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Motilal Oswal Securities Limited
“A STUDY OF SATISFACTION LEVEL OF EQUITY SUBBROKERS” AT MOTILAL OSWAL SECURITIES LTD., (AHMEDABAD CITY)
A SUMMER PROJECT REPORT SUBMITTED IN THE PARTIAL FULLFILLMENT OF AWARD OF MBA (BATCH 2010-12)
SUBMITTED TO ANKIT SHAH
SUBMITTED BY TEJASH. JOSHI (107240592052)
K.P PATEL SCHOOL OF MANAGEMENT & COMPUTER STUDIES Kapadwanj, Gujarat, India JULY 2011
Motilal Oswal Securities Limited
CERTIFICATE
Motilal Oswal Securities Limited
DECLARATION Myself Tejas H. Joshi hereby declare that this project is the record of authentic work carried out by me, in well reputed company MOTOLAL OSWAL SECURITIES LIMITED during the academic year 2010-2011, under the guidance of. MR. ANKIT SHAH, faculty member K P PATEL SCHOOL OF MGT &COMPUTER STUDIES KAPADWANJ. This is my real work and has not been submitted to any other university or institute towards the award of any degree.
YOURS FAITHFULLY
TEJAS H. JOSHI
Motilal Oswal Securities Limited
PREFACE
In order to achieve Perfection, theoretical knowledge must be supplemented with practical knowledge and training. The basic objective of the summer internship is to bridge between theoretical knowledge and practical knowledge.
I know that training is for the development and enhancement of the knowledge in a particular field. It can never be possible to make a mark in today’s competitive era only with theoretical knowledge when industries are developing at global level, practical knowledge of administration and management of business is very important. Hence, practical study is of great importance to M.B.A. student.
With a view to expand the boundaries of thinking, I have undergone summer internship training program at MOTILAL OSWAL SECURITIES LTD. I have made deliberate efforts to collect the required information and fulfill training objective.
I consider myself very fortunate that I got an opportunity to work with an esteemed company like MOTILAL OSWAL SECURITIES LTD.
Place: KAPADWANJ
TEJAS H. JOSHI
Date:
(107240592001)
Motilal Oswal Securities Limited
ACKNOWLEDGMENT
Guidance, cooperation, and inspiration are the important factors in the accomplishment of an assigned task. I am most indebted to those mentioned below for their moral and active support.
At the outset, I profoundly thank to our college KSMCS for providing us with this opportunity and for all its cooperation and contribution. I also express my gratitude to our honorable Head of the Department. Mr.AJAY TIWARI and are highly thankful to my project guides Mr.ANKIT SHAH, and all others professors who helped me with the project. I am also thankful to other college staff that helped in my project
I am very thankful to Mr. M. K. JAYAPRAKASH SIR [ A.V.P. ( Acquisition) OF MOTILAL OSWAL SECURITIES LTD.] and Mr. PRATIK SANGHVI [ A.V.P (B.A.D.) MOTILAL OSWAL SECURITIES LTD.] who has given me such a nice opportunity to undergo the training and also very thankful to Mr. Hiral Raval [B.D.M of MOTILAL OSWAL SECURITIES LTD.] who is our external guide of my project, for giving me his valuable suggestions and guidance throughout the training period and would also like to thank the whole MOTILAL OSWAL staff for helping me in queries.
Finally, I am sincerely thankful to others who have directly or indirectly helped me in the completion of the project.
Motilal Oswal Securities Limited
EXECUTIVE SUMMARY
As a part of our study, I did my project in “Motilal Oswal Securities Ltd.”. Basically, MOSL is in the broking industry providing a varied products and services to their clients. MOSL is one of the leading broking firms at National level.
In my summer internship I was given the project work on “A STUDY OF SATISFACTION LEVEL OF EQUITY SUB-BROKERS”- wherein I found the possibilities for MOSL’s business expansion via Franchisee in Ahmedabad city. For which I have done my practical study on sub-brokers survey in Ahmedabad city.
During my internship at MOSL, I also engaged myself in the work of searching for franchisee prospect. I found out address of various franchisees from NSE sub-brokers list and from the lead given by the visited sub-brokers themselves.
After finding out the address of franchisee, my starting point of research was visit them and took detailed information from them. I survey 150 sub-brokers and questioned them relating to the products & services provided by their brokers, departments with their present brokers, business development supports provided and required by them for their business development and other personal information. I also visited some of the leading regional brokers to make my selves more aware of the market scenario. I also discussed this with our research guides (the assistant branch manager and Business acquisition manager) and with also other staff of the branch.
From the data collected through questionnaire, I have found out the various marketing strategies, possibilities that MOSL can use for acquiring business in the future; in the other uncovered regions of Ahmedabad.
I have found that MOSL is enjoying good reported place in the market through its varied products and services, various department desk, its unique business models.
Motilal Oswal Securities Limited
TABLE OF CONTENTS S.No.
Topic
I
Certificate
II
Declaration
III
Acknowledgment
IV
Preface
V
Executive Summary
Page No.
Chapter 1
Introduction
1
1.1
Industry profile
4
1.1.1 Over the counter exchange of India
7
1.1.2 National Stock Exchange of India
7
1.1.3 Division of Share Market
8
1.1.4 Major Players in the broking Industry
11
Company Profile
12
1.2.1 Introduction
13
1.2.2 MOSL Four Companies
14
1.2.3 Organization Structure
15
1.2.4 Values
16
1.2.5 Management Team
17
1.2.6 Trading Department
22
1.2.7 H.R Department
22
1.2.8 Awards & Accolades
24
1.2.9 Services By MOSL
25
Product Profile
26
1.3.1 Products & Services
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1.3.2 New Offering
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1.2
1.3
Motilal Oswal Securities Limited 1.3.3 Stoke Market Review
36
Theoretical Aspects of Business
38
1.4.1 Percentage of Sub-broker in Each region
39
1.4.2 Business Model
40
Research Methodology
45
2.1 Statement of Problem
46
2.2 Hypothesis
46
2.3 Objectives of Study
47
2.4 Utility of the Study
48
2.5 Research Design
48
2.6 Sample Design
49
2.7 Source Of Data
49
2.8 Limitation of the Study
49
2.9 Data Analysis & Interpretation
50
Chapter 3
Findings & Recommendation
68
Chapter 4
Conclusion
80
Chapter 5
Reference
82
Chapter 6
Annexure
84
1.4
Chapter 2
Motilal Oswal Securities Limited
CHAPTER 1 INTRODUCTION
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Motilal Oswal Securities Limited
INTRODUCTION
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 over 1600 member team.
Today Motilal Oswal has 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, Institutional Equities, Private Equity, Investment Banking Services and Principal Strategies.
It has a diversified client base that includes retail customers (including High Net worth Individuals), mutual funds, foreign institutional investors, financial institutions and corporate clients. It‟s headquartered in Mumbai and as of March 31st, 2011, had a network spread over 611 cities and towns comprising 1,644 Business Locations operated by our Business Partners and us. As at March 31st, 2011, MOSL had 709,041 registered customers
MOSL is one of the best companies among Indian domestic broking houses enjoying an unmatched and unparalleled brand recall. Motilal Oswal Securities Ltd. Is financially sound and have an excellent track record of consistent market growth in all key business segments.
Company is committed to give their customers the best services and holding to their core values which always place their client's interests first. These values are reflected in their business principles, which emphasize integrity, commitment to excellence, innovation and teamwork
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Motilal Oswal Securities Limited
MOSL provide the solid research to their clients. As a part of project concern we are studying the business models and for the growth of business which is the tools being used and required by the sub-brokers.
So, this project aspires to know the competent market leaders, behavior of the individual client. This also helps us to know the preferences of the Sub-brokers to choose the main brokers so that they can provide good services according to the subbrokers requirements to make more and more sub-brokers, individual client and other HNI clients
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Motilal Oswal Securities Limited
1.1. Industry Profile Introduction:
The Indian financial services industry has experienced significant growth in the last few years. The Indian financial markets have considerably broadened and deepened due to various financial market reforms undertaken by the regulators. Introduction of innovative and diverse financial instruments and entry of large domestic players and sophisticated international players have triggered this growth.
None banking financial services sector, such as equities, derivatives and commodities brokerage, residential mortgage and insurance services, where new innovative products and expanding delivery channels have helped these sectors achieve high growth rates. Retail segment has grown multi-fold due to Regulatory reforms, diverse asset instruments, changing demographic profile, soft real interest rates and enhanced foreign participation (FIIs).
