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RESERACH REPORTON

STUDY OF INVESTMENT PATTERNOF AN INVESTOR TOWARDS VARIOUS

INVESTMENT ALTERNATIVES

ATANGEL STOCK BROKING LTD.

JAMNAGAR

SUBMITTED BYGUSAI CHETANGIRI RAMESHGIRI

MBA SEM – IV

GUIDED BYProf. RAJESH FALDU

ACADEMIC YEAR

2005 – 2007

SUBMITTED TOJAYSUKHLAL VADHAR INSTITUTE OF MANAGEMENT STUDIES

(JVIMS)BIPIN T. VADHAR COLLEGE OF MANAGEMENT

JAMNAGAR

AFFILIATED TOSAURASHTRA UNIVERSITYRAJKOT

1



DECLARATION

I undersigned GUSAI CHETANGIRI RAMESHGIRI student of M.B.A.-IV semester

declare that I have prepared this report on “Study of investment pattern of an

investor towards various investment alternatives available before him” at Angel

Stock Broking LTD. Jamnagar under the guidance of Prof. Rajesh Faldu of JVIMS.

I also declare that this project report is my own preparation and not copied from

anywhere else.

(Signature)

___________

GUSAI CHETANGIRI RAMESHGIRII

Roll No.: 23

2



PREFACE

It gives me a great pleasure to write about this stock broking firm which is especially

prepared with the aim to make the learning process complete with the practical

knowledge. I had visited Angel Stock Broking Ltd., at Jamnagar. The project has

covered the main points which I felt necessary and also given by firm. So, from this

project one can get a raw idea of this stock-broking firm.

I have also conducted a research on, “Study of investment pattern of an investor

towards various investment alternatives available before him.” I have try to find out

the preference of an investor amongst the various investment avenues and also the

manner in which he invest his money in that avenue.

I hope this project will also receive its generous support and kind arrangements

Thanking you.

CHETANGIRI GUSAI

3



ACKNOWLEDGEMENT

My visit at Angel Stock Broking Ltd., at Jamnagar and the project work has taken the

help of many known and unknown faces who have directly or indirectly guided me &

help me.

I take this opportunity to express my sincere thanks to Prof. Rajesh Faldu and Mr.

Jwalant Shingala (Branch Manager), at Angel Stock Broking Ltd. who had played a

very important role in the completion of this project.

I also pay special thanks to the employees who have helped me in providing the

knowledge regarding Angel Stock Broking.

Yours truly,

CHETANGIRI GUSAI

4



CONTENTS

Sr.No.

Particulars

Page No.

1. Executive Summary6

2. Introduction7

(a) Company Details 8

(b) Industry Details 31

(c) Regulatory Environment Details 42(d) Competitors Detail 47

3. Problem Formulation 62

4. Research Objectives 63

5. Research Methodology 65

a) Research Designb) Data collection Methodc) Sampling Methodd) Data Analysis

6. Findings 87

7. Limitation of the study 89

8. Conclusions 90

9.Appendixes :a ) Questionnaireb) List of Chartsc) Glossaryd) Bibliography

93

10. Bibliography 99

5



EXECUTIVE SUMMARY

I have taken training Angel Stock Broking LTD. As per my view it is working

efficiently. It is speedily going to take first place among the private players. I have

done organizational study and also conducted a Research Survey on “Study

Pattern of an investor towards various investment alternatives available

before him.”

Every department of Angel is working very efficiently.

Angel Stock Broking LTD. is having a good financial & promoter background. The

main strength of lies in its Research Team comprising of famous ResearchAnalysts in Technical and Fundamental.

In my Research on “Study Pattern of an investor towards various investment

alternatives available before him.”

In my research I have found out that Nowadays the mind set of Indian investor

has also changed towards stock market. Earlier the Indian investor was of the

belief that investing in stock market was risky but nowadays the scenario has

changed and more and more number of persons are investing their money in it.

6



INTRODUCTION

Indian stock market has been growing by lips & bounce. It is one of the favorite areas of

investment amongst many investors. The investors find it much attractive in terms of

making money and good investment destinations.

Various stock broking firms are available in the market to provide services to the

investor and help him in carry out the transaction in the starting from giving advice in

buying particular script / security till the purchase and sale of the script / security. Angel

stock broking is one of those firms available in the market. It assists such investors who

are willing to invest in the stock market and assist them in every activity relating to thestock market.

The scenario of Indian stock market has been changed drastically recently compare to

what it used to be in past. Now it has become much more systematized through the use

of latest technology and new improved soft wares. Due to these latest technology and

soft wares only trading activities in stock market has become much systematic compare

to what it used to be in the past.

I have conducted a Research on “Study Pattern of an investor towards various

investment alternatives available before him.”

7



COMPANY

DETAILS

8



ABOUT ANGEL

In a shot span of 18 years since inception, the Angel Group has emerged as one of the

top five retail stock broking houses in India, having membership of BSE, NSE and the

two leading Commodity Exchanges in the country i.e. NCDEX & MCX. Angel Broking is

also registered as a Depository Participant with CDSL.

The group is promoted by Mr. Dinesh Thakkar, who started this business as a sub-

broker in 1987 with a team of 3. Today the angel group is managed by a team of 1600+

direct employees and has a nation wide network comprising of 12 Regional hubs, 59

branches and 2200+ sub brokers & business associates. The group currently servicesmore than 1.8lac retail clients. The mainline business activities of Angel are:

• Stock Broking

• Derivatives Trading

• Internet Trading

• Wholesale debt market operations

• Depository services NSDL and CDSL

• IPO Distribution

• Commodities Trading

9



COMPANY’S PROFILE

NAME OF THE COMPANY: ANGEL STOCK BROKING LTD.

REGISTERED OFFICE: G-1, Akruti Trade Centre,

Road No. 7, MIDC Marol,

Andheri (E),

Mumbai – 400 093

BRANCH OFFICE: ANGEL STOCK BROKING LTD.

Indraprashta Building, 2nd Floor,

Office 228-229

Pancheshwar Tower Road,

Jamnagar- 361001

FORM OF ORGANISATION: Private Sector

PROMOTER: Dinesh Thakkar

ACCOUNTING YEAR: 1ST April to 31st March

10



VISION

To provide best value for money to investors through:

Innovative products

Trading / investment strategies

State of the art technology

Personalized service

11



STRENGTHS OF ANGEL

•

Understanding the needs of a channel partner and retail investor very well.

