A SYNOPSIS

“A STUDY ON ONLINE DE-MAT ACCOUNT”

AT

SHAREKHAN

In the partial fulfillment of the requirement for the award of degree in

MASTER OF BUSINESS ADMINISTRATION

Submitted By

M. DHEERAJ RAJ SURANA

HALL TICKET NO: 2278-19-672-161

VISHWA VISHWANI SCHOOL OF BUSINESS

(Affiliated to Osmania University)

THUMKUNTA, HAKIMPET, HYDERABAD, TELANGANA 500078

(2019- 2021)

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INTRODUCTION

Demat refers to a dematerialized account. Just as we have to open an account with a bank if
we want to save your money, make cheque payments etc, we need to open a demat account if
we want to buy or sell stocks. So it is just like a bank account where actual money is replaced
by shares. We have to approach the DPs (remember, they are like bank branches), to open
our demat account.

Demat account allows you to buy, sell and transact shares without the endless paperwork and
delays. It is also safe, secure and convenient.

Let's say our portfolio has 100 of Satyam, 50of Suzlon, 20 of ICICI BANK, 50 of Tech
Mahindra and 100 of TCS shares. All these will show in our demat account. So we don't have
to possess any physical certificates showing that us own these shares. They are all held
electronically in our account. As we buy and sell the shares, they are adjusted in our account.
Just like a bank passbook or statement, the DP will provide you with periodic statements of
holdings and transactions.

Individuals, companies, Trusts, Partnership firms, NRIs, HUF, Banks and Institutions are
allowed to open a depository account with any depository through a depository participant.
The investor would need to execute a standard form giving all his details, bank details,
instruction details, nomination details and off-course photograph and signature. Along with
this form, the investor would also have sign an agreement with the depository participant
which usually forms a standard part of the account opening process. The details on the form
have to be matched with a photocopy of the investor's passport, driving license etc. to certify
the mentioned details. If the investor is an NRI, then the client will have to provide overseas
address, provide copy of RBI Approval, if any. The RBI Approval is not mandatory for
opening of a DP. Account but is required to receive shares into the account when purchased
through the secondary market.

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SCOPE OF STUDY

 It provides a complete knowledge of various fundamental concepts of share market

and online trading.

 It will help in analyzing the behavior of consumers and help in Knowing the parameters
of investment on which they would like to invest

 Through this project I am not only bringing long term clients for my organization but
also creating a word of mouth publicity of my organization by offering the best
services to the clients so that more and more potential customer will come and stick to
my organization.

 Also, through this project I suggest the organization the behavioral pattern of investor
towards different instruments.

 From the study I have learned very much, about the company as well as the strategy
of the customers, which helps me a lot at my working days.

NEED & SCOPE OF THE STUDY

 To understand the D-MAT ACCOUNT and online trading.
 To identify the investment through online trading.
 To find an appropriate approach for attracting the people in investing into
SHAREKHAN online trading.

 To know about the operations of online trading India.

 To find out the trends in Indian banking sector and growth to know about
importance of online trading in India.

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COMPANY PROFILE

Share khan is one of the leading retail brokerage of City Venture which is running successfully since
1922 in the country. Earlier it was the retail arm of the Mumbai-based SSKI Group, which has over
eight decades of experience in the stock business. Share khan offers its customers a wide range of
equity related services including trade execution on BSE, NSE, Derivatives, depository services, online
trading, investment advice etc.

Earlier with a legacy of more than 80 years in the stock markets, the SSKI group ventured into
institutional and corporate finance 18 years ago. SSKI is one of the leading players in institutional and
corporate finance activities. SSKI holds a sizeable portion of the market in each of these segments.
SSKI’s institutional arm accounts for 7% of the market for Foreign Institutional portfolio investment
and 5% of all Domestic Institutional portfolio investment in the country.

