this project is about the descriptive analysis of depository participants

1. PROJECT REPORT
AT
STOCK HOLDING CORPORATION OF INDIA LIMITED
ON
“A Descriptive Analysis of Depository Participant With
Stock Holding Corporation of India Ltd”
DR. GAUR HARI SINGHANIA INSTITUTE OF MANAGEMENT AND RESEARCH
Dr. Gaur Hari Singhania Institute Of Management and Research
Submitted by:
Jayati Poddar
1340
(2010-2012)
Submitted to:
Faculty Guide- Jyotika Kukrety
Company Guide: Mr. Vinay Singh

2. DECLARATION
I, Jayati poddar studying in Dr.Gaur Hari Singhania Institute Of Management And
research do hereby declare that this Project relating to Stock Holding Corporation
of India Ltd (SHCIL) and the title “A Descriptive analysis of the depository
participant with Reference to SHCIL” has been prepared by me after
undergoing the prescribed industrial survey as part of the requirement of the
PGDM program of GHS-IMR.
My guide for the training was Mr. Vinay Singh (Branch manager) and Mentor
lecturer Mrs.Jyotika Kukrety.
I, further declare that this project work is the outcome of my efforts and not a
replica of any other report/work submitted to any university or boards.
Name of student: Jayati Poddar
Place: Kanpur

3. ACKNOWLEDGEMENT
I express my gratitude to Prof.Prithvi Yadav sir, Director
Of GHS-IMR for providing me an opportunity to undergo summer training. And
also for those who have guided and inspired me in completing this study. I would
like to express my deep sense of gratitude to our faculty mentor Mrs. Jyotika
Kukrety for giving me support and helping me during my project study.
I would like to express my gratitude to my project guide Mr. Vinay Singh for
his constant encouragement and guidance without the task would not have
been completed.
Last but not the least I would like to thank my parent and friends for their support.
THANKYOU ALL
Jayati Poddar

5. STOCK HOLDING CORPORATION OF INDIA LTD.
EXECUTIVE SUMMARY
The study is about describing the different services and products offered at
SHCIL.
Project mainly deals with how the resources of the organization are used in
their day to-day activities.
Stock holding has various financial Products and Services to be offered to the
clients but problem lies in the low promotional activities undertaken by it,
due to which though it has the services not offered by other DP's it fails in
captivating customers.
The past few years have seen a phenomenal growth in the capital market
leading to an explosion in transaction holding despite the transparency
offered by NSE and BSE, the primitive settlement and transfer process kept
the biggest chunk of the market risk- bad delivery, delayed transfer, fake
certificates, loss and theft etc, unresolved. The Depositories is the answer to
such risk and problems.
Along with it a brief introduction to India‟s largest financial intermediary,
SHCIL has been given and it is shown that what are demat a/c, mutual funds
and life insurance and how they work.
The main objective of this project is concerned with studying the Depository
system the services provided by the depositories to the customers and what
are procedures for opening the various types of accounts like Demat a/c etc
Thus, I got interested to conduct study on the Depository Services under the
title “Descriptive analysis of Depository Participants with reference to Stock
Holding Corporation of India limited.

6. How to open demat account
Before opening the account the form can be collected from any of our branches.
The name should appear same as it on the share certificate
All columns must be filled in.
Write bank account number and 9 digit MICR number correctly issued by your
bank as it will facilitate effective disbursement of monetary corporate actions into
your account.
Signature of the holder must be with BLACK pen.
Fill the details regarding PAN card and all financial details required to be filled
For proof identity and address proof , there must be any one among them-
passport, voter ID, driving license, college ID.
2 recent photograph and signature across it
Client ID is given to the customers

7. Charges for accounts opening Investors traders
1. annual membership charges 500 1200
2. charges (one time)kit charges 30 30
3. custody charges nil nil
4. dematerialisation 3/- 3/-
5. rematerialisation 25/- 25/-
6. postage 25/- 25/-
7. invocation of pledge 50/- 50/-
8. transaction charges 10/- 10/-
Once the account is opened then, you will be allotted client identity number.
You will be sent a kit containing:-
Details of your account as recorded by SHCIL.
Copy of the agreement entered into with SHCIL.
"Delivery instruction by client" booklet allotted to your demat account. This
booklet helps you transfer shares from your account to broker account and other
accounts.
Now you are ready to operate your DP account.

8. Maintenance
Change in permanent/correspondence address
A request letter ( format available on the site) signed by all the holders is required
Along with this Photocopy of proof of identification and proof of new address is
required. Please also bring the originals with you for verification purpose. Client or
the authorized bearer can visit our branch for the same. Copy of the latest transaction
statement received from SHCIL is also required.
Change in signature
Request letter (format available) signed by the client. The new signature to be attested
by the bank. The request may be submitted along with the copy of POI and the
photocopy of the latest transaction statement received from SHCIL.
Addition of PAN/Map in
Request letter signed by the client giving the PAN/Map in number.
Accounts with Power of Attorney
These accounts can be operated by both the client and the POA Holder. In case the
client has given the POA in favour of 2 or more persons, then the mode of operation of
the POA holders is also to be mentioned. In case the power of attorney is to be revoked,
a letter signed by the client is required.
Change of Telephone Number
Request letter signed by all the holders, with a photocopy of the recent telephone bill
and proof of identification of one of the holder.
Instruction by Fax
Clients may avail this facility by faxing their delivery instructions to SHCIL, by

9. executing the fax indemnity.
Change in Standing Instruction
For recording any change in the standing instruction (for receiving direct credits) in
the demat account, we require a letter signed by all the holders.
Change in Power of Attorney Details
If you have given POA details and you wish to operate the account yourself, the POA
has to be revoked by you in writing.
Death of Beneficiary account holder(s) - Transmission of account
Transmission of account takes place in the event of death of the beneficiary account
holder(s). There can be three situations in transmission of account. See which
category you fit into and follow the relevant procedure:
- When the account has joint holders and one of the holder dies.
- When the account has a sole holder with a nominee.
- When the account has a sole holder without a nominee.
If the shares are transmitted to beneficiary accounts of surviving holders and this
beneficiary account is in a DP other than SHCIL.
Classify the transmission case into the above categories.
 Over and above the documents explained above, the client master list from the
target DP has to be submitted.
 Freezing of account
An account is frozen/suspended
- Only on your instruction.
- By competent authority i.e. by the Depository / SEBI.

10. - On receipt of court order.
 Defreezing of account
Defreezing of an account takes place,
- Only on your instruction.
- For defreezing pledge accounts, your instruction has to be
accompanied by bank authorization.

11. Research Title
A Descriptive Analysis of Depository Participants with “Stock
Holding Corporation Of India Ltd.”
Purpose
The past few years have seen a phenomenal growth in the capital market leading to
an explosion in transaction holding despite the transparency offered by NSE and
BSE, the primitive settlement and transfer process kept the biggest chunk of the
market risk- bad delivery, delayed transfer, fake certificates, loss and theft etc,
unresolved. The Depositories is the answer to such risk and problems.
Introduction of the depositories has paved the way for instituting an infrastructure
for eliminating these risks and increasing the efficiency of the system. The purpose
of this study is to provide information to both the organization and the
investors/savers, providing to the former present state and future prospect and to
the later differences among the services provided by the various depository
participants.
This Analysis will help to have a better understanding about where SHCIL stands
in the market today and also to compare various DPs on certain parameters
Objectives
The main objectives of the project undertaken are:
1. To understand the attitude and perception of investors/savers towards the DP‟s
2. To ascertain SHCIL‟s position in the competitive market.
3. To develop and analyze strategies of SHCIL
4. To help improve its market share.

12. 5. To offer suggestions based upon the findings
Limitations of the study
1. The study is limited only to SHCIL, BO Govind Nagar, Kanpur
2. There was a constraint of time.
3. The entire study is based on the information provided by the various respondents
4. The policy of the company does not allow getting all the information.

