A

PROJECT STUDY REPORT

ON

COMPARATIVE ANALYSIS OF VARIOUS FINANCIAL INSTITUTIONS IN THE MARKET

Under the su er!"s"#n #$% DEEPALI MALODIYA )Le*turer + Academic Session ,--./,-00

Su&'"tted &(%

Inst"tute O$ M1n12e'ent Stud"es Faculty of Management

E'1"3 "d % F1*e&##4% PREFACE

MBA program is one of the most reputed professional courses in the field of Management. There is a study project as an integral part of MBA in the IV Semester. As a complementary to that everyone has to submit a report on the or! conducted in the industry.This report is thus prepared for the study project done at . The topic of the project is" #$%M&A'ATIV( A)A*+SIS %F VA'I%,S FI)A)$IA* I)STIT,TI%)S I) T-( MA'.(T/.The organi0ation shall ma!e all possible efforts to have a secure and safe domain. The data1information is very important and most

critical to the business re2uirements3 therefore proper measures should be adopted so that the information is ell secured and protected.

ACKNO5LED6EMENT
I e7 ress '( sen*"er th1n4s t# '( r#8e*t 2u"de 9h# h1s &een 2u"d"n2 $#r*e t# '( re #rt #n COMPARATIVE ANALYSIS OF VARIOUS FINANCIAL INSTITUTIONS IN THE MARKET I am also than!ful to all of my teachers and friends for their support and encouragement in finding out the appropriate material for this project report" ithout their than!less support

and efforts" ma!ing this report ould have been impossible for me. I am also than!ful to for providing me re2uired facilities in the department I ould also li!e to than! the hole respondents ho provide me the best !no ledge and

for their help and cooperation throughout the project 2

E:ECUTIVE SUMMARY

The project #$omparative Analysis of various Financial Institutions in the mar!et/ to get the idea" as scenario. The basic objective behind the study carried out by me is to !no

as done

ell as !no ledge" benefits and use of financial advisor in the present much more

about the prospects of Financial &lanning in the gro ing economy. &eople should come out of the concept of just !eeping their money in Savings Account and Fi4ed 5eposits and should concentrate on their financial planning to ma4imi0e returns by ta!ing proper guidance from financial planner. Most of the advisors provide e4pertise information and !no ledge about various financial products" li!e bonds" mutual funds" insurance" e2uity mar!et and real estate etc. The in6depth analysis of the report ill help the reader !no much more about the investors and financial advisors. Investors having lo 3 saving potential" gro th of capital

acts as a primary objective behind investments. Investors get high level of satisfaction from e4isting financial advisors" potential and portfolio. The sum up" there has been a sustained effort and dedication involved to ma!e this study a comprehensive mar!et study but at the same time. The researcher is open to any !ind of suggestions that further needs to be considered in respect to the course of his or!. hich depicts that there is a need of financial institutions to approach these investors in a proper manner so as to provide value additions to the saving

T1&3e #$ C#ntents
Pre$1*e A*4n#93ed2e'ent E7e*ut"!e Su''1r( C#ntent $hapter )o. 8 ; 9 : > 7 = < @ 8? 88 8; $hapter )ame Introduction to the Industry Introduction to the organi0ation Financial Institutions in the Mar!et 7 9: :8 7<

$omparative Study of 5ifferent &layers in the Mar!et =; Analysis of the $omparison 'esearch Methodology Facts and Findings Analysis and Interpretation $onclusion 'ecommendation and Suggestions Appendi4 Bibliography =< <? <9 <> 8?: 88? 88>

CHAPTER 0 INTRODUCTION TO THE INDUSTRY

FINANCIAL ADVISORS/ 1+ O!er!"e9/

&lanning for a secure financial future is not easy. +et increasingly" individuals are in charge of their o n financial futures. Most are a are that planning is critical" yet donAt the have time or the e4pertise to develop a plan and ma!e the needed financial decisions. So there arises a need for Financial Advisors to manage the individualAs process of managing this ealth is !no n as Bealth Management. There are a number of financial advisors offering a diverse portfolio of services to suit different financial re2uirements of their clients. In order to accomplish the tas!" advisors help individuals or corporate manage their ealth appropriately throughC )"+ In!est'ent S#3ut"#ns% / The financial planner helps the individuals diversify their portfolio through alternative investment plans" mutual funds" e2uities" and even save for retirement through annuities. )""+ F"n1n*"13 P31nn"n2% / Financial &lanning is an e4ercise aimed to ensure availability of right amount of money at the right time to meet the individualAs financial goals. Financial institutions plan individualAs current e4penditures and save for future short6term or long6term goals by analy0ing different options available. )"""+ Ret"re'ent P31nn"n2% / The financial planner guides their clients in planning for their financial re2uirements after retirement" by helping them identify goals" researching and analy0ing different opportunities to secure funds and ma!e investments to suits their needs. )"!+ 5e13th M1n12e'ent% / It is a comprehensive service to optimi0e" protect and manage the financial ell6being of an individual" family or corporation. Its basic definition covers individuals advice on loans" investments and insurance to give a broad picture of ho these companies provide the assistance of professional financial advisors. These financial ealth and the hole

should best deploy their financial resources. A broader picture may include ta4 advice" estate planning" business planning" charity foundations and other financial needs.

(ven though one of the most significant factors in our life is the state of our personal finances" being" result e rarely spend time on managing them since unli!e businesses. The reason e all understand the e are not accountable to any one for our personal financial goals and results. As a e tend to get careless in our financial matters. I !no

importance of savings but let us not get confused bet een savings and investment. Mere savings Dputting aside a portion of earningsE do not insure or guarantee achievement of future financial goals.

&+ F"n1n*"13 P31nner )5e13th P31nner ; F"n1n*"13 Ad!"s#r+/

8

The financial planner helps identify various ta4able and non6ta4able investments. This is not a comprehensive list of services. They may differ from one financial management company to another. %ne can select the services according to their re2uirements" be it personal or professional. A financial planner or! begins ith a consultation ith the client" from hom the planner

obtains information on the clientAs finances and financial goals. The planner then develops a comprehensive financial plan that identifies problem areas" ma!es recommendations for improvement" and selects appropriate investments compatible institutions usually meet and to determine ith the clientAs goals" attitude to ard ris!" and e4pectation or need for a return on the investment. Financial ith established clients to update them on potential investments hether the clients have been through any life changesFsuch as

marriage" disability" or retirementFthat might affect their financial goals. Finding clients and building a customer base is one of the most important of a financial plannerAs job" because referrals from satisfied clients are an important source of ne business. Many institutions also contact potential clients by giving seminars or lectures or meet clients through business and social contacts.

)"+ Need $#r 1 $"n1n*"13 31nner%

G -olistic in outloo!C $F&s consider all circumstances" family needs" goals" values" and aspirations" hile ma!ing recommendations. G &rofessionalsC $F&s protect privacy" strive to maintain the highest ethical standards and continually enhance s!ills and credentials through continuing education. G (ducational in natureC $F&s guide one through options and e4plain the clearly to help ma!e the best choices. G $ommitted to successC -olistic financial planning is a process" not an event" and commit to adjusting plan as life goals change. 9

)""+ R#3e #$ F"n1n*"13 P31nner<s

1+ De$"n"n2 (#ur 6#13s% / A planner ill ta!e note of and record all your financial goals.

+ou save for a variety of reasonsC to buy a house and a car" to educate your children" to set them up in business" to get them married" to go on vacations" and" finally" to give yourself a comfortable life in retirement. But not all of us get around to defining retirement means or HgoodA education means in money terms. &+ S1!"n2 $#r the'% / %nce these goals are ritten do n" you can clearly see hat you hat HcomfortableA

need to save today to meet these goals. The concept of HsavingsA changesI from Hsomething thatAs left overA to Hsomething that you target every monthA. The planner helps ith your budgeting by ma!ing you -e helps you rationali0e rite do n your income and e4penses in great detail. asteful e4penses and establish a system of generating surpluses ords" planning is about

every month. %nce you see the magnitude of your investment goals and the need to save properly" the desire for the latest in everything diminishes. In other creating ealthIand managing it efficiently. hich varies from

*+ C#!er"n2 R"s4% / The planner then assesses your insurance needs" person to person and from age to age. As a young bachelor and you have a stay6at6home on your life insurance ife

ith no dependants" youAll ell.

need disability insurance rather more than life insurance" but the minute you get married hom you support" you need life insurance as ill that on disability. The planner Bhen the !ids come along and your old parents too become your dependants" the outlay ill have to increase" as ill help you identify your insurance needs" 2uantify them and then suggest policy options. d+ P31nn"n2 $#r Ret"re'ent% / The planner then loo!s at your retirement needs and plans for the time accounts hen youAll no longer be earning. +our contributions to your (&F and &&F ill" of course" help you on that countIprovided youAve been disciplined and not

made ithdra als from these accounts half ay through. e+ M14"n2 It H1 en% / The planner has ta!en so long just to establish hat you ant out ill

of life in money terms3 even no " the actual investment is t o steps a ay. The planner

10

no

assess your Hris! profileA. This is just a

ay to see

hat level of ris! youAre comfortable

ith. It

ould depend on your age and your family circumstances.

$+ T#t13 F"n1n*"13 S#3ut"#ns% / A planner has a Hbig pictureA vision and is able to see the inter6lin!ages of all your goals" e4penses and investments. 2+ The =131n*"n2 A*t% / A plannerAs responsibility doesnAt" ho ever" end a product. -e still has to hand6hold you" for instance" Imprudent investors tend to buy rebalance your portfolio. ith your buying

hen the stoc! mar!et tan!s or tops.

hen the mar!et is high and sell in a slump. The planner

educates you on the merits of a long6term approach and regular investing and helps you

*+ F"n1n*"13 P31nn"n2/
HFinancial planningA is the process of charting out the money course of your life. ItAs li!e having a financial roadmap that guides your every step till you pass on the baton to the ne4t generation. In other ords" it is a process in hich an individual sets long6term financial goals through investments" ta4 planning" asset allocation" ris! management" retirement planning and estate planning. Most of us approach our financial lives li!e the disorgani0ed traveler thin! ho gets to his destination eventually and perhaps even enjoys the rough ride. Be e have a clear roadmap in mind" but our financial lives are mar!ed by ad6hoc

decisions and capitulation to the temptations of the flavors of the financial season.

)"+ =ene$"ts #$ F"n1n*"13 P31nn"n2

A sound and meticulous Financial &lanning benefitsC G Sophisticated financial advice to cope G -elp dealing ith changing life situation G )on6biased opinion on oneAs insurance needs ith oneAs retirement planning G %ptimum asset allocation and investment strategy formulation G (fficient ta4 strategy and estate planning ill have follo ing enumerated

11

In!est'ents /
1+ O!er!"e9
The money you earn is partly spent and the rest is saved for meeting future e4penses. Instead of !eeping the savings idle you may li!e to use savings in order to get return on it in the future. This is called Investment. In other money or capital to an endeavor profit.A ItJs actually pretty simpleC investing means putting your money to itJs a different ay to thin! about ho or! for you. (ssentially" ays you ords" Investment is Hthe act of committing ith the e4pectation of obtaining an additional income or

to ma!e money. There are many different

can go about ma!ing an investment. This includes putting money into stoc!s" bonds" mutual funds" or real estate Damong many other thingsE" or starting your o n business. Sometimes people refer to these options as Kinvestment vehicles"K Ka hich is just another ay of saying hich ill be ay to invest.K (ach of these vehicles has positives and negatives"

discussed later in the thesis. The point is that it doesnJt matter 12

hich method you choose for

investing your money" the goal is al ays to put your money to current scenario to understand.

or! so it earns you an

additional profit. (ven though this is a simple idea" itJs the most important concept in the

&+ =1s"* In!est'ent O&8e*t"!es

Investing is a conscious decision to set money aside for a long enough periods in an avenue that suits your ris! profile. The options for investing our savings are continually increasing" yet every single investment vehicle can be easily categori0ed according to three fundamental characteristics 6 Safety" Income and Lro th 6 hich also correspond to types e e4amine these ays in of investor objectives. Bhile it is possible for an investor to have more than one of these objectives" the success of one must come at the e4pense of others. -ere hich investors can incorporate them in devising a strategy. three types of objectives" the investments that are used to achieve them and the

13

)"+ S1$et(
&erhaps there is truth to the a4iom that there is no such thing as a completely safe and secure investment. +et e can get close to ultimate safety for our investment funds through the purchase of government6issued securities in stable economic systems" or through the purchase of the highest 2uality corporate bonds issued by the economyJs top companies.

14

Such securities are arguably the best means of preserving principal

hile receiving a

specified rate of return. The safest investments are usually found in the money mar!et and include such securities as Treasury bills DT6billsE" certificates of deposit" commercial paper

15

or ban!ersJ acceptance slips3 or in the fi4ed income DbondE mar!et in the form of municipal and other government bonds" and in corporate bonds.

)""+ In*#'e
-o ever" the safest investments are also the ones that are li!ely to have the lo est rate of income return" or yield. Investors must inevitably sacrifice a degree of safety if they increases" safety generally goes do n" and vice versa. ant to increase their yields. This is the inverse relationship bet een safety and yieldC as yield

)"""+ 6r#9th #$ C1 "t13

Lro th of capital is most closely associated particularly gro th securities" hich offer lo ith the purchase of common stoc!" yields but considerable opportunity for orlds

increase in value. Blue6chip stoc!s" by contrast" can potentially offer the best of all

by possessing reasonable safety" modest income and potential for gro th in capital generated by long6term increases in corporate revenues and earnings as the company matures.

