this project.  By the help of this project, I become able to know about the departmentation and structure of the company.  The overall project was helpful for me as it covered financial sector’s knowledge and financial services.

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3.2 SWOT ANALYSIS OF MOTILAL OSWAL SECURITIES LTD.

STRENGTH

Large and diverse distribution network MOSL financial products and services are distributed through a pan-India network. The business has grown from a single location to a nationwide network spread across 1,160 Business Locations operated by them and their Business Associates in 363 cities and towns.

Strong research and sales teams 28 equity research analysts covering 208 companies in 25 sectors and 5 analysts covering 18 commodities. In 2006, Asia money rated a member of their sales team as the best sales person for Indian equities. Gurugram Business School, Nagpur

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Experienced top management Both of Promoters, Mr. Motilal Oswal and Mr. Raamdeo Agrawal, are qualified chartered accountants with over two decades of experience each in the financial services industry. In addition, our top management team comprises qualified and experienced professionals with a successful track record.

Well-established brand Motilal Oswal is a well-established brand among retail and institutional investors in India. They believe that their brand is associated with high quality research and advice as well as our corporate values, like integrity and excellence in execution. Some more strengths are as follows: Wide range of financial products and services  Healthy Financial Market  Excellent Infrastructure  1 of the top 5 broker in the country  MOSL presence in the field of finance for a long time.

Weakness

 The main concern with the brokerage business is cyclicality. Trading volumes drop sharply during a downturn. When the Indian stock market enters the bear phase, Motilal Oswal will be affected. Gurugram Business School, Nagpur

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 Leading firms are better placed to weather a downturn and may even be able to accelerate industry consolidation by rolling up smaller firms that have been affected to a much larger extent.  Dependency on third parties exposes us to losses caused by financial  or other problems experienced by them.  MOSL operate on leased premises.  MOSL have entered into a number of related party transactions. Opportunities

 Good customer base.  Rising consumer incomes will translate into disproportionately higher allocation of these funds into equities.  Right now, under 3% of India's retail assets are invested in stock markets. Cash, bank deposits, real estate and gold dominate the pie chart on how Indians invest their wealth.

 Further, the stock broking industry is highly fragmented and seeing a gradual consolidation. Motilal Oswal's growth has outpaced that of the industry and the company should continue to gain from this consolidation in stock markets.  Growing IPO issues Gurugram Business School, Nagpur

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 Can make use of sustained growth in retail segment of financial  product.  Economic growth in India  Rising of FDI  Growing consumer awareness about equity related product.

Threats

 Existing Competitors  Market Uncertainty  Political instability or changes in the government could delay the liberalization of the Indian economy and adversely affect economic conditions in India generally, which could impact our financial results and prospects.  Broad economic factors like inflation etc.  We have reputational risks in respect of our distribution of third party products  Downturns or disruptions in the securities markets could reduce transaction volumes, and could cause a decline in the business and impact profitability. Gurugram Business School, Nagpur

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