• Deriving inspiration from their vision of providing the best value for money to their

clients.

• Strict adherence to compliance norms.

• Ethical business practices.

• Timely research based advice to their clients.

50 member research / advisory team comprising of experienced fundamental and

technical analysis, sector specialties, derivative strategist and commodity analysts

12



QUALITY ASSURANCE POLICY

Angel is committed to being the leader in providing World Class Products & Services

which exceed the expectations of our customers achieved by teamwork and a process

of continuous improvement.

13



BUSINESS PHILOSOPHY

Ethical Practices & transparency in all their dealings

Customer Interest above all

Always deliver what we promise

Effective cost management

14



INVESTMENT PHILOSOPHY

“Given the client’s risk profile, maximize performance by adhering to disciplined

investment approach backed by quality research.”

Angel’s investment philosophy is based on two key attributes:

1. Wealth Creation

2. Wealth Preservation

15



OBJECTIVE OF ANGEL INVESTMENT PHILOSOPHY

Angel’s objective at all time is to protect and then grow your portfolio.

The primary aim is to avoid the thoughts of the declining market and not necessarily

out-perform the rapidly rising market but to consolidate both the periods, which would

result in out-performing the market along with wealth creation.

Angel’s investment philosophy is outlined by in-depth focus on a disciplined long term

investment approach in potential multi-baggers.

The 3 important tenets that we look for in any stock are:

• Consistent, steady & sustainable returns

• Margin of safety

• Low volatility

16



CRM (Customer Relationship Management) Policy

Angel CRM policy is as follows:

“A customer is the most important visitor on our premises. He is not dependent on us

but we are dependent on him. He is not an interruption in our work but is the purpose of

it. We are not doing him a favour by serving. He is doing us a favour by giving us an

opportunity to do so.”

17



ORGANISATION CHART

ANGEL STOCK BROKING LTD, NATIONAL BRANCH

GENERAL MANAGER

HEAD RETAIL SALES MANAGER

ZONAL MANAGER

REGIONAL MANAGER

BRANCH MANAGER

RELATIONSHIP MANAGER

Chart - 1

18



SWOT ANALYSIS

STRENGTH:

• Strong Communication Network.

• Good Image and strong back ground.

WEAKNESS:

• High Employee Turnover.

OPPORTUNITY:

• To get into the segment of such investors who are less risky.

• Marketing at rural and semi-urban areas.

THREATS:• Increasing number of local players.

• Past image of Stock market

MANAGEMENT TEAM

19



Sr. No. Names Designation

1 Mr. Dinesh Thakkar Chairman & Managing Director

2 Mr. Rajen Shah Chief Investment Officer

3 Mr. Phani Sekhar Senior Research Analyst

SERVICES PROVIDED

1. E Broking:

Multiple exchanges on single screen

Intra-day calls & flash news

Historical charts with technical tools

2. Research

20



Daily services

Technical services

Fundamental services

3. Investment Advisory Service

Angel offers personalized advisory services to HNI investors and actively assists themin managing their portfolio...

Web enabled centralized back-office

Centralized help desk services

E-contract notes cum bills

4. Commodities

State-of-the-art internet trading platform

Trading & educational seminar

Efficient risk management

5. Demat service

Hassle free automated pay-in

Wide branch coverage

Centralized billing & accounting

6. Value Added back office service

Centralized help desk services

E-contract notes cum bills

21



RESEARCHDEPARTMENT

TOP QUALITY RESEARCH

Market Outlook at 9:30 AM

A crisp pre-market report that arms our clients with sensitive information before the

opening bell. Key corporate developments, policy announcements, geo-political news

and views are analyzed for their impact on the market

Technical Report at 6:00 PM

22



This report analyses trading patterns, historical background, market position of keystocks and offer short term (1 to 5 days) as well as medium term (10 to 20 days) views.Tracking individual scrips as well as the Sensex and Nifty, its insight cuts through themarket maze

Derivative Analysis Report

The report provides FII activity in derivative segments, change in open interest, put callratio, cost of carry of stock and index based derivative products. Our derivative analystsuse the above tolls to project the movement during the next trading sessions

Commodities Services

Agro Tech Speak:

Mainly gives the investors insight into and a forecast for agro commodities viz. pulses

(urad channa etc); reports on oil complex (soyabean castor etc.) along with spices with

reports on kapas guar seed

23



Call Evaluation:

A report designed for evaluating the calls given by the angel research team where the

reports are classified in 3 broad categories viz. achieved , triumph, not achieved alongwith the trade recommendations

Commodities Tech Speak:

This report mainly equips the investors dealing in MCX segment in commodities like

gold, silver, crude oil, copper etc with the market insight and expert recommendation on

the trading strategies

24



PORTFOLIO

MANAGEMENTSERVICE

Angel PMS – Ideal For

Portfolio Management Services from Angel are essential for investor who needed

Long term wealth generation

Personalized service

25



Investment opportunities in Indian equities

Fundamental research based investment decisions

In essence, all investor who have faith and belief in the Indian growth story and

robust corporate performance would find Angel PMS most suitable to meet their

objectives.

PMS Schemes @ Angel

Scheme 1: Angel OYSTER

Description:

The main objective of the scheme is wealth generation by delivering superior

returns over long term through investments and equity related instruments.

Investment Strategy:

26



To generate wealth on consistent basis rather than outperform by taking

higher risk.

Logic works well and thus will be given weight age along with financials

Early identification of stocks to ride through the entire investment cycle

Timing of investment is important to generate superior returns

Bottom –up approach

Parameters Driving Investment Decision:

Blend of growth and value stocks

Investments in companies regardless of market capitalizations

Keen selection of stocks based on potential for value unlocking based on

key events

Focus on companies which display

* Scalable business potential

* Large market opportunity

* Beneficiary of favorable economic cycle

* Valuation at steep discount to asset value

27



Sectoral Composition:

May include under- researched companies

Portfolio could invested in liquid funds

Investor Profile:

Safety of capital will be of utmost importance

The scheme would be suited for investors having medium to long term

perspective (i.e. 12-18 months)

Scheme 2: Angel BLUE- CHIP

Description:

The objective of the scheme is to generate capital appreciations in the medium to

long term through investments in equities and equity related instruments

comprising predominantly large cap companies.