Se*#nd1r( O&8e*t"!es )"+ C#st #$ In$31t"#n

%ne needs to invest no isely to meet the cost of Inflation. Inflation causes money to lose as a 7M inflation rate for the e4t ;? years" a value because it ill not buy the same amount of a good or a service in the future as it does or did in the past. For e4ample" if there 's.8?? purchase today ould cost 's.9;8 in ;? years. 'emember to loo! at an hich is the return after inflation. The aim of investments ill

investmentAs HrealA rate of return"

should be to provide a return above the inflation rate to ensure that the investment does not decrease in value. For e4ample" if the annual inflation rate is 7M" then the investment need to earn more than 7M to ensure it increases in value.

)""+ T17 M"n"'">1t"#n

An investor may pursue certain investments in order to adopt ta4 minimi0ation as part of his or her investment strategy. A highly6paid e4ecutive" for e4ample" may investments ant to see! ith favorable ta4 treatment in order to lessen his or her overall income ta4

burden. Ma!ing contributions to an I'A or other ta46sheltered retirement plan can be an 16

effective ta4 minimi0ation strategy. By far" ta46saving is the most compelling reason for investors to set aside money for the long term.

)"""+ M1r4et1&"3"t( ; L"?u"d"t(

$ommon stoc! is often considered the most li2uid of investments" since it can usually be sold ithin a day or t o of the decision to sell. Bonds can also be fairly mar!etable" but hich the fi4ed term some bonds are highly illi2uid" or non6tradable" possessing a fi4ed term. Similarly" money mar!et instruments may only be redeemable at the precise date at ends.

)"!+ Ret"re'ent
Anyone ho ill retire needs to plan for it. There is more than one reason to save for hat you have in retirement. The all important reason is the rising cost of living. ItAs called inflation. If you start planning for retirement early on" you can bridge the gap bet een your hand today and hat you ould li!e to have hen you retire. If you begin saving for

retirement early on in your life" you can set aside smaller amounts. +ou can also ta!e on more ris! by investing larger amounts in e2uities i.e." stoc!s and e2uity funds. If you delay saving for retirement" you have to be lo er. ill have to invest larger sums of money to save for the same ill amount3 also the share of e2uity investments as a portion of your retirement savings

17

T( es #$ In!est'ents/ 1+ O!er!"e9
There are many ays to invest your money. %f course" to decide are suitable for you" you need to !no for a particular investing objective. their characteristics and hich investment vehicles hy they may be suitable

18

G 5ebt Mar!et G Bonds G Mutual Funds G (2uity Mar!et G Insurance G $ash G Lold G 'eal (state G -ome *oans

19

T( es #$ In!est'ents
'eturn (2uity Bonds $o. 5ebentures $o. F5s Ban! 5eposits &&F *ife Insurance Lold 'eal (state Mutual Funds Safety -igh Moderate Moderate Moderate *o Moderate *o Moderate -igh -igh Volatility *o -igh Moderate *o -igh -igh -igh -igh Moderate -igh *i2uidity -igh -igh Moderate Moderate Moderate *o *o *o *o -igh *o Moderate *o *o Moderate Moderate -igh *o Moderate -igh $onvenience Moderate -igh *o Moderate -igh -igh Moderate Lold *o -igh

)"+ De&t Instru'ents

5ebt instruments protect your capital" therefore the importance of a solid debt portfolio. This not only gives stability" but also offers you optimal returns" li2uidity and ta4 benefits. 5ebt products" besides safeguarding your capital" can be used to meet short" medium and long6 term financial needs.

Sh#rt/Ter' O t"#ns%
They are good for short term goals" you can loo! at li2uid funds" floating rate funds and short6term ban! deposits as options for this category of investments. *i2uid funds have retuned around >M post6ta4 returns as compared to >.7M post6ta4 that your one6year <M ban! fi4ed deposit gives you. So" if you have funds for investment for over a period of one year" it is better to go in for ban! deposits. 1+ F"7ed M1tur"t( P31n )FMP+% If you !no e4actly for ho much time you need to invest

your surplus" a smarter option is to invest in FM&s. They are shorter6tenured debt schemes that buy and hold securities till maturity" thereby eliminating the interest rate ris!. Try and opt for FM&s that offer a double inde4ation benefit. Fund houses usually launch double6 inde4ation FM&s during the end of the financial year so that they cover t o financial year closings.

20

Med"u' @ L#n2/Ter' O t"#ns%

These options typically offer lo or virtually no li2uidity. They are" ho ever" largely useful as income accumulation tools because of the assured interest rates they offer. These instruments Dsmall savings schemesE should find place in your long6term debt portfolio. 1+ E' 3#(ee Pr#!"dent Fund )EPF+% &F 8;M. The contribution Section <?$. &+ Pu&3"* Pr#!"dent Fund )PPF+% A ithdra al is permissible every year from the seventh ithdra al ill be ill also be counted as your debt component ill be eligible for ta4 benefits under

hich can be ma4imi0ed to ;?M of your basic salary3 the company contributes another ill yield a return of <M and

financial year of the date of opening of the account and the amount of year in hich the amount is

limited to >?M of the balance at credit at the end of the :th year immediately preceding the ithdra n or at the end of the preceding year hichever is lo er. -o ever" it doesnAt score too ell on li2uidity. &&F is a great investment if you have

age on your side so that you can ma4imi0e the benefit by e4tending the period of holding. *+ N1t"#n13 S1!"n2s Cert"$"*1te )NSC+% Bhile the interest component gets accrued Ddeemed to be reinvestedE" it is returned to you along 21 ith the principal only on maturity. -ence the returns are both fi4ed and assured. Investments up to 's.8"??"??? are eligible

for deduction from income under Section <?$. -o ever interest earnings are fully ta4able. &remature encashment is only allo ed under specific circumstances such as death of the holder" forfeiture by the pledge or under courtAs order. d+ K"s1n V"41s P1tr1 )KVP+% *i2uidity in .V& is available any time after ;.7 years from the investment date" but a loss of interest has to be borne on premature li2uidation. The interest earned is fully ta4able as per your ta4 slab rate. e+ P#st O$$"*e T"'e @ Re*urr"n2 De #s"ts )POTD+% +ou can e4it a &%T5 months of starting one ithout receiving any interest and if percentage points are deducted. There are no ta4 benefits in this scheme. $+ P#st O$$"*e M#nth3( In*#'e S*he'e )POMIS+% &remature ithdra n prematurely. 2+ Sen"#r C"t">ens S1!"n2s S*he'e )SCS+% The tenure is > years and can be e4tended by another 9 years. *i2uidity is available after one year but it proves costly as there is a penalty of 8.>M of the amount deposited. )o ta4 brea! and no you need to pay T5S too. ithdra al is permitted if ithin si4

ith6dra n after one year then ;

deposit is more than one year old. A deduction of >M is levied from the principal amount if

h+ =1n4 De #s"ts% These are fle4ible" li2uid and offer good interest rates today. Ma!e use of the t o6in6one savings accounts that ban!s offer Dsurplus over a specified sum is transferred to a depositE to get a higher return on the money accumulating in your savings account. In the recent Budget" the benefit of Section <?$ deposits" hich are !ept notification for this is yet to come. as also e4tended to ban! ith scheduled ban!s for a minimum period of five years. The

)""+ =#nds 1+ O!er!"e9

22

It is a fi4ed income instrument issued for a period of more than one year ith the purpose of raising capital. The central or state government" corporations and similar institutions sell bonds. A bond is generally a promise to repay the principal along ith a fi4ed rate of interest on a specified date" called the Maturity 5ate. The main attraction of bonds is their relative safety. If you are buying bonds from a stable government" your investment is virtually guaranteed" or ris!6free. The safety and stability" ho ever" come at a cost. Because there is little ris!" there is little potential return. As a result" the rate of return on bonds is generally lo er than other securities.

&+ T17 S1!"n2 =#nds

These are those bonds that have a special provision that allo s the investor to save on ta4. (4amples of such bonds areC aE Infrastructure Bonds bE $apital Lains Bonds a. 'ural (lectrification $orporation D'($E Bonds b. )ational -igh ay Authority of India D)-AIE c. )ational Ban! for Agriculture N 'ural 5evelopment d. 'BI Ta4 'elief Bonds

)"""+ Mutu13 Funds 1+ O!er!"e9

23

A mutual fund is a body corporate registered

ith S(BI that pools money from the

individuals1corporate investors and invests the same in a variety of different financial instruments or securities such as (2uity Shares" Lovernment Securities" Bonds" 5ebentures" etc. The income earned through these investments and the capital appreciations reali0ed are shared by its unit holders in proportion to the number of units o ned by them. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified" professionally managed bas!et of securities at a relatively lo cost. Mutual fund units are issued and redeemed by the Asset hich is Management $ompany DAM$E based on the fundAs net asset value D)AVE" determined at the end of each trading session. Mutual funds are considered to be the best investments as on one hand it provides good returns and on the other hand it gives us safety in comparison to other investments avenues.

5#r4"n2 #$ 1 Mutu13 Fund /

&+ T( es #$ Mutu13 Funds

24

Mutual fund schemes may be classified on the basis of its structure and its investment objective.

=( Stru*ture
"A O en/Ended Funds In an open6ended fund" investors can buy and sell units of the fund" at )AV related prices" at any time" directly from the fund. This is called an open ended fund because the pools of funds is open for additional sales and repurchases. %pen ended funds have to balance the interest of investors ho come in" investors ho go out and investors ho stay invested. ""A C3#sed/Ended Funds A closed ended fund is open for sale to investors for a specific period" after in the secondary mar!ets" hich further sales are closed. Any further transaction for buying the units or repurchasing them" happen here closed end funds are listed. In a closed ended fund" thus" the pool of funds can technically be !ept constant. Investors in closed end funds receive either certificates or depository receipts" for their holdings in a closed end mutual fund

"""A Inter!13 Funds Interval funds combine the features of open6ended and close6ended schemes. They are open for sale or redemption during pre6determined intervals at )AV related prices.

=( "n!est'ent #&8e*t"!e
"A 6r#9th Funds The aim of gro th funds is to provide capital appreciation over the medium to long6 term. Such schemes normally invest a majority of their corpus in e2uities. It has been proven that returns from stoc!s" have outperformed most other !ind of investments held over the long term. Lro th schemes are ideal for investors having a long6term outloo! see!ing gro th over a period of time.

""A In*#'e Funds

25

The aim of income funds is to provide regular and steady income to Investors. Such schemes generally invest in fi4ed income securities such as bonds" corporate debentures and Lovernment securities. Income Funds are ideal for capital Stability and 'egular Income.

"""A =131n*ed Funds 26

The aim of balanced funds is to provide both gro th and regular income. Such schemes periodically distribute a part of their earning and invest both in e2uities and fi4ed income securities in the proportion indicated in their offer documents. "!A M#ne( M1r4et Funds The aim of money mar!et funds is to provide easy li2uidity" preservation of capital and moderate income. These schemes generally invest in safer short6term instruments such as treasury bills" certificates of deposit" commercial paper and inter6ban! call money. 'eturns on these schemes may fluctuate depending upon the interest rates prevailing in the mar!et.

!A L#1d Funds A *oad Fund is one that charges a commission for entry or e4it. That is" each time you buy or sell units in the fund" a commission from 8M to ;M. !"A N#/L#1d Funds A )o6*oad Fund is one that does not charge a commission for entry or e4it. That is" no commission is payable on purchase or sale of units in the fund. ill be payable. Typically entry and e4it loads range

Other S*he'es
"A T17 S1!"n2 S*he'es These schemes offer ta4 rebates to the investors under specific provisions of the Indian Income Ta4 la s as the Lovernment offers ta4 incentives for investment in specified avenues. Investments made in (2uity *in!ed Savings Schemes D(*SSE and &ension Schemes are allo ed as deduction u1s << of the Income Ta4 Act" 8@78.

=1n4s !;s 'utu13 $unds

27

&A'AM(T('S 'eturns Administrative e4p. 'is! Investment options )et or! *i2uidity Ouality of assets Interest calculation

BA).S *o -igh *o *ess -igh penetration At a cost )ot transparent

M,T,A* F,)5S Better *o Moderate More *o but improving

Better Transparent

Minimum balance bet een (veryday 8?th. N 9?th. of every month

Luarantee

Ma4imum 's.8 *a!h on )one deposits

"!+ E?u"t( 1+ O!er!"e9

(2uities are often regarded as the best performing asset class vis6P6vis its peers over longer time frames. -o ever e2uity6oriented investments are also capable of e4posing investors to the highest degree of volatility and ris!. There are a number of factors" basis" can be challenging for most. Stoc! mar!ets have al ays been a dra for investors for their ability to generate ealth hich affect the performance of e2uities ad studying and understanding all of them on an ongoing

over the long6term. Fear" greed and a short6term investment approach act as hurdles that frustrate the investor from achieving his1her investment goals. +ou need to !eep in mind the ris! associated ith the stoc!s. +ou also need to diversify your e2uity portfolio i.e." include 28

more stoc!s and sectors. This helps you diversify your investment ris!" so even if something ere to go rong ith a stoc!1industry in your portfolio" other stoc!s1industries should help you shore up your portfolio.