Finance and investment industry is playing a vital role for the development of the economy. Financial market in India is one of the oldest in the world and is considered to be the fastest growing and best among all the markets of the emerging economies. The history of Indian capital markets dates back 200 years toward the end of the 18th century when India was under the rule of the East India Company. The development of the capital market in India concentrated around Mumbai where no less than 200 to 250 securities brokers were active during the second half of the 19th century.
The financial market in India today is more developed than many other sectors because it was organized long before with the securities exchanges of Mumbai, Ahmedabad and Kolkata were established as early as the 19th century. By the early 1960s the total number of securities exchanges in India rose to eight, including Mumbai, Ahmedabad and Kolkata apart from Madras, Kanpur, Delhi, Bangalore and Pune. Today there are 21 regional securities exchanges in India in addition to the centralized NSE (National Stock Exchange) and OTCEI (Over the Counter Exchange of India).
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Motilal Oswal Securities Limited
The international financial market over the world has grown very fast in the recent years. The private capital market is consistently improving since 1997. The buoyant capital flows among the nation's boundaries have raised the existing strength of the financial market domestically as well as internationally.
Trading Pattern of the Indian Stock Market
Trading in Indian stock exchanges is limited to listed securities of public limited companies. They are broadly divided into two categories, namely, specified securities (forward list) and non-specified securities (cash list). Equity shares of dividend paying, growth-oriented companies with a paid-up capital of at least Rs.50 million and a market capitalization of at least Rs.100 million and having more than 20,000 shareholders are, normally, put in the specified group and the balance in non-specified group.
Two types of transactions can be carried out on the Indian stock exchanges:
Spot delivery transactions "for delivery and payment within the time or on the date Stipulated when entering into the contract which shall not be more than 14 days following the date of the contract": and
Forward transactions "delivery and payment can be extended by further period of
14 days each so that the overall period does not exceed 90 days from the date of the contract". The latter is permitted only in the case of specified shares. The brokers who carry over the outstanding pay carry over charges (can tango or backwardation) which are usually determined by the rates of interest prevailing.
A member broker in an Indian stock exchange can act as an agent, buy and sell securities for his clients on a commission basis and also can act as a trader or dealer as a principal, buy and sell securities on his own account and risk, in contrast with the practice prevailing on New York and London Stock Exchanges, where a member can act as a jobber or a broker only. 5
Motilal Oswal Securities Limited
The nature of trading on Indian Stock Exchanges are that of age old conventional style of face-to-face trading with bids and offers being made by open outcry. However, there is a great amount of effort to modernize the Indian stock exchanges in the very recent times.
1.1.1 Over The Counter Exchange of India (OTCEI)
The traditional trading mechanism prevailed in the Indian stock markets gave way to many functional inefficiencies, such as, absence of liquidity, lack of transparency, unduly long settlement periods and benami transactions, which affected the small investors to a great extent. To provide improved services to investors, the country's first ring less, scrip less, electronic stock exchange - OTCEI - was created in 1992 by country's premier financial institutions - Unit Trust of India, Industrial Credit and Investment Corporation of India, Industrial Development Bank of India, SBI Capital Markets, Industrial Finance Corporation of India, General Insurance Corporation and its subsidiaries and Can Bank Financial Services.
Trading at OTCEI is done over the centers spread across the country. Securities traded on the OTCEI are classified into: Listed Securities, Permitted Securities, Initiated debentures.
OTC has a unique feature of trading compared to other traditional exchanges. That is, certificates of listed securities and initiated debentures are not traded at OTC. The original certificate will be safely with the custodian. But, a counter receipt is generated out at the counter which substitutes the share certificate and is used for all transactions.
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Motilal Oswal Securities Limited
1.1.2 National Stock Exchange (NSE)
With the liberalization of the Indian economy, it was found inevitable to lift the Indian stock market trading system on par with the international standards. On the basis of the recommendations of high powered Pherwani Committee, the National Stock Exchange was incorporated in 1992 by Industrial Development Bank of India, Industrial Credit and Investment Corporation of India, Industrial Finance Corporation of India, all Insurance Corporations, selected commercial banks and others.
Trading at NSE can be classified under two broad categories: 1)
Wholesale debt market
2)
Capital market.
Wholesale debt market operations are similar to money market operations institutions and corporate bodies enter into high value transactions in financial instruments such as government securities, treasury bills, public sector unit bonds, commercial paper, certificate of deposit, etc.
There are two kinds of players in NSE:
1)
Trading members and
2)
Participants.
Recognized members of NSE are called trading members who trade on behalf of themselves and their clients. Participants include trading members and large players like banks who take direct settlement responsibility.
Trading at NSE takes place through a fully automated screen-based trading mechanism which adopts the principle of an order-driven market. Trading members can stay at their offices and execute the trading, since they are linked through a communication network. The prices at which the buyer and seller are willing to transact will appear on the screen. When the prices match the transaction will be completed and a confirmation slip will be printed at the office of the trading member.
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Motilal Oswal Securities Limited
1.1.3 Basically, Share Market can be divided into two parts
Primary Market It is the market where new issues of securities are offered to the investors.
Secondary Market An investor of a secondary market buys a security from another participant of the same and not from any issuing corporation (as in case of Primary Market
Difference between Primary and Secondary Markets In the primary market securities are issued to the public and the proceeds go to the issuing company. Secondary market is a term used for stock exchanges, where stocks are bought and sold after they are issued to the public.
Primary market Individuals apply to get shares of the company Company IPO Companies share ownership by issuing share
Company
Owners
Companies allocate shares to individuals and those who get the shares become part owners of the company. 8
Motilal Oswal Securities Limited
Secondary Market
Company
Broker
Stock Exchange
Individual Investors
Companies get themselves listed on popular stock exchanges like BSE and NSE
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Motilal Oswal Securities Limited
Multi Channel Access to the Stock Market
Relationship Manager
Live chat
Call centre
Website
SMS
Email
CUSTOMER SUPPORT
Multi Channel Investment Option
Share Shops
Dial n Trade Online Trading
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Motilal Oswal Securities Limited
1.1.4 Major Players in the Broking Industry
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Motilal Oswal Securities Limited
COMPANY PROFILE
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Motilal Oswal Securities Limited
1.2.1 Introduction of Motilal Oswal Securities Ltd
The story of Motilal Oswal Securities Ltd (MOSL) goes back many years, when Mr. Motilal Oswal and Mr. Raamdeo Agrawal met each other as students in a Mumbai suburban hostel in the early eighties. Both the young chartered accountants hailing from a rural & an unpretentious background had a common dream viz 'to build a professional organization with strong value systems, to provide reliable & honest investment advice to investors'. Thus was born their first enterprise called "Prudential Portfolio Services" in 1987. Motilal Oswal Securities Ltd. was founded in 1987 as a small sub-broking unit, with just two people running the show. Focus on customerfirst-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 1600 member team.
Today MOSL 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 , Institutional Equities, Private Equity , Investment Banking Services and Principal Strategies.
MOSL have a diversified client base that includes retail customers (including High Net worth Individuals), mutual funds, foreign institutional investors, financial institutions and corporate clients. MOSL‟s headquartered in Mumbai and as of March 31st, 2010, had a network spread over 611 cities and towns comprising 1,644 Business Locations operated by our Business Partners and us. As at March 31st, 2010, MOSL had 709,041 registered customers.
Motilal Oswal Financial Services is a well-diversified financial services group having businesses in securities, commodities, investment banking and capital venture With over 1,644 business locations and more than 709,041 customers in over 611 cities, Motilal Oswal is well suited to handle all your wealth creation and wealth management needs. These solutions are provided by a force of over 1600 employees and over 808 Business Associates 13
Motilal Oswal Securities Limited
1.2.2 Motilal Oswal Financial Services Ltd consists of four companies
Motilal Oswal Investment Advisors Pvt. Ltd. is our Investment Banking arm with collective experience of over 100 years in investment banking/corporate banking and advisory services
Motilal Oswal Commodities Broker (P) Ltd. has been providing commodity trading facilities and related products and services since 2004.
Motilal Oswal Venture Capital Advisors Private Limited has launched the India Business Excellence Fund (IBEF); a US$100 mn India focused Private Equity Fund.
Motilal Oswal Securities Ltd. (MOSL) is a leading research and advisory based stock broking house of India, with a dominant position in both institutional equities and wealth management. Our services include equities, derivatives, e-broking, portfolio management, mutual funds, commodities, IPOs and depository services.
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Motilal Oswal Securities Limited
1.2.3 Organizational Structure:-
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Motilal Oswal Securities Limited
1.2.4 VALUES
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Motilal Oswal Securities Limited
1.2.5 Management Team:-
Mr. Motilal Oswal CMD, MOSL
Mr. Motilal Oswal is the Chairman and Managing Director of Motilal Oswal Financial Services Ltd. (MOFSL). He is a Chartered Accountant and started the business along with co-promoter, Mr. Raamdeo Agrawal in 1987.