It has 60 institutional clients spread over India, Far East, UK and US. Foreign Institutional Investors
generate about 65% of the organization’s revenue, with a daily turnover of over US$ 2 million. The
content-rich and research oriented portal has stood out among its contemporaries because of its steadfast
dedication to offering customers best-of-breed technology and superior market information. The
objective has been to let customers make informed decisions and to simplify the process of investing in
stocks

Mission of the Share khan is

“To educate and empower the individual investor to make better investment decisions through
 QUALITY ADVICE
 INNOVATIVE PRODUCTS and
 SUPERIOR SERVICE.”

WORK STRUCUTRE OF SHAREKHAN

Share khan has always believed in investing in technology to build its business. The company has used
some of the best-known names in the IT industry, like Sun Microsystems, Oracle, Microsoft, Cambridge
Technologies, Nexgenix, VignetteVeriSigngn Financial Technologies India Ltd, Spider Software Pvt.
Ltd. to build its trading engine and content. The City Venture holds a majority stake in the company.
HSBC, Intel & Carlyle are the other investors.

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On April 17, 2002 Share khan launched Speed Trade and Trade Tiger, are net-based executable
application that emulates the broker terminals along with host of other information relevant to the Day
Traders. This was for the first time that a net-based trading station of this caliber was offered to the
traders. In the last six months Speed Trade has become a de facto standard for the Day Trading
community over the net. Share khan’s ground network includes over 700+ Share shops in 180+ cities in
India.

The firm’s online trading and investment site www.sharekhan.com - was launched on Feb 8, 2000. The
site gives access to superior content and transaction facility to retail customers across the country.
Known for its jargon-free, investor friendly language and high quality research, the site has a registered
base of over 3 Laces customers. The number of trading members currently stands at over 7 Laces. While
online trading currently accounts for just over 5 per cent of the daily trading in stocks in India, Share
khan alone accounts for 27 per cent of the volumes traded online.
The Corporate Finance section has a list of very prestigious clients and has many ‘firsts’ to its credit, in
terms of the size of deal, sector tapped etc. The group has placed over US$ 5 billion in private equity
deals. Some of the clients include BPL Cellular Holding, Gujarat Papaya, Essar, Hutchison, Planetasia,
and Shopper’s Stop. Finally, Share khan shifted hands and City venture get holds on it.

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 REVIEW OF LITERATURE
D-MAT ACCOUNT AND ONLINE TRADING

HOW TO OPEN A D-MAT ACCOUNT AND ONLINE TRADING IN SHAREKHAN

SECURITIES

A/C opening charge- 450/-; Name of the software used- Odin

Software installation charge- 900/-; Maintenance charge- 250/- from 3rd year.

Exposure- 20 times for intraday.

Name of the bank with the help of which customer get the facility of net banking- AXIS
bank ,ICICI bank, HDFC bank.

Services provided- Equity, Commodities, Insurance, Wealth Management Services,

Insurance, Investment Banking.

DP sell charge- 8/-; Brokerage- intraday-.03% & Delivery-.3%

Transaction Report- Through mail (Free of Cost)

Prepaid Scheme - Not available.

Types of trading accounts provided- De-Mat a/c, Trading a/c, Margin a/c.
Network- 1837 locations more than 498 cities.

Margin money- 50000/- for R-ALLY & R-ALLY Lite.

10000/ - for R-ALLY Pro.
Secrecy- Password provided to the customer has to change every after 20 days.