)!+ Insur1n*e 1+ O!er!"e9

*ife insurance has traditionally been loo!ed upon pre6dominantly as an avenue that offers ta4 benefits hile also doubling up as a saving instrument. The purpose of life insurance is ords" life to indemnify the nominees in case of an eventuality to the insured. In other person insured. The purpose of buying a life insurance is to protect your dependants from any financial difficulties in your absence. It helps individuals in providing them insuring themselves ith the t in benefits of hile at the same time acting as a compulsory savings instrument to elcome and of course" since some plans also double up

insurance is intended to secure the financial future of the nominees in the absence of the

ta!e care of their future needs. *ife insurance can aid your family on a rainy day" at a time hen help from every 2uarter is as a savings instrument" they assist you in planning for such future needs li!e childrenAs marriage" purchase of various household items" gold purchases or as seed capital for starting a business.

life is full of dangers" but

ith insurance" you can at least ensure that you and your al! the tightrope if you !no there is a safety net.

dependents donAt suffer. ItAs easier to

+ou should try and ta!e cover for all insurable

29

life is full of dangers" but

ith insurance" you can at least ensure that you and your al! the tightrope if you !no there is a safety net.

dependents donAt suffer. ItAs easier to

+ou should try and ta!e cover for all insurable ris!s. If you are a are of the major ris!s and buy the right products" you can cover 2uite a fe follo sC G *ife G -ealth G Income G &rofessional -a0ards G Assets G %utliving Bealth G 5ebt 'epayment bases. The major insurable ris!s are as

T( es #$ Insur1n*e P#3"*"es%
1+ Ter' P31ns A term plan is the most basic type of life insurance plan. It is the most cost6effective life insurance product. ,nli!e other plans that come ith an investment or savings component" term plans are products that cover only your life. This means your dependents or nominees get the sum assured on your death. A term plan offers life cover at a very nominal cost. This is due to the fact that term plan premiums include only mortality charges and sales and administration e4penses. There is no savings element.

&+ M#ne( =1*4 P31n 30

A money bac! plan aims to give you a certain sum of money at regular intervals3 simultaneously it also provides you ith life cover. Money bac! plans are especially useful in case you need money at regular intervals for your childAs education" marriage" etc. *+ Un"t L"n4ed Insur1n*e P31ns )ULIPs+ ,*I&s basically or! li!e a mutual fund ith a life cover thro n in. They invest the premium hile in mar!et6lin!ed instruments li!e stoc!s" corporate bonds and government securities DgsecsE. The basic difference bet een ,*I&s and traditional insurance plans is that portion of their corpus in stoc!s. -o ever" investments in ,*I& should be in tune shift his money bet een e2uity and debt in varying proportions. d+ Pens"#n ; Ret"re'ent P31ns &lanning for retirement is an important e4ercise for any individual. A retirement plan from a life insurance company helps an individual insure his life for a specific sum assured. At the same time" it helps him in accumulating a corpus" retirement. hich he receives at the time of traditional plans invest mostly in bonds and gsecs" ,*I&sA mandate is to invest a major ith the individualAs ris! appetite. ,*I&s offer fle4ibility to the policy holder I the policy holder can

e+ End#9'ent P31ns Individuals ith a lo ris! appetite" ho ant an insurance cover" hich ill also give them returns on maturity could consider buying traditional endo ment plans. Such plans invest most of their money in specified debt instruments li!e corporate bonds" government securities DgsecsE and the money mar!et.

)!"+ C1sh 1+ O!er!"e9

Investors must hold a sufficient amount of their assets in cash i.e. in li2uid form3 this remember that e2uity6oriented investments are made ill help them tide over unplanned e4penditures and other contingencies. Also one must ith a long6term perspective and li2uidating them to meet any contingency may prove to be a loss6ma!ing proposition 31

depending on the mar!et conditions. -oldings in cash include amount held in savings ban! accounts" li2uid funds and short6term fi4ed deposits.

)!""+ 6#3d 1+ O!er!"e9

In India" gold has traditionally played a multi6faceted role. Apart from being used for adornment purpose" it has also served as an asset of the last resort and a hedge against inflation and currency depreciation. India has more than 89"??? tones of hoarded gold" hich translates to around 's.7">?"??? crores. Lold is an asset class thatAs associated safety. -o ever" the ups and do n that the yello ith metal has seen over the last fe

months" has made it loo! similar to other mar!et investment assets. This is due to an unprecedented demand for gold as an investment avenue since the last couple of years. Lold has attracted a high level of attention in last couple of years" positive given its proven linear relationship ith an image shift from ith the ,S

a non6volatile asset to a hot investment avenue. The future outloo! for the metal loo!s ith the crude oil and non6linear dollar. The much6a aited gold e4change6traded funds ould provide a very good vehicle to

the investors and a sensible alternative to the current forms available for investment.

)!""+ Re13 Est1te 1+ O!er!"e9

'eal estate is a great investment option" as it gives you capital appreciation and rental income. ItAs an investment option since it fights inflation. The fundamentals for investing in property mar!ets remain strong in India 6 relatively lo interest rates" strong capital flo s" ith high employment gro th" abundant li2uidity" attractive demographics Dyoung population and migration from BestE" increase in affordability" and a large supply of stoc! to !eep up rent1income at demand and focus on 2uality. The price you pay for a property should reflect the future hich you let it. As in the stoc! mar!et" the prices in real estate are also 32

driven by sentiments. All that is re2uired to reverse a price movement is a change in sentiment.

)!"""+ H#'e L#1ns 1+ O!er!"e9

A home loan helps one to buy more than just a home. Buying a property is perhaps the single largest investment decision an individual has to ma!e in his lifetime. Therefore" he needs to plan for his finances for individuals today. ell before he decides to invest a significant amount of money in buying a home. -o ever" the availability of home loans has made life a lot easier

33

CHAPTER , INTRODUCTION TO OR6ANISATION

34

A&#ut HDFC &1n4 3"'"ted

The -ousing 5evelopment Finance $orporation *imited D-5F$E as amongst the first to

receive an Jin principleJ approval from the 'eserve Ban! of India D'BIE to set up a ban! in the private sector" as part of the 'BIJs liberali0ation of the Indian Ban!ing Industry in 8@@:. The ban! as incorporated in August 8@@: in the name of J-5F$ Ban! *imitedJ" ith its registered office in MuBBAi" India. -5F$ Ban! commenced operations as a Scheduled $ommercial Ban! in Qanuary 8@@>.

V"s"#n
To become a orld class Ban!

35

M"ss"#n 1nd =us"ness str1te2(

%ur mission is to be Ka Borld $lass Indian Ban!K" benchmar!ing ourselves against international standards and best practices in terms of product offerings" technology" service levels" ris! management and audit N compliance. The objective is to build sound customer franchises across distinct businesses so as to be a preferred provider of ban!ing services for target retail and profitability" consistent holesale customer segments" and to achieve a healthy gro th in ith the Ban!Js ris! appetite. Be are committed to do this hile

ensuring the highest levels of ethical standards" professional integrity" corporate governance and regulatory compliance. %ur &us"ness str1te2( emphasi0es the follo ingC Increase our mar!et share in IndiaAs e4panding ban!ing and financial services industry by follo ing a disciplined gro th strategy focusing on 2uality and not on 2uantity and delivering high 2uality customer service. *everage our technology platform and open scalable systems to deliver more products to more customers and to control operating costs. Maintain our current high standards for asset 2uality through disciplined credit ris! management. 5evelop innovative products and services that attract our targeted customers and address inefficiencies in the Indian financial sector. $ontinue to develop products and services that reduce our cost of funds. Focus on high earnings gro th ith lo volatility.

36

Pr#'#ters
-5F$ is IndiaJs premier housing finance company and enjoys an impeccable trac! record in India as ell as in international mar!ets. Since its inception in 8@==" the $orporation has ell over a million d elling units. -5F$ maintained a consistent and healthy gro th in its operations to remain the mar!et leader in mortgages. Its outstanding loan portfolio covers has developed significant e4pertise in retail mortgage loans to different mar!et segments and also has a large corporate client base for its housing related credit facilities. Bith its e4perience in the financial mar!ets" a strong mar!et reputation" large shareholder base and uni2ue consumer franchise" -5F$ environment. as ideally positioned to promote a ban! in the Indian

=us"ness $#*us
-5F$ Ban!Js mission is to be a Borld6$lass Indian Ban!. The objective is to build sound customer franchises across distinct businesses so as to be the preferred provider of ban!ing services for target retail and gro th in profitability" consistent holesale customer segments" and to achieve healthy ith the ban!Js ris! appetite. The ban! is committed to 37

maintain the highest level of ethical standards" professional integrity" corporate governance and regulatory compliance. -5F$ Ban!Js business philosophy is based on four core values 6 %perational (4cellence" $ustomer Focus" &roduct *eadership and &eople.

C1 "t13 Stru*ture
As on 98st March" ;??@ the authorised share capital of -5F$ Ban! is 's. >>? crore. The paid6up capital as on the said date is 's. :;>" 9<":8"?@?16 D :;">9"<:"8?@ e2uity shares of 's 8?16 eachE. The -5F$ Lroup holds 8@.9<M of the Ban!Js e2uity and about 8=.=? M of the e2uity is held by the A5S 5epository Din respect of the ban!Js American 5epository Shares DA5SE IssueE. ;=.7@ M of the e2uity is held by Foreign Institutional Investors DFIIsE and the Ban! has about >":<"==: shareholders. The shares are listed on the BoBBAy Stoc! (4change *imited and The )ational Stoc! (4change of India *imited. The Ban!Js American 5epository Shares D A5S E are listed on the )e +or! Stoc! (4change D)+S(E under the symbol J-5BJ and the Ban!Js Llobal 5epository 'eceipts DL5'sE are listed on *u4embourg Stoc! (4change under ISI) )o ,S:?:8>F;??;.

C&# 1nd t"'es &1n4 1'1321t"#n

%n May ;9" ;??<" the amalgamation of $enturion Ban! of &unjab ith -5F$ Ban! as

formally approved by 'eserve Ban! of India to complete the statutory and regulatory approval process. As per the scheme of amalgamation" shareholders of $Bo& received 8 share of -5F$ Ban! for every ;@ shares of $Bo&. The merged entity ill have a strong deposit base of around 's. 8";;"??? crore and net ould

advances of around 's. <@"??? crore. The balance sheet si0e of the combined entity

be over 's. 8"79"??? crore. The amalgamation added significant value to -5F$ Ban! in terms of increased branch net or!" geographic reach" and customer base" and a bigger pool of s!illed manpo er.

38

In a milestone transaction in the Indian ban!ing industry" Times Ban! *imited Danother ne private sector ban! promoted by Bennett" $oleman N $o. 1 Times LroupE -5F$ Ban! *td." effective February ;7" ;???. This ban!s in the )e as merged ith as the first merger of t o private

Leneration &rivate Sector Ban!s. As per the scheme of amalgamation

approved by the shareholders of both ban!s and the 'eserve Ban! of India" shareholders of Times Ban! received 8 share of -5F$ Ban! for every >.=> shares of Times Ban!.

D"str"&ut"#n net9#r4
-5F$ Ban! is head2uartered in MuBBAi. The Ban! at present has an enviable net or! of over 8:8; branches spread over >;< cities across India. All branches are lin!ed on an online real6time basis. $ustomers in over >?? locations are also serviced through Telephone Ban!ing. The Ban!Js e4pansion plans ta!e into account the need to have a presence in all major industrial and commercial centers here its corporate customers are located as ell as the need to build a strong retail customer base for both deposits and loan products. Being a clearing1settlement ban! to various leading stoc! e4changes" the Ban! has branches in the centers here the )S(1BS( have a strong and active member base.

The Ban! also has a net or! of about over 9;@> net or!ed ATMs across these cities. Moreover" -5F$ Ban!Js ATM net or! can be accessed by all domestic and international Visa1Master$ard" Visa (lectron1Maestro" &lus1$irrus and American (4press $redit1$harge cardholder

39

The Ban! also has a net or! of about over 9;@> net or!ed ATMs across these cities. Moreover" -5F$ Ban!Js ATM net or! can be accessed by all domestic and international Visa1Master$ard" Visa (lectron1Maestro" &lus1$irrus and American (4press $redit1$harge cardholders.

40

CHAPTER B FINANCIAL INSTITUTIONS IN THE MARKET

41

ell62ualified financial planner li!e a $ertified Financial &lanner D$F&E

ould

or!

ith a

person to prepare his plan. A $F& is finance savvy and combines the objectivity and trust" developed through years of e4perience and e4pertise in planning oneAs personal finance.

CERTIFIED FINANCIAL PLANNERCM certification or $F&$Mcertification is an international program in the field of Financial &lanning" ealth management and financial advisory services.Financial &lanning is one of orld. Being one of the fastest gro ing ith investible surplus. Assuming e need at least >?"??? at a faster rate. the fastest gro ing careers across the

economies"India currently has around > crore families

one financial planner is handling appro4. 8"??? lients $F&$Mcertification

$ertifiedFinancial &lanners in India immediately. This is set to gro

as rated as Lold Standard in Financial &lanning by the BAll StreeT 42

QournAl in the year ;??7. CERTIFIED FINANCIAL PLANNERCM certification or $F&$M$ertification is a mar! of e4cellence granted to individuals homeetthe stringent standards of education" e4amination" e4perience and ethics. It is themost prestigious and internationally accepted Financial &lanning certification recogni0ed and respected by the global financial community. $F&$M $ertification is the highest level of certification in the field of Financial &lanning orld ide ith over 8"8<";:> $F&$M certificants" ho are idely respected by consumers" professionals and industry.

certification is for financial services professionals" customer relationship officers" insurance agents" stoc! bro!ers" those loo!ing to e4pand their careers in the financial services business" and graduates ho ant to be professionally and globally recogni0ed.