Mr. Oswal 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.
Mr. Oswal has served on the governing board of the Bombay Stock Exchange (BSE) as well as IMC and also has served on many committees of BSE, NSE, SEBI and CDSL. He is also a board member and a Director of Jain International Trade Organisation (JITO).
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Motilal Oswal Securities Limited
The Indian Council of Management Executives (ICME) has awarded the Knight of the Millennium to Mr. Oswal for the Capital Market
Recently, Mr. Oswal was conferred the “Udyog Rattan Award” for his outstanding performance in the industrial development of the country by the Institute of Economic Studies, New Delhi. He has also been inducted into The Hall of Fame for excellence in Franchising by the Franchising World Magazine. He is also awarded as the Champion of Arthshastra by the Rotary District and the Excellent Business Achiever in Financial Services Award by the Institute of Chartered Accountants of India.
Motilal Oswal Financial Services group activities include Wealth Management, Investment Banking, Institutional Broking, Private Equity and Asset Management with operations in 1644 outlets in over 611 cities and more than 709,041 customers. The company's employee‟s strength is about 1500 people including 600 MBAs, Engineers and Chartered Accountants etc.
In the year 2006 and 2007, Asia Money Brokers Poll has rated Motilal Oswal Securities as the country's Best Local Research Company. It was also ranked as the Best Brokerage in the ET Now – Starmine Analysts Awards 2009 and among the top 2 Local Brokerages in the AsiaMoney and Institutional Investor Brokerage polls.
In the year 2008, NASCOM – CNBC – TV18 rated Motilal Oswal as the Best IT User Award for the Financial Services Category. Franchisee World Magazine the most coveted award in the retail and franchising industry rated Motilal Oswal as “The Best Franchisee in Financial Services” for the second year in succession.
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Motilal Oswal Securities Limited
MD, MOSL .
[Ty pe a quo te fro
Mr. Raamdeo Agrawal JMD, MOSL
m the
document or the
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 specialises 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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Motilal Oswal Securities Limited
Navin Agrawal
Ashutosh Maheshvari
Director, MOFSL
CEO, MOFSL
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Motilal Oswal Securities Limited
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Motilal Oswal Securities Limited
1.2.6 TRADING DEPARTMENT
Motilal Oswal is one of the broker who is acting as wholesalers and as a broker, it is the duty of it to provide service of collecting funds and securities from the investors and send it to clearing house and vice versa. According to SEBI investor has to open trading account for trading in shares. Client can open an account in any depository.
Trading department is divided into three parts: Pre-trading (A/c opening, Deposits, etc) Trading (Dealing room, Sauda punching, conformation) Post-trading (Payout process, Bills, Pay-in-process, Contract note)
1.2.7 HUMAN RESOURCE DEPARTMENT
MOFSL has grown at a scorching pace, not only in terms of business but also in terms of its most valuable asset -people. They have an ever-growing employee strength of 2315 associates that operates out of a rapidly expanding Company network.
HR at Motilal Oswal, on the one hand strives to make every employee of the organization its brand ambassador and on the other hand make the Motilal Oswal brand stand for the best people practices.
The 3 pillars of HR strategy are: (1) A clear and relentless (persistent) focus on leadership development (2) Stringent (severe) focus on the identification and development of 'High Potentials' at all levels (3) Investment in technology to deliver state-of-the-art HR processes across the organization in a time and cost efficient manner.
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Motilal Oswal Securities Limited The key initiatives towards implementation of the strategy have been: Balanced Scorecard and KRA implementation:
Leadership Development:
Style and competency assessment for the top tier management of the Company was carried out and an intensive Executive Coaching programme based on Individual Development Plans has been started for 13 of the top leaders of the organization.
Technology:
The recruitment process has been enabled and implemented using the existing HR software of My Zone. This has been implemented in Mumbai during the current year and will be rolled out across all regions during this year.
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Motilal Oswal Securities Limited
1.2.8 Awards and Accolades :
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Motilal Oswal Securities Limited
1.2.9 Services offering by MOSL:
International & local
International capital market
Acquisition finance arrangement, LBO etc, SYNDICATION
FCCBs & GDRs
STRUCTURED FINANCE
DOMESTIC IPOs
M&A ADVISORY
PRIVATE EQUITY PLACEMENT
RESTRUCTURING CORPORATE FINANCE ADVISORY
International & domestic
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Motilal Oswal Securities Limited
PRODUCT PROFILE
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Motilal Oswal Securities Limited
1.3.1 Product and services In keeping with its tradition of personalized service, Motilal Oswal Securities Limited provides Customized Equity Advisory Group to clients based on their profile. Equity Research is an inherent strength of MOSL. Converting that research to advice is the main function of Equity Advisory. Investors are presented with well researched opportunities in companies which will grow in both market perceived value and growth. Along side, the trading fraternity is catered to with ideas induced by Technical analysis and news flow analysis. The investment ideas identified by the research team are presented and communicated with conviction to our clients by our advisory team. Our advisory team has highly trained equity professionals, who act as your Equity Advisor. MOSL Equity Advisor proactively helps you take informed equity investment decisions and build a healthy portfolio giving the best fit to your investment and trading needs.
The MOSL Equity Advisory Group is based in Mumbai at largest dealing and advisory floor of India. This centralized advisory team caters to peculiar Investment need of every HNI & MNI client and business partner; in a seamless, speedy and reliable manner using state-ofthe-art technology and telecommunication infrastructure.
MOSL Equity Advisors are equipped with the knowledge and prudence making sure that every rupee deployed works the hardest it can. Your advisors play the part of a guide ushering you on a swift wealth creation ride. The sheer strength of our advisory creates synergy for seamless flow of Investment support.
To improve the overall experience while the clients interact with our advisors, MOSL have implemented a contact center solution, Drishti, in our dealing room. Among other benefits, this solution helps advisors to manage their client base more efficiently and effectively. The system provides a single number contact to all our clients as well as a single click auto-dial for advisors without having to remember their contact details.
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Motilal Oswal Securities Limited
1. Wealth Management and Broking & Distribution : MOSL offer Wealth Management Services, Broking & third party products to retail customers through MOFSL, MOSL and MOCBPL. MOSL also provide financing services, investment advisory, financial planning and portfolio management services (PMS) to our clients. As at June 30, 2009, MOSL had 5, 57,373 registered customers, to whom MOSL provide equity & commodities brokerage and PMS.
As at June 30, 2010, MOFSL had a total of 4, 86,571 depository clients. MOSL classify our clients into two segments - 'mass retail' and 'high net worth' (addressed by a separate offering called 'Purple'). MOSL offer our clients investment products across the major asset classes including equities, derivatives, and commodities and distribute third-party products such as mutual fund schemes and primary equity offerings. MOSL distribute these products through our business locations and our online channel.
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Motilal Oswal Securities Limited
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Motilal Oswal Securities Limited
2. Institutional Broking MOSL offer equity broking services in the cash and derivative segments through MOSL to institutional clients in India and overseas.
These clients include companies, mutual funds, banks, financial institutions, insurance companies, and FIIs. As at June 30, 2009, MOSL were empanelled with over 300 institutional clients including 200 FIIs.
MOSL service these clients through dedicated sales teams across different time zones.
3. Investment Banking MOSL offer financial advisory services relating to mergers and acquisitions (domestic and cross-border), divestitures, restructurings and spin-offs through MOIAPL.
MOSL 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 48 transactions in 2008-09.
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Motilal Oswal Securities Limited
4. Private Equity
In 2006, our private equity subsidiary, 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 million. The fund is aimed at providing growth capital to small and medium enterprises in India, with investments typically in the range of US$3 million to US$7 million. In its final closing, in December 2007, the fund obtained commitments of US$125 million (Rs.4, 875 million) from investors in India and overseas. US$31 million of these funds have already been deployed across six deals and the fund is in advanced stages of closing three more deals, aggregating to US$30 million. MOFSL is sponsoring India Reality Excellence Fund (”IREF”), an INR 750 crores Private Equity Real Estate Fund. MOPEAPL will be the investment manager and advisor to the fund.
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Motilal Oswal Securities Limited
5. Asset Management Our Portfolio Management Services (PMS) are offered through MOSL. As on 30th June, 2009, assets under management for this business were Rs. 6.8 bn. For the PMS business, MOSL have a 5 member fund management team; they are supported by MOSL Research Team of 27research analysts.