13. STOCK HOLDING CORPORATION OF INDIA LTD
INTRODUCTION TO SHCIL

14. Introduction to SHCIL
Background
1. Depository:
A depository is a facility for holding securities, which enables securities transactions
to be processed by book entry. To achieve this purpose, the depository may
immobilize the securities or dematerialize them (so that they exist only as electronic
records).' India has chosen the dematerialization route. In India, a depository is an
organization, which holds the beneficial owner's securities in electronic form, through
a registered Depository Participant (DP). A depository functions somewhat similar to
a commercial bank. To avail of the services offered by a depository, the investor has
to open an account with it through a registered DP.
2. Depository Participant
A Depository Participant (DP) is an agent of the depository who is authorized to offer
depository services to investors. Financial institutions, banks, custodians and
stockbrokers complying with the requirements prescribed by SEBI/ Depositories can be
registered as DP.
Benefits of Depository
1. Bad delivery eliminated
2. Immediate transfer of shares
3. No stamp duty on such transfers
4. Elimination of risks that are normally associated in dealing with Physical
certificates - loss / theft / mutilation due to careless handling / forgery / etc
5. Reduced transaction cost

15. Services provided by Depository
1. Dematerializations (usually known as demat) is converting physical certificates
to electronic form
2. Rematerializations, known as remat, is reverse of demat, i.e. getting physical
certificates from the electronic securities
3.Transfer of securities, change of beneficial ownership
4. Settlement of trades done on exchange connected to the Depository
5. Pledge / Hypothecation of demat shares, viz. Loan against shares
6. Electronic credit in public offering of the Companies
7. Non - Cash corporate benefits, viz. Bonus / Rights - direct credit into
electronic form.
No. of Depository in the country
National Securities Depository Ltd.
Central Depository Services Ltd

16. Stock Holding Corporation Of
India Ltd.
Industry Profile

17. Industry profile
Financial Markets
Stock Holding Corporation Of India Ltd. (SHCIL), the premier custodian of
Indian Capital Market providing services of international standards, is
geared up to reposition itself in the changed scenario.
The corporation has restructured and geared itself to serve the growing needs of
individual investors in the paperless environment. The organization in its
willingness to provide its state of art of financial services in securities industries to
the various segments of the investors has expanded itself to more than 100 cities
across the country. SHC desires to give investors the time and attention in
monitoring the performance of their securities consistently. All aimed at providing
the investor with optimum financial gain.
India has a well established capital market mechanism where in effective and
efficient transfer of money capital or financial resources from the investing class to
the entrepreneur class in the private and the public sector of the economy occur.
Indian capital market has a long history of organized trading which started with the
transaction in the loan stocks of the East India Company; from that time it has
undergone drastic changes to meet the requirements of the globalization.
There has been a shift of house hold savings from physical assets to financial
assets, particularly the risk bearing securities such as shares and debentures.
Capital market structure has also undergone sea changes with number of financial
services and banking companies, private limited companies coming into the scene
which made the competition in the market stiffer.

18. CAPITAL MARKET
The capital market consists of primary market and secondary market segments.
The primary market deals with the issue of new instruments by the corporate sector
such as equity shares, preference shares and debentures. The public sector
consisting of central and state governments, various public sector industrial units
(PSUs), statutory and other authorities such as state electricity boards and port trust
also issue bonds.
The primary market in which public issue of securities is made through a
prospectus is a retail market and there is no physical location. Direct mailing,
advertisements and brokers reach the investors. Screen based trading eliminates the
need of trading floor.
The secondary market or stock exchange where existing securities are traded is an
auction arena. Since 1995, trading in securities is screen based. Screen based
trading has also made an appearance in India. The secondary markets consist of 23
stock exchanges including the NSE and OTCE and Inter Connected Stock
Exchanges of India ltd. The secondary market provides a trading place for the
securities already issued to be bought and sold. It also provides liquidity to the
initial buyers in the primary market to re-offer the securities to any interested buyer
at a price, if mutually accepted. An active secondary market actually promotes the
growth of the primary market and capital formation because investors in the
primary market are assured of a continuous market and they can liquidate their
investments in the stock exchange.
DEPOSITORY

19. Depository is an organization where the securities of a share holder are kept
in the electronic form at the request of the shareholder through a medium of a
depository participant (DP). The principal function of a depository is to
dematerialize securities and enable their transactions in book form
electronically.
In India, the Depository Act defines a depository to mean “A company
formed and registered under the companies act, 1956 and which has been
granted a certificate of registration under sub-section (la) of section 12 of the
Securities and Exchange Board of India (SEBI) act, 1992”. A depository
established under the Depositories Act can provide any service connected
with recording of allotment of securities or transfer of ownership of securities
in the record of a depository. A depository cannot directly open accounts and
provide services to clients. Any person willing to avail of the services of the
depository can do so by entering into an agreement with the depository
through any of its Depository Participants.
Legal Framework of Depositories:
The depositories act of 1996 provides for regulation of depositories in
securities and for matter there with or incidental there to and came into force
on 2Oth of September, 1995. SEBI formulated the Depositories and
participants regulations act, 1996 to oversee the matter regarding admission
and working of depositories and its participant. The depositories act passed
by parliament received the presidents‟ assent on August 10, 1996 enables the
setting up of multiple depositories in the country. Only a company registered
under the Companies Act Of 1956 and sponsored by the specified categories
of institution can setup depositories in India. The depository offers services
relating to holding of securities and facility processing of transactions in such
securities in book entry form. The transactions handed by depositories
include settlement of market trades, settlement of off trades, Securities
lending and borrowing, pledge and hypothecations.

20. Eligibility criteria for a depository:
1.A public financial institution as defined in section 4a of companies act
of 1956.
2. A bank included in second schedule to the RBI act, 1934
3. A foreign bank operating in India with the approval of the RBI.
4. Recognized Stock Exchanges
5. An institution engaged in providing financial services where not less
than 75% of equity held jointly or severely by these institution.
6. A custodian of securities approved by government of India.
7. A foreign financial services institutions approved by government of
India.
8. The promoters of depository are also known as its sponsor.
9. A depository company must have a minimum worth of Rs. 100 Cr.
10. The sponsor of the depository has to hold at least 51% of capital
of the depository company.
Agreement Between Depository and Issuers:
If either the issuer (a company which has issued securities) or the investor
opts to hold his securities in a demat form, the issuer enters into an agreement
with the depository to enable the investors to dematerialize their securities.
No such agreement is necessary where :
i. Depository, is the issuer of securities, or;
ii. The State or Central Government is the issuer of government securities.
Where the issuer has appointed a registrar to the issue or share transfer, the
depository enters into a tripartite agreement with the Issuer and Registrar &
Transfer (R&T) Agent, as the case may be, for the securities declared eligible
for dematerialisation. At present, NSDL is discharging the responsibility of
R&T Agent for the securities issued by State and Central Governments.

21. Rights and Obligations of Depositories:
1. Every depository should have adequate mechanisms for reviewing monitoring
and evaluating the controls, systems, procedures and safeguards.
2. Annual inspections of the procedures and same should be reported to SEBI.
3. To ensure that the integrity of automatic data processor systems is maintained to
safeguard information.
4. Adequate measures including insurances, to protect the interests of the beneficial
owners against any risk.
5. It should conduct an annual inspection of these procedures and forward a copy
of the inspection report to SEBI.
Functions of Depository:
Dematerlisation
One of the primary functions of depository is to eliminate or minimize the
movement of physical securities in the market. This is done through
converting securities held in physical form in to holdings in to back entry
form.
Accounts Transfer
The depository gives effects to all transfers resulting from the settlement of trade
and other transaction between various beneficial owners by recording entries in the
accounts of such beneficial owners.
Transfer and registration
A transfer is a legal change of ownership of a security in the records of the
issuer. Transfer of securities under demat occurs merely by passing book
entries in the records of the depositories, on the instructions of beneficial
owner.
Pledge and hypothecation
Depositories allow the securities placed with them to be used as collateral to
secure loans and other credits. The securities pledged are transferred to a
segregated or collateral account through book entries in the records of the
depository.