Currently, all the stock exchanges in India have a demutualised set up. D-Materialization: As
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discussed before, the old settlement system was inefficient due to (i) the time lag for settlement
and (ii) the physical movement of paper-based securities. To obviate these problems, the
Depositories Act, 1996 was passed to provide for the establishment of depositories in securities
with the objective of ensuring free transferability of securities with speed and accuracy. There
are two depositories in India, viz. NSDL and CDSL. They have been set up to provide
instantaneous electronic transfer of securities. D-Mat (D-Materialized) settlement has
eliminated the bad deliveries and associated problems. To prevent physical certificates from
sneaking into circulation, it has been made mandatory for all newly issued securities to be
compulsorily traded in D-Materialized form. Now, the public listed companies making IPO of
any security for Rs.10 crore or more have to make the IPO only in D-Materialized form.
Clearing Corporation: The anonymous electronic order book ushered in by the NSE did not
permit members to assess credit risk of the counter-party and thus
Necessitated some innovation in this area. To address this concern, NSE had set up the first
clearing corporation, viz. National Securities Clearing Corporation Ltd.
(NSCCL), which commenced its operations in April 1996.
Investor Protection: In order to protect the interest of the investors and promote awareness, the
Central Government (Ministry of Corporate Affairs 1) established the Investor Education and
Protection Fund (IEPF) in October 2001. With the similar objectives, the Exchanges and SEBI
also maintain investor protection funds to take care of investor claims. SEBI and the stock
exchanges have also set up investor grievance / service cells for redress of investor grievance.
All these agencies and investor associations also organize investor education and awareness
programmes.
Globalization: Indian companies have been permitted to raise resources overseas through issue
of ADRs, GDRs, FCCBs and ECBs. Further, FIIs have been permitted to invest in all types of
securities, including government securities and tap the domestic market. The investments by
FIIs enjoy full capital account convertibility. They can invest in a company under portfolio
investment route upto 24% of the paid up capital of the company. This can be increased up to
the pectoral cap/statutory ceiling, as
applicable to the Indian companies concerned, by passing a resolution of its Board of
Directors followed by a special resolution to that effect by its general body. The Indian stock
exchanges have been permitted to set up trading terminals abroad. The trading platform of
Indian exchanges is now accessible through the Internet from anywhere in the world. RBI
permitted two-way fungibility for ADRs / GDRs, which means that the investors (foreign
institutional or domestic) who hold ADRs / GDRs can cancel them with the depository and sell

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the underlying shares in the market. 1 Earlier known as Department of Company Affairs.
Launch of India VIX 2: Volatility index is a measure of market’s expectation of volatility over
the near term. It measures the amount by which an underlying Index is expected to fluctuate in
the near term, based on the order book of the underlying index options. India’s first volatility
index, India VIX (based on the Nifty 50 Index Option prices) was launched by NSE in April
2008.
Direct Market Access: In April 2008, SEBI allowed the direct market access (DMA) facility to
the institutional investors. DMA allows brokers to offer their respective clients, direct access to
the Exchange trading system through the broker’s infrastructure without manual intervention by
the broker. Launch of Securities Lending & Borrowing Scheme: In April 2008, the
Securities Lending & Borrowing mechanism was allowed. It allows market participants to take
short positions effectively with less cost.
Launch of Currency Futures: On August 29, 2008, NSE launched trading in currency future
contracts in the USD-INR pair for the first time in India. Trading in other currency pairs like
Euro – INR, Pound Sterling – INR and Japanese Yen was further made available for trading in
March 2010.
ASBA: Application Supported by Blocked Amount (ASBA) is a major primary market
reform. It enables investors to apply for IPOs / FPOs and rights issues without making a
payment. Instead, the amount is blocked in investors’ own account and only an amount
proportionate to the shares allotted goes out when allotment is finalized. Launch of Interest Rate
Futures: On August 31, 2009, futures on interest rate was launched on the National Stock
Exchange.
Issue of Capital and Disclosure Requirements (ICDR) Regulations 2009: In August 2009, the
SEBI issued Issue of Capital and Disclosure Requirements (ICDR) Regulations 2009, replacing
the Disclosure and Investor Protection (DIP) Guidelines 2000. ICDR Regulations 2009 would
govern all disclosure norms regarding issue of securities.
The trading on stock exchanges in India used to take place through open outcry without use of
information technology for immediate matching or recording of trades. This was time
consuming and inefficient. This imposed limits on trading volumes and efficiency. In order to
provide efficiency, liquidity and transparency, NSE introduced a nation-wide on-line fully
automated screen based trading system where a member can punch into the computer quantities
of securities and the prices at which he likes to transact and the transaction is executed as soon
as it finds a matching sale or buy order from a counter party. Screen based electronic system
electronically matches orders on a strict price/time priority and hence cuts down on time, cost