MOSL have received an in-principle approval from Securities Exchange Board of India (SEBI) to set up a mutual fund business in India, through our promoter company, Passionate Investment Management Private Ltd.
MOSL feel that there is a huge opportunity for new entrants as the industry is still in its nascent stage in terms of AUM size, number of players and number of schemes, when analyzing and comparing it with countries like Brazil and other emerging economies. MOSL will grow our asset management business by leveraging our existing investment management capabilities in managing funds, our strong research and a large in-house retail franchise network to spread our reach and capture the investment potential in India and abroad.
6. Broking & Distribution services
Equity (cash and derivatives)
Commodity Broking
Portfolio Management Services
Distribution of financial products
Financing
Depository Services
IPO distribution
MOSL offer these services through our branches, Business Partner locations, the internet and mobile channels. MOSL also have strategic tie-ups with State Bank of India and IDBI Bank to offer our online trading platform to its customers.
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Motilal Oswal Securities Limited
7. 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. MOSL offer these services through our branches, Business Partner locations, the internet and mobile channels.
8. Mutual Fund At Motilal Oswal Securities Ltd, they understand the importance of financial goals of their privileged clients and provide them comprehensive solutions to all your financial needs. Through their tailor made portfolios, they serve clients needs better and help them and make informed investment decisions. Their dedicated Mutual fund desk gives clients Solid advice backed services thus giving them the edge that they always wanted.
9. IPO’s Book Building and Fixed Price Issue are the two types of Initial Public Offerings (IPO‟s) through which a public company can raise money in the capital market.
10. My Broker Motilal Oswal Securities Limited provides a platform of becoming our own broker with complete research support from MOSL which helps us to make right decision at right time. MOSL can choose our trading a/c which suits our trading habit‟s & preference and trade anywhere, anytime. Buying and selling is as easy as click of a button.
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Motilal Oswal Securities Limited
1.3.2 NEW OFFERINGS: MOST SHARES M 50 (Act like funds and trade like shares) Motilal Oswal has launched India‟s first fundamentally weighted ETF based on S&P CNX NIFTY Index – An open ended exchange traded fund. MOST Shares M 50 takes the NIFTY 50 constituents and remixed them in a different proportion using Motilal AMC‟s pre-defines methodology; based on fundamental performance and valuation MOST Share M 50 is an open ended exchange traded fund giving the investors the benefits of investing in a mutual fund that trade like a share i.e. a diversified blue chip portfolio, real time liquidity and prices. Exchange Traded Fund: ETFs are just what their name implies: baskets of securities that are traded, like Individual stocks, on an exchange. Unlike regular open-end mutual funds, ETFs can be bought and sold throughout the trading day like any stock. Advantages of Most M50:
Higher allocation to stocks with superior fundamentals and reasonable valuation.
Combines the benefits of passive allocation and active execution
Lower cost structure (apprx 1% against 2%) as compared to the traditional investment product.
No entry/exit load
Tax efficient exposure to the “market”.
Complete transparency with daily portfolio exposure.
Available at low denomination of less than Rs. 100/-
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Motilal Oswal Securities Limited Uses of Most Shares M50: All types of investors i.e. Retail or Institutional, Long term or short term can use the Most shares M50 for the following strategies:1.
Investing
2.
Trading
3.
Hedging
4.
Arbitrage
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Motilal Oswal Securities Limited
1.3.3 STOCK MARKET REVIEW
MOSL is known for its equity research ideas. Asia Money Broker's Polls have consistently rated our research as one of the best in the industry. Our annual Study on Wealth Creation , authored by Mr. Raamdeo Agrawal, is keenly awaited by investors across the globe. While „Winner Category and Category Winners‟ was the theme for the 2009 study, the 2010 study talked about „Creating Wealth from the Unknown and Unknowable‟. Bargains are found when markets are blind to large business opportunity, positive changes or sustained growth; losses are guaranteed when one grossly overpays India‟s next trillion dollar journey will see distinctly buoyant corporate profits, and boom in savings and investment At current valuations, margin of safety in the market is low. However, very high liquidity can lift the market to rich levels of valuation for quite some time
Our Quarterly Results Preview Compendium, which MOSL also publish in the form of a pocket size book, is immensely popular. Published well before the first results announcements hit the market, it serves as a useful guide through the results season. Some of the noteworthy features that make it a unique product offering are:
A clearly spelt-out India Strategy
Updates on all the sectors under our coverage
Quarterly and annual estimates on all companies under MOSL coverage
Tear-away ready reckoners
MOSL Results Updates are amongst the most comprehensive on the street and are yet amongst the quickest to reach MOSL clients. MOSL have a universe of over 225 stocks. While MOSL service our clients regularly through updates on each company under MOSL coverage, MOSL have also been helping them create wealth by identifying trends early and uncovering interesting wealth creation ideas. MOSL have analysts covering 25+ sectors and commodities.
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Motilal Oswal Securities Limited
Regular
Thematic
Sector
Company
Expert Speak
Industry Update
Initiating Coverage
EcoScope
Travelog
Ground Reality
Wall of Worry
Company Updates Re-initiating Coverage
Conferences / Events Elections
Market Analysis
Corner Office InSites
Policy Maker
Annually
Annual Report Update
Budget Wealth Creation Study
Quarterly
India Strategy Report
Results Preview Results Update / Review Holding Report
Monthly
MPower
AMC Holdings
Auto Dasboard
MOSL Wealth Derivatives Roll Over
Tele Talk Time Indian Airports Ports Power Generation Gasoline Weekly
Pivot
Metals Weekly
Week in a Nutshell
MOSL 3X3
Commodity Weekly
Valuation Guide
MOSL LongShort MOSL Weekly MOSL Derivatives Daily Margin Update
Daily
Commodity Daily Corporate News Market Diary MOSL Market Action
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Motilal Oswal Securities Limited
THEORITICAL ASPECT OF STUDY
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Motilal Oswal Securities Limited
1.4.1 Percentage of sub – brokers present in each region
Interpretation Here the above graph indicates the presence of sub-brokers in Ahmedabad region. MOSL can see that here 60% of the sub-broker are in south region, 31% of the sub-broker are in west region, 8% of the sub- broker are in north region, and 1% of the sub-broker are in east region.
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Motilal Oswal Securities Limited
1.4.2 BUSINESS MODELS
Hybrid Models: MOSL
- Dealers - Relationship Managers - MOSL Business Development officers - Customer Service - Infrastructure - Dealing Terminals - Connectivity - Regional MOSL support Team
Customer
-Brand -Marketing Support - Advisory Support -Dedicated Advisors -Investment Ideas -Inactive to Active -Business Development -Sales Support -Training -Systems & Process Dev -Performance Training -Back office -Centralized RMS
Franchise e
Products offered: - Equity, Commodity, PMS and Mutual Fund
At MOSL MOSL believe in treating their sub-brokers business as if were their own. In this true spirit of partnership MOSL have set up a dedicated team of Business Development Manager (BDM) who function as part of the sub-broker team.The BDM would help sub-brokers in the following ways:-
-
Joint sales meeting for acquiring HNI customers
-
Establishing Systems & Processes
-
Conducting Seminars & Investors meet
-
Business Plan Preparation
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Motilal Oswal Securities Limited
Business model
Sub broker
A person with good track record & reputation in financial services/other business/social circles with a good client base Minimum 2-3 years’ experience in selling financial products as main broker/sub broker/Remise/Mutual fund distributor/Insurance advisor/Financial planner or an employee of existing broker/sub broker
Remisier/sub broker
A person with a good track record & reputation in financial services/other business/social circles with a good client base Minimum 2-3 years of experience in selling financial products Capacity to invest minimum 2 lacs
Capacity to invest minimum 5-10 lacs initially and ability to invest continuously in infrastructure and people. Willingness to design office premises in accordance with the policies laid down by MOSL
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Motilal Oswal Securities Limited
Offerings to sub broker
Product support
Marketing & sales support
BSE,NSE,NSE F&O, BSE F&O, NCDEX, NDSL, CDSL, E trading PMS Mutual fund
One relationship manager will be assigned to you for your regular research advice & market updates through chat –phone-emails
Service support
One customer service executive will be assigned to you for your routine queries through chat-phoneemails
Marketing and business Centralized web based development support on a back office access will be regular basis provided Start up kit comprising of glow sign flex, visiting cards, marketing broachers etc will be provided by MOSL to help kick start the business.