22. Linkages with clearing system
The clearing system performs the functions of ascertaining the pay-in (sell) or
pay (buy) of brokers who leave traded on the stock-exchange. Actual delivery
of securities to the clearing system from the selling brokers and delivery of
securities from the clearing system to the buying broker is done by
depository.
To achieve this, depositories and the clearing system are linked
electronically.
To handle the securities in electronic as per the Depositories Act 1996, two
depositories are registered with SEBI. They are: National Securities
Depository Limited (NSDL), Central Depository Services (India) Limited
(CDSL).
DEPOSITORY PARTICIPANTS
Depository participants (DPS) are described as an agent of the depository.
They are the intermediaries between the depository and the investors. The
relationship between the DP‟s and the depository is governed by an
arrangement made between the two under the depositories act. In a strictly
legal sense a DP is an entity who is registered as such with SEBI under the
provisions of the SEBI Act. As per the provisions of this act a DP can offer
depository services only after obtaining a certificate of registration from
SEBI.
Eligibility Criteria For Depository Participant
1. A public financial institution as defined in sections of the companies act.
2. A bank included for the time being in the second schedule to the RBI.
3. A foreign bank operating in India with the approval of RBI.
4. A state financial corporation established under the provisions of section 3
of the state financial corporation‟s act, 1951.
5. An institution engaged in providing financial services promoted jointly or
severally by any of the institutions mentioned above.
6. A custodian of securities who has been granted a certificate of registration
by SEBI.
7. A clearing corporations or a clearinghouse of stock exchange.

23. 8. A stock broker who has been granted a certificate of registration by SEBI.
9. A non-banking finance company.
10. A R& T agent who has been granted a certificate of registration by
SEBI.
A person desirous of becoming a DP of NSDL should make an application to
SEBI through NSDL. NSDL evaluates and sends to SEW within 30 with
recommendations. If all the conditions are met SEBI grants the registration
certificate to the applicant. SEBI prescribes a minimum net worth of Rs.50
Lakh for stock brokers and non-banking finance companies (NBFCs) for
granting them a certificate & registration to act as a DR. A certificate of
registration is valid for a period of 5 years. It may be renewed after 5 years.
Rights and Obligations of Depository Participant
1. Agreement with beneficial owners:
The DP must enter into an agreement with a beneficial owner before acting as a
DR on his behalf. A DR while conducting business with a client, acts as an agent
of NSDL and is liable to the clients for all the acts and deeds performed by him.
2. Separate accounts:
The DP shall open a separate account in the name of each beneficial owner‟s
account only on receipt of instructions from beneficial owner.
3. Statement of account:
The DP should provide statements of accounts to the beneficial owner as laid in the
agreement with the beneficial owner. It should be done fortnightly if any
transactions are made and at least quarterly if no transactions are done, It can be
provided through internet.
4. Transfer or withdrawal by beneficial owner:
The DP should allow a beneficial owner to withdraw or transfer securities from its
accounts in such manner as specified in the agreement with beneficial owner.
5. Connectivity:
The DP should maintain continuous electronic communication with each
Depository in which it is participant.

24. 6. Monitoring, reviewing & evaluating internet systems &
controls:
DP should have an adequate mechanism for the purposes of reviewing monitoring
and evaluating its internal accounting controls and systems. It has to get an audit
done on quarterly basis.
7. Reconciliation:
The DP shot reconcile its records with every depository in which it is participant
on a daily basis. The NSDL system is designed to do this automatically every day
at the end of the day (EOD).
8. Returns:
The DP should submit periodic returns to SEBI and to every depository in which it
is a participant.
9. DP to indemnify depository
A DP has to indemnify the depository, its officers and employees for all costs, fees,
expenses, liability, taxes, actual losses and damages of any nature whatsoever
suffered like failure to company with laws, failure to deliver eligible securities etc..
10. Prohibition Of Assignment
No DP can assign or delegate its functions as a participants to any other person
prior approval of NSDL.
11. Insurance
DP‟s should take appropriate insurance cover to insure against losses arising from any
business risk and system failure.
12. Record Of Services
The DP should maintain and preserve the documents for all transactions for a
minimum period of 5 years.
13. DP to ensure integrity and back-up of data
While DP‟s maintain electronic records, they should ensure the integrity of the data
processing system. All necessary precautions should be taken to ensure that the
records are not lost, destroyed. It should be tampered with sufficient back-up of
records should be taken and made available at all times at different places. All
DP‟s must comply with the rules of SEBI. If not, SEBI may cancel the registration
of DP.

25. GOVERNING BODIES OF DEPOSITORY PARTICIPANT
Governing bodies of depository participants
National Securities Depository Limited (NSDL)
National securities depository limited is the first depository to be set up in India. It
was incorporated on December 12, 1995. The Industrial Development Bank Of
India (IDBI) largest development bank in India, UTI largest Indian mutual fund
and the National Stock Exchange In India sponsored the setting up of NSDL and
subscribed to the initial capital. NSDL commenced operations on November
8,1996.
Following organizations are shareholders of NSDL as on March 31, 2001:
1.Industrial Development Bank Of India
2. United Trust Of India
3. National Stock Exchange Of India
4. State Bank Of India
5. Global Trust Bank
6. CITI BANK
7. Standard Charted Bank
8. HDFC Bank (housing and development finance corporation)
9. HSBC (hongkong and shinghai banking corporation)
10. Deutsche Bank
11. Dena Bank
12.Canara Bank
Ownership:
NSDL is a public limited company incorporated under the companies act,
1956. NSDL had a paid up equity capital of Rs.10 crore. The paid-up capital
has been reduced to Rs.80 crore since NSDL has bought back its shares of the
face value of Rs.4.2 crore in the year 2000. However, its network is above
Rs.100 crore as required by SEBI regulations.
Management of NSDL:
NSDL is managed by professional board of director. The managing director
conducts the day to day operations. To assist the MD in his functions, the board
appoints an executive committee of not more than 16 members. The eligibility

26. criteria and period of nomination of the members of eligibility criteria etc. are
governed by the bye-laws of NSDL in this regard.
Bye-laws of NSDL:
The bye-laws approved by SEBI which contain 14 chapters they are:
a) Short title and commencement
b) Definitions
c) Board of directors
d) Executive committee
e) Business rules
f) Participates
g) Safeguards to protect interest of clients and participants.
h) Securities
i) Accounts by book entry
j) Reconciliation accounts and audit
k) Disciplinary action appeal
l) Appeals
m) Conciliation
n) Arbitration
Function of NSDL:
NSDL performs the following functions through Depository participants (DP)
1. Enables the surrender and withdrawal of securities to and from the depository
(dematerialisation and rematerialisation).
2. Maintains investor holdings in the electronic form.
3. Effects settlement of trades not done on the stock-exchange (offmarket trades).
4. Transfer of securities.
5. Pledging I hypothecation of companies or corporates.
6. Receipt of non-cash corporate benefits like bonus rights r electronic form.
7. Stock lending and borrowing.
The investors interact with a depository participant (DP) of NSDL. A DP can be a
bank, financial institution, a custodian or a broker. Just as one opens a bank
account to avail of the services of a bank, an investor has to open an account with a
DP in order to avail of the depository facilities.

27. Milestone of NSDL
August 2009 Demat Accounts cross one crore
August 2008
Launch of Central Recordkeeping Agency (for New Pension
System)
May 2008
NSDL and Japan Securities Depository Center sign Information
Sharing and Collaboration Pact
April 2008
NSDL and National Depository Center (Russia) sign
Information Sharing and Collaboration Pact
February 2008
NSDL and Euroclear (Belgium) sign Information Sharing and
Collaboration Pact
September 2007
Value of securities held in dematerialised form at NSDL crosses
US$ 1 trillion
September 2007 Launch of SMS alert facility for investors
June 2007
NSDL and DTCC (US Depository) sign Information Sharing
and Collaboration Pact
January 2007
NSDL and TDCC (Taiwan Depository) sign Information
Sharing and Collaboration Pact
November 2006 NSDL completes a decade of depository operations
January 2006 Launch of National Skills Registry by NDML
July 2005 Launch of Tax Information Network - PAN Ledger
January 2005 Launch of online upload of Central Excise challan data
October 2004 Intraday production shifting to Disaster Recovery Site
June 2004
Incorporation of NSDL Database Management Limited (NDML)
- wholly owned subsidiary company of NSDL
June 2004 Launch of Online Tax Accounting System (OLTAS)
June 2004 Launch of PAN card services
January 2004 Launch of Tax Information Network (TIN)
January 2004 Launch of IDeAS
November 2003 Introduction of demat of Warehouse Receipts
November 2003 Launch of Market Participants and Investors Database (MAPIN)
October 2003 Demat Accounts cross 6 million
April 2003 Introduction of T+2 Rolling Settlement
December 2002 Demat Accounts cross 5 million