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and risk of error, as well as on fraud resulting in improved operational efficiency. It allows
faster incorporation of price sensitive information into prevailing prices, thus increasing the
informational efficiency of markets. It enables market participants, irrespective of their
geographical locations, to trade with one another simultaneous, improving the depth and
liquidity of the market. It provides full anonymity by accepting orders, big or small, from
members without revealing their identity, thus providing equal access to everybody. It also
provides a perfect audit trial, which helps to resolve disputes by logging in the trade execution
process entirety. The sucked liquidity from other exchanges and in the very first year of its
operation, NSE became the leading stock exchange in the country, impacting the fortunes of
other exchanges and forcing them to adopt SBTS also. Today India can boast that almost 100%
trading take place through electronic order matching.

Now D-Materialization of shares is introduced “a new concept” which converts paper based
physical trading into electronic trading. It is a safe and convenient way to hold securities.
Screen based trading system helps in faster transfer of securities and no stamp duty is required
on transfer of securities. The trading system operates on a strict price time priority. All orders
received on the system are sorted with the best priced order getting the first priority for
matching i.e. the best buy order match with the best sell order. Orders are matched
automatically by the computer keeping the system transparent, objective and fair. The trading
system provides tremendous flexibility to the users in terms of kinds of orders that can be
placed on the system. The trading system also provides market information online.
In order to promote D-Materialization of securities, NSE joined hands with leading financial
institutions to establish the national securities depository Ltd. (NSDL), the first depository in
the country, with the objective of enhancing the efficiency in settlement systems as also to
reduce the menace of fake/forged and stolen securities. This has ushered in an era of D-
Materialized trading and settlement. SEBI has made D-Materialized settlement mandatory in an
ever –increasing number of securities in a phased manner, thus bringing about an increase in the
proportion of shares delivered in D-Materialized form. There is an increasing preference to
settle trades, particularly in high value securities, in

WHAT IS D-MAT

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In India, a D-MAT ACCOUNT and online trading, the abbreviation for D-Materialized
account, is a type of banking account which D-Materializes paper-based physical stock shares.
Conversion of Securities from Physical (Paper) Mode into Electronic Mode is Called D-
Materialization. The Client opens D-MAT ACCOUNT and online trading with any DP. Upon
D-Mat, the Certificates are destroyed and credit entry of exactly equal number of Securities is
created in Depository in Electronic mode. The B.O. account of holder is credited and the
securities loose their identities. The D-Materialized account is used to avoid holding physical
shares: the shares are bought and sold through a stock broker.

This account is popular in India. The market regulator, securities and exchange board of India
(SEBI) mandates a D-MAT ACCOUNT and online trading for share trading above 500 shares.
As of April 2006, it became mandatory that any person holding a D-MAT ACCOUNT and
online trading should possess a permanent account number (PAN), and the deadline for
submission of PAN details to the depository lapsed on January 2007.

D-Materialization is the process by which physical certificates of an investor are converted to

an equivalent number of securities in electronic form and credited in the investor's account with
its DP. In order to D-Materialize certificates; an investor will have to first open an account with
a DP and then request for the D-Materialization of certificates by filling up a D-Materialization
request form [DRF], which is available with the DP and submitting the same along with the
physical certificates. The investor has to ensure that before the certificates are handed over to
the DP for D-Mat, they are defaced by marking "Surrendered for D-Materialization" on the face
of the certificates.

ACCOUNT OPENING

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To avail the services of a depository an investor is required to open an account with a
depository participant of any depository.
 
PROCEDURE FOR OPENING AN ACCOUNT

A D-Mat account are opened on the same lines as that of a Bank Account. Prescribed Account
opening forms are available with the DP, needs to be filled in. Standard Agreements are to be
signed by the Client and the DP, which details the rights and obligations of both parties

 The DP officials will make available the relevant account opening form (depending on
whether the client is a retail investor or corporate client/clearing member) and specify
the list of documents regarding references that should be submitted along with the form.
It will also give a copy of the relevant agreement to be entered with the client, in
duplicate.