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Motilal Oswal Securities Limited Offerings to Remisier
Product support
Infrastructure Support
Sales support
BSE,NSE,NSE Trading terminal with F&O, BSE F&O, Orion NCDEX, NDSL, software(BSE/NSE) CDSL, E trading PMS Mutual fund Dealing desk
Research advice & market updates through chat phone emails
Direct Landline Phone Conference room
Back office support
Issuing notes/bills clients
contract to end
Online risk management software & back office software
Unique offerings for a special partnership
Multiple Products
BSE,NSE,NSE F&O,BSE F&O,NCDEX,NSDL,CDSL,e broking, PMS,MF(direct & exchange traded),Private equity, margin funding**, distribution of IPO**,distribution of insurance**
Infrastructure Support
State of the art offices with experienced managers Trading terminal NSE & BSE Dealing desk Direct landline phone Conference facilities
Research
Morning calls Interaction with research desk Sector specific reports Research access thorou7gh uppermost portal Centralized advisory support
Advisory support
Dedicated advisor 43
Motilal Oswal Securities Limited Equity CTCL Id- orion
Trading software
E broking CTCL Id: My broker Commodities CTCL: ODIN Business development support
Dedicated team of business development managers who assist your business growth
Business conversion Dedicated team to provide operational training & helps in converting support business Service support
One customer executive will be assigned to you for your routine queries through phone – emails Online risk management software & back office software
RMS
Single rms software for online and offline clients Thorough VPN Through VSAT Unique online platform for daily dissemination of research recommendation
Connectivity Idea dashboard
Quarterly review
business Comprehensive business review to under stand your business progress and suggest suitable action points
Mini admin terminal
clients Limits can be directly set by BA (Deposit based)
Digital services
digital contract notes, Auction bills, Leon and SSTT Certificates
Rewards recognition Technical software
and Unique business partner Fraternity Program- UPPERMOST
analysis Falcon Charting Software
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Motilal Oswal Securities Limited
CHAPTER 2
RESEARCH METHODOLOGY
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Motilal Oswal Securities Limited
2.1 STATEMENT OF PROBLEM
What can be done towards sub-broker satisfaction and sub-broker loyalty?
How to capture new market segments and what are the needs and expectations of these segments?
Despite of having well drawn plan on sub broker by qualified management team why such kind of the problems arises between the sub-broker & Broker.
What do the existing franchisees feel about the overall product?
2.2 HYPOTHESIS Ho: The number of years in a broking firms are not depended on revenue growth. H1: The number of the years in a broking firms are depended on revenue growth
YEARS
REVENUE GROWTH LEAST
MOST
PREFERED
PREFERED
TOTAL
< 5 Years
17
75
92
6 to 10 Years
3
35
38
11 to 15 Years
3
7
10
>15 Years
3
7
10
TOTAL
26
124
150
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Motilal Oswal Securities Limited
Chi-Square Tests
Pearson ChiSquare
Value
Df
Asymp. Sig. (2sided)
4.686a
3
0.196
CONCLUSION Here chi-square value is 0.196 , Which is greater than 0.05 ( P value) So, 0.196 > 0.05 So, Here There is a significant relation between number of years in broking firm and revenue growth. So Ho is not rejected.
2.3 OBJECTIVE OF STUDY
To study the preferences of sub-brokers in Ahmedabad city, regarding wide range of the products, services and support tools.
To understand whether sub-brokers are satisfied with the business developments and supports being provided to them by their present main brokers in Ahmedabad.
To understand the gap between sub-brokers‟ expectations & main brokers‟ perceptions.
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Motilal Oswal Securities Limited
2.4 SIGNIFICANCE OF STUDY
This will also help MOSL to select right tools for approaching the prospects, to give knowledge of the products & services and other business development supports.
This will also help MOSL to make out the brand awareness at regional level.
This study will provide the knowledge to MOSL to reframe the policies as per requirements of the regional sub-brokers.
This study also helps MOSL to get knowledge of competitors strategy towards their sub-brokers.
2.5 RESEARCH DESIGN A research design is defined, as the specification of methods and procedures for acquiring the Information needed. It is a plant or organizing framework for doing the study and collecting the data. Designing a research plan requires decisions all the data sources, research approaches, Research instruments, sampling plan and contact methods.
DESCRIPTIVE STUDIES
Descriptive research in contrast to exploratory research is marked by the prior formulation of specific research Questions.
The investigator already knows a substantial amount about the research problem.
Descriptive research is also characterized by a Preplanned and structured design.
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Motilal Oswal Securities Limited
2.6 SAMPLING DESIGN
Sample size
Sampling method: Convenient Sampling:
: 150
Because of limited time and money, I have selected convenient sampling method (Non Random Sampling) But, MOSL have not found much difference in findings gained from different areas. So it shows enough validity of the research.
Research Instruments : Questionnaire (attached in Annexure)
Geographical Scope: Ahmedabad city
Population: Equity Sub-Broker in Ahmedabad city
2.7 SOURCE OF DATA:
Primary: Primary data is collected by visiting various persons who are connected with broking industry through surveys/questionnaires, interviews.
Secondary: Company material, websites, research reports, yellow pages
2.8 Limitation of the study
People not give good response
We have to work under the company guidelines & task which has given to me
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Motilal Oswal Securities Limited
2.9 DATA ANALYSIS & INTERPRETATION 1) Number of years of sub-broker in broking Business. NO. OF YEARS
RESPONDENT
%
< 5 years 6 - 10 year 11 - 15 year > 15 years TOTAL
99 36 7 8 150
66 24 4.67 5.33 100
No. of years of current setup
180 160
0.66 %
140 120 100
0.24 %
80 99
60 40
0.045 %
36
20
7
0.05 % 8
0 < 5 years
6 - 10 year
11 - 15 year
> 15 years
INTERPRETATION The above graph indicates that 99 respondents out of 150 are from less than 5 years in this business and only 8 respondents are in this business from last 15 years.
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Motilal Oswal Securities Limited
2) Products & Services provided to Sub-Broker by their main Broker.
PRODUCTS AND SERVICES
RESPONDENT
%
Equity Commodity Insurance IPO PMS Currency mutual fund marin of funding any other TOTAL
146 82 58 91 48 48 59 15 7 554
26.35 14.80 10.47 16.426 8.66 8.66 10.65 2.71 1.27 100
Product and services provided by broker 26% 180 160 140 120 100 80 60 40 20 0
16%
14.8% 10%
146 82
58
9% 91 48
11%
9%
48
59
3% 15
1.2% 7
INTERPRETATION Out of 150 respondents 146 Sub-Broker were provided equity product by their broker. And also only 15 Sub-Brokers are provided Margin of funding. So, Motilal has the opportunity to focus on the products which are less popular products like margin of funding, this provides MOSL potentials for acquiring more and more business.
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Motilal Oswal Securities Limited
3) Services/facilities provided to sub-broker by their broker. SERVICES AND FACILITIES
RESPONDENT
%
Different account opening scheme Depository services Different online trading software Investment advices Risk management desk Account opening within 24 hours Mutual fund research desk Business Development software SMS configuration to franchisee’s clients CDSL-rights Investment banking Branding materials online mutual fund platform Customer service desk HNI desk TOTAL
124 89 111 61 34 30 35 80 138 123 81 31 13 32 50 1032
12.01 8.62 10.75 5.91 3.29 2.90 3.39 7.75 13.37 11.91 7.84 3.00 1.25 3.10 4.84 100
Facilities provided by broker 3% 1% 3%
5%
12%
8%
9%
Different account opening scheme Depository services Different online trading software Investment advices Risk management desk
12%
11%
6% 13% 8%
3%
3%
3%
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Account opening within 24 hours Mutual fund research desk Business Development software SMS configuration to franchisee’s clients
Motilal Oswal Securities Limited
INTERPRETATION
From the 150 respondents almost 89 respondents were provided Depositary services by their broker.
Only 13 Sub-Broker were provided Online Mutual Fund Platform. That is only a 1.25% in the research.
Motilal Oswal has to focus on the various services & facilities which is available In the market & also which are having a less percentage in the survey like branding materials, Account opening within 24 hours, online Mutual funds platform etc.
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Motilal Oswal Securities Limited
4) Main sources for getting new clients by Sub-Broker.
SOURCES
NO. RESPONDENT
%
Reference
148
64.63
Advertisement Sales team
35 19
15.28 8.30
Others TOTAL
27
11.79 100
229
Sources for getting client 12% Reference
8%
Advertisement Sales team 15%
Others 65%
INTERPRETATION Main source of getting new clients for sub-broker is reference, Sub-brokers getting information about the clients through references like existing clients,
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Motilal Oswal Securities Limited
5) Percentage of client dealing in following.