28. November 2002 Launch of STEADY - An STP initiative by NSDL
April 2002 Introduction of T+3 Rolling Settlement
September 2001 NSDL launches SPEED-e
July 2001
Introduction of T+5 Rolling Settlement and Uniform Settlement
Cycle
June 2000 98% settlement in demat form
June 2000 Commencement of Demat of Debt Instruments
May 2000 Demat accounts with NSDL cross 2.5 mn
February 2000 NSDL launches internet based service - SPEED - for CMs
May 1999 NSDL launches NCFM - Depository Operations Module
January 1999 Commencement of compulsory trading for retail investors
December 1998 Introduction of Demat of Government Securities
December 1998 Establishment of NSDL branches at Chennai, Delhi & Kolkata
November 1998 Demat accounts with NSDL cross 100,000
April 1998 Demat delivery in physical segment at NSE and BSE
March 1998
Value of securities held in dematerialised form at NSDL crosses
US$ 5 bn.
January 1998 Compulsory demat trading for Institutional investors
December 1997 Commencement of Demat trading at BSE
June 1997
Value of securities held in dematerialised form at NSDL crosses
US$ 1 bn.
December 1996 Commencement of Demat trading at NSE
November 1996 NSDL Inauguration
August 1996 Enactment of Depositories Act
December 1995 NSDL Incorporation
September 1995 Promulgation of Depositories Ordinance

29. Central Depository Services Of India Limited
(CDSL)
Central depository services of India ltd were the second depository to be granted
the commencement certificate by SEBI on 8 February 1999, inaugurated on 15
July 1999. It is promoted by the Bombay stock exchange, in association of bank of
India. Both NSDL and CDSL interface with investors through their service
providers known as DP. The depository is interconnected. It is possible to transfer
shares from one depository to another.
CDSL was promoted by The Stock Exchange, Mumbai (BSE) jointly with leading
banks such as State Bank of India, Bank of India, Bank of Baroda, HDFC Bank,
Standard Chartered Bank, Union Bank of India and Centurion Bank. CDSL was set
up with the objective of providing convenient, dependable „and secure depository
services at affordable cost to all market participants.
Milestones of CDSL system :
1.CDSL received the certificate of commencement of business from SEBI in
February 1999.
2. Honorable union finance minister, Shri Yashwanth Sinha flagged off the
operations of CDSL on July 15 1999.
3. Settlement of trades in the demat mode through BOl shareholding limited,
the clearing house of BSE started in July 1999.
4. All leading stock exchanges like national stock exchange, Calcutta stock
exchange, Delhi stock exchange, stock exchange Ahemdabad, etc have
established Connectivity with CDSL.
5. As at the end of Dec 2004, over 4900 issuers have admitted their securities
(equities, bonds, debentures, and commercial papers), units of mutual funds,
certificate of deposits etc. into the CDSL system. CDSL‟s demat services are
extended through its agents called Depository Participants (DP). The DP is

30. the link between the investor and CDSL. An investor who opens a demat
account with a DP can utilize the services offered by CDSL. While the OP
processes the instructions of the investor , the account and records thereof is
maintained with CDSL.
6. The recurring costs to be incurred by a CDSL DP in terms of maintaining
back-ups
and the related data storage are minimal. This enables a CDSL DP to offer
depository services to investors at an attractive price and at the same time
achieve break-even faster at much lower volumes. The centralized
architecture also allows CDSL-DP to make available to the investors a to-the
minute status of their account and transactions.
BENEFITS AND SAFETY OF DEPOSITORY SYSTEM
1. Elimination of bad deliveries:
Once the holdings of investors are dematerialized, the question of bad deliveries
doesn‟t arise because both transfer deed and share certificate are eliminated in
depository system.
2. Elimination of all risks associated with physical
certificate:
Dealing with physical securities have the associated risks of loss of certificates
during movements to and from the registrars. These expose the investor to cost of
obtaining duplicate certificates, advertisement etc., such problems don‟t arise in the
depository environment.
3. No stamp duty:
No stamp duty for transfer of equity instruments and units of mutual funds in this
system.
4. Immediate transfer and registration of certificate:
Once the securities are credited, to the investors account on payout, he becomes the
legal owner of the securities.

31. 5. Faster settlement cycle:
The exclusive demat segment follow rolling settlement of T+2 days which enables
faster turnover of stock and enhance liquidity with the investor.
6. Buyer is secured:
In physical environment, the buyer is not secured since the shares purchased may
not be transferred. This is not the case with depository system.
7. Faster disbursement of non-cash corporate benefits:
NSDL provides for direct credit of non-cash corporate entitlements like rights,
bonus etc., to an investors account ensuring faster disbursement.
8. Reduction in rate of interest on loan:
Some banks provide these benefits against pledge of departmentalized securities.
9. Increase in maximum limit of advances:
This increases from Rs.l0 lakh to Rs.20 Lakh per borrower. There is also a
reduction in minimum margin from 50% to 25% by banks to advances against
demat securities.
10. Reduction in brokerage:
Brokers may provide a reduction in the brokerage of 0.25% to 0.5% for trading
in dematerialised securities as it reduces their back office cost of handling
paper.
11. Reduction in handling huge volumes of paper:
In the physical environment every entity involved in purchase or sale of securities
was to handle paper and pass on the paper to the next entity. But in the depository
system only the delivery instruction to be given by the client is in the form of
paper.

32. 12. Periodic status reports:
DP‟s need to provide periodic reports to investors on their holding and
transactions. Dematerialized securities can be delivered in the physical segment:
From April 1998 this facility is available at stock-exchange where trading in
dematerialized securities is allowed. But physical securities are not allowed to be
delivered in the dematerialized segment, making dematerialized stocks held with
the investors more liquid than physical stocks.
13. Elimination of problems related to change of address of
investors,
transmission etc:
Investors have to inform the change of address which will be reflected in the
database of all the companies where the investor is a registered holder of securities.
14. Elimination of problems related to nominations:
An account holder can get securities in all companies transmitted transferred to his
account by completing formalities with a single entity.
15. Elimination of problems related to selling securities on
behalf of a minor:
A natural guardian is not required to take court approval for selling demat
securities on behalf of a minor.
16. Convenient consideration of account:
To multiple accounts opened by investors, all accounts can be consolidated into
one account by giving instructions to DP.
17. Convenient portfolio monitoring:
Client can monitor portfolio by checking a single statement of
holding/transactions.
18. Increased volumes:
Due to case in transaction and related costs, many players have entered/increased
their transaction, which increases liquidity.

33. 19. Newer services:
Opportunities like pledge / hypothecation and stock lending are given specifically
by depository system. Many safety measures like investor grievances, insurances
cover, computer and communication infrastructure, periodic review, certificate of
registration were made necessary to protect investors.

34. STOCK HOLDING CORPORATION OF INDIA
LIMITED
COMPANY PROFILE

35. STOCK HOLDING CORPORATION OF INDIA
LIMITED
Introduction to the company:
Stock Holding Corporation of India ltd (SHCIL) was incorporated under the
companies Act, 1956 on July 28, 1986 at the initiative of the Government of India,
with an authorized capital of Rs.25 cores and a paid up capital of Rs.10.5 cores,
subscribed by seven All India financial and investment institutions and insurance
companies, viz.
Industrial Development Bank of India (IDBI)
Unit Trust of India (UTI)
Life insurance corporation of India (LIC)
ICICI Ltd
Industrial finance corporation of India Ltd (IFCI)
Industrial Investment Bank of India (IIBI)
General Insurance corporation of India and its subsidiaries, viz.
1. Oriental insurance co ltd
2. New India insurance co ltd
3. National insurance co ltd
4. United India insurance co ltd.
SHCIL was incorporated as a public limited company on July 28, 1986 and
provides custodial services to institutional investors and depository services to
retail investors. SHCIL commenced operations in August 1988 and has been
providing custodial and related services of international standards for nearly a
decade to the promoter and other institutions, foreign institutional investors (FIIs),
commercial banks and mutual funds.
It is headed by luminaries from its promoter institutions who constitute its Board of
Directors and take policy decisions pertinent to the affairs of the corporation. A
senior management team that reports to the Managing Director and the CEO aids,
assists and strategies business lines for the Corporation.
The primary focus of the corporation was specific – to set up custodial services of
international standards in India and in the process to manage the entire array of
post trade activities of Financial Institutions and Foreign Institutional Investors
with dedicated client relationship teams and state-of-the-art reporting systems.