43

Financial &lanning is one of the fastest6gro ing professions across the

orld

and Financial &lanners are the most sought after professionals by a fast gro ing or!ing population that earns ell" and needs e4pert handling of their finances. The opportunities are aplenty ith Ban!s" Financial &lanning outfits" Bealth Managers" life Insurers" Accounting Firms" Stoc! bro!ers see!ing professionals ith such e4pertise. Financial &lanners offer e4pert opinions on issues related to retirement planning" estate planning" ta4 planning" investment planning" insurance planning" financial management of small businesses and trusts" stoc! bro!ering" debt and ris! analysis. needless to say a career as a Financial &lanner can prove both challenging and re arding. recogni0ing Financial &lanningAs occupational benefits" there are many surveys that indicate a career in Financial &lanning as the top career choice orld ide. Most

Financial &lanners enjoy relatively lo

stress" have a high earning potential and enjoy

a high degree of or!place autonomy. The personal satisfaction element cannot be underestimated. Very often" independent Financial &lanners find that people are just over helmed and need direction" so itAs their job to listen" understand their situation and offer some options that ill help them. It gives them satisfaction to help people ith blending the financial side ith the do better" not just ith their finances but

other sides of clientsA lives so that they can achieve their goals.

G enhanced career and employment opportunities in Financial Services Sector. G &ersonal satisfaction in !no ing you have earned the professionAs highest standard and met the global benchmar!. G Satisfied clients ho appreciate the comprehensive approach to Financial &lanning and e4tend long term relationships and referrals. G +our e4pertise and credibility as a 2ualified professional is instantly communicated. G More revenue streams by increasing your product and service offering to your clients. G enhanced Social Status by joining the league of professionals. G recognition in over ;9 countries across the orld. G opportunities to sho case your !no ledge on Financial &lanning N Advising 44

through various media vehicles. Financial &lanners may earn in any of the follo ing three aysC

8E A &lanner can be paid by a salary from the company for hich the &lanner or!s3 by fees based on an hourly rate" a flat rate" or on a percentage of the assets and1or income. ;E By commissions paid by a third party from the products sold to clients to carry out the Financial &lanning recommendations. 9E By a combination of fees and commissions hereby fees are charged for the amount of or! done to develop Financial &lanning recommendations and commissions are received from any product sold. As the profession is in its nascent stage various models are being tried and tested by the Financial &lanners in India. But surely over a period of time the clear trend is to ards a fee6only model li!e other professions" i.e. medicine" la " accountancy" etc.

45

Financial &lanning Standards Board India DF&SB IndiaE offers the $erTIFIe5 FI)A)$IA* &*A))('$Mcertification or $F&$M certification &rogram. F&SB India is the sole licensing body that a ards $F&$M certification in India through an agreement ith uS based F&SB" ltd. The mission of F&SB India is to help benefit the public by granting the $F&$Mcertification and upholding it as the recogni0ed standard of e4cellence for &ersonal Financial &lanning. $F&$M certification is a arded by affiliate organi0ations of F&SB" ltd. in their respective countries of operation. .indly note F&SB IndiaAs authori0ed (ducation &roviders are only training and administrative entities authori0ed by F&SB India and not the $F&$M certification a arding bodies. F&SB India reserves the rights of a arding and relin2uishing $F&$M certification as per the certification policies. Financial &lanning Standards Board India DF&SB IndiaE is a &ublic I &rivate enterprise and a &rofessional Standards Setting body that proactively guides the development and promotion of standards for Financial &lanning professionals to benefit the public in the country. F&SB India closely or!s ith all the sta!eholdersA vi0. the Lovernment" the regulators" the Industries1Associations" the $orporations" the Media and the Leneral &ublic to achieve its objectives. It is a &rofessional $ertification organi0ation" part of leading Llobal $onfederation established by prominent financial service corporations ith an objective to professionali0e the concept of Financial &lanning in India. F&SB India is supported by >? Financial Services organi0ations in the country as its $harter Members.

+es" currently $F& certification is offered and recogni0ed in ;9 countries including Australia" Austria" Bra0il" $anada" $hina" $hinese Taipei" France" Lermany" -ong .ong" Indonesia" Ireland" Qapan" Malaysia" ne Realand" netherland" republic of .orea" Singapore" South Africa" S it0erland" Thailand" united .ingdom and united States of America. F&SB" ltd. enters into licensing and affiliation agreements ith non6profit organi0ations Dor their e2uivalentE around the orld that allo s the organi0ations to establish and operate the $F& certification program in a country or region. F&SB Affiliates ho meet and maintain F&SBAs affiliation criteria of high 46

standards are authori0ed to administer the $F& certification program on behalf of F&SB in a country or region. F&SB India is one of the Affiliates of F&SB" ltd. $F& certification underta!en in any of the affiliate country is recogni0ed globally and governed by cross border policy usage. L*%BA* $%,)T %F $F& $('TIFI$A)TS Das in 5ecember ;??<E $ountry1'egion )o. of $F& $ertificants

To benefit the public" F&SB regulates ho

$F& professionals use F&SBAs $F& or 47

$erTIFIe5 FInAn$IAl &lAnner mar!s outside the borders of the country or region in hich they first received $F& certification.Incidental ,seF&SB permits incidental use of the $F& mar!s by $F& professionals outside the country or region of their initial certification. Incidental use consists of displays of the $F& mar!s in1onC G articles published in a ne G country or region. G business cards or brochures distributed hile traveling abroad. ebsites targeted to ard sta!eholders in the country or region of initial certification that are vie able outside the areaAs borders. $ross6Border ,se If an individual ishes to hold himself or herself out as a $F& professional or use the $F& mar!s outside his or her country or region of initial certification for anything other than incidental use" the $F& professional can pursue one of t o optionsC 8. $ross6Border $ertificationC An individual using the $F& mar!s in more than country or region and abiding one country or region can become cross6border certified by obtaining $F& certification from the F&SB Affiliate in the ne by the certification rene al re2uirements of both F&SB Affiliates. once the $F& professional has completed the process" he or she can identify himself or herself as a $F& professional in those territories as ell. ;. 'estricted ,se of the $F& Mar!sC If an individual does not ant to1cannot become territory" he or she can al ays communicate the fact that he or she certified in a ne

has obtained $F& certification in the country or region of initial certification.

48

The !inds of services Financial Institutions offer can vary

idely. Some institutions assess

every aspect of oneAs financial life" including saving" investments" insurance" ta4es" retirement" and estate planning and help one develop a detailed strategy or plan for meeting all financial goals. The major players in the mar!et are as follo sC G +(S Ban! G $itiban! G ,TI Ban! *imited G -SB$ Ban! G -5F$ Ban! *imited G Bajaj $apital G 'eligare (nterprises *imited

49

1+ YES =ANK "+ Intr#du*t"#n

+(S BA). has been conceived in the spirit of professional entrepreneurship" Indian Ban! catering to H(merging IndiaA. The vast ban!ing e4perience of the &romoters" 'ana .apoor and Asho! .apur ho have a ith an unstinted commitment to establish a high 2uality" technology driven" state6of6the6art private

collective financial sta!e of 9<.7;M has been strengthened by the financial support of 'aboban! )ederland to provide +(S BA). a strong foundation of enduring financial trust. 50

+(S BA). loo!s to offer comprehensive ban!ing and financial solutions. Bhich is

hy"

they have inducted top 2uality -uman $apital across all the ban!ing functions" including $orporate N Institutional Ban!ing" Financial Mar!ets" Investment Ban!ing" Business N Transactional Ban!ing and 'etail Ban!ing N Bealth Management.

""+ Ser!"*e O$$er"n2s

aE Mutual Funds +(S Ban! tap into the latest mar!et trends to give the clients the access to the best Mutual Funds. bE &ortfolio Management Services The ban! helps you to manage your e4isting e2uity portfolios managers thus providing the clients meet their investment needs. cE L%I Bonds They provide you ith fi4ed tenure Bonds" issued by the Lovernment of India" hich ensure regular fund inflo s. dE Ta4 Saving Bonds By investing in specified bonds" the ban! can help you to reduce your ta4 liability under section >:($ of the Income Ta4 Act. eE Subscription to I&%s The ban! facilitates subscription to select I&%s in the capital mar!et" helping you to ta!e timely advantage of available opportunities. fE *ife Insurance +(S BA). has partnered ith Ma4 )e +or! *ife" one of the most reputed *ife Insurance companies in India. The ban!ing sector can play a constructive role in being an agent of change and a creator of social and economic value. At +(S BA)." they aspire to create and share value. Ma4 )e hich ensure that +or! *ifeAs internationally benchmar!ed training processes3 fle4ible product suite" service e4cellence and financial strength complement this outloo!" e are able to deliver the true value of life insurance to our customers. 51 ith the help of selected fund ith professional services and customi0ed options to

+(S BA). provides the entire suite of life insurance products" ranging from ris! protection to investment6related unit lin!ed products" for individuals" groups or select employees. gE Leneral Insurance +(S BA). has partnered ith Bajaj Allian0 Leneral Insurance $o to distribute their )on *ife Insurance products to our clients.

52

&+ CITI=ANK "+ Intr#du*t"#n

$itigroup in India $itigroup is the single largest foreign direct investor in the financial services industry in India. $ommitted to India for over 8?? years" $itigroup considers itself a local ban! ith an international perspective bac!ed by the largest global net or!. Bith a staff strength of over 8>"???" $itigroup has consolidated its position as the most innovative and comprehensive financial products and services provider in the country" and today has a customer base of over 8"??? large corporate" over ;;"??? small and medium enterprises and over >.> million retail customers. A pioneer in consumer ban!ing" $itiban! as the first to introduce credit cards" focused consumer lending programs and electronic ban!ing in India. Today" the $itiban! net or! comprises of 9@ ban! branches across ;= cities and over :?? $iti$ard Ban!ing centersI hich combine ATMs and self6service phone and Internet ban!ingFoffering $itiLold ealth management" credit cards" mortgage services" 53

Auto *oans" &ersonal *oans" Suvidha and )'I Services. Through $itiFinancial" $itigroup offers consumer finance services in the country.

""+ Ser!"*e O$$er"n2s

$itiLold offers the clients a comprehensive range of products to meet their transaction" savings" investment" and insurance re2uirements. The clients can select from a set of term and endo ment insurance policies brought to them through ban! insurance partners so that the clients needs for ealth protection are ta!en care of. The clients can also select from a range of asset products" namely personal" home and auto loans at special relationship pricing. $itiLold Bealth Management offers the clients an e4clusive privilege that comprises ofC aE Mutual Funds At $itiLold you can choose from a range of pre6selected Mutual Funds managed by some of the biggest names in fund management such as Alliance $apital" Fran!lin Templeton India" Birla Sun*ife" Rurich India" 5S& Merril *ynch" -5F$" I5BI &rincipal and &rudential 6 I$I$I. The funds on offer are from a rigorously compiled list that ensures only the best reaches you. bE Ta4 Advisory Services $itiLold has tied up clients ith the leading ta4 advisory firm 6 5eloitte" -as!ins N Sells to help the ith their ta4 management. 5eloitte" -as!ins N Sells" a member firm of 5eloitte

Touche Tohmatsu D5TTE" is amongst the leading global ta4ation6consulting firms. 5TT operates from 89? countries" has more than 7"??? partners and over @?"??? professionals around the globe. cE 'eal (state Advisory Services In todayJs mar!et" real estate presents an attractive real estate investment option. To assist the clients ith advice on various real estate investments" or to help them in leasing" buying ith a orld6class real estate consulting firm 6 ith or selling properties" $itiLold has tied up Mumbai" .ol!ata and 5elhi only. $itiLold investment options.

$hesterton Meghraj &roperty $onsultants. This service is currently available in the cities of ill organi0e special seminars for the clients these consultants and the clients can also consult them one6on6one on real estate

54

dE Art Advisory Services In todayJs mar!et" art presents an attractive investment option. To assist the clients up ith a reputed art gallery" Apparao Lalleries. ith advice on various art investments" or to help them in buying or selling art" $itiLold has tied eE Insurance Services In todayJs mar!et" insurance presents an attractive investment option. To assist the clients ith advice on various insurance policies" or to help them in purchasing insurance" $itiLold has tied up ith Birla.

*+ UTI =ANK LTD "+ Intr#du*t"#n

,TI Ban! as the first of the ne private ban!s to have begun operations in 8@@:" after the private ban!s to be established. The Ban! today is ith the public holding Dother than promotersE ide net or! of more than :>? branch offices Lovernment of India allo ed ne

capitali0ed to the e4tent of 's. ;<?.8; $rores at =;.:9 M. &resently the Ban! has a very

and (4tension $ounters. The Ban! has strengths in both retail and corporate ban!ing and is committed to adopting the best industry practices internationally in order to achieve e4cellence.