%
CASH
FUTURE OPTION
0 to 20
5
43
COMMOD ITY 44
21 to 40
21
28
12
41 to 60
30
21
4
61 to 80
26
3
0
81 to 100
48
1
4
TOTAL
130
96
64
100 80
44
60
12
40
28
4 21 0 3
43 20
4 1
30
21
48
26
5
0
0 to 20
21 to 40 CASH
41 to 60
FUTURE OPTION
61 to 80
81 to 100
COMMODITY
INTERPRETATION: The above graph indicates that 20% of the Clients are dealing in cash 5 sub-brokers, dealing in Future option with 43 sub-broker, dealing in commodity with 44 sub.broker.
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Motilal Oswal Securities Limited
6) The qualities that attributed for Sub-broker to be a successful sub – broker. QUALITIES
NO. OF RESPONDENT
%
The brand value of the company you are associated with. Higher ratio of successful trading calls generated.
99
36.80
96
35.69
A culture of properly researched Ideas coupled with good infrastructure & client servicing.
70
26.02
Other please specify...
4
1.49
TOTAL
269
100
Qualities attributes to be a successful subbroker The brand value of the company you are associated with.
1% 26%
37% Higher ratio of successful trading calls generated.
36%
A culture of properly researched Ideas coupled with good infrastructure & client servicing. Other please specify...
INTERPRETATION 36% of the respondents thinks that higher ratio of successful trading calls given to the customer is the key to become a successful broker. Motilal Oswal being best for its Equity research in the industry can approach these clients as they would like to take the research services of Motilal Oswal Securities in order to give more successful calls to their customers. And also almost 37% of the respondents thinks that‟s the brand value of the co. you are associated with are concerned. 56
Motilal Oswal Securities Limited
7) Factors according to Sub-Broker for having a satisfied client.
FACTORS
NO. OF RESPONDENT
%
Prompt & timely addressing of client queries
79
43.41
Best technology in place
48
26.37
Thinking ahead of time
51
28.02
Any others….
4
2.20
TOTAL
182
100
Factors needed to satisfy clients 43.4% 140 120 100 80 60 40 20 0
26.4%
79
28%
51
48
2.2% 4
Prompt & Best Thinking Any others…. timely technology in ahead of time addressing of place client queries
INTERPRETATION From the 150 respondents, almost 43.4 % of the respondents think that mostly clients are looking for prompt & timely services from them.
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Motilal Oswal Securities Limited
8)
The immediate challenges for this industry & Sub-Broker’s plan to tackle that challenges.
IMMEDIATE CHALLENGES
RESPONDENT
%
Lack of interest in the stock markets in the retail category
97
44.09
Source for fresh capital drying up from both domestic & foreign investors Cut costs & wait for good times to come
60
27.27
58
26.36
Any other
5
2.27
TOTAL
220
100
Immediate challenges 2% Lack of interest in the stock markets in the retail category 26% 44%
Source for fresh capital drying up from both domestic & foreign investors Cut costs & wait for good times to come Any other
28%
INTERPRETATION From the 150 respondents, the higher value is 44% into the lack of interest in the stock market in the retail category, where the other is 26 % & 28% for the both cut cost and wait for good time to come and also for the sources for the fresh capital drying up from both domestic and foreign investors respectively. This will mostly helpful to know the problems and also the challenges that will be tackle in the share market 58
Motilal Oswal Securities Limited
9)
The importance of following development criteria for business. (Circle the one that is most suitable to your Preference. Consider 5 as most preferred and 1 as the least preferred)
IMPORTANT OF BUSSINESS DEVELOPMENT Client Acquisition Client base Active Ratio Client satisfaction Revenue Growth
NOT AT ALL IMPORTANT
NOT IMPORTANT
NEUTRAL IMPORTANT
VERY TOTAL IMPORTANT
5
8
26
50
61
150
5 2 2
2 4 0
10 22 6
75 58 37
58 64 105
150 150 150
2
1
23
67
57
150
[Note – Here consider 1 as not at all important and same as the 5 as the very important and also 3 as the neutral]
Chart Title Client Acquisition
Client base
Active Ratio
Client satisfaction
Revenue Growth 105
75 50
67
58
61 58 64
57
37 26 5 5 2 2 2 NOT AT ALL IMPORTANT
8
2 4
1
NOT IMPORTANT
23
22 10
6
NEUTRAL
IMPORTANT
VERY IMPORTANT
INTERPRETATION Client satisfaction is a most important development criteria for the business. The other leading important factors or the criteria are revenue growth, client base, active ratio, etc
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Motilal Oswal Securities Limited
10) Please rank the following business development support as per their importance in your business. (Rank from 1 as most imp. to 8 as least imp.)
Business development Support
No. of responses Rank
Centralized Advisory & Research Support Local area Marketing & Business Support Initial Training & Business migration Easy access to senior management Centralized customer services Office look & feel Seminar & Investor Meet B-Plan Preparation & other support
16.5 17.125 16.75 14.625 17.375 13.375 16.5 16.375
5.5 2 3.5 8 1 5.5 7 3.5
No. of responses No. of responses 16.5
17.125
16.75
17.375 14.625
16.5
16.375
13.375
INTERPRETATION From the above table, it is said that the no. of the respondents are high into the centralize customer services and same as the least one is the easy acess to the senior management. The most of the respondents like the customer support, local marketing, etc.
This will let MOSL to know the requirement and support required by the sub-brokers for their business development, which in other hand will be very helpful for future correspondence with their prospects.
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Motilal Oswal Securities Limited
11) What kind of support you require which will lead to next level. (Please give rating from 1 to 4; first priority will be ranked 1 and so on).
Supports Require To Lead The Next Level Marketing and business development support Brand value of broker Successful calls given by broker Back office/customer care support
No. Of Resp. 33 33 33.25 32.75
Rank 2.5 2.5 1 4
support require to lead the next level no. of resp.
rank
4 2.5
2.5 1
33
Marketing and business development support
33.25
33
Brand value of broker
Successful calls given by broker
32.75
Back office/customer care support
INTERPRETATION From the above table, MOSL can see that the red line shows the rank and the blue one is for the no. of respondents. Here, the most of the respondents preferred the successful calls given by the broker and like wise to all.
This will helpful to know or to go to the next level of the business and increase the growth.
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Motilal Oswal Securities Limited
12) Please rate the importance of following criteria while selecting a broker for Franchisee… (Circle the one that is most suitable to your preference. Consider 5 as most preferred and 1 as the least preferred) Criteria’s for Franchisee Acquisition Growth Opportunities Revenue Sharing ratio Brand Name Business Model Research Analysis Products & services Initial Deposit
NOT AT ALL IMPORTANT 0 0 4 2 10 0 4
NOT IMPORTANT 6 5 5 3 11 10 8
NEUTRAL
IMPORTANT VERY IMPORTANT 65 63 74 55 37 65 37 73 47 64 63 44 79 28
16 16 39 35 18 33 31
Criteria’s for Franchisee Acquisition 4 8
31
Products & services
10
33
Research Analysis
10
Initial Deposit
Business Model
Brand Name
11
23
79
63
18
5
16
Growth Opportunities
6
16
NOT AT ALL IMPORTANT
64
37
39
Revenue Sharing ratio
44
47
35
4 5
28
73
37
65
74
55
65
NOT IMPORTANT
62
63
NEUTRAL
IMPORTANT
VERY IMPORTANT
TOTAL 150 150 150 150 150 150 150
Motilal Oswal Securities Limited INTERPRETATION Out of 150 respondents, 74 have given “top importance” to Revenue sharing ratio; growth opportunity and research analysis are marked as “important” by 65 and 64 respondents. Business model, product & Services and Initial deposit are being marked as neutral by 37, 63, 79 respondents respectively. MOSL has to give high importance to the “Revenue sharing ratio” followed by the other criteria like Research Analysis and Growth Opportunity for acquiring the franchisee and for future business expansion.
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Motilal Oswal Securities Limited
13) What kind of research analysis is provided by your broker?
TIME
Physical
Email
Uploaded on Website
Daily Weekly Monthly Quarterly Annually
0 0 7 5 21
89 13 4 0 0
15 24 11 0 0
Providing research reports Physical
Email
Uploaded on Website
89
24
15
11 0
13 0 Daily
0 Weekly
4 7
0
0 21
0
5
Monthly
Quarterly
Annually
INTERPRETATION The majority of the respondent is in the daily email through. The least one is the daily & weekly physical reports. It helps to know the current situation and how to boost up the business.
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Motilal Oswal Securities Limited
14) Have ever change your sub-brokership in the past ?