36. The corporation quickly garnered nearly 70% market share of the domestic
custodial business and the financial figures shot up impressively for the first
decade of it existence.
SHCIL has also received “No Action Letter” from Securities Exchange
Commission (SEC) of USA, which renders it an eligible institution to hold assets
of US-based funds.
SHCIL subsidiaries:
 SHCIL Projects Ltd.
 SHCIL Services Ltd.
 SHCIL ltd.
 SHCIL Commodities& Derivatives Trading Co. ltd.
Vision of the Company:
“To become one stop shop for all financial services”.
This vision of the company is slowly being achieved with the foray of the
company into new financial services and products into its portfolio the latest
to be the Insurance product, which would be soon distributed.
Mission of the Company:
“To spread Quality Service through the innovative use of technology”.

37. Objectives of the Company:
1. To retain the No. 1 position in the DP industry by being ahead of all other DP service
providers with the innovative use of technology would be soon distributed.
2. To provide justified service to every rupee the client pays.
3. To ensure security and convenience of transaction to its clients at reasonable price.
4. To channel technology to make convenient products for financial market that give
quantum benefits to investors, corporate houses and brokers.
5. To reach 37 million Internet users in the years to come with e-commerce projection
scaling USD 1.7 billion.
6. To move with speed and ease, diversifying into new areas, considerably on others and
sharpening its focus and paradigms.
7. To increase its customer base, this at present is 7 lakh.
8. To evolve a new strategy to emerge as a broad based financial powerhouse in the years
to come.
9. To find ways to make information and reporting system more effective for the
institutional clients.
10. To expand to the South-East Asia, with the aim of becoming the leader.
Basic facts about SHCIL
1. SHCIL is India‟s largest depository participant.
2. SHCIL has around 20% market share i.e. over 8 lakhs demat accounts.
3. SHCIL has approx, 50% market share of delivery- based transaction which
amount to
1.33 crore transaction.

38. Our Values
1.Safety and Efficiency of operations is a hallmark of SHCIL
2.Professionalism and Integrity
3.Customer First
4.Relationship Building
5. Commitment to Quality irrespective of asset size

39. STOCK HOLDING CORPORATION OF INDIA LIMITED
PRODUCTS AND SERVICES

40. STOCK HOLDING CORPORATION OF INDIA LIMITED
PRODUCT PROFILE
1. ADDSHARES
2. FUNDINVEST
3. GOI BONDS
4. INSURANCE
5. PENSION FUNDS
1. ADDSHARES
Introduction
SHCIL arranges loan against DEMAT shares.
1· Tie-up with reputed banks which offer you the most competitive interest rates in
the market.
2· You can use the shares in your free account as collateral and take a loan from
any of our empanelled banks.
3· SHCIL completes your documentation and processing and gives you a cheque
within 48 hours of application.
Advantages
Our tie ups with banks give you a wider range of banks to choose from. This leads
to a wider range of specified and non-specified shares to get loan against.

41. The add shares team helps you with the paper formalities precedent to a loan. You
can now get a loan at a competitive interest rates and Margins. This is a resultant of
their tie up with a wide range of banks.
· Add shares simplify long-winded loan procedures for you and facilitates early
disbursements of funds.
· Add shares are available at any of our branches numbering over 120.
3. FUNDINVEST
Introduction
Fund Invest is a basket of financial products, ranging from fixed income
securities
like fixed deposits, Infrastructure bonds and Capital Gain Bonds to variable
income
securities like Initial Public Offers (IPO‟s) of Equities and Mutual Funds. It is
an
attempt to offer financial products that cater to the various investment needs
of our
esteemed clients. An effort to guide the investor to a product portfolio that
best suits
his risk- return profile.
Applications for investments can be source from any of the SHCIL offices.
Apart
from guiding our investor to pick up the right combination of investment
instruments, we help them 'after-sales' service, by acting as an interlocutor
between the investor and the issuer of the securities. SHCIL is an AMFI
Registered Mutual Fund Advisor (ARMFA).
4. GOI BONDS
Savings Bonds are issued by RBI on behalf of Government of India in the
following
series.
8.0% taxable bonds

42. These Bonds are held in electronic form in an account called Bond Ledger Account
(BLA). Bond Ledger Accounts can be opened and operated with RBI designated
Receiving Offices. SHCIL has been designated as one of the Receiving Offices by
RBI for this purpose. Subscriptions for Savings Bonds can be submitted at any of
our
branches.
The following categories can subscribe to Savings Bonds:
Category of Investor 8.0% (Taxable)
1. Individual
His or her individual capacity.
Individual capacity on joint basis.
Individual capacity on anyone or survivor basis.
On behalf of a minor as father/mother/legal guardian.
2. HUF (Hindu Undivided Family)
3. Charitable Institution
Charitable Institution to mean a Company registered under Section 25 of the Indian
Companies Act 1956
An Institution which has obtained a Certificate of Registration as a Charitable
Institution in accordance with a law in force.
Any institution which has obtained a certificate from Income tax Authority for the
purposes of Section 80G of the Income Tax Act, 1961.
Advantages
Hassle free maintenance: The GOI Bonds are held in electronic form in an account
called Bond Ledger Account. This ensures smooth investing minus paperwork.
1. Electronic Clearing Services: You can avail of Electronic Clearing System
(ECS) services. This ensures automatic credit of benefits and redemptions
when they accrue.
2. Easy access: You can apply for subscriptions into these Bonds in any SHCIL
center across the country.
3. Dispatch: Certificate of Holdings is dispatched to the client through courier on
realization of subscription.
5. INSURANCE:
Introduction:
SHCIL, a company promoted by Insurance majors & Financial Institutions, is a
Corporate Agent of LIC for Life Insurance products and NIA for General
Insurance products.

43. SHCIL has a dedicated team of IRDA Certified Insurance Advisors to provide all
services relating to Insurance. We also provide Free Professional advice to clients
on
need base insurance. SHCIL has 200 plus odd Branches all over India to take care
of all your Insurance related queries and needs.
LIC products:
1. KEY MAN INSURANCE
Key Man Insurance is an insurance taken by a business firm on life of an employee
(Key Man) whose services contribute substantially to the success of the business of
the firm.
The object of Key man insurance is to indemnify business firm from the loss of
earnings may occur because immediate replacement of the Key Man may not be
possible. Section 37 (1) of the Income Tax Act ,1961 provides that any expenditure
laid out or
expended wholly and exclusively for the purposes of business or profession shall
be
allowed as a deduction in the computation of income from business or profession.
Only Partnership firms and Companies are eligible for Key Man Insurance.
2. CHILDREN POLICY
KOMAL JEEWAN Plan 159
Under this children‟s plan, the payment of premium ceases on policy
anniversary immediately after the child attains 18 years of age. The plan,
besides offering risk cover, also offers payment of sum assured in
installments at age 18, 20, 22, 24 and guaranteed and loyalty additions, if
any, at 26 years of age.
JEEWAN KISHORE Plan102
1. High bonus from day one.
2. Child becomes owner of the policy automatically at the age of 18 years.
JEEWAN CHAYYA Plan 103
1. Ideal for parents having less than a year old child.
2. Makes provision for education/ marriage of the child.
3. Extra benefit of waiver of premium in case of death of the policy holder.
This policy is given under non-medical scheme up to sum assured of Rs.1 lakh,
3. ENDOWMENT POLICY
ENDOWMENT WITH PROFITS Plan 14
1. Moderate Premiums
2. High bonus
3. High liquidity
4. Savings oriented

44. This policy not only makes provisions for the family of the Life Assured in event
of his early death but also assures a lump sum at a desired age. The lump sum can
be reinvested to provide an annuity during the remainder of his life or in any other
way considered suitable at that time.
LIMITED PAYMENT ENDOWMENT WITH PROFITS Plan 48
Just as in the case of limited payment whole life polices, here, too, the payment of
premium can be limited either to a single payment or to a term shorter than the
policy.
The endowment is, however, payable only at the end of the policy term, or upon
death
of the policy holder if it takes place earlier.
If payment of the premiums ceases after at least three years' premiums have been
paid,
a free paid-up Policy for an amount bearing the same proportion to the sum assured
as the number of premiums actually paid bears to the number stipulated for in the
policy, will be automatically secured provided the reduced sum assured, exclusive
of any attached bonus, is not less than Rs.250 Such reduced paid-up policy will not
be entitled to participate in the profits declared thereafter, but such bonus as has
already been declared on the policy will remain attached thereto.
JEEWAN MITRA Plan 133
The benefits of this policy can be considered only for standard and substandard
lives
Class I and II. It cannot be allowed for people engaged in hazardous occupations.
Individuals engaged in dangerous pursuits will be rated against the revised tabular
occupational extra rates. This policy covers the risk for triple the sum assured.
JEEWAN ANAND Plan 149
Jeevan Anand is a With Profit Assurance Plan. It is a combination of the
Whole Life Plan and the most popular Endowment Assurance Plan. The plan
provides the predecided
Sum Assured and Bonuses at the end of the stipulated premium paying term,
but the risk cover on the life continues till death.
1. Moderate Premiums
2. High bonus
3. High liquidity
4. Savings oriented
JOINT LIFE (Jeewan Saathi) POLICY Plan 89