Investment Strategy:

The scheme will seek to achieve returns through brand based participants

in equity markets by creating a diversified equity portfolio. The portfolio

will be overweight on large cap companies.

28



The portfolio strives at all time to achieve an 80% allocation to large cap

companies.

The allocation of sectors and stocks in the portfolio may be dynamically

structured in tune with changes in broader market conditions

Parameters Driving Investment Decision:

Overweight on large cap stock. However quality mid cap stocks may also

be considered for investment.

Portfolio to comprise of a combination of growth & value stocks.

The portfolio strives to limit the exposure to any sector to less than 25% of

the portfolio size

The portfolio strives to limit the exposure to any stock to less than 10% of

the portfolio size

29



The allocation and composition of medium capitalized stocks to vary based

market conditions

Investor Profile:

The scheme would be suited for investors with low to moderate risk

appetite

The scheme would be suited for investors having medium to long term

perspective.

INDUSTRY

30



DETAILS

INDUSTRY DETAILS

After looking at the details about the company it will be pleasure to get the detail

about the industry. The detail regarding the industry comprises the factors that are too

included in the industry in which the existing company belongs.

31



INDIAN CAPITAL MARKET

The function of the financial market is to facilitate the transfer of funds from

surplus sectors (lenders) to deficit sectors (borrowers). Normally, household have

excess of funds or savings, which they lend to borrowers in the corporate and public

sectors whose requirement of funds far exceeds their savings. A financial market

consists of investors or buyers, sellers, dealers and does not refer to a physical location.

It means that it is not requirement of existence of any physical place in the market. We

can say any condition that it is market when any purchaser and seller come into

existence. And in case of capital market we can say any condition a market when there

is an existence of investors and borrowers of the fund. Formal trading rules and

32



communication networks for originating and trading financial securities link the

participants in the market.

Electronics form of Stock Exchange:

NSE:

Tata consultancy services, a division of Tata sons Ltd., was selected as the

prime contractor and system integrator by the NSE to provide a total turnkey solution for

the money market and capital market’s floorless trading system.

The aim was to enable NSE to provide nation-wide electronic trading with highest

transparency in the market place. Using the client-server architecture, fault-tolerant

computing and in memory database, Tata Consultancy Services solution gave NSE

high visibility and impact.

33



Tata Consultancy Services also developed the local and nation wide clearing and

settlement system to run in oracle RDBMS environment. There are 1069 company has

been listed in the market. In NSE average daily turnover is Rs. 55,499 crore and

average daily 43, 54,568 trades happen

BSE:

BOLT i.e. BSE’s Online Trading System, is designed and developed by CMC Ltd,

now a Tata Group company. This screen-based trading system replaced the manual out

cry method of trading in the ring and went live on March 1995. This enabled BSE to

provide floorless and fully automated screen-based trading facilities in the capital

market instruments with equal access to investors all over the country.

Currently, there are 7314 companies has been listed at BSE and shows an

average daily turn over of Rs. 3515 crore.

34



For the furtherer expansion of its activities, BSE decided to provide web based

trading facility to the members as it was felt that Internet trading would fundamentally

change the way exchange and brokers interact with their customers. Tata Consultancy

Services developed the system with the objective of enabling the exchange to serviceits members and the customers of the members in an efficient manner using the

Internet.

OVERVIEW OF NATIONAL SECURITIES DEPOSITORY LIMITED (NSDL)

In a span of about four years, investors have switched over to electronic (Demat)

settlement and NSDL stands at the center of this change.

NSDL is the first depository to be set up in India. It was incorporated on Dec. 12,

1995. IDBI the largest development bank in India, UTI the largest Indian mutual fund

and the NSE the largest stock exchange of India sponsored the setting of NSDL and

subscribed to the initial capital. NSDL commenced operations on Nov. 8, 1996.

35



The following organizations are the shareholders of NSDL

• Industrial Development Bank of India

• Unit Trust of India

• National Stock Exchange

• State Bank of India

• Global Trust Bank Ltd.

• Citibank NA.

• Standard Chartered Bank.

• HDFC Bank Ltd.

• The Hong Kong and Shanghai Banking Corporation Ltd.

• Deutsche Bank.

• Dena Bank.

• Canara Bank

Promoters / Shareholders

• Promoters

• Industrial Development Bank of India Limited

• Unit Trust of India

• National Stock Exchange of India Limited

• Other Shareholders

36




• Oriental Bank of Commerce

• Citibank NA

•

Standard Chartered Bank• HDFC Bank Limited

• The Hong Kong and Shanghai Banking Corporation Limited

• Deutsche Bank

• Dena Bank

• Canara Bank

• Union Bank of India

CORE SERVICES OF NSDL

37

CORE

SERVICE

S

Accountopening

CORPORATE

ACTION

PLEDGEANDHYPOTHE-CATION

STOCKLENDING

ANDBORROWI

NG

PUBLICISSUES

TRADING ANDSETTLEMENT

DEMATERI-LIZATION

TRANMISSIN AND

NOMINATION



Operations performed at a depository are as follows:-

• Holds Securities in accounts

• Transfer Securities between accounts

• Transfers without handling physical securities.

• Safekeeping of securities

In the Depository:-

• All joint holders to sign instructions.

• No minimum balance required.

• Interest can be earned only be participating in Stock Lending Scheme.

38



• Does not move balances in account without account holder’s authorization.

• Signature and photograph of nominees to be provided.

• Providing the safety of shares of the share holders which are in their Demat

account and in the Trading account.