ANSWER Yes No TOTAL
RESPONDENT 19 131 150
% 12.67 87.33 100
Changing of sub-brokership in the past Yes 13%
No 87%
INTERPRETATION Out of the 150 respondents, the majority is NO. Almost 87 % were not changing their broking business into the past. The remaining 13 % have changed their sub – brokership into the past.
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Motilal Oswal Securities Limited
15) What is your initial investment for starting your business?
INITIAL INVESTMENT Less than 100,000 100,000 to 300,000 300,000 to 500,000 More than 500,000 TOTAL
NO.RESPONDENT 20 73 34 23 150
% 13.33 48.67 22.67 15.33 100
Initial investment 49% 140 120 100
23%
80
15%
13%
60
73
40 20
34
20
23
0 Less than 100,000
100,000 to 300,000
300,000 to 500,000
More than 500,000
INTERPRETATION Out of 150 respondents, the most of the respondents are invest Rs. 100,000 to 300,000 as initial investment. The Percentage is 49% The least one is into the less than 100,000. The percentage is almost 13 %
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Motilal Oswal Securities Limited
16) Please rate your satisfaction level with the services provided by your present broker…
Satisfactory level
No. of respondent
%
Very satisfied Satisfied Neutral Not satisfied Not at all satisfied TOTAL
110 30 9 0 1 150
73.33 20 6 0 0.67 100
Satisfication level
Verry satisfied
73% 20%
Satisfied Neutral
6%
Not satisfied Not at all satisfied
1%
0%
INTERPRETATION From the above information, it is stated that the most of the respondent of 110 out of 150 feel the satisfaction level high.
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Motilal Oswal Securities Limited
CHAPTER 4 FINDINGS & RECOMMENDATON
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Motilal Oswal Securities Limited
RECOMMENDATIONS MOSL have examined that different investors are giving priorities to investment instrument as per their need. Accordingly, as per the needs of the client, a product can be recommended to him. Motilal Oswal Financial Services Limited (MOSL) has strength in Top Quality Research, Internet Trading, Investment Advisory Services, Value Added Back office services and DP Services. The firm also deals in commodities and mutual funds to add more number of clients.
Motilal Oswal should increase its promotional activities and it should make aware people of Ahmedabad city about its product and services.
Motilal Oswal should turn the existing customer to trade or invest in other product, which they are not aware about, or not investing in them.
Motilal Oswal should organize seminars and presentation of highly experienced person. It should provide classroom training and literature to those who are eager to learn about share market. It should distribute documents about product information.
Initial deposit, which quite high, should be reduced up to a considerable level. If not possible than that should be an easy installment scheme option available.
One of the most important aspect while selecting a Broking firm is „Revenue Sharing Ratio‟.
In fact many times just because of the above two factors (i.e. Initial deposit & Revenue Sharing Ratio) a prospect remove the name of MOSL from the list while choosing a broker.
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Motilal Oswal Securities Limited
FINDINGS From the study carried out and the analysis of the result obtain from the survey, the following suggestions and recommendations were made to help the firm improve upon its product.
On the basis of my analysis MOTILAL OSWAL‟S best USP (Unique selling product is their advice and research report provided to the clients in a weekly and monthly form.
The time to time services for the clients like Account opening sms, daily research report after the working hours of share market and before the opening bell of share market for Sub-Brokers.
The brokerage charges also very reasonable for the clients, MOSL charges only 0.3% for the intraday and 30% for the delivery base.
Providing technical software free of cost to the sub-broker is one of the main feature of Motilal Oswal Securities Ltd.
Motilal Oswal Securities Ltd providing an UPPERMOST card to the employees to motivate them.
Motilal Oswal Securities Ltd has invested 100 crores in just research programme
The nearest competitor of Motilal Oswal Securities Ltd is Kotak Securities Ltd in terms of the revenue sharing ratio, brokerage, franchise acquisition etc.
Motilal Oswal Securities Ltd having strategy to keep only one franchise in one territory.
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Motilal Oswal Securities Limited
STRATEGIC TOOLS
SWOT ANALYSIS OF MOTILAL OSWAL SECURITIES LIMITED
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Motilal Oswal Securities Limited
Strengths:
Large and diverse distribution network
MOSL‟s financial products and services are distributed through a pan-India network. Its business has grown from a single location to a nationwide network spread across 1568 business locations operated by their business associates or directly by us in 595 cities and towns.
Strong research and sales teams
MOSL research teams are focused on cash equities, equity Derivatives and commodities. It has been awarded „Asia Money Polls 2007‟ with 'Best Overall Country Research – Local Brokerage'
Brand recognition
'Motilal Oswal' is a well-established brand among retail and institutional investors in India. MOSL have been able to leverage its brand awareness to grow its businesses, build relationships and attract and retain talented individuals.
Weakness:
Very less exposure towards the retail business.
Most revenue generation from the franchisee business only.
No Establishment as Mutual Fund though have a strong research base.
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Motilal Oswal Securities Limited
Opportunities:-
Growing Financial Services industry‟s share of wallet for disposable income.
Huge market opportunity for wealth management service providers as Indian wealth
management business transforming from mere wealth safeguarding to
growing wealth.
Regulatory reforms would aid greater participation by all class of investors.
Leveraging technology to enable best practices and processes.
Increased appetite of Indian corporate for growth capital.
Threats:-
Execution risk.
Slowdown in global liquidity flows.
Increased intensity of competition from local and global players.
Unfavorable economic conditions
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BCG Matrix of MOSL products
Growth Rate
H PMS
MF
Investment Banking
AMC
Private Equity
Online Broking
Offline Broking
Insurance
L L
H Market Share 1. Stars = (high growth, high market share):
Use large amounts of cash and are leaders in the business so they should also generate large amounts of cash.
Frequently roughly in balance on net cash flow. However if needed any attempt should be made to hold share, because the rewards will be a cash cow if market share is kept.
In the MOSL PMS, Investment banking & Private equity all are falling under the star. Because they create high growth and high market share with more and more revenue.
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Motilal Oswal Securities Limited 2.
Cash Cows = (low growth, high market share):
Profits and cash generation should be high, and because of the low growth, investments needed should be low. Keep profits high
Foundation of a company
MOSL‟s offline broking falls under the cash cow covering high market share and low growth.
3.
Dogs =(low growth, low market share):
Avoid and minimize the number of insurance company.
Beware of expensive „turn around plans‟.
Deliver cash, otherwise liquidate
Insurance fall under the dog so, MOSL expands the product otherwise liquidate the insurance.
4.
Question Marks (= high growth, low market share):
Have the worst cash characteristics of all, because high demands and low returns due to low market share
If nothing is done to change the market share, question marks will simply
Absorb great amounts of cash and later, as the growth stops, a dog.
Either invests heavily or sells off or invests nothing and generates whatever cash it can. Increase market share or deliver cash
MOSL MF, AMC, Online broking fall under the Question Mark category.
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Motilal Oswal Securities Limited
Porter’s Five Force Model
Porter's five forces analysis is a framework for the industry analysis and business strategy development developed by Michael E. Porter of Harvard Business School in 1979. It uses concepts developed in Industrial Organization (IO) economics to derive five forces which determine the competitive intensity and therefore attractiveness of a market. Attractiveness in this context refers to the overall industry profitability. An "unattractive" industry is one where the combination of forces acts to drive down overall profitability. A very unattractive industry would be one approaching "pure competition".
Porter refers to those forces close to a company that affect its ability to serve its customers and make a profit. A change in any of the forces normally requires a company to re-assess the marketplace. The overall industry attractiveness does not imply that every firm in the industry will return the same profitability. Firms are able to apply their core competences, business model or network to achieve a profit above the industry average.
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Bargaining power of Buyers:
It is also described as the market of outputs. The ability of customers to put the firm under pressure and it also affects the customer's sensitivity to price changes.
There are various types of investors who trade through stock broking houses like MOSL, which includes investors like small investors, medium net worth investors, business partners, institutional investors and mutual fund companies.
Here the bargaining power of stock broking houses depends on how big the investor is. So here MOSL can say that bargaining power of stock broking houses is high in case of small investors.
While the bargaining power is moderate in case of HNI (High New Worth Investors)/ MNI‟s (Medium Net Worth Investors) and business partners.
But the in case of mutual fund companies and institutional investors bargaining power is less.
There is competitive buzz in stock broking industry; competitors are offering low brokerage and best services with added feature and switching cost is pretty much less. So the bargaining power is more inclined towards the investors and they can easily switch over to competitors product.
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Motilal Oswal Securities Limited
The Intensity of Competitive Rivalry:
For most industries, this is the major determinant of the competitiveness of the industry. Sometimes rivals compete aggressively and sometimes rivals compete in non-price dimensions such as innovation, marketing, etc
The company is facing the competition from local as well as national level players. The local players provide facility for off-line trading while the national players like ICICIdirect.com and Kotakstreet.com, HDFC Security provide online trading services.