45. This policy is issued on the lives of the husband and wife provided the
female's life belongs to Category I or is actively engaged in her spouse's
business. In case of death of one of the policy holder the surviving partner
gets the sum assured, the premium is stopped and on death or maturity full
sum assured along with bonus is paid back.
4. RETIREMENT PLAN
Its once again that time of the year when most of you are on the look out for tax
saving avenues for investment. And for most, insurance has been on the top of the
list of choices. While earlier, buying insurance was mainly for tax benefits, but
these days with increased awareness, consumers have been narrowing down on
picking up the right policy that suits their future needs.
NIA Products:
1. MEDICLAIM POLICY
2. FIRE INSURANCE
3. PRIVATE CAR INSURANCE
4. HOUSEHOLDER‟S POLICY
MEDICLAIM POLICY
This insurance policy can be used to protect the insured party against expenses
incurred for hospitalization for illness/ injury/ diseases as well as domiciliary
hospitalization.
Suitable for:
1. Each and every person aged between 5 and 75 years of age. Children aged
between 3 months and 5 years have to be insured along with their parents.
2. Government or private institutions for their employees.
3. Clubs or associations for their bona-fide members.
FIRE INSURANCE
This policy offers protection against loss or damage of property/ materials caused
by
fire. The insurance should be taken for a maximum amount of its current value
after
considering factors of wear and tear as well as depreciation.
Suitable for: This policy is vital for every individual or corporate body with respect
to the property where they have insurable interest. Since insurable interest signifies

46. the right to insure, the person or corporate body must be legally competent to enter
into a fire insurance contract.
PRIVATE CAR INSURANCE
Riskscovered
This insurance policy protects the motor vehicle from loss or damage
1. By fire, lightning, self-ignition, explosion, burglary, housebreaking or theft.
2. Riot or strike.
3. Flood, earthquake, cyclone or inundation.
4. Transit by road, air, elevators or lifts.
5. Liability for third party's injury or death, third party property and towards the
paid driver too.
6. Drunken driving.
HOUSEHOLDER’S POLICY
The Householder's Insurance Policy comprises of ten sections covering of the
insured's building, fixtures and fittings, contents, jewellery and valuables,
television sets and VCRs, bicycles, accompanied baggage as well as personal
accident and public liability benefits. Of these ten, the insured party must opt for at
least three sections and section 2 is compulsory.
If the insured party opts for cover for more than 4 sections excluding compulsory
sections, a discount of 15 percent is offered on the Non-Tariff sections. For more
than
6 sections, excluding Sections I and II, 20 percent discount is offered on Non-
Tariff sections.
5. STOCK DIRECT
Stock direct has changed the way you look at trading in securities.
A three way hands shake between leading brokers, national and international banks
and SHCIL is the crux of stock direct. Stock direct – India‟s first online trading
platform was launched in 1999.
Today stock direct is the most secure online trading platform which combines
encryption technology/digital signature features. A few clicks will seamlessly
check your funds and security positions, route the order to the broker of your
choice and do the necessary fund and share movements for you.

47. Advantages
One Stop Shop
Give a single instruction towards funds confirmation for buy orders, order routing
to your broker and fund and share movements for settlement purpose.
Convenience
Trade from home through the net or use the RTMs placed at specified SHCIL
centers.
Security
Digital Signature & Smart Card technology based on 128 bit Encryption make
your transactions 100% secure.
Cost-Effective
No minimum value of transaction.
Choice of Stock Exchanges
Buy/Sell shares on BSE / NSE
(G) PENSION FUNDS
SHCIL offers pension fund administration services to pension fund trusts. The
pension fund scheme administered by the trust could be a defined benefit or a defined
contribution scheme. For both the scheme types, SHCIL offers the entire range of
services that include design, development and maintenance of a customized pension.

48. SERVICE PROFILE
Various Services Provided By Stock Holding
Corporation Of India Limited :-
DP SERVICES:-
SHCIL Depository Participant services address customers individual investment
needs. With a parentage of leading financial institutions and insurance majors and
a proven track record in the Custodian business, Company have reiterated their
past success by establishing ourselves as the first ever and largest Depository
Participant in India. From a tentative foray in 1998 into the individual investor
arena to servicing around seven lakh accounts, it have endeavored to constantly
add and innovate to make business a pleasure for you.
At SHCIL, company places a very high premium on client reporting. Periodic
statements sent to you keep you informed of customers account status. Dedicated
Customer Care lines manned by trained staff answer customer queries on demat /
trades / holdings. The latest in client response at SHCIL is Interactive Voice
Response (IVR) system for round the clock information on customers account.
DEMAT:-
Dematerialisation is the process of conversion of shares from physical form
to the electronic mode. Companies dedicated demat team enable you to
convert customer‟s physical holdings into electronic mode in a quick and
hassle-free manner.
CLEARING MEMBER SERVICES:-
SHCIL's long-standing association with Clearing Members has enabled it to
develop services based on an understanding of their working and their requirement
for timely and accurate information .It accepts deposits of base capital and
Additional base capital requirements stipulated by NSE for clearing members
trading on its capital market segment. Besides, SHCIL s new products with a
broker empanelment clause ensure a mutually beneficial tie-up. Clearing members

49. stand to earn a steady income from SHCIL s product transactions and new add to
their client-base, while they capitalize on their rapport with the market. It currently
offers Depository services to more than 680 clearing members of various
exchanges connected with NSDL and CDSL. SHCIL s Customer Care lines answer
all customers DP queries while the Interactive Voice Response (IVR) system gives
you information on customers account and other valuable data like CC calendar
details, tariff, ISIN information, etc. via telephone, fax and e-mail.
Advantage:-
 SHCIL s Customer Care help lines give timely and accurate information to
CMs.
The Interactive Voice Response (IVR) system at SHCIL gives round the clock
information on holdings & transactions Pay in / Pay out details, overdue cum
holding details, etc. via telephone, fax or e-mail.
DERIVATIVE SERVICES:-
SHCIL provides Clearing Services for derivative segment of BSE/NSE and
Commodity segment of MCX/NCDEX.
 STOCK DERIVATIVES-
SHCIL is a Custodian/Professional Clearing Member of derivative segment at the
Bombay Stock Exchange and at the Futures & Options Segment of the NSEIL
respectively.
 COMMODITY DERIVATIVES:-
SHCIL is the first Professional Clearing Member of Commodity segment on the
Multi Commodity Exchange (MCX) and National Commodity & Derivative
Exchange (NCDEX).
SHCIL has a full fledged in-house back office systems and procedures to cater to
the needs of trading members and other institutional / corporate clients in this
segment. A dedicated team of professionals handles derivative operations and
assists its clients.
As a professional clearing member, SHCIL performs the following functions;
Clearing - Computing obligations of all his TM s i.e. determining positions
to settle.
Settlement - Performing actual settlement.
Collateral Management - Collection of collateral (cash and cash/cash
equivalents and setting up exposure limits for TMs and Institutional clients.
Risk Management - Setting position limits based on upfront
deposits/margins for each TM and monitoring positions on a continuous
basis.