SERVICE STANDARDS OF NSDL

A DP has to deal in business with the following characteristics:-

• Sensitive and Demanding clients

• Intense competition on the price front due to which the profit margins are under

tremendous pressure

• Thin profit margins require high volume of clients/transactions for operating the

DP services profitably

• High volume of business is error prone, unless supported by appropriate systems

and quality of manpower

39



OVERVIEW ABOUT CENTRAL DEPOSITORY SERVICES (INDIA)

LIMITED (CDSL)

CDSL is the second depository set up by the Bombay Stock Exchange

(BSE) in India. It commenced its operations on March 22, 1999. It was set up

BSE and other co – sponsored with the net worth of Rs. 104 crores. In it BSE has

a 45 % stake while others have 55 % stake. In the same year it has Five Stock

Exchanges established connectivity with it for offering trade in Demat securities

and 765 companies signed up with it to get their securities admitted for

dematerialization. It has 13 DPs in 91 cities across 168 locations covering 320

cities. Other co – sponsored are as under.


• Bank of India

• Bank of Baroda

• HDFC Bank

CDSL has also attained membership of the Asia – Pacific Central

Securities Depository Group (ACG). ACG has 22 members including depositories

from Japan, Jog Kong, Singapore, Malaysia, Australia, and New Zealand.

Membership of the organization is expected to help CDSL enhancing its

knowledge base and contributing to the development of other member

organizations in the best international practices, settlement risk management,

cross-border linkage and technological development. This, in turn, would help

CDSL to secure foreign institutional investors’ business through their custodian.

40



Operations Performed by CDSL

• Carrying out actually share transactions

•

To do PSU disinvestments• To provide Centralized system at one e-space

• To secure Foreign Institutional Investors’ business

• Dematerialization of the Securities

• Pledge creation in against the securities

• Rematerialization

• Trading and settlement on day to day basis

• Work as a custodian of its clients

41



REGULARTORY

ENVIRONMENT

DETAILS

42



REGULATORY ENVIRONMENT DETAILS

LEGISLATION

The four main legislations governing the securities market are:

(a) The Securities Contracts (Regulation) Act, 1956, preventing transactions

in securities by regulating the business of dealing insecurities

(b) The Companies Act, 1956, which is a uniform law relating to companies

throughout India

(c) The SEBI Act, 1992 for the protection of interests of investors and for

promoting development of and regulating the securities market, and

(d) The Depositories Act, 1996 which provides for electronic maintenance and

transfer of ownership of dematerialized securities.

RULES AND REGULATIONS

The Government has framed rules under the SCRA, SEBI Act and the

Depositories Act. SEBI has framed regulations under the SEBI Act and the

depositories Act for registration and regulations of all market intermediaries, for

prevention of unfair trade practices, insider trading, etc. Under these Acts,

Government and SEBI issue notification, guidelines, and circulars which need to

be compiled with by market participants. The self-regulatory organizations

(SROs) like Stock Exchanges have also laid down their rules.

43



REGULATORS

The regulators ensure that the market participants behave in a desired

manner so that the securities market continues to be a major source of finance

for corporate and government and the interest of investors are protected. The

responsibility for regulating the securities markets shared by Department of

Economic Affairs (DEA), Department of Company Affairs (DCA), Reserve Bank

of India (RBI), Securities and Exchange Board of India (SEBI) and Securities

Appellate Tribunal (SAT).

44



OBJECTIVES OF SEBI

The promulgation of the SEBI ordinance in the parliament gave status to

SEBI in 1992. According to the preamble of the SEBI, the three main objective

are:

• To protect the interests of the investors in securities

• To promote the development of securities market

• To regulate the securities market

FUNCTIONS OF SEBI:

The main functions entrusted with SEBI are:

• Regulating the business in stock exchange and any other securities

market

• Registering and regulating the working of stock brokers, share transfer

agents, bankers to the issue, trustees of trust deed, registrars to am issue,

merchant bankers, underwriters, portfolio managers, investment advisers

and such other intermediaries who may be associated with securities

market in any manner.

• Registering and regulating the working of collective investment schemes

including mutual funds

• Promoting and regulating self-regulatory organizations

• Prohibiting fraudulent and unfair trade practices in the securities market

• Promoting investors education and training of intermediaries in securities

market

• Prohibiting insiders trading in securities

• Regulating substantial acquisition of shares and take over of companies

• Calling for information, undertaking inspection, conducting enquiries and

audits of the stock exchanges, intermediaries and self-regulatory

organizations in the securities market.

45



REGISTRATION OF INTERMEDIARIES:

The intermediaries with securities market shall buy, sell or deal in

securities after obtaining of registration from SEBI, as required by section 12:

1. Stock-broker

2. Sub-broker

3. Share transfer agent

4. Banker to an issue

5. Trustee of the trust deed

6. Registrar to an issue

7. Merchant banker

8. Underwriter

9. Portfolio manger

10. Investment advisor

11. Depository

12. Depository participant

13. Custodian of securities

14. Foreign institutional investor 15. Credit rating agency

16. Collective investment schemes

17. Venture capital funds

18. Mutual funds

19. Any other intermediary associated with the securities market

46



COMPETITOR’SDETAILS

47



COMPETITORS DETAILS

•

STOCK HOLDING CORPORATION OF INDIA LIMITED

• MOTILAL OSWAL

• ICICI BANK

• SHARE KHAN

• UTI BANK

• MARWADI GROUP

• CENTURION BANK

• HDFC

• KOTAK

• PRANAV SECURITIES

• MERRILL LYNCH

• OTHER STOCK BROKERS

• ANAGRAM SECURITIES

48



SHCIL (STOCK HLDING CORPORATION OF INDIA LIMITED)

Stock Holding Corporation of India Limited (SHCIL) was promoted by

public financial institutions and insurance majors like IDBI, UTI, ICICI, LIC, GIC

and its subsidiaries, IFCI and IIBI. SHCIL was incorporated as a public limited

company on July 28, 1986.

SHCIL provides depository, post trading, custodial services,

securities lending, to institutional investors and retail investors.

Other auxiliary services provided by SHCIL include derivatives clearing,

PF fund accounting, SGL constituent account services, mutual funds and other

capital market instruments distribution

MOTILAL OSWAL

The company came into existence in 1987 with small business house. The

following are the function of the motilal Oswal

They are the Distributor of Mutual Funds same as Karvy they are the ARN

code holder who can sell the mutual fund of all the company

49

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They have registered themselves with NSE and do the functions of

Derivatives market, commodity market, cash market

ICICI BANK

ICICI Bank is India's second-largest bank with total assets of about

Rs.1,67,659 crores at March 31, 2005 and profit after tax of Rs. 2,005 crores for

the year ended March 31, 2005 (Rs. 1,637 crores in fiscal 2004). ICICI Bank has

a network of about 560 branches and extension counters and over 1,900 ATMs.