There are also other big names like Indiabulls, Angel broking, Sharekhan, Marwadi etc. encircles the company form both the sides by providing online and off-line trading with competitive services.
As in broking and typically financial industry product innovation is not the major determinant of competition as product can be easily imitate by other players the price factor plays a major role in this industry.
Threat from Potential Entrants:
Profitable markets that yield high returns will attract new firms. This results in many new entrants, which will effectively decrease profitability. Unless the entry of new firms can be blocked by incumbents, the profit rate will fall towards a competitive level (perfect competition).
Nationalized banks are also thinking to enter in this field by tying up with broking houses. E.g. Bank Of Baroda.
The entry barriers to this industry are huge capital, Technological awareness, regulatory constraints, Experience curve required, Network connectivity and Expected Retaliation.
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Motilal Oswal Securities Limited
Threat from Substitutes:
The existence of close substitute products increases the propensity of customers to switch to alternatives in response to price increases (high elasticity of demand).
The instruments like Bank FD, post office etc. are major competitors for this broking house and their products.
The companies and banks which are having these instruments can plunge into this industry.
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CHAPTER 3 CONCLUSION
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Motilal Oswal Securities Limited
CONCLUSIONS Even though MOSL has less number of franchisees in Ahmedabad, it is considered a wellreputed broking firm in the market. It has established itself as one of the leading brokerage firm of India.
Motilal has the opportunity to focus on the products which are less popular products like Private equity. Investment Banking too is lacking behind, this provides MOSL potentials for acquiring more and more business.
When asked about support services 40% of respondents wants centralized advisory & research reports support, 20% of respondents need easy access to centralize customer service and 266% office look & feel, as primary requirements.
Equity with 26% & IPO 16% with & Commodity with 15% are the major trading offering & contribute highly to gross brokerage
MOSL has to focus on the prospects from view point of services they are been rendered by their present broker. This strategy will increase the market potential for their business expansion.
MOSL has to focus on the prospects who are not satisfied with the services like Business Development Software, Online mutual fund Platform, Different trading software, MF research desk, Account opening within 24 hours etc.
MOSL has all the varied departments it will be easy for them to focus on the competitors sub broker, prospects for business expansion.
MOSL to know the requirement and support required by the sub-brokers for their business development, which in other hand will be very helpful for future correspondence with their prospects.
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CHAPTER 5 REFERENCE
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BIBLIOGRAPHY BOOKS:
D.R.COOPER and P.S Schindler, (2006). “Business Research Methods”, Tata McGraw-Hill, New Delhi.
Kothari C.R, Research Methodology (2001) “Tata McGraw-Hill, New Delhi.
Ken Black, “Business Statistics”(2004) 4th Edition, John Wiley & sons (Asia) Pte. Ltd.
Newspapers:
The Economic Times
Mint
The Business Standard
Websites:
http://www.motilal.com/knowledge_center
http://www.nseindia
http://www.monycontrol.com
www.angelbroking.com
www.icicidirect.com
www.kotaksecurities.com
www.religaresecurities.com
www.shahinvestments.com
www.wikipedia.com
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CHAPTER 6 ANNEXURE
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Motilal Oswal Securities Limited
ANNEXURE AN STYDY OF SATISFACTION LEVEL OF EQUITY SUB-BROKER
QUESTIONNAIRE Disclaimer
:-
I am an MBA student and as a part of our curriculum, we are here to analysis of sub-brokers and financial products & services provided to sub-brokers by main brokers in Ahmedabad. We ensure you that the data given by you would be totally confidential and will be used for project purpose only. So kindly help us by giving your valuable time for filling this questionnaire.
Q-1
From how many years you are into the broking business ?specify ___________ < 5 years [
Q-2
], 6-10 years [
], 11-15 years [
],
> 15 years [
]
Which are the products and services are provided to you by your broker/company ? □ Equity
[
]
□ Currency
[
]
□ Commodity [
]
□ Mutual fund
[
]
□ Insurance
[
]
□ Margin funding [
]
□ IPO
[
]
□ Any other
]
□ PMS
[
]
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[
Motilal Oswal Securities Limited Q-3
Which of the following services/facilities are provided to you by your broker/company? [Please point out relevant options] □ Different account opening scheme
[ ]
□ CDSL-rights
[ ]
□ Depository services
[ ]
□ Investment banking
[ ]
□ Different online trading software
[ ]
□ Branding materials
[ ]
□ Investment advices
[ ]
□ online mutual fund platform [ ]
□ Risk management desk
[ ]
□ Customer service desk
[ ]
□ Account opening within 24 hours
[ ]
□ HNI desk
[ ]
□ Mutual fund research desk
[ ]
□ Business Development software
[ ]
□SMS configuration to franchisee’s clients[ ]
Q-4
which are your main sources for getting new clients ? Reference
Q-5
[
]
Advertisement [
]
Sales team
[
]
Others
[
]
what are the percentage of clients dealing in the followings…? Cash ________, F/O _________, Commodity ________________
Q-6
what do you think are the qualities that attributed for you to be a successful sub - broker? o
The brand value of the company you are associated with.
[
]
o
Higher ratio of successful trading calls generated.
[
]
o
A culture of properly researched Ideas coupled with good infrastructure & client servicing.
[
]
o
All the above
[
]
o
Other please specify...
[
]
__________________________________________________________
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Motilal Oswal Securities Limited Q-7
What are the factors according to you for having a satisfied client? o
Prompt & timely addressing of client queries
[
]
o
Best technology in place
[
]
o
Thinking ahead of time
[
]
o
nd
1 and 2 one
[
]
o
2nd and 3rd
[
]
o
1st and 3rd
[
]
o
All the above
[
]
o
Any others….
[
]
st
___________________________________________________________ Q-8
Q-9
What are the immediate challenges for this industry & your plan to tackle this? o
Lack of interest in the stock markets in the retail category
o
Source for fresh capital drying up from both domestic & foreign
[
]
Investors
[
]
o
Cut costs & wait for good times to come
[
]
o
All of the above
[
]
o
Any other , ___________________________________________[
]
Please rate the importance of following development criteria for your business. (Circle the one that is most suitable to your preference. Consider 5 as most preferred and 1 as the least preferred)
Client Acquisition
1
2
3
4
5
Client base
1
2
3
4
5
Active Ratio
1
2
3
4
5
Client satisfaction
1
2
3
4
5
Revenue Growth
1
2
3
4
5
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Motilal Oswal Securities Limited Q-10
Please rank the following business development support as per their importance in your business. (Rank from 1 as most imp. to 8 as least imp.)
Business Development Support
Rank
Business Development Support
Centralized Advisory & Research Support
Centralized customer services
Local area Marketing & Business Support
Office look & feel
Initial Training & Business migration
Seminar & Investor Meet
Easy access to senior management
B-Plan Preparation& other support
Q-11
What kind of support you require which will lead to next level. (Please give rating from 1 to 4; first priority will be ranked 1 and so on)
Q-12
o
Marketing and business development support
[
]
o
Brand value of broker
[
]
o
Successful calls given by broker
[
]
o
Back office/customer care support
[
]
Please rate the importance of following criteria while selecting a broker for Franchisee… (Circle the one that is most suitable to your preference. Consider 5 as most preferred and 1 as the least preferred)
Growth Opportunities
1
2
3
4
5
Revenue Sharing ratio
1
2
3
4
5
Brand Name
1
2
3
4
5
Business Model
1
2
3
4
5
Research Analysis
1
2
3
4
5
Products & services
1
2
3
4
5
Initial Deposit
1
2
3
4
5
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Rank
Motilal Oswal Securities Limited Q-13
What kind of research analysis is provided by your broker? □ Daily
□ Weekly
□ Monthly
□ Quarterly
□ Annually
In which form is it provided? □ Physical Q-14
Q-15
Q-16
□ Email
□ Uploaded on Website
Have ever change your sub-brokership in the past ? Yes [
], _____________________________________
No [
],
What is your initial investment for starting your business? Less than 100,000
[
]
100,000 to 300,000
[
]
300,000 to 500,000
[
]
More than 500,000
[
]
Please rate your satisfaction level with the services provided by your present broker… High
1
2
3
4
89
5
Low
Motilal Oswal Securities Limited
Personal Details
Name :- ____________________________________________________________ Address :- __________________________________________________________ ___________________________________________________________________ ___________________________________________________________________
Contact no :-________________________________________________________ E-mail Id :- _________________________________________________________ Company name :-_________________________________________________
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