50. Advantage:
SHCIL has always been a pioneer in clearing and settlement services in the cash.
SHCIL has the capability to handle large volumes of business with greatest
accuracy, keeping customer interests as the top priority.
SHCIL being a professional clearing member has no trading interests in the
Commodity segment. There is strictly no dissemination of information on trading
or any other operation of any of its clients.
Collateral Management
SHCIL has excellent system to manage cash and cash equivalents deposited as
collateral for derivatives trading.
Continuous Patronage from Institutional clients:
SHCIL being a custodian clearing member having major institutional clients,
provides more credibility. Tie-up with banks having nation-wide reach for banking
activities: Since settlement in derivatives trading takes place daily. Funds
movement has to be fast. SHCIL has tie up with new generation banks having wide
reach and modern
facilities like TT / anywhere banking etc. to contain the time lag in banking
transactions.
Competitive service charges:
SHCIL is the pioneer in introducing Derivatives Clearing and Settlement services
in the country. Service charges are so competitively structured to facilitate any
entrant.
Low investment:
The clearing function in the Commodity derivative segment requires huge
investment in back office systems and requires strict compliance to the regulatory
framework.
BROKING
Stock Holding Corporation of India Ltd. (SHCIL) in its endeavor to provide one
stop shop to its large retail & institutional clients has promoted SHCIL Services
Limited (SSL) as its broking arm.
SHCIL has been promoted by All India Public Financial Institutions and Insurance
Majors. SHCIL is known for its Security, Integrity, wide network and focus on
technology. SHCIL Services Ltd will continue this tradition .
NRI SERVICES:-
SHCIL has grown to become a major player in the capital market. With a network
of more than 120 offices operating across the country and franchisees operating

51. abroad, SHCIL provides Depository Participant and related services close to 0.7
million satisfied investors out of which over 6000 are NRI Clientele.
SHCIL has a full fledged NRI cell operating specifically to cater needs pertaining
to Depository account opening and maintenance. NRI cell co-ordinates with
prospective NRI customers, collects and assists in obtaining the relevant
documents and ensures the Depository Account is opened hassle free.
CUSTODIAL SEGMENT:-
SHCIL has been providing Custodial Services of international standards to
Domestic
Mutual Funds, Financial Institutions and Foreign Institutional Investors. With
almost 70% of the Institutional business in its fold, SHCIL has evolved over the
times to meet the changing requirements of dynamic markets and demanding
clients. A dedicated pool of trained and highly experienced professionals work
literally round the clock on state of the art computer systems, dedicated
communication channels, well connected to Client institutions, Stock Exchanges,
Clearing houses, Depositories and leading Institutional brokers. In terms of
collective man-years, SHCIL has the most experienced team in the entire Industry.
Tariff:-
1. Annual membership charges Rs 500/-
2. Purchase Nil
3. Sale( market&off market) 0.05%(min Rs 25/-)+NSDL
charges
4. Custody charges NIL
5. Dematerialisation Rs 3/- per certificate
6. Postage per Demat request Rs 25/-
7. Rematerialisation Rs 15/- per certificate
8. Postage per remat request Rs 25/-
9. Creation/confirmation of creation of 0.02%+NSDL charges

52. pledge
10. Closure/confirmation of closure of
pledge
0.02%+NSDL charges
11. Invocation Rs. 50/- per transaction
12. Late transaction charges Rs. 10/-
Trade processing services:
SHCIL has specially trained personnel handling thousands of trade instructions
involving large values on sophisticated systems using digital signature on STP
(Straight Through Processing) systems, ensuring smooth trade confirmations to
Stock Exchanges, reporting and resolution of mismatches with Clients, etc.
Settlement services:
Institutional trades are either settled through the Clearing House of the Stock
Exchanges or as DVP directly with the contracting broker or Counter Party. As a
Custodian SHCIL strives for timely settlement of Funds and Securities. Funds are
collected/ deposited from/to client and settled with the Clearing Houses/ Brokers/
Counter Parties.
In the present context, most of the Institutional trades are settled in the Depository
mode. For the Institutional segment alone, SHCIL has a unique clearing code on
the two principal stock exchanges and separate DPM units on both NSDL and
CDSL. This ensures smooth settlement of transactions on both
Exchanges/Depositories, based on the deliverables and receivables received by
them for each settlement. For the occasional delivery and receipt of securities in
the physical mode,
Institutional services:
SHCIL has installed dedicated DPM‟s (Depository Participant Modules) on both
the Depositories, viz. NSDL (National Securities Depository Ltd) and CDSL
(Central Depository Services Ltd). A dedicated Institutional DP team at SHCIL
addresses your need for all core DP services like conversion of physical holdings
into electronic form, settlement of trade instructions, rematerialisation, repurchase
and pledge instructions, providing of holding and transaction statements and daily
reconciliation of client holdings.

53. COMPETITORS:
Kotak Securities
Karvy Securities
Motilal Oswal
Anand Rathi
India Bull
1. Kotak Securities Limited, a subsidiary of Kotak Mahindra Bank, is the stock broking and
distribution arm of the Kotak Mahindra Group. One of the oldest broking houses in India, its
operations include stock broking and distribution of various financial products. It is a corporate
member of both the Bombay Stock Exchange and the National Stock Exchange of India. Kotak
Securities was founded in 1994 and is headquartered in Mumbai, India.
Motilal Oswal financial services ltd. is a diversified financial services firm
offering a range of financial products and services such as Wealth Management ,
Broking & Distribution, Commodity Broking, Portfolio Management Services ,
Institutional Equities, Private Equity, Investment Banking Services and Principal
Strategies. Motilal Oswal Securities is a Depository Participant of NSDL and a
Depository Participant of Central Depository Services Limited (CDSIL) in 2000.
The company started offering Derivatives products and advisory services on both
BSE as well as NSE in 2001.
Anand Rathi is a leading full service securities firm providing the entire gamut of
financial services. The firm, founded in 1994 by Mr. Anand Rathi, today has a pan
India presence as well as an international presence through offices in Dubai and
Bangkok. AR provides a breadth of financial and advisory services including
wealth management, investment banking, corporate advisory, brokerage &
distribution of equities, commodities, mutual funds and insurance, structured
products - all of which are supported by powerful research teams. The firm's
philosophy is entirely client centric, with a clear focus on providing long term
value addition to clients, while maintaining the highest standards of excellence,
ethics and professionalism. The entire firm activities are divided across distinct

54. client groups: Individuals, Private Clients, Corporates and Institutions and was
recently ranked by Asia Money 2006 poll amongst South Asia's top 5 wealth
managers for the ultra-rich. In year 2007 Citigroup Venture Capital International
joined the group as a financial partner.
India bulls is an Indian company with its presence in the Real Estate,
Infrastructure, Financial Services, Securities, Retail, Multiplex and Power sectors.
The company was founded in May 2000 as an online stock brokerage and has since
then diversified into its current portfolio. India bulls Group is one of India's large
Business houses. The Group has several businesses which cover a wide spectrum
of Real Estate, Financial Services, Securities, Power and Chartered Aviation.
Many of the companies are public entities and are listed on Indian stock markets.
Karvy has presence with leadership position in a wide range of financial services
including Broking, Commodities, Registry Services, Merchant Banking, Realty
services etc. The group also has presence in the BPO services and technology
services space. A professionally managed and highly focused financial
intermediary in the Indian markets.

55. SWOT ANALYSIS
STOCK HOLDING CORPORATION OF INDIA LIMITED
STRENGTH
1. Wide coverage throughout the country.
2. Promoted by 7 financial institutions.
3. Largest account holders
4. Largest custodian.
5. Catering to Indians as well as NRIs and FIIs.
6. One stop shop for all financial solutions.
7. Advanced system network.
8. SHCIL is the first depository participant. It has the opportunity of holding more
than 7000000 accounts at all centers.
9. Multiple products and services: SHCIL provides a variety of services under the
same roof.
10. It is the member of both NSDL and CDSL.
WEAKNESS
1. Lack of aggressive marketing.
2. Improper billings.
3. Expensive.(Because separate account has to be opened according to holdings).
4. Less investment in advertising.
5. The clients are not provided any incentives or motivations, which would
encourage them to make timely payment.
6. The company has not undertaken sufficient steps to create awareness among the
clients about SHCIL. The only procedure adopted is the Internet.
7. The HR department is placed in Mumbai. So the newly recruited employees lack
sufficient training facilities.
OPPORTUNITIES