55

""+ Ser!"*e O$$er"n2s &( C1 "t13 M1r4et

aE (2uity Mar!et $ontent $apital Mar!et is pioneer in offer e2uity related content for ,TI Ban!As portal includesC G (2uity Mar!et $ommentary G Stoc! &rice 5ata G $harting Facility G Financial 5ata G I&% 5ata G &ortfolio Trac!er bE Mutual Funds $ontent Indian Mutual Fund industry has pic!ed up" It is fastest gro ing industry" gro ing investor" today" there are 97 Mutual Funds and over ;?? schemes ith number of ith total assets hich

of appro4imately 's. <8"??? crores. So it has become essential for you to !eep updated information on your portal. $apital Mar!et offers you range of content solution as follo sC G Mutual Fund )AV G Fund &rofile Sheet G 5ividend N Mobili0ation 5etails G Mutual Fund I )e s G Mutual Fund I )F% G Mutual Fund I Tools 56

cE $ommodity Mar!et $ommodities Mar!et is gro ing in India and $apital Mar!et offers follo ing screens pertaining to $ommodity Mar!etC G $ommodity prices (nd of the day for all the e4changesC o Lainers N *osers o Top Traded Value o Advance 5ecline G Scrolling tic!er for Spot N Future prices N Let Ouote button. G $ommodity ne s is also updated on daily basis

d+ HS=C =1n4 "+ Intr#du*t"#n

The antecedents of the -SB$ Lroup in India can be traced bac! to %ctober 8<>9 Mercantile Ban! of India" *ondon and $hina as founded in Bombay Dno hen the MumbaiE. The

ac2uisition in 8@>@ by The -ong .ong and Shanghai Ban!ing $orporation *imited of the Mercantile Ban! as a decisive factor in laying the foundation for todayJs -SB$ Lroup. -SB$ in India is proud to have retained the LroupJs pioneering strea! by being an active partner in the development of the Indian ban!ing industry 6 even giving India its first ATM ay bac! in 8@<=. The organi0ationAs adaptability" resilience and commitment to its customers have further enabled it to survive through turbulent times and prosper through good times over the past 8>? years.

""+ Ser!"*e O$$er"n2s

aE Financial &lanning Services Inflation" falling interest rates and fluctuating mar!et conditions re2uire you to plan your finances carefully. $elebrate important occasions in the future by managing your ealth ell no . -SB$Js Financial &lanning Services offer assistance to secure your future. %ur financial planning services are available for e4isting -SB$ customers and are free of cost. 57

bE Mutual Funds ,se the proven e4pertise and insights of the orldJs local ban! for your investments. Be ealth potential in the long6term offer you investment options in funds that meet our selection criteria and fit your re2uirements" helping you create and increase your scenario. cE Insurance +ou have probably planned your life ith great care" or!ing slo ly and steadily to ards fulfilling your dreams and ambitions. ,nfortunately you have no control over certain natural and man6made events that may overturn your plans. As you change so do your insurance needs. The insurance solution that is relevant to you today may be very different to the solution you re2uire years from no . It is therefore critical for you to identify protection needs that are pertinent to you and your circumstances.

58

e+ Re3"21re "+ Intr#du*t"#n

'eligare (nterprises *imited *imited and it as promoted by the promoters of 'anba4y *aboratories as changed to #'eligare (nterprises &rivate as originally incorporated as #Vajresh ari $osmetics &rivate *imited/ on

Qanuary 9?" 8@<:. The name of the company *imited/ on Qanuary 8?" ;??7.

'eligare (nterprises *imited D'(*E" is one of the leading integrated financial services groups of India. '(*As businesses are broadly clubbed across three !ey verticals" the 'etail" Institutional and Bealth spectrums" catering to a diverse and ide base of clients. '(* offers a multitude of investment options and a diverse bou2uet of financial services and has a pan India reach in more than 8>>? locations across more than :7? cities and to ns.

$+ =1818 C1 "t13 "+ Intr#du*t"#n

Bajaj $apital is one of IndiaAs leading Financial Services companies offering Free Advice on Investments" Insurance" Ta4 Saving" 'etirement &lanning" Financial &lanning" $hildrenAs Future &lanning and other services. They are also S(BI6approved $ategory I Merchant Ban!ers. Today" Bajaj $apital is a one of the largest financial planning and investment advisory companies in India" ith a strong presence all over the country. They offer a comprehensive range of services including financial planning and investment advice" and the entire gamut of financial instruments and investment products of almost all major companies" both public and private. In addition" they also provide investment assistance by helping clients complete all the formalities" and help them !eep regular trac! of their investments. 59

""+ Ser!"*e O$$er"n2s

aE Mutual Funds bE Ta4ation Advise cE Bonds dE &ost %ffice Schemes eE (state &lanning fE Insurance gE Financial &lanning hE 'etirement &lanning =1818 C1 "t13<s BC-D F"n1n*"13 P31nn"n2 Financial &lanning is becoming increasingly popular in developed countries all over the orld. )o " F'((T Bajaj $apitalJs 97?S Financial &lanning &rogramme could ma!e a difference to all those ho ish to lead a orry6free" financially secure life. 97?S Financial &lanning is based on the premise that every individual has certain basic financial needs that are e4pressed at various stages of life Dgetting married" buying assets li!e homes" vehicles" or providing for your childrenJs education and eddingE. ith a little help from Bajaj $apital" clients too can give themselves the 97?S Financial &lanning edgeT )o " Bajaj $apital brings you the same service ABS%*,T(*+

Instead of investing in an ad6hoc manner" 97?S Financial &lanning helps you ta!e a holistic" all6round vie . Briefly" 97?S Financial &lanning comprisesC G Investment &lanningC To ma!e your ealth gro G $ash Flo &lanningC To provide for assets and meet the periodic cash re2uirements Ta4

&lanningC To save on ta4es and increase your income 60

G Insurance &lanningC To protect yourself" your family and your assets G $hildrenJs Future &lanningC To give your children a financially secure future G 'etirement &lanningC Because retirement is a time to rela4" not to get orried

2+ A33e2r# C1 "t13 Ad!"s#rs Pr"!1te L"'"ted )"+ Intr#du*t"#n

Allegro Advisors is a leading Indian full service investment ban! that builds value across a spectrum of clients" including the government" corporations" financial institutions" high net6 orth individuals and professionals. G $omprehensive service offering G Investment Ban!ing" $apital Mar!ets" Asset Management N &rivate Ban!ing G (nsuring clientJs financial ell6being

61

G Team of e4perienced advisors Allegro $apital is a comprehensive Investment Ban! that comes ith years of e4pertise in orld. offering financial solutions and advisory services across the corporate

Allegro $apital Advisors has offices located in !ey metros across India. %ur teams of financial advisors and specialists have the local !no ledge" contacts and a areness to create optimum solutions that meet our clientJs financial ambitions. Living our clients the global local advantage" internationally. e have broadened our reach to ;> major cities and to ns of India ith several reno ned advisory houses and institutions" and established strategic alliances

62

)"""+ Ser!"*e O$$er"n2s

The investment approach begins by allegro revie or!ing closely ith the clients to identify their long6

term financial goals" ris! tolerance and the nature of their e4isting asset base. Additionally" each clientAs portfolio on an ongoing basis and evaluate possible adjustments in response to economic changes" mar!et trends or client needs. Allegro ensures this highly personali0ed model of service by maintaining amongst the lo est client to advisor ratios in industry. Allegro offers one of the idest range of financial services that covers the spectrum of every need a client may have in managing his or her ealth. %ur services are categori0ed to serve diverse financial needs and the diverse investment strategies that are re2uired to gro services that allo a clientAs ealth. in the long term. A special Allegro Lro thUC 5esigned for the young e4ecutive" it comprises a set of products and start up incomes ma4imi0e potential to gro offering has been designed for or!ing couples Allegro (2uityUC A pure e2uity offering ith a uni2ue strategy that !eeps in perspective capital conservation through medium and long strategies such as dividend yields" I&%s" buy6bac!s" value pic!s" sectoral pic!s" gro th fund opportunities etc. &MS is offered selectively Allegro BealthU6 A top of the line service offering that comprises the entire bas!et of services that include speciali0ed e2uity advisory including personal advise from our highly reputed advisory panel across ta4ation" debt" e2uity and money mar!ets" automatic portfolio and rebalancing management" insurance and loan advisory" access to a < hr 7 days a ee! helpline. &ortfolio Management Services is offered selectively.

63

)h+ ID=I =1n4 )Other Pu&3"* Se*t#r/Ind"1n =1n4s+ %

Industr"13 De!e3# 'ent =1n4 #$ Ind"1 )ID=I+ "s the ten2th 31r2est &1n4 "n the 9#r3d "n ter's #$ de!e3# 'entA The N1t"#n13 St#*4 E7*h1n2e )NSE+E The N1t"#n13 Se*ur"t"es De #s"t#r( Ser!"*es LtdA )NSDL+E St#*4 H#3d"n2 C#r #r1t"#n #$ Ind"1 )SHCIL+ 1re s#'e #$ the "nst"tut"#ns 9h"*h h1s &een &u"3t &( ID=IA ID=I "s 1 str1te2"* "n!est#r "n 1 3eth#r1 #$ "nst"tut"#ns 9h"*h h1!e re!#3ut"#n">ed the Ind"1n F"n1n*"13 M1r4etsA ID=I =1n4E r#'#ted &( ID=I 6r#u st1rted "n N#!e'&er 0..F 9"th 1 &r1n*h 1t Ind#re 9"th 1n e?u"t( *1 "t13 &1se #$ RsA 0--- '"33"#nA

64

M1"n $un*t"#ns #$ ID=I ID=I "s !ested 9"th the res #ns"&"3"t( #$ *#/#rd"n1t"n2 the 9#r4"n2 #$ "nst"tut"#ns en212ed "n $"n1n*"n2E r#'#t"n2 1nd de!e3# "n2 "ndustr"esA It h1s e!#3!ed 1n 1 r# r"1te 'e*h1n"s' $#r th"s ur #seA ID=I 13s# undert14es;su #rts 9"de/ r1n2"n2 r#'#t"#n13 1*t"!"t"es "n*3ud"n2 entre reneursh" de!e3# 'ent r#2r1''es $#r ne9 entre reneursE r#!"s"#n #$ *#nsu3t1n*( ser!"*es $#r s'133 1nd 'ed"u' enter r"sesE u 2r1d1t"#n #$ te*hn#3#2( 1nd r#2r1''es $#r e*#n#'"* u 3"$t'ent #$ the under r"!"3e2edA

65

ID=IGs r#3e 1s 1 *1t13(st ID=IGs r#3e 1s 1 *1t13(st t# "ndustr"13 de!e3# 'ent en*#' 1sses 1 9"de s e*tru' #$ 1*t"!"t"esA ID=I *1n $"n1n*e 133 t( es #$ "ndustr"13 *#n*erns *#!ered under the r#!"s"#ns #$ the ID=I A*tA 5"th #!er three de*1des #$ ser!"*e t# the Ind"1n "ndustr(E ID=I h1s 2r#9n su&st1nt"133( "n ter's #$ s">e #$ # er1t"#ns 1nd #rt$#3"#A De!e3# 'ent13 A*t"!"t"es #$ ID=I Pr#'#t"#n13 1*t"!"t"es In $u3$"3'ent #$ "ts de!e3# 'ent13 r#3eE the =1n4 *#nt"nues t# er$#r' 1 9"de r1n2e #$ r#'#t"#n13 1*t"!"t"es re31t"n2 t# de!e3# 'ent13 r#2r1''es $#r ne9 entre reneursE *#nsu3t1n*( ser!"*es $#r s'133 1nd 'ed"u' enter r"ses 1nd r#2r1''es des"2ned $#r 1**red"ted !#3unt1r( 12en*"es $#r the e*#n#'"* u 3"$t'ent #$ the under r"!"3e2edA These "n*3ude entre reneursh" de!e3# 'entE se3$/e' 3#('ent 1nd 912e e' 3#('ent "n the "ndustr"13 se*t#r $#r the 9e14er se*t"#ns #$ s#*"et( thr#u2h !#3unt1r( 12en*"esE su Test"n2 Centres $#r s'133 "ndustr"esA Te*hn"*13 C#nsu3t1n*( Or21n"s1t"#ns 5"th 1 !"e9 t# '14"n2 1!1"31&3e 1t 1 re1s#n1&3e *#stE *#nsu3t1n*( 1nd 1d!"s#r( ser!"*es t# entre reneursE 1rt"*u31r3( t# ne9 1nd s'133 entre reneursE ID=IE "n *#331&#r1t"#n 9"th #ther A33/Ind"1 F"n1n*"13 Inst"tut"#nsE h1s set u 1 net9#r4 #$ Te*hn"*13 C#nsu3t1n*( Or21n"s1t"#ns )TCOs+ *#!er"n2 the ent"re *#untr(A TCOs #$$er d"!ers"$"ed ser!"*es t# s'133 1nd 'ed"u' enter r"ses "n the se3e*t"#nE #rt t# S*"en*e 1nd Te*hn#3#2( Entre reneursG P1r4sE Ener2( C#nser!1t"#nE C#''#n Hu13"t(