 The client will submit the duly filled in account opening form and client has to visit
personally for opening the account in DP. The DP officials have to do in person
verification and affix the “IN PERSON VERIFICATION” stamp on the account
opening form. It should also furnish such documents regarding references, as specified
by the DP, along with the account opening form. After executing the agreement the
client has to forward it to the DP.

 The DP officials will verify that the account opening form is duly filled in. It will also
verify the enclosed documents, if any. Incomplete forms will be forwarded to the client
for rectification.

 For Corporate Clients, the DP officials will verify if the board resolution for the
authorized signatories is enclosed.

 In case the documents are not proper, the DP officials will reject the form and intimate
the client of the same, stating the reasons for doing so.

RESEARCH METHODOLOGY
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Research methodology refers to the search for Knowledge. It is a way to systematically solve
the research problem. In it we study the various steps that are generally adopted by the
researcher in studying his research problem along with logic behind them.

Research Methodology concerning a research problem or study provide answers to

various questions like; why a research study has been undertaken, how the research problem has
been defined, what data have been collected and what particular method has been adopted to
collect the data, what technique has been used for analyzing the data and a host of similar other
questions

Though there are more than one alternative approaches available to the researcher, but this not
enough to make the task of selecting the suitable research design simpler. Like the so-called
suitable research design may require some in between approach. The objective of study being
the main determinant of the validity and reliability of the method adopted the degree of
usefulness of the scientific method. Since there are many aspects of research methodology, in
line of action has to be chosen from variety of alternatives, so that individual choice of suitable
method is further complicated and make a viable whole. The choice of suitable method is
further complicated by the possibility of many permutations and combinations. The fair
selection can be arrived at through the objective assessment and of course comparison of
various alternatives. The finally selected line of action must ensure that this is indeed best one
as against those rejected by the researcher. in addition, the circumstances and problems also
having a bearing in the choice. To count a fem, limitations could be imposed in the sense of
funds available, time and urgency in conducting the research. So the final choice must be based
on assessment of its advantage and disadvantages when weighted against affecting factors.

Research methodology can be said to have four major components namely-Research design,
Sample design, Data collection procedure and methods of analyzing and reporting the findings.

Research Design

The research problem having been formulated in clear cut terms, the researcher will be required
to prepare a research design i.e., he will have to state the conceptual structure with in which
research would be conducted. The preparation of such a design facilitates research to be as

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efficient as possible yielding maximal information. But how all there can be achieved depends
mainly on the research purpose. Research purpose may be grouped into four categories.

(1) Exploration
(2)Description
(3) Diagnoses and
(4) Experimentation.

Exploratory research studies are those whose main purpose is that of formulating a problem
for more precise investigation or of developing the working hypotheses from on operational
point of view.

Descriptive research studies are those studies which are concerned with describing the
characteristics of a particular individual, or of a group

Diagnostic research studies determine the frequency with which something occurs.

Experimental research studies are those where the researcher tests the hypothesis of casual
relationship between the variables.
Research design of this particular research study of D-Materialization of shares is primarily
based on descriptive and diagnostic research design. As descriptive and diagnostic research
design describes the characteristics and determines the frequency with which something occurs
respectively, similarly this research determines the characteristics of the individuals who deal in
share and also determine the frequency of dealing on the basis of their characteristics.
SAMPLE DESIGN
All the items under consideration in any field of inquiry constitute a ‘Universe’ or ‘Population’.
A complete enumeration of all the items in the population is known as a census inquiry. This
type of inquiry involves a great deal of time, money and energy. Hence quite often a few items
so selected constitute what is technically called a sample.

The researcher must decide the way of selecting a sample or what is popularly known as sample
design. A sample design is a definite plan determined before any data are actually collected for
obtaining a sample from a given population. Samples can be either probability or non-
probability samples. With probability samples each element has a known probability of being

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included in the sample but non-probability samples are those based on simples do not allow the
researcher to determine this probability.