ICICI Bank offers a wide range of banking products and financial services to

corporate and retail customers through a variety of delivery channels and through

its specialized subsidiaries and affiliates in the areas of investment banking, life

and non-life insurance, venture capital and asset management. ICICI Bank set

up its international banking group in fiscal 2002 to cater to the cross border

needs of clients and leverage on its domestic banking strengths to offer products

internationally. ICICI Bank currently has subsidiaries in the United Kingdom,Canada and Russia, branches in Singapore and Bahrain and representative

offices in the United States, China, United Arab Emirates, Bangladesh and South

Africa.

SHAREKHAN

50

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http://images.google.co.in/imgres?imgurl=http://www.chennaionline.com/cityfeature/events/images/icici01.jpg&imgrefurl=http://www.chennaionline.com/cityfeature/events/08-icici.asp&h=150&w=200&sz=6&tbnid=Bk9SCQrgWMgFbM:&tbnh=74&tbnw=99&hl=en&start=4&prev=/images%3Fq%3Dicici%2Bbank%26svnum%3D10%26hl%3Den%26lr%3D



Sharekhan is an equities focused organization tracing its lineage to SSKI,

a veteran equities solutions company with over 8 decades of experience in the

Indian stock markets.

In the stock markets. Sharekhan does not claim expertise in too many

things. Sharekhan's expertise lies in stocks and that's what he talks about with

authority. So when he says that investing in stocks should not be confused with

trading in stocks or a portfolio-based strategy is better than betting on a single

horse, it is something that is spoken with years of focused learning and

experience

Sharekhan brings a user- friendly online trading facility, coupled with a

wealth of content that will help investors stalk the right shares.

UTI BANK

UTI BANK is a registered member (Depository Participant) of NSDL.

India’s first depository. We can avail all of the depository-related services by just

opening an account with NSDL through UTI Bank.

UTI Bank provides services like dematerialization of shares,

rematerilialization, pledge-Hypothecation, freezing/ locking Of Accounts, transfer

of shares and settlements, receipt of corporate benefits, holdings & transaction

statements on email, tele depository services.

51

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MARWADI SHARES AND FINANCE PRIVATE LIMITED

Marwadi Shares And Finance Pvt. Ltd. Was incorporated in

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codes. The company ranked among top 50 broking houses. It has 250 franchisee

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CENTURION BANK

Centurion Bank, as its very positioning suggests, has an extensive

network of branches across India. And each of these branches are harnessed to

state of the art technologies to offer unparallel customer service. But of course,

we go way beyond merely offering our valued customers technology driven

solutions. Centurion Bank constantly endeavors to offer customized services that

are driven by customer requirements rather than just exhibiting technologicalprowess.

Among Centurion Bank’s greatest strengths is the fact that it is a

professionally managed bank with a globally experienced management team.

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They provide services like Personal Banking, Retail Loans, NRI Services, Demat,

Cash Management, e PAY solutions

HDFC (HOUSING DEVELOPMENT FINANCE CORPORATION)

HDFC was found over two decades ago, in 1977, their solution for

success is customer satisfaction. They think “All you need is the courage to

innovate, the skill to understand your clientele and the desire to give them your

best.”

Today, over a million satisfied customers whose dreams are realize by

HDFC, stand testimony to their success. Their objective, from the beginning, has

been to enhance residential housing stock and promote home ownership.

Now, their offerings range from hassle-free home loans and deposit

products, to property related services and a training facility.

They also offer specialized financial services to their customer base

through partnerships with some of the best financial institutions worldwide.

KOTAK SECURITIES

Kotak Securities, an affiliate of Kotak Mahindra Bank, is the stock-

broking and distribution arm of the Kotak Mahindra Group. The institutional

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business division, which brings you AKSESS, primarily covers secondary market

broking. It caters to the needs of foreign and Indian institutional investors in

Indian equities (both local shares and GDRs, Global Depository Receipts). The

division also has a comprehensive research cell with sectorial analysts covering

all the major areas of the Indian economy.

The group a net worth of over Rs.1, 550 crores and employs over 3,000

employees in its various businesses. With a presence in 59 cities in India and

offices in New York, London, Dubai and Mauritius, it services a customer base of

over 5, 00,000

Kotak Mahindra has partnerships with Goldman Sachs (one of the world's

largest investment banks and brokerage firms), Ford Credit (one of the world's

largest dedicated automobile financiers) and Old Mutual (a large insurance,

banking and asset management conglomerate).

Pranav Securities

Pranav Securities is India's first ISO 9001: 2000 certified broking house. A

Rs. 120 mn. Net worth – among the better capitalized houses in the industry. A

fully professional, young and dynamic organization promoted by Mr. Pranav M.

Shah and the Sonex Group of Hong Kong presence on all the leading exchange

segments on the cash and Derivative markets. Expertise in cross border

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of OCBs and NRIs. Track record of profitable ideas fro our clients with research

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inputs that are widely quoted in local and international print/electronic media. A

veritable galaxy of research products catering to different time horizons and

investment needs.

MERRILL LYNCH

Merrill Lynch is one of the world’s leading financial management and

advisory companies, with offices in 36 countries and total client assets of

approximately $1.6 trillion, at the end of 2004.

Merrill Lynch has three core businesses – Global Private Client, Global

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Merrill. As an investment bank, the company is a leading global

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$501 billion at the end of 2004.

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BAJAJ CAPITAL

Bajaj Capital is SEBI approved merchant bankers, investment advisors

and financial planners. They have a track record of ethical dealings for the last 38

years and have had the honor of helping millions of investors achieve their life's

financial goals.

ANAGRAM SECURITIES

Anagram Securities is the part of the Rs. 2000 crores Lalbhai Group. It

was found in 1993 and is a member of the National Stock Exchange. Last year

their trading crossed Rs. 17000 crores with around 5000 people making. They

are dealing only in Stock Market and nothing else. Though they are doing good

research work regarding companies and market which will be the beneficial to

the investors. Gujarat state is one of the most important fields of their business.