66

$#r'u31t"#n 1nd 1

r1"s13 #$ r#8e*tsE the"r "' 3e'ent1t"#n 1nd re!"e9A

Entre reneursh" De!e3# 'ent Inst"tute Re13"s"n2 th1t entre reneursh" de!e3# 'ent "s the 4e( t# "ndustr"13 de!e3# 'entE ID=I 31(ed 1 r"'e r#3e "n sett"n2 u #$ the Entre reneursh" De!e3# 'ent Inst"tute #$ Ind"1 $#r $#ster"n2 entre reneursh" "n the *#untr(A It h1s 13s# est1&3"shed s"'"31r "nst"tutes "n ="h1rE Or"ss1E M1dh(1 Pr1desh 1nd Utt1r Pr1deshA ID=I 13s# e7tends $"n1n*"13 su #rt t# !1r"#us #r21n"s1t"#ns "n *#ndu*t"n2 stud"es #r sur!e(s #$ re3e!1n*e t# "ndustr"13 de!e3# 'entA

67

CHAPTER I
68

COMPARATIVE STUDY OF DIFFERENT PLAYERS IN THE MARKET

T1&3e % C#' 1r"s#n 1'#n2 !1r"#us $"n1n*"13 1d!"s#rs

P1r1'eters Fees I&% Advisory Ta4ation Advisory 5ebt &ost %ffice Schemes Bonds 'eal (state Advisory A33e2r# V V V V V W UTI =1n4 W V V W V W C"t"&1 HDFC Re3"21re n4 W W W W V W V V W W V &art of real estate ,nbiased Advisory V W W 69 fund W W W W W V W W V W YES =1n4 W V W W V W =1818 C1 "t13 W V V V V V

Administration Services Bro!erage -ouse Target Salaried Audience Business men Financial &lanning 'etirement &lanning $ommodity Trading Insurance

V W V W V V W Based on )eed Analysis

W V V V V V W *I$

W W V V V V W Birla

V V V V V V W V

V V V V W W V V

V W V V W W W Ma4 )e +or! *ife W V

V V V V V V W Bajaj

'estructuring of *iabilities Beb &ortal

V W

W V

W V

W V

W V

W V

70

The investment approach begins by allegro revie

or!ing closely

ith the clients to identify their long6

term financial goals" ris! tolerance and the nature of their e4isting asset base. Additionally" each clientAs portfolio on an ongoing basis and evaluate possible adjustments in response to economic changes" mar!et trends or client needs. Allegro ensures this highly personali0ed model of service by maintaining amongst the lo est client to advisor ratios in industry. Allegro offers one of the idest range of financial services that covers the spectrum of every need a client may have in managing his or her ealth. %ur services are categori0ed to serve diverse financial needs and the diverse investment strategies that are re2uired to gro a clientAs ealth.

71

The investment approach begins by allegro revie

or!ing closely

ith the clients to identify their long6

term financial goals" ris! tolerance and the nature of their e4isting asset base. Additionally" each clientAs portfolio on an ongoing basis and evaluate possible adjustments in response to economic changes" mar!et trends or client needs. Allegro ensures this highly personali0ed model of service by maintaining amongst the lo est client to advisor ratios in industry. Allegro offers one of the idest range of financial services that covers the spectrum of every need a client may have in managing his or her ealth. %ur services are categori0ed to serve diverse financial needs and the diverse investment strategies that are re2uired to gro 72 a clientAs ealth.

CHAPTER F ANALYSIS OF THE COMPARISON

73

It can be observed from the above Table that most of the financial advisors are not charging any fees for their advisory services i.e. they are giving it free of cost because the ban!s D$itiban!" ,TI Ban!" -SB$E earn commission if the customer purchases mutual funds" insurance" from it. The bro!ing company earns bro!erage if the client purchases 'BI bonds etc or if he does any e2uity trading. The ban! only charges marginal fees on the custodial services.

74

-o ever" -5F$ Ban! 6 instead of as!ing customers to bring in a specific amount of funds 6 charges customers on various types of services it offers. The management of understood" the ban! sends a portfolio should be. ritten investment proposal on ealth depends on the customerJs ris! appetite" his investment objectives. %nce these are hat the ban! thin!s the

75

-o ever" -5F$ Ban! do charge clients from 's.9>"??? a year for trac!ing portfolio up to 's.9> la!h and 's.8"??"??? for trac!ing portfolio up to 's.8 crore. These services include e2uity6related services along ith dedicated advisors. The ban! also offers services bet een 's.8?"??? and 's.;>"??? per annum for non6interactive products. The ban!" ho ever" aives these fees if it earns money through transactions routed through the ban!.

76

Ta4ation advisory is given by very fe ban!s have a tie6up model has ith Birla so $itiban!

players li!e Allegro" Bajaj $apital" ,TI Ban!. Various

ith different insurance and mutual fund companies li!e $itiban! ill only sell Birla insurance to their clients irrespective of the fact hich ta!es ealth

hether the product meets the clientAs financial goals. Allegro is one player

care of loan restructuring. $ommodity trading is only being handled by 'eligare as a separate product as S(BI have not yet allo ed commodity trading to be a part of advisory services.

77

-o ever ban!s offer portfolio management services to customers. This means that a customer cannot give money to a private ban!er and as! the 'M to invest on his behalf in different financial products. This service can be offered only by entities other than a ban! such as 'eligare" Allegro Advisors" Bajaj $apital" etc. A ban!er therefore every time and get a ill have to call ritten confirmation from the client before any deal is done.

78

CHAPTER C RESEARCH METHODOLO6Y

79

1+ T"t3e #$ the Stud(

$omparative analysis of various financial institutions in the mar!et.

&+ O&8e*t"!e #$ Stud(

To study the prospects of various financial products provided by different financial institutions in the mar!et. &eople should come out of the concept of just !eeping their money in Savings Account and Fi4ed 5eposits and should concentrate on their financial planning to ma4imi0e returns by ta!ing proper guidance from financial planner.

*+ T( e #$ Rese1r*h
This project is more of an e4ploratory research population. The population for this project -5F$slic"cscheme"jaipur. The research methodology adopted as both &rimary and Secondary. &rimary data as ith more of 2ualitative analysis than ith finding a sample of the 2uantitative. The data collection method for this project begins

as the various places in Qaipur. DQohari Ba0ar"

M I 'oad" Ton! 'oad" Malviya )agar and Qhot ara Industrial AreaE and at the

collected to study the investment psyche of a person" their practice on saving" investment options available and the need of financial institutions to manage individualAs Ouestionnaire as designed to ascertain the investorAs behavior as future prospects and gro th momentum of the ealth management industry. ealth. ell as to depict the

d+ S1' 3e S">e 1nd 'eth#d #$ se3e*t"n2 s1' 3e D1t1 C#33e*t"#n Meth#ds @ Instru'ents
The instrument for data collection person as a structured 2uestionnaire targeted to ards people as designed to !no the investment psyche of a ho do investments. This 2uestionnaire

hile investing in the financial products. as informal N friendly conversation" hich does not limit

The mode of communication discussion ithin a

ell6defined boundary.

80

D1t1 C#33e*t"#n S#ur*es "+ Pr"'1r( Rese1r*h

'esearch as done to get a detail overvie of the ealth management industry and study as designed to study ealth. This project is the need for financial planner in the current scenario. Ouestionnaire available and the need of financial institutions to manage individualAs mainly based on first hand observation in the mar!et" the scope of financial planning and the need of a certified financial planner.

the investment psyche of a person" their practice on saving" different investment options ay financial planning functions"

""+ Huest"#nn1"re Des"2n

A structured 2uestionnaire as designed covering both open and close ended 2uestions" to study the perception of people regarding investment avenues and the concept of financial planner. XSpecimen of the 2uestionnaire is attached in A))(W,'( AY.

"""+ Se*#nd1r( Rese1r*h

Various sources of information ere collected for attaining clarity on the prospects of ealth management industry and the various financial institutions in the mar!et. The source also includes basic investment objectives and the various types of investment avenues open to an individual. -o ever the follo ing sources ere considered for information gatheringC G $ompanies ebsites G Articles and reports available on the eb

G )e s papers li!e (conomics Times and Investment Insurance Maga0ines G Various other sources mentioned in the references" in A))(W,'( B

"!+ P# u31t"#n *#ns"dered $#r rese1r*h

Sample 5etails 8?? people belonging to different fields" 2uestionnaire" on the basis of ho do investment" 81 ere as!ed to fill the hich an attempt is made to study the prospects of Financial

&lanning in the mar!et. The sample unit consists of those people

ho are trading in

secondary mar!ets" mutual funds" initial public offer" insurance" debt instruments as they can give the accurate information about financial planning. A sampling frame has been developed so that everyone in the target population has an e2ual chance of being sampled. &ersonal InformationC G Se4 'atioC From the total 8?? respondents 8> ere females and <> ere males.

&ersons Male Female

'atio <> 8>

Se7 R1t"# #$ S1' 3es

Males Females

e+ S*# e #$ Stud(
82

There e4ist a potential gro th in the

ealth management industry and thus this

project authenticates the feasibility of financial institutions in the mar!et. (4panding needs and proliferation of financial products are ma!ing it difficult for individuals to invest ithout planning. Most are a are that planning is critical3 yet donAt have the time or the e4pertise to develop a plan N therefore the role of Financial &lanner comes in picture.

$+ L"'"t1t"#n #$ the Stud(

The scope of the research 'eligare (nterprises *imited. The sample area as primarily in Qaipur. DQohari Ba0ar" M I 'oad" Ton! 'oad" as limited to top = ealth management companies" namely +(S Ban!" $itiban!" ,TI Ban!" -SB$ Ban!" -5F$ Ban!" Bajaj $apital and

Malviya )agar and Qhot ara Industrial AreaE and at the -5F$S*I$"$6scheme "opposite jaiclub"Qaipur and accordingly the response is presumed to represent hole of India. The sample si0e comprised of 8?? respondents from different fields and income group" and their responses are presumed to represent the ealth management mar!

The score allotted by the different respondents on different parameter might not be ith the same yardstic!" as individuals are subjective in nature as environment round them differs" ell as the hich play a critical role in building up a perception.

83

CHAPTER J FACTS AND FINDIN6S

84

It can be observed that most of the financial advisors are not charging any fees for their advisory services i.e. they are giving it free of cost because the ban!s D$itiban!" ,TI Ban!" -SB$E earn commission if the customer purchases mutual funds" insurance" from it. The bro!ing company earns bro!erage if the client purchases 'BI bonds etc or if he does any e2uity trading. The ban! only charges marginal fees on the custodial services. -o ever" -5F$ Ban! 6 instead of as!ing customers to bring in a specific amount of funds 6 charges customers on various types of services it offers. The management of understood" the ban! sends a portfolio should be. Ta4ation advisory is given by very fe have a tie6up model ith Birla so $itiban! players li!e Bajaj $apital" ,TI Ban!. Various ban!s ritten investment proposal on ealth depends on the customerJs ris! appetite" his investment objectives. %nce these are hat the ban! thin!s the

ith different insurance and mutual fund companies li!e $itiban! has ill only sell Birla insurance to their clients irrespective of the fact hich ta!es ealth

hether the product meets the clientAs financial goals. Allegro is one player

care of loan restructuring. $ommodity trading is only being handled by 'eligare as a separate product as S(BI have not yet allo ed commodity trading to be a part of advisory services. -o ever ban!s cannot offer portfolio management services to customers. This means that a customer cannot give money to a private ban!er and as! the 'M to invest on his behalf in different financial products. This service can be offered only by entities other than a ban! such as 'eligare" Bajaj $apital" etc. A ban!er therefore a ill have to call every time and get ritten confirmation from the client before any deal is done.

85

CHAPTER K ANALYSIS AND INTERPRETATION

86

Liven belo

are the graphical representations of the responses received on 2uestions ill be

as!ed through the 2uestionnaire. The interpretation derived and the model adopted replies ere received accordinglyC

e4plained in detail in the later part of the report. %n as!ing the follo ing 2uestions" the

KA0A 5h1t "s (#ur #&8e*t"!e &eh"nd "n!est'entsL

Investing is a conscious decision to set money aside for a long enough periods in an avenue that suits your ris! profile. The 2uestionnaire as!ed the respondents to reveal their objective behind investments" majority of the respondents disclosed gro th of capital as their prime objective investor hile safety of capital stands secondary. This response reflects the )o of 'espondents Din ME illingness to ta!e calculated ris!s for gro th of their capital

%bjective Behind Investment

Lro th of $apital Ta4 Minimi0ation Safety of $apital 'etirement *i2uidity Beating Inflation %thers

:7.;< 8:.?> 8>.= 8:.<< ;.:< 9.98 9.98

87

The research has highlighted that gro th of capital is the most important factor consider ile investing as evident by the response

hich they

herein :7.9M of the respondents voted

for the same. -o ever" it can also be seen that 8>.=M of the investors prefer safety of their capital as their secondary objective the returns and illing to adjust hich depicts that investors give greater emphasis to hich signifies that the financial planner should ith safety of capital. *i2uidity is the least important factor

as only ;.>M of the respondents voted for it

designed the portfolio giving more importance to gro th and safety of capital as per individual financial goals hile li2uidity should have the minimum focus. In our sample" inflation has only been given 9.9M of the total sample inflation rate. hich reflects that

people are still not giving much consideration to inflation even due to a sharp rise in the

88

KA,A S"n*e 9hen 1re (#u "n!est"n2 "n $"n1n*"13 "nstru'entsL

The respondents ere as!ed as from hen they have started investing in financial instrument so as to ascertain the average period of e4perience of an investor in the mar!et. The responses ere then graphically hich indicates that majority of the investors i.e. hich adds to the

:<.;M of the respondents have been investing for more than 8; months and signifies that the responses revealed are from e4perienced and 2ualified investors credibility and reliability of the research. Months *ess than 9 months 9 to 7 month 7 to < months < to 8; months More than 8; months )o of 'espondents Din ME 8?.<: 89.;> @.7: 8<.?= :<.8@

7? >? :? 9? ;? 8? ? *ess than 9 months 9 to 7 month 7 to < months M#nths < to 8; months More than 8; months Series8

KABA D# (#u 31n (#ur "n!est'entsL

To evaluate the level of importance the investor gives on detailed financial planning to arise in their investment decision" the respondents 89 ere as!ed to reveal hether their

N# #$ Res #ndents )"n M+

investments are result of a careful planning or itAs a mere individuals follo financial goals" they tend up in ma!ing

ord of mouth. As many

ord of mouth leaving behind the fact that every individual has different rong decisions for their investments.