56. 1. E – Broking.
2. Acquisition of smaller DPs.
3. Collaboration with banks.
4. New products.
5. The company can take steps to increase the awareness among the
clients and thereby increase the business.
6. The company can attract more number of franchises.
THREATS
1. Increased cost as perceived by customers.
2. Fluctuating market conditions affect the business.
3. The number of competitors is increasing at a higher rate. Their charges are also
low when compared to the charges of SHCIL. The nearest competitors are banks
providing DP services along with their regular services.
4. The company does not charge any amount for closing the account. Since
retaining the customer is very important and most of the customers will not think
of closing the account at time of opening the account the company can charge
some for closure.
5. The discounts and offers given by other DP‟s when compared to offers of
SHCIL are leading to reduction in the number of clients.
SWOT ANALYSIS OF KARVY
STRENGTH
·Employees are highly empowered.
·Strong Communication Network.
·Good co-operation between employees.
·Number 1 Registrar and Transfer agent in India.
·Number 1 dealer of Investment Products in India.
WEAKNESS
High Employee Turnover
OPPORTUNITY
1. Growth rate of mutual fund industry is 40 to 50% during last year and

57. it expected that this rate will be maintained in future also.
2. Marketing at rural and semi-urban areas.
THREATS
1. Increasing number of local players.
2. Past image of Mutual Fund.
SWOT ANALYSIS OF INDIA BULLS
STRENGTH
• Online trading platform.
• Diverse Branch Network provides ample opportunities to penetrate
deep into the existing & untapped market.
• India bulls offers its clients a pool of financial services and
products:
• No annual maintenance charges.
• No custodial charge.
• It does not keep any condition as to collect minimum amount of
brokerage from its clients
• Most competitive BROKERAGE and DP charges (on delivery
0.5% and on intraday 0.1%)
• Equity analysis report to support the investment decision of its
clients
• Trading via branch network, telephones and internet account i.e.
both online and offline
• Induction of new employees through an extensive computer based
training module.
WEAKNESS
• It should have its own mutual funds as India bulls is providing
advises in mutual fund.
• It should provide tips via SMS.

58. • There should be a separate set of staff working in fields and trading
on behalf of their clients:
• Position to answer the questions of their clients relating to the
current market position as they are on fields.
• Commodities are not traded online.
• It does not provide with the indices of major world markets, ADR
prices of Indian scripts.
• Unlike some of its competitors like ICICI and Kotak, India bulls
does not provide a complete catalogue of financial services (e.g.
Banking facility).
OPPORTUNITIES
1. Financial services like banking .
2. Market expansion i.e. opening branches at untapped areas.
3. India bulls is registered with Luxembourg stock exchange and so can
target other stock exchanges.
4. ATM facility should be provided for easy withdrawals.
5. The Capital market in the last few years has turned out to be one of
the favorable avenues for the retail investors
6. Scope of online trading on BSE.
7. India bulls has tied up with other third party companies to sell their
products. Due to the high client base of India bulls, there exists an
opportunity to cross sell these products in the market.
THREATS
1. Companies like Share khan, ICICI Direct, Kotak, and Private Brokers
are major threats to India bulls.
2. Banks with demat facility jockeying for position.
3. Local brokers capable of charging lower brokerage.
4. Industry competitors vying for the same target segment.
5. Changes in SEBI guidelines & other tax implications.
6. Government Regulations.

59. STRENGTH:
 Breadth of Services
In line with its client-centric philosophy, the firm offers to its clients the entire
spectrum of financial services ranging from brokerage services in equities and
commodities, distribution of mutual funds, IPOs and insurance products, real
estate, investment banking, merger and acquisitions, corporate finance and
corporate advisory.
Clients deal with a relationship manager who leverages and brings together the
product specialists from across the firm to create an optimum solution to the client
needs.
 Management Team
Anand Rathi brings together a highly professional core management team that
comprises of
individuals with extensive business as well as industry experience.
 In-Depth Research
Our research expertise is at the core of the value proposition that we offer to our
clients. Research teams across the firm continuously track various markets and
products. The aim is however common - to go far deeper than others, to deliver
incisive insights and ideas and be accountable for results
WEAKNESS
The name of the organization ANAND RATHI indirectly indicates that it belongs
to an individual.
Small range of product line.
SWOT ANALYSIS OF MOTILAL OSWAL
Strengths
 Large and diverse distribution network
 Strong research and sales teams
 Brand recognition
 Experienced top management
 Strong financial results
Weaknesses
Charges are high compare to other companies in industry

60. Opportunities
 Growing Financial Services industry's share of wallet for disposable income.
Huge market opportunity for wealth management service providers as Indian
wealth management business is transforming from mere wealth
safeguarding to growing wealth.
 Regulatory reforms would aid greater participation by all class of investors
 Leveraging technology to enable best practices and processes
 Increased appetite (need) of Indian corporate for growth capital
Threats
 Execution risk
 Slowdown in global liquidity flows
 Increased intensity of competition from local and global players
 Unfavorable economic conditions

61. RESEARCH METHODOLOGY
METHODOLOGY
Type of research descriptive and explanatory
Sampling technique non-probability sampling
Sample size 88
Instrumentation technique Interview and Questionnaire
Sources of data collection Primary Data was collected by Interview
and
Questionnaire while Secondary Data
collected from books, internet, magazine.
It is a survey method. The questionnaire and interview schedule, personal
interview will be relied upon for gathering primary data. An aggregate of 96
respondents from various Depository Participants responded to the questionnaire.
For the purpose of secondary data books, articles, reports, annual reports of the
stock exchanges, Internet are used.

62. Analysis:
Age-investment amount
Income-investment amount
Education-investment amount
1. age –investment amount
Research Hypothesis
Ho: there is independency of investment amount on age.
Ha: there is no independency of investment amount on age.
Test applied: chi-square contingency test
Formula:
X2
= ∑∑(fo-fe)^2/fe
α=5% (assume)
df= (r-1)(c-1)=2
X2
0.05,2= 5.9915

63. investment amount
age
20-40 20 5 25
40-50 15 6 21
50-above 60 33 8 41
68 19 87
I II III=(I-II)^2 IV=III/II
observed expected (O-E)^2
20 19.54023 0.211388559 0.010818
5 5.45977 0.211388559 0.038717
15 16.41379 1.998810939 0.121776
6 4.586207 1.998810939 0.435831
33 32.04598 0.910159863 0.028402
8 8.954023 0.910159863 0.101648
0.737193
X2
calculated= 0.737193
X2
table value> X2
calculated
5.9915> 0.737193
Result: Ho: accepted
Business Implication:
As the null hypothesis is accepted, it means that the investment amount invested by the investors is
independent of age.
2. income- investment amount
Research methodology
Ho: there is independency of investment amount on the income of the investors.
Ha: there is no independency of investment amount on the income of the investors.
Test applied: chi-square contingency test

64. Formula:
X2
= ∑∑(fo-fe)^2/fe
α=5% (assume)
df= (r-1)(c-1)= 2 X2
0.05,2= 5.9915
investment amount
income
below 1L 1L-1.5L
10000-20000 32 5 37
20001-30000 12 5 17
above 30000 24 9 33
68 19 87
I II III=(I-II)^2 IV=III/II
observed expected (O-E)^2
32 28.91954 9.4892324 0.328125
5 8.08046 9.4892324 1.174343
12 13.28736 1.6572863 0.124727
5 3.712644 1.6572863 0.44639
24 25.7931 3.21522 0.124654
9 7.206897 3.21522 0.446131
Calculated value 2.64437
X2
calculated= 2.64437

65. X2
table value< X2
calculated
X2
calculated = 2.64437
X2
table value> X2
calculated
5.9915> 2.64437
Result: Ho. accepted
Business Implication:
As the null hypothesis is accepted which means that the amount invested on the preferred investment
is independent of their education.
3. education- investment amount
Research hypothesis:
Ho: there is independency of investment amount invested by the investors on education.
Ha: there is no independency of investment amount invested by the investors on education.
Test applied: chi-square contingency test
Formula:
X2
= ∑∑(fo-fe)^2/fe
α=5% (assume)
df= (r-1)(c-1)= 2

66. X2
0.05,1= 3.8415
investment amount
education below1L 1L-1.5L
GRAD 31 9 40
PG+UG+OTHER 37 10 47
68 19 87
e11 31.26437
e12 8.735632
e21 36.73563
e22 10.26437
I II
III=(I-
II)^2 IV=III/II
observed expected (O-E)^2
31 31.26437 0.06989 0.002235
9 8.735632 0.06989 0.008001
37 36.73563 0.06989 0.001903
10 10.26437 0.06989 0.006809
calculated value 0.018948
X2
calculated= 0.018948
X2
table value< X2
calculated
3.8415< 0.018948
Result: Ho. accepted

67. Business Implication:
As the null hypothesis is accepted which means that the amount invested on the preferred investment
is independent of their education.