And they have about 30 branches throughout Gujarat

56

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PRODUCTS & SERVICES

Angel stock broking offers a full range of financial services and products

ranging from Equities to Mutual Fund to enhance your wealth and hence achieve

your financial goals.

Angel stock broking offers real-time prices, detailed data and news, intelligent

analytics, and electronic trading capabilities, right at your fingertips. This powerful

technology is complemented by our knowledgeable and customer focused

Relationship Managers.

Angel’s Relationship Managers are available to you to help with your

financial planning and investment needs. To provide the highest possible quality

of service. Angel provides full access to all products and services through multi-

channels. Services provided are as below

• Equities & Derivatives

• Depository Services

• Commodities

• Mutual Funds

• IPOs

57



Equities & Derivatives and Commodities:

Our Retail Equity Business caters to the needs of individual Indian and

Non Resident Indian (NRI) investors. Angel offers broker assisted trade

execution, automated online investing and access to all IPOs.

Through various types of brokerage accounts Angel offers the purchase

and sale of securities which includes Equity, Derivatives and Commodities

Instruments listed on National Stock Exchange of India Ltd. (NSEIL). The Stock

Exchange, Mumbai (BSE), NCDEX and MCX.

58



Depository Services

Angel is a depository participant with the National Securities Depository

Limited and Central Depository Services (India) Limited for trading and

settlement of dematerialized shares. Angel performs clearing services for all

securities transactions platform – execute trades through Angel Securities and

settle these transactions through the Angel Depository Services. Angel

Depository Services is part of our value added services for our client that create

multiple interfaces with the client and provide for a solution that takes care of all

your needs.

59



RESEARCH

60



PROBLEM FORMULATION

Research being a logical process definitely follows predetermined or steps in

order to obtain the desired results or outcomes. Though the entire process of

research is quite complex and requires a considerable degree of knowledge and

skill, the step of problem formulation is most challenging and critical one for the

researcher as well as the research. It is rightly said that a problem, well defined is

half solved.

The Research topic undertaken by me is “Study of the Investment Pattern of

an investor towards various investment alternatives available before him. ”

61



Research Objective

Any activity done without any objective cannot turn fruitful. An objective provides

a specific direction to an activity. Objectives may range from very general to very

specific, but they should be clear enough to point out with reasonable accuracy

what researchers wants to achieve through the study and how it will be helpful to

the decision maker in solving problem.

In context of my project study

The main objectives of my research is to” Study of the Investment Pattern of

an investor towards various investment alternatives available before him. ”

However following are the sub objectives.

To identify the investor preference towards various investment

alternatives.

To identify whether the investor is a risk taker or seeks safety of his funds.

What is the ratio of his risk & return?

To identify the short term or long term investor.

62



RESEARCH

METHODOLOGY

63



RESEARCH METHODOLOGY

A research design is a pattern or an outline of a research project’s workings. It is

a statement of only the essential elements of a study, those that provide the

basic guidelines for the details of the project.

If there were no research design, the research would have only foggy notion

about what is to be done. There are numerous specific designs, which can be

classified into three broad categories.

Descriptive Design

Quasi Experimental Design

Experimental Design

64



Descriptive Design:

These designs have its name because they describe a phenomenon

without establishing association between the factors. Hence these designs

are utilized when a need is to produce accurate description of variables.

Quasi Experimental Design :

These designs as the name implies lacks the vigorous qualities of real

experiments particularly valid demonstration of variable association. Still

they are not descriptive ones.

Experimental Design:

These designs are intended to demonstrate cause and effect relationship

such designs can measure communicate variation i.e. degree of change in

one variable ‘y’ when another variable ‘x’ is changed.


In context of my project study my research design would be descriptive

design.

65



SAMPLING METHOD

The sampling method can be categorized in the following manner:

• Probability Sampling

• Non Probability Sampling


In my research the sampling method would be Non Probability Judgment

Sampling

Sample Size

In my research the sample size is 100.

67



DATA ANALYSIS

AND

INTERPRETATION

68



INVESTMENT IN VARIOUS ALTERNATIVES

M.F.

20%

Govt.Sec.

22%

Stock market

45%

Commodities

5%

Real estate

8%

Chart- 2

From above graph it is observed that 45% of the people invest in the stock

market, after that Government Securities is the second preferred investment

alternative and Mutual Fund is the third preference for investment and

69



Commodities Market is the least preferred investment alternative amongst all

investment alternatives.

Nowadays, more and more investors are investing in the stock market and

awareness and knowledge of stock market is increasing by leaps and bounce

whereas commodities market in India is not yet preferred by the Investors

compare to other alternatives like Mutual Fund, Government Securities, Real

Estate etc.

INVESTMENT CRITERION

Good return

45%

Quick return

20%

Liquidity

25%

Safety of funds

8%

Other

2%

Chart- 3

The above chart depicts that 45% of the investors wants to earn a goodreturn from their investment after that 25% of the investors prefers that

their investment should provide highly liquidity that means they should be

able to sale them as and when they are in need of money, 20% of the

investor wants quick return from their investment while 8% of the investor

wants safety of their funds.

70



PREFERENCE IN MUTUAL FUND SCHEME

Open - ended

57%

Close - ended

29%

Both

14%

Chart- 4

The above chart depicts that open ended scheme is highly preferable

amongst the Mutual Fund investors. 57% of the Mutual Fund investors

prefer to invest in Open- ended Mutual Fund Scheme while 29% of the

investors prefer to invest in Close ended scheme while 14% of the

investors prefer to invest in both the types of the schemes.

71



The main reason why the investor prefers Open ended scheme is that the

investor has the option of selling his units in the market any time according

to his likings.

INVESTMENT IN GOVERNMENT SECURITIES

K.V.P.

25%

Fixed Deposits

37%

Government

Bonds

9%

N.S.C.

6%

Post -office

Deposits

21%

Other

2%

Chart -5

According to the above chart Fixed Deposits are still the best investment

avenue amongst the investors who invests in the Government Securities

with 37% investors investing in it, after that K.V.P.(Kishan Vikas Patra)

comes second with 25% of the investor investing in it, after that Post office

deposits comes where 21% of the Investors invests money while in N.S.C.

( National Saving Certificate) 6% of the investors are investing money.