Most are a are that planning is critical" yet donAt have the time or the e4pertise to develop a plan and ma!e the needed financial decisions. %n analy0ing the response <:M of the persons plan their investments investment decisions on ad hoc basis. %pinion of 'espondents +es )o )o of 'espondents Din ME <: 87 hile only 87M ta!e

Res #nse #n P31n the"r In!est'ent

+es )o

KAIA 5h1t "s (#ur r1*t"*e #n s1!"n2 '#ne(L

90

To determine the saving habits of the investors" the 2uestionnaire en2uired the respondents as about their practice of savings. The greater the inclination of saving the more funds available for investment. Around :=.>M of the respondents try to save from their income" hile only ;@.=M of the respondents al ays ma!e an effort to save some part of their income. %pinion of 'espondents 5onAt believe in Savings -igh (4penses Try to Save Al ays Save Some %thers )o of 'espondents Din ME 8.@< 8@.< :=.>; ;@.= .@@ ill be the

Res #nse #n r1*t"*e #$ s1!"n2 '#ne(

>? :? N# #$ Res #ndents )"nM+ 9? ;? 8? ? 5onAt believe in -igh (4penses Savings Try to Save Al ays Save Some %thers Series8

O "n"#n #$ Res #ndents

%nly ;M of the respondents donAt believe in savings" savings in Indian households. -o ever" it available income. hich substantiate high importance of omen

as also observed that majority of the

respondents had high inclination for savings and try to save the ma4imum out of their

KAFA H#9 'u*h th#u2ht h1!e (#u 2"!en t# s1!"n2 $#r ret"re'entL
Anyone ho ill retire needs to plan for it. There is more than one reason to save for hich retirement. The all important reason is the rising cost of living. Its called inflation"

91

simply put" means that purchasing po er of money falls over time" so you buy less for the same amount of money or you have to pay more for the same 2uantity of goods. %n analy0ing the level of importance the respondents give on saving for retirement" majority i.e. :=M of the respondents give some importance retirement. O "n"#n #$ Res #ndents Some A *ot Very *ittle )one N# #$ Res #ndents )"n M+ := 8< 8< 8= hile only 8<M give a lot of importance hile planning for their to saving for retirement. This depicts non serious attitude of Indians

Res #nse #n S1!"n2s $#r Ret"re'ent

Some A *ot Very *ittle )one

KACA 5hen d# (#u *#ns"der #ne sh#u3d st1rt 31nn"n2 $#r ret"re'entL
If you start planning for retirement early on" you can bridge the gap bet een in your hand today and hat you ould li!e to have 92 hat you have hen you retire. Bhat to !eep in mind

hile saving for retirement depends a lot on our age and ho aside smaller amounts.

much money you are

illing

to set aside every month. If you begin saving for retirement early on in your life" you can set

&lanning for retirement in early age of employment is depicted on analy0ing the responses as 9>.<M start planning belo the age of 9? years" hile :;.8M of the respondents feel" the ideal age to be above :? years.

O "n"#n #$ Res #ndents Belo 9? 98 I :? :8 I >? Above >?

N# #$ Res #ndents )"n M+ 9>.=@ ;;.88 ;;.88 ;?

Res #nse #n 12e re$eren*e t# 31n $#r ret"re'ent

Belo 9? 986 :? :8 6 >?

KAJA 5h1t d# (#u $ee3 "s *#ns"dered t# &e the N$und1'ent133( s1$e< $#r' #$ "n!est'entL
%n en2uiring from the respondent about hat are the fundamental secure forms of investments" 9>.:M of the respondents feel that investing in property is the safest form of investment follo ed by Insurance. The least secured form of investment as revealed by respondents is investment in e2uity as secondary mar!et is subject to huge volatility N uncertainty. 93

It can be seen from the response that people are more

illing to put their money in property

or real estate in spite of the economy e4periencing a major climb in the property prices. About 8:.:M of the respondents feel that Ban! deposits is also the safe form of investments as it gives assured returns on the sum invested. %pinion of 'espondents Ban! 5eposit &roperty &ostal 5eposit Lold Insurance Bonds Mutual Fund (2uity )o of 'espondents Din ME 8:.9= 9>.99 =.=< 9.>@ 8>.>= 8;.>= =.8@ ;.@@

Res #nse #n $und1'ent3( s1$e $#r' #$ "n!est'ent

:? 9> 9? ;> ;? 8> 8? > ? Ban! 5eposit &roperty &ostal 5eposit Lold Insurance Bonds Mutual Fund (2uity

N# #$ Res #ndents )"nM+

Series8

O "n"#n #$ Res #ndents

KAKA H#9 d# (#u t14e $"n1n*"13 de*"s"#nsL

An individualAs decision has a vital role to play in achieving investment objectives and thereby ma!ing investments in a systematic manner. 5ecisions can ma!e or brea! investment avenues as in major loss. %n en2uiring from the respondents about ho they ta!e their financial decisions" majority of hich depicts they are not ho the respondents ta!e their financial decisions independently rong decisions ould merely lead to rong investments resulting

ta!ing any advisory services from financial e4perts. There are majority of respondents regarding investments. 94

feel that they can handle their portfolio on their o n and hence ma!e their o n decisions

%pinion of 'espondents Independently Friends Bro!er $A Ban! Financial Advisor %thers

)o of 'espondents Din ME :< ;< 8 = 8 88 :

Res #nse re21rd"n2 t14"n2 $"n1n*"13 de*"s"#ns

7? >? N# #$ Res #ndents )"nM+ :? 9? ;? 8? ?
$A Br o! er Ba n! ds en de ntl y Fri en Ad vis or %t he rs

Series8

Ind ep

O "n"#n #$ Res #ndents

KA.A D# (#u h1!e 1n( Insur1n*e P#3"*(L

*ife is full of dangers" but ith insurance" you can at least ensure that you and your ith the dependents donAt suffer. The purpose of buying insurance is to protect your dependants from any financial difficulties in your absence. It helps individuals in providing them t in benefits of insuring themselves instrument to ta!e care of their future needs. The research has highlighted that majority of the respondents are availing insurance policy hich signifies that people are much a are about the advantages ith an insurance policy hich can cover their life as ell as prove to be as a savings instrument. %pinion of 'espondents )o of 'espondents Din ME 95 hile at the same time acting as a compulsory savings

Fin an cia l

+es )o

=> ;>

Res #nse t# h1!"n2 1n "nsur1n*e #3"*(

+es )o

Around =>M of the respondents do have insurance policy" are still not availing this type of investment.

hile ;>M of the respondents

KA0-A I$ (esE 9h( d"d (#u &u( 1n Insur1n*e P#3"*(L

%n en2uiring from the respondents about hy they bought insurance policy" majority of the hich depicts people have respondents bought insurance as a security against death

ensured that their dependents donAt suffer incase of any uncertainty as life insurance indemnifies the nominees in case of an eventuality to the insured. By having insurance policy" the financial future of the nominees is secured in the absence of the person insured. %f the respondents ho possessed insurance" 9:M of the respondents had purchased hile 98M had bought it primarily as a savings ord6of6mouth due to high insurance mainly as a security against death demand of the product and it bought insurance to save ta4. %pinion of 'espondents For Saving Ta4 )o of 'espondents Din ME ;< 96

product. %ver =M of the respondents purchased insurance as a

as also observed that around ;<M of the respondents

For Savings For Security Against 5eath %thers

98 9: =

Res #nse $#r &u("n2 1n "nsur1n*e #3"*(

:? 9? N# #$ Res #ndents )"nM+ ;? 8? ? For Saving Ta4 For Savings For Security Against 5eath %thers Series8

O "n"#n #$ Res #ndents

KA00A Are (#u 191re 1&#ut the *#n*e t #$ F"n1n*"13 Ad!"s#rsL

There are a number of financial advisors offering a diverse portfolio of services to suit different financial re2uirements of the individuals. In order to accomplish the tas!" these companies provide the assistance of professional financial advisors. The advisors educate individuals on the merits of a long6term approach and regular investing and help to rebalance their portfolio. %n analy0ing the response =<M of the respondents hile around ;;M of the respondents advisors ere a are about financial advisors

ere still not a are about professional financial

hich depicts there lays a scope to penetrate these people and inform them

regarding the services offered by various financial institutions.

97

%pinion of 'espondents +es )o

)o of 'espondents Din ME =< ;;

Res #nse #n 191reness #$ $"n1n*"13 1d!"s#rs

+es )o

KA0,A D# (#u *urrent3( 1!1"3 $"n1n*"13 1d!"s#r ser!"*es; r"!1te &1n4"n2 ser!"*esL
Majority of the respondents are currently not availing financial advisor services" hich reveal the concept of financial advisors is not that much developed in the Indian mar!et. Individuals are earning and paying high ta4es thus ignoring the ta4ation benefits" hich they can avail by proper computation of ta4es. Individuals usually rely on $hartered Accountants leaving behind the fact that they are e4perts in Accounting and not in for all the financial needs of an individual. According to the response" it can be seen that 77M of the respondents are not availing any financial advisory services number of people hile only 9:M are ta!ing financial advisory services. Thus hole concept. thereAs much scope left for the financial management companies to target these large ho are totally una are about the ealth management so there is a need for Financial Advisors. -ence" there is a re2uirement for one stop shop

%pinion of 'espondents +es

)o of 'espondents Din ME 9: 98

)o

77

Res #nse t# 1!1"3"n2 $"n1n*"13 1d!"s#r( ser!"*es

+es )o

KA0BA I$ (esE $r#' 9h#'L

To find out the various companies from respondents have for different companies. %n analy0ing the response" =9.99M of the respondents advisors services from $itiban! and of the respondents others total sample. %pinion of 'espondents $iti Ban! -5F$ Ban! Allegro Advisors Bajaj $apital -SB$ Ban! +es Ban! 'eligare %thers )o of 'espondents Din ME =9.99 97.7= ;? 89.99 87.7= 8? 9.99 99.99 99 hen they ere primarily availing financial here the investors get financial advisory services ould reveal the preference the N ma!e their decisions regarding investments. This

ere as!ed the reason behind" they replied

$itiban! provides free advisory services and has got a strong brand name. Secondly 97M ere ta!ing financial advisory services from -5F$ Ban! follo ed by hich catered around 99.9M of the hich include ,TI Ban!" SBI" I$I$I Ban!" etc

Res #nse re21rd"n2 s#ur*e #$ $"n1n*"13 1d!"s#r(

<? N# #$ res #ndents )"nM+ =? 7? >? :? 9? ;? 8? ? $iti Ban! -5F$ Ban! Allegro Advisors Bajaj $apital -SB$ Ban! +es Ban! 'eligare %thers Series8

O "n"#n #$ res #ndents

KA0IA 5h1t 1re the r#du*ts (#u 1re 2ett"n2 $r#' (#ur ser!"*e r#!"derL
According to our response" around ;;M of the respondents are availing advices on insurance products follo ed by mutual funds hich hold 8:.7M of the total sample. This depicts there is a huge demand for insurance in the Indian economy as compared to other financial instruments. It can also be inferred that individuals have started ta!ing advises regarding ta4 planning and loans restructuring. %pinion of 'espondents Mutual Fund I&% (2uity &ost %ffice Schemes Insurance &roperty Ta4 &lanning *oan Administration Lold Art )o of 'espondents Din ME 8:.79 <.89 <.89 88.9< ;8.@> =.9; 88.9< @.=7 :.?= ;.:: ?.<8

100

insurance products follo ed by mutual funds

hich hold 8:.7M of the total sample. This

depicts there is a huge demand for insurance in the Indian economy as compared to other financial instruments. It can also be inferred that individuals have started ta!ing advises regarding ta4 planning and loans restructuring.

101

KA0F

31n #$ "n!est'entsL
ere as!ed to reveal hether their

To evaluate the level of importance the investor gives on detailed financial planning to arise in their investment decision" the respondents individuals follo investments are result of a careful planning or itAs a mere financial goals" they tend up in ma!ing ord of mouth. As many

ord of mouth leaving behind the fact that every individual has different rong decisions for their investments.