Probability samples are those based on simple random sampling, systematic sampling , etc
where as non probability samples are those based on convenient sampling, judgment sampling
etc.

DATA COLLECTION TECHNIQUES

The required data is collected both from primary as well as secondary sources.

Primary Sources: The primary data was collected through structured unbiased questionnaire
and personal interviews of investors. For this purpose questionnaire included were both open
ended & close ended & mulple-choice questions.

Secondary Sources: Secondary data is the data, which is collected and complied for
different purposes, which are used in research for this study. The secondary data includes
material collected from:-

Magazines & Bulletins’- Brochure of SHAREKHAN Limited investment solutions.

Internet-
www.sebi.gov.in
www.nseindia.com

SIZE OF SAMPLE
The overall sample involved in the study consisted of 50 individuals. Keeping in view the
limited resources of time , a limited sample of individuals. It was fixed before hand and every
effort was made to cover the given number of individuals with available time for the collection
of data for this project. The data was collected with the help of the questionnaire herself by the
researcher.

METHOD USED FOR ANALYSIS OF STUDY

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 The methodology used for this purpose is Survey and Questionnaire Method. It is a time
consuming and expensive method and requires more administrative planning and supervision. It
is also subjective to interviewer bias or distortion.

ANALYSIS OF DATA
After the data have been collected, the researcher turns to the task of analyzing them. The
analysis of data requires a number of closely related operations such as establishment of
categories, the application of these categories to raw data through coding, tabulation and then
drawing statistical inferences. The unwisely data should necessary be condensed into a few
manageable groups and tables for further analysis. Thus researcher should classify the raw data
into some purposeful and usable categories. In the process of analysis, relationships or
differences supporting or conflicting with original or new hypotheses should be subjected to
tests of significance to determine with what validity data can be said to indicate any conclusion

INTERPRETATION

The interpretation is done on the basis of the analyzed data and also some recommendations are
given to fill the loopholes of the actual scenario.

Objective

An objective is the brainchild behind any project report. A project report will always have a
certain objective which needs to be accomplished. Following are the objectives behind the
preparation of my project at Sharekhan ltd.

• To Compare Sharekhan securitiesOnline share trading account with the big players in the
Market i.e. ICICI, India bulls, HDFC, RELIENCE MONEY as well as with INDIA
INFOLINE

• Identify the areas where Sharekhan securitiesScores above its competitors and what are its
weak links.

• Know the market potential of Sharekhan securitiesconsidering the fact that there are many
competitors in this field with some more firms expected to join the fray in the near future.
This will be done with the help of a questionnaire. Provide suggestions to the company
regarding what else it can do to stand apart in this ever-competitive field and thereby emerge
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as a market leader.

• To understand the company, its achievements and tasks, products and services and also to
collect information about its competitors, its products and services offered.

• After understanding and collecting information about the organization and its competitors,
a trainee will be able to work well for the organization.

• To Study present online share trading

LIMITATION OF STUDY

The respondents who have not given any information are not included in the sample but do
come under the population.

It was not possible to cover each and every client of each and every house and hence a
sample of 100 people was taken.

The market share of all the online share trading products is only for the one who lives in
India and the market share of all the companies may differ in different cities. It may also differ
nationally.

Due to the tough competition each and every firm is offering different

schemes like, free opening A/c or different advance brokerage schemes where
Sharekhan securities is lacking in this area.

CHAPTERIZATION

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• INTRODUCTION

• REVIEW OF LITERATURE

• NEED OF THE STUDY

• OBJECTIVE AND SCOPE OF STUDY

• METHODOLOGY. (DETAILS OF METHODOLOGY USED FOR

DATA COLLECTING).

• INDUSTRY PROFILE

• COMPANY PROFILE

• DATA ANALYSIS AND INTERPRETATION

• FINDING AND RECOMMENDING SUGGESTIONS

• CONCLUSION

• BIBLIOGRAPHY

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