72



INVESTMENT IN REAL ESTATE

Land

45%

Building&Infrast

ructure33%

Both

22%

Chart- 6

The investors who prefers Real Estate as an investment alternative 45%

of them prefers Land as an investment alternative while in Building &

Infrastructure 33% of the investor invest their money while 22% of the

investors invest their money in both the investment alternative.

73



INVESTMENT IN COMMODITY

MCX

59%

NCDEX

29%

Both

12%

Chart- 7

Amongst the investors who prefers to invest in the commodity market 59%

of them invest/ trade in MCX while 29% of them invests/ trades in NCDEX

while 12% of them prefers both MCX & NCDEX.

74



INVESTMENT IN MCX

Copper

24%

Gold

42%

Silver

20%

Crude - Oil

10%

Other

4%

Chart- 8

From the chart we can conclude that amongst the investor who prefers to

invest/ trade in MCX trade / invest in Gold most with 42% and after that

copper comes with 24% then silver comes with 20% preference then

crude comes with 10%.

75



INVESTMENT IN NCDEX

Wheat

52%

Kapas

15%

Jiru

6%

Channa

18%

Other

9%

Chart -9

The above chart shows that the investor trade / invest in NCDEX prefers

wheat first with 52% after that channa comes second with 18% and thenkapas with 15% then followed by 6%.

76



TYPE OF INVESTOR IN STOCK MARKET

Investor

33%

Trader

22%

Both

45%

Chart- 10

The above chart depicts that 33% of the investors who prefers stock

market as an investment alternative are investors who invests for a longtime compare to trader with 45% who invest for a shorter period of time.

77



PARAMETERS CONSIDERED BEFORE INVESTING IN ANY

COMPANY

Profitability

44%

E.P.S.

17%

Company image

26%

Market capital

10%

Other

3%

Chart- 11

The above chart depicts the parameters which the investor considersbefore investing into particular script of the company. From the chart we

can conclude that majority of the investors considers profitability first with

44% after that the second preference is given to the company image with

26% followed by E.P.S. with 17% and market capital 10%.

78



HOW INVESTOR TAKES BUYING DECISION IN THE STOCK

MARKET

Own knowledge

13%

Advice from

Broking house

50%

Advice from

Friend/Relative

31%

Other

6%

Chart- 12

The above chart shows the various factors from which the investor takes

the buying decision in the stock market. We can conclude that majority of

the investor takes the buying decision from the advice from the broking

house with 50% and 31% takes from the advice from friends / relatives

while only 13% takes buying decision from their own knowledge.

79



INVESTOR'S RETURN CRITERION

Book Profit

41%

High Return

31%

Moderate

Average Return

21%

Other

7%

Chart- 13

The chart shows the return criteria of the investor who are investing in the

stock market for a longer period of time compare to trader. We can see

from the chart that 41% of the investors have the tendency of booking of

the profit while 31% of the investors are looking for higher return whereas

21% are looking for moderate / average return.

80



TRADING PATTERN OF TRADER IN STOCK MARKET

Intraday

22%

Future & Option

33%

Other

5%

Both

40%

Chart- 14

The above chart depicts the trading pattern of a trader who is investing for

a shorter period of time in the stock market. By looking at the chart we can

say that 33% of the traders prefers trading in Future & Options while 22%

of the traders prefers Intraday as the trading pattern, whereas majority of

them prefers trading in both with 40%.

81



TRADER’S RISK & RETURN RATIO

High Risk& High

Return

43%

Low Risk& Low

Return

21%

Moderate

Risk&Moderate

Return

29%

Other

7%

Chart- 15

The above chart depicts the ratio between the risk & return of a trader in a

Stock Market. The chart shows that 43% of the traders believe in the ratio

of the high risk & return while 29% of the traders believe in Moderate risk /

Moderate return while 21% of the traders are of the side of Low Risk &

Low Return.

82



EDUCATIONAL DETAILS OF THE RESPONDENTS

Under Graduate

48%

Post Graduate

23%

Other

29%

Chart- 16

The chart shows the educational background of the respondents. From

the chart we can see that 48% of the respondents are under graduate

while 23% of them are post graduate whereas 29% of them belong to

other background such as under 12th, 10th etc.

83



INCOME (MONTHLY) OF RESPONDENTS

>10000

26%

10,000-25,000

44%

25,000-35,000

18%

<35,00012%

Chart- 17

The above chart is about the income (monthly) of the respondents which

shows that maximum 44% of them belong to the class of 10,000- 25,0000

while 26% of them belong to the class of <10,000 whereas 18% of the

respondents belong to the class of 25,000-35,000 and 12% of them

belong to the class of >35,000 per month.

84



FINDINGS

• It has been noticed that more and more no. of people are now investing in

the stock market compare to other investment alternatives Mutual Fund,

Government Securities, Real Estate, Commodities market etc.

• The prime criteria of an investor regarding investment are good return

after that liquidity comes second.

• In Mutual fund the investor prefers open ended scheme more than close

ended scheme.

• In Government securities investors first preference is Fixed Deposits than

K.V.P. (Kishan Vikas Patra) comes.

• In Real Estate Land is the favourite investment alternative for Investor.

• In Commodities market Investor trades more in MCX compare to NCDEX

• In MCX investors trade mostly in Gold.

• In MCDEX market investor trade most in Wheat

86



• In Indian Stock Market investor are more of both the types i.e. Investor &

Trader compare to either Investor or Trader

• The Investor before investing into any company first factor he considers

the profitability of the company.

• The investor’s buying decision is highly influenced by the Advice / Tips

from the broking house

• More no. of investors are working on the strategy of booking the Profit.

• More no of traders are doing trading in both the patterns i.e. Intra day &

F.O. (Future & Options.)

• Most of the trader believes in the ratio of high risk & high return

• More no. of respondents belong to the under graduate educational

background

• Most no. of the respondents belong to the income (per month) level

10,000-25,000

• Most no. of the respondents belongs to the middle class.

87



LIMITATIONS

• Due to limitation of time and cost constraints a sample size of only 100

respondents is chosen.

• This research is done within the Jamnagar city only therefore findings

and suggestion given on the basis of this research cannot be considered for

the entire universe.

• Data analysis and interpretation done may not be that strong due to

small sample size.