102

KA0C5h"*h t( e #$ $1*t#r"n2 (#u re$erL

DaE 'ecourse DbE )on6'ecourse

An13(s"s 1nd Inter ret1t"#n%/ 8.;? customers prefer recourse factoring. ;. 'emaining 8? customers prefer non recourse factoring.

103

CHAPTER . CONCLUSION

104

This part of research paper determines the prospects of financial advisors in the mar!et ith relevance to the information derived from analysis of the responses. Feasibility of financial institutions can be studied by both financial feasibility and mar!eting feasibility.

1+ F"n1n*"13 Fe1s"&"3"t(
Financial feasibility ill study the need of financial advisors due to changes in the inflation hich investors usually ignored so by availing the rate" loans" insurance charges" etc

financial advisory services" one can e4pect unbiased advise on the entire spectrum of personal finance and thereby adding value to the investorAs current portfolio and potential savings. The statistics regarding the investments are discussed belo various factors in the Indian economy. so as to sho the trend of

"+ 6r#9"n2 E*#n#'(

The anticipated gro th rate of 7 6 = percent in ;??<6?@" ac!no ledges the momentum of development in the Indian economy. The odds are loaded heavily in favor of a continuation of the gro th momentum and a virtuous cycle of gro th and savings" that appears to be already under ay" is li!ely to accelerate that pace. India is the orldAs second most populous country ith a little over 8 billion people and the orld L5&. The impact of 8>

8?th in terms of economic si0e" representing around 7M of an attractive investment destination in the global arena India" hich

years of economic reform finally appears to have !ic!ed in and allo ed India to emerge as

ith an anticipated gro th rate of 7 to = M for the year ;??<6?@" supported by robust ould build a strong business scenario ealth management provide ould increase the economic activity in the country" evident from increased ith commentary" research" and practical ideas that bridge the gap bet een ould result in increase in the

gro th in the Indian industries and service sector

employment opportunities and entrepreneurship projects. As investors theory and practice in contemporary global business" it financial advisors in the Indian mar!et 105

demand for financial advisors in the country" thereby authenticating the prospects of

""+ Str#n2 F"n1n*"13 M1r4et

IndiaJs financial mar!ets have undergone rapid changes since the country eBBAr!ed on a program of economic reforms in 8@@8. They have embraced technology" seen a substantial increase in the variety and volume of transactions" and securities and ne in ne instruments. ith the entrepreneur. Therefore" the financial mar!et itnessed the emergence of ne

India itnesses gro ing number of venture capitalist ban! hich do not hesitate in investing projects and bear high ris! scenario in India is conducive for procurement of funds for launching the business maga0ine in the mar!et.

"""+ In$31t"#n
Inflation is moving at around :M and the savings account is giving an interest of 9.>M per annum hich signifies that inflation is merely eating up the money in the ban! account so individuals should come out of just !eeping their money in their ban! accounts and should invest in the financial instruments to fetch higher returns.

&+ M1r4et Fe1s"&"3"t(

Mar!eting feasibility involves determining the prospects of financial advisors in the gro ing economy li!e India. The study includes assessing the need of financial institutions to achieve all the individualAs financial goals and !eeping these goals in mind ho individualAs current portfolio N savings potential. For assessing the satisfaction level of investors ho are availing financial advisory services" the performance of the current players in the mar!ets ea!ness mar!et. less" then greater ill be studied and their strength and ill be analy0ed" If the investorAs satisfaction level from the current advisor is ill be the feasibility of prospects of financial advisors in the Indian do they recommend certain investment options in the mar!et in order to provide value additions to

106

107

After analy0ing the response" mar!eting feasibility e4ist on the basis of follo ing discoveries.

0A 6r#9th #$ C1 "t13 "s the M18#r O&8e*t"!e &eh"nd In!est'ents

It as observed that :7.9M of the respondents do investments for achieving gro th of as considered secondary objective capital i.e. revenue ma4imi0ation. Safety of capital assured returns

behind investments as only 8>.=M of the respondents thin! about their safety of capital i.e. hich reflects that investors are more concerned for gro th rather than safety irrespective of their financial goals in life. A financial advisor can ta!e care of all the financial goals in !eeping three goals in mind" he can recommend certain investment options ranging from mutual funds" insurance" I&%" post6office schemes" secondary mar!ets" etc

,A L#9 s1!"n2 P#tent"13

%ut of the total sample" around :<M of the respondents said that they try to save money hich depicts lo saving potential among the Indian investors. They are not in the habit of as observed that only ;@.=M al ays save some portion of saving on a regular basis as it

their ta!e home salary. The financial advisor should promote regular savings among the investors so as to open various investment channels for them to fetch good returns.

BA In!est#rs t14"n2 F"n1n*"13 De*"s"#ns Inde endent3(

Investors are ta!ing their financial decisions independently planning hich reflects the need for financial advisors ill simultaneously ho the financial goals and ithout doing any financial ill ta!e note of and record all

or! out the money value for each of the goals.

Additionally" financial advisors can also set aside some money for contingencies I medical and other emergencies in li2uid form and invest the rest in diversified portfolio so that the ris! gets distributed.

IA H"2h A91reness #$ F"n1n*"13 Ad!"s#rs "n the Ind"1n M1r4et

Majority of the investors i.e. =<M of the respondents financial advisors but among them" very fe services ere a are about the concept of investors have actually gone for availing these

hich sho s lac! of trust and confidence in the services provided by the financial

advisors in the eyes of general public. The financial advisors should find out the 108

deficiencies and fla s in the current services being provided to the investors and attempt at suggesting ays and means to remedy the same.

FA H"2h Le!e3 #$ S1t"s$1*t"#n $r#' E7"st"n2 F"n1n*"13 Ad!"s#rs

Majority of the investors ere very satisfied ith the services provided by the e4isting service providers hich primarily include $itiban!" -5F$ Ban!" -SB$ Ban!" etc. Thus it becomes evident that the satisfaction level of the investors is high from the e4isting advisors and thereby validates the prospects of financial advisors in the Indian mar!et.

*+ Test #$ H( #thes"s @ C#n*3us"#n

As it could be seen from the above factors that investors are having lo saving potential" hich gro th of capital acts as a primary objective behind investments" investors ta!ing financial decisions independently" high level of satisfaction from e4isting financial advisors" manner so as to provide value additions to the saving potential and portfolio. The hypothesis holds true that there e4ist a potential gro th in the industry India. To conclude" the above research substantiates both financial and mar!eting feasibility for the prospects of financial advisors in the Indian mar!et. ealth management depicts that there is a need of financial institutions to approach these investors in a proper

hich represents huge prospects of financial advisors in the gro ing economy li!e

109

CHAPTER 0RECOMMENDATION AND SU66ESTIONS

110

%n studying the peculiarities of the follo ing points are recommended approaching the people.

ealth management industry and analy0ing the hile

responses of the investors on their perception and e4pectation from a financial advisor" the hich a general financial advisor should consider

India is seeing a maturing financial environment. Interest rates have fallen and unli!e in the past" options to attract savings e4ist through a spate of financial products and services that have differing ris!1gro th and asset accretion propositions. It is becoming increasingly obvious to people that their money" in real terms" help gro s their savings or assets. Bhile this is becoming a universally undeniable desire" the fact is that some people donAt have the !no ledge and inclination to understand the financial mar!ets and others donAt have the time to follo them. This then leads to financial decisions being ta!en by individuals based on either relationship hearsay or the sales call of a vendor. ould fall in value if they ere to !eep ould their money in the ban!. And hence the !eenness to find out the right avenue that

1+ Un&"1sed Ad!"s#r(
Investment Advisory Services are in this business of managing the assets of individuals and corporations. -o ever" the distinct model of services should enables the advisors to offer unbiased advise on the entire spectrum of personal finance" !eeping the clients interest foremost hile doing so. The investment strategies developed across perpetuity should ith fre2uent revie s of investment decisions made to ith hat as planned. outline a detailed financial plan ensure that portfolios are in line

&+ Cert"$"ed F"n1n*"13 P31nner

Financial planning is a ne animal in the Indian mar!et. The big thing to happen is the coming to India of the $ertified Financial &lanner D$F&E mar!" o ned by the Board of Standards in the ,S and licensed out to non6profit associations in 8< countries" including the ,S" $anada" Australia and the ,.. *eading financial playersIasset management companies" ban!s" mutual funds and insurance companies" forms these associations.

111

Another player in this space is the )S(As $ertification of Financial Mar!ets D)$FME" an arm of the )ational Stoc! (4change that tests and certifies insurance and mutual fund agents. A third institution" the Association of Mutual Funds DAMFIE" is encouraging its agents to morph from distributors to advisors. Apart from the institutions" some individuals and small companies have set up practice anticipating that the mar!et approach to a planned one. ill move from an ad6hoc

112

*+ F"n1n*"13 P31nn"n2 Sh#u3d =e En*#ur12ed

It is a process in hich an individual sets long6term financial goals through investments" ta4 ho gets to his destination e have a clear roadmap in planning" asset allocation" ris! management" retirement planning and estate planning. Most of us approach our financial lives li!e the disorgani0ed traveler eventually and perhaps even enjoys the rough ride. Be thin!

mind" but our financial lives are mar!ed by ad6hoc decisions and capitulation to the

113

temptations of the flavors of the financial season. %ne of the myths regarding financial planning is that only rich individuals and -)Is can underta!e this. This perception e4ists because most players in the mar!et target these people" as they are very profitable customers. -o ever" anyone can use financial planning. In fact" individuals should use effective financial planning to build their years. ealth over the

114

CHAPTER 00 APPENDI:% HUESTIONNAIRE

115

)ameC ZZZZZZZZZZZZZZZZZZZZZZZZZZZ AgeC ZZZZZZZZZZZZZ %ccupationC ZZZZZZZZZZZZZZZZZZZZZZZZZZZ Se4C ZZZZZZZZZZZZ Annual IncomeC ZZZZZZZZZZZZZZZZZZZZZZZZZZZ $ityC ZZZZZZZZZZZZZ

8. Bhat is your objective behind investments[ DaE Safety of $apital DbE 'etirement DcE Beating Inflation DdE Ta4 Minimi0ation DeE *i2uidity DfE Lro th of $apital 6 'eturns DgE %thers Dplease specifyE ZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZ

;. Since

hen are you investing in financial instruments[

DaE *ess than 9 months DbE 9 months I 7 months DcE 7 months I < months DdE < months I 8; months DeE More than 8; months DfE %thers Dplease specifyE ZZZZZZZZZZZZZZ

9. 5o you plan your investments[ DaE +es DbE )o" hy ZZZZZZZZZZZZZZZZZZZZZZZZZ

:. Bhat is your practice on saving money[ DaE I donAt believe in saving. DbE IAd li!e to save" but my e4penses N financial commitments do not permit me. DcE I try to save henever N herever possible. DdE I al ays save some percentage of my ta!e6home salary ithout e4ception. DeE %thers Dplease specifyE ZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZ >. -o much thought have you given to saving for retirement[

DaE Very little DbE Some DcE A lot DdE )one

116

7. Bhen do you prefer one should start planning for retirement[ DaE ,nder 9? DbE 98 I :? DcE :8 I >? DdE Above >?

>. Bhat do you feel is considered to be the Hfundamentally safeA form of investment[ DaE Ban! deposits DbE &roperty1*and DcE &ostal deposits DdE Lold DeE *ife insurance policies DfE Lovernment bonds DgE Mutual funds DhE (2uity1Shares DiE %thers Dplease specifyE ZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZ

7. -o

do you ta!e financial decisions[

DaE Independently DbE Advise from friends 1 relatives DcE Bro!er DdE Advise from a $hartered Accountant DeE Advise from a Ban! DfE Financial Advisors DgE %thers Dplease specifyE ZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZ

=. 5o you have any Insurance &olicy[ DaE +es DbE )o

<. If yes"

hy did you buy an Insurance &olicy[

DaE As a means of saving DbE As a means of saving ta4 DcE For security against death DdE %thers Dplease specifyE ZZZZZZZZZZZZZZ

@. Are you a are about the concept of Financial Advisors[ DaE +es DbE )o

117

8?. 5o you currently avail financial advisor services1private ban!ing services[ DaE +es DbE )o" hy ZZZZZZZZZZZZZZZZZZZZZZZZZ 88. If yes" from hom[ DaE $itiban! DbE -5F$ Ban! DcE Allegro $apital Advisors DdE Bajaj $apital DeE -SB$ Ban! DfE +(S Ban! DgE 'eligare DhE others Dplease specifyE ZZZZZZZZZZZZZZ

8;. Bhat are the products you are getting from your service provider[ DaE Mutual Funds DbE Initial &ublic %ffer DI&%E DcE Secondary Mar!et DdE &ost %ffice Schemes15ebt DeE Insurance DfE 'eal (state1&roperty DgE Ta4 &lanning DhE *oans DiE Administrative Services DjE Lold D!E Art1&aintings DlE %thers Dplease specifyE ZZZZZZZZZZZZZZ

118

CHAPTER 0, =I=LIO6RAPHY

119

The follo ing companies and associationAs information used in the research. 8. Internet Source G httpC11 G httpC11 G httpC11 G httpC11 G httpC11 G httpC11 G httpC11 G httpC11 .yesban!.in .citiban!.co.in1 .utiban!.com1 .hsbc.co.in .religare ealthcare.com .hdfcban!.com .bajajcapital.com .online.citiban!.co.in

eb sites

ere referred

hile collecting

120