• The information given by the respondent may not be 100% genuine.

88



.

CONCLUSION

• It has been noticed that more and more no. of investors are now

preferring Stock Market as an investment alternative compare to another

investment avenues.

• The scenario of Indian stock market has been changed compare to what

it used to be in past.

• The investor who seeks safety of his funds and stability of returns

prefers government security compare to other investment alternatives

• The perception of Indian investor regarding Indian Stock Market has

changed drastically. It has been now seen as an investment avenue

compare to earlier when people used to believe that Stock Market is

highly risky.

• Most of the investor in stock market takes the buying decision from theadvice / tips from the broking house.

• The awareness level and knowledge of stock market has been

increasing by leaps and bounce

89



• Professional and Business class, which is considered to be the most

knowledge class, prefers stock market as an investment tool rather than

doing trading.

• The investor prefers Stock Market more because of Good return and

highly liquidity.

• Due to the uncertainty of return and various scams most of the Investors

do not prefer Stock Market as an investment alternative.

• The trader in the stock market believe in taking the more risk and they

believe in the ratio of high risk & high return.

• Most of the investor preferring land as an investment alternative mainly

due to tax saving purpose.

• The investor in Mutual Fund prefers open ended scheme than close

ended scheme.

• The Investor possess less knowledge of Commodity Market compare to

Stock Market

90



RECOMMENDATIONS

• The awareness and knowledge amongst the investors is less regarding

the investment alternatives available before him. So, the company should

conduct various seminars and presentation to guide the investor and

increase their knowledge.

• Company should concentrate more on its Marketing Department

• The high employee turn over is a big concern for the company. So the

company should recruit such persons who can serve the organization for a

long time

• The company should send their representative to the investor and make

them aware of the various services & benefits they get compare to other companies.

91



• The company should also try to come out with some new products which

are not yet launched in the market. This is possible with some Research

and Development. So company should spend on R & D.

QUESTIONNAIRE:

Dear respondents I am conducting a survey on “To Study the Investment Pattern of

an investor towards various investment alternatives available before him.” Kindly

corporate in my research by giving genuine answers.

1. Where do you invest your money?

Mutual fund

Government securities

Stock market

Commodities

Real estate / Properties

Other

2. What is your investment criterion? Good return

Quick return

Liquidity

Safety of funds

Other

92



3. If you are investing in mutual fund then in which scheme do you prefer?

Open-ended scheme

Close-ended scheme

Both of the above

4. If you are investing in Government securities where do you invest your money?

K.V.P.

Fixed deposits

N.S.C.

Post office deposits

Government Bonds

Other

5. If you are investing in real estate where do you invest your money?

Land

Building & Infrastructure

Both of the above

6. If you are trading in Commodity then in which market do you trade?

MCX

NCDEX

Both

7. If you are investing in MCX then in which commodity do you trade most?

Copper

Gold

Silver

Crude-oil

Other

8. If you are investing in NCDEX then in which commodity do you trademost?

Wheat

Kapas Channa

Ziru

Other

9. If you are investing in stock market what type of investor you are?

Investor

93



Trader

Both of the above

10.Which parameters you look before investing in a particular company?

Profitability position

EPS Image

Market capital

Other

11.How you take the buying decision regarding any particular script/security?

Own knowledge

Advice/tips from the broking house

Advise/tips from friends or relatives

Other

12.If you are investor then what is your return criteria?

Book profit

High return

Average/moderate return

Other

13.If you are trader then what is your trading pattern?

Intraday

Future & Option

Both of the above Other

14.If you are a trader what is your risk& return ratio?

High risk & high return

Low risk & low return

Moderate risk & moderate return

Other

15.Personal Information

Name: _______________________________________________

Education:

Under Graduate

94



Post Graduate

Under 12

Other

Social Class:

Upper class

Middle class

Lower class

Income (monthly):

<10,000

10,000 – 25,000

25,000 -35000

>35,000

LIST OF CHARTS

Sr. No, Name of Charts Page No.

1. Organization Chart 18

2. Investment Chart 70

3. Investment Criteria 71

4. Preference in Mutual Fund Scheme 72

5. Investment in Government Security 73

6. Investment in Real Estate 74

7. Trading in Commodities market 75

8. Investment in MCX 76

9. Investment in MCDEX 77

10. Type of investor in Stock Market 78

11. Parameters considered before investing 79

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12. How investors take buying decision in Stock Market? 80

13. Investor’s return criteria 81

14. Trader’s trading pattern in Stock Market 82

15. Return criteria of Trader in Stock Market 83

16. Educational classification of respondents 84

17. Income (monthly) of respondents 85

18. Social Class of respondents 86

GLOSSARY

Trader:

A trader is a person who deals in the stock or commodities market for the short

period and with a view to earning a good return. His trading period can be ranged

from 1 day to 1 month. A trader is usually a more risk taker.

Investor:

An Investor is a person who invest long term in the stock market compare to

trader. An investor is one who does delivery based buying in stock market. He

can invest for a period ranging from 1 day to 5 to 10 years according to his liking.

MCX & NCDEX:

MCX & NCDEX are the two segments of the Commodity market in which investor

can trade according to his liking.

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Book profit:

Booking of profit means that an investor / trader sales the securities after earning

a reasonable return.

Liquidity:

Liquidity means the investor’s has the convenience of selling his investment any

time and avail his money as and when he needed and the investor’s money is

not blocked for a certain period of time.

Future & Options:

It is a trading pattern in the stock market in which the trader has the option of

purchasing shares in a lot depending upon the shares and its price. In Future &

Option the trader has the option of purchasing the shares by just paying the

margin money specified by the stock exchange and he can hold these shares up

to last Thursday of the month. In between he can sale the shares according to

his liking but the maximum holding period is last Thursday of the month.

Intra day:

It is a trading pattern in Stock Market in which the trader can purchases or sale

securities for the period of one day only. At the end of the day he has to settle his

trade.

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BIBLIOGRAPHY

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WEBSITE VISITED FOR THE PROJECTS

• www.angeltrade.com.

• www.nseindia.com

http://www.angeltrade.com/

http://www.nseindia.com/

http://www.angeltrade.com/

http://www.nseindia.com/

chetan final

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