Académique Documents
Professionnel Documents
Culture Documents
SUBMITTED BY:
RAJDEEP SINGH
Submitted to:
FACULTY GUIDE
COMPANY GUIDE
UBS CHANDIGARH
Date of submission:
DECLARATION
Date: Place: -
2 | Page
ACKNOWLEDGEMENT
Thanking You,
Rajdeep Singh,
3 | Page
EXECUTIVE SUMMARY
TABLE OF CONTENTS
4 | Page
SL
NO.
01
CONTENTS
Declaration
02
Acknowledgement
03
Executive summary
04-a
Objective of project
05-a
b
c
d
e
f
g
h
i
Group Milestones
SWOT analysis
j
k
06-a
b
c
d
e
f
Financial Evaluation
Conclusion
References
5 | Page
PAGE
NO.
01
CONTENT
Porters Five Force analysis
02
03
04
05
06
6 | Page
Pg.
NO.
9 | Page
Trading, IPOs and Mutual Funds are the top three products
offered by 90% of firms offering trading, 67% IPOs, and 53%
offering Mutual Fund transaction.
In terms of various areas of growth, 84% of firms have shown
their interest in expanding their institutional clients, 66% firms
intend to increase FIIs, and 34% are interested in setting up Joint
Ventures in India and abroad.
In terms of IT penetration 62% firms provide their website, and
90% have email facility.
CP o o t
mew n p t i
eae tlr i t i
oo nf
ins n u e
twp h p e
iel ni e n d t
ur as s n t r
yt s
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P o w e r P o C t f o e s m n u t p p i a p e l lt i o i e t f i r o s n n e i w n e t h n e t r i a n n d t u s s t r y
TP
ho r
ew
ae t r
o f
sc u
bu s
is t t
uo t
em s
e r
s
oT
wh
re e r a
ot
f o
cf u s su t bo
sm i t eu
rt se
Fig: 1
Competition
The industry is now in a fairly high growth phase. However the
brokerage industry is very cyclical and is impacted by activity levels
in the markets. During the downturns such as 2008-2009 periods, the
smaller players were squeezed out of the business. As a result there is
a contrast consolidation happening in the industry.
Potential of new entrants
A new entrant in addition to the above also needs a reasonable level of
capital to fund the working requirements of the business (finance to
customers, deposits with exchanges, etc).
The scale requirements are increasing constantly and as a result a new
entrant will require higher levels of investments in the future to enter
the business. As pointed out, it is likely to see many entrants in the
industry. On the contrary, it is likely that the smaller players will exit
by selling out or closing.
Power of the supplier
Not much relevant in most segments except investment banking,
where employees control client relationships and hence have to be
highly compensated.
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Fig:2
Seeing the overall brokerage as a single unit, the key success factors
or the winning strategy of Indian Brokerage Industry is a mixture of:
People
Process
Technology
There are the three ingredients that together create value for both
international and domestic customers.
By people it indicates to the service providers or the employees of the
various firms of this industry, who day in and day out interact with the
customers and provide them services and satisfy them.
Transparency of the process followed and disclosure method is yet
another success factor. The settlement of transactions is generally
done in a process of T+2 days. And the government support even still
plays a very vital role in forming the rules and norms of such
processes.
Technology enables to stay competitive and on edge with the
competitors; facilitating the ease of processes and speed and to
maintain and be up to date. This serves as a great success of the
brokerage industry.
All these factors together help create value to the customer.
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Fig: 3
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does this by establishing the bank discount rates and the rules for
credit. The markets response to the Feds determination to control
inflation by raising and lowering the discount rate affects long term
interest rates, which have a significant impact on the securities
market.
Securities Exchange Commission
The Securities Exchange Commission (SEC) is the primary regulatory
agency that oversees the securities industry. The SEC is an
independent bipartisan, quasi-judicial agency of the government. The
laws administered by SEC deal with securities and finance and seek to
provide protection for investors in their securities transactions.
COMPANY OVERVIEW
Master Trust is one of the leading financial services group in India
with 26 years of customer's patronage built on loyalty and trust.
The Philosophy of Master Trust has its seeds embedded in the
group's belief in nurturing the investment culture towards value
investing.
Its constant endeavor to understand the client's needs and meeting
them with the right financial solutions has helped it emerge as one of
the leading broking houses in the country.
As a one stop shop catering to all kinds of investment needs, Master
Trust focuses on the retail investors who are looking for value added
financial solutions.
With a network of over 750 Business Locations across India & around
1.5 Lac client base we provide products like Equity, Derivatives,
Commodity, Currency, Gold ETF, Mutual Funds, Insurance, IPO,
Forex, NRI Services & Merchant Banking.
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MISSION:
To always earn the right to be our clients first choice through
personal & social wealth maximization
VISION:
To be well diversified financial shop for wealth creation and being an
ideal service provider in our domain of business.
CORPORATE PHILOSOPHY:
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VALUE SYSTEM:
Fig:4
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Group Milestones-:
2007
2006
2005
2004
2002
2001
1999
1997
1995
Master Trust Ltd. came out with the IPO (Initial Public Offe
Upgraded Dealership of OTCEI to Membership.
1994
1993
1987
1986
1985
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WS t er ae k n ge st h e s
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OT hp r e oa ut sr t u n i t e s
Fig: 5
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Power of customers
Customer is the king of the market. They have a lot of options while
planning to purchase products. Products offered by Master trust are
unsought in nature and are industry dependent. The threats which lies
here are:
Too many goods chasing too few consumers.
Buyer purchases in bulk quantities and are mostly corporate
clients.
Product is not much differentiated.
Buyers cost of switching to a competitors product is low.
Shopping cost is low.
Credible Threat of integration.
Threat of substitutes
Master Trust poses great threat of substitutes like people of low risk
appetite would like to invest in bank rather than in share market, real
estate, commodities, etc. Its products can very well be substituted by
substitutes offered by competitors.
31 | P a g e
MARKET DYNAMICS
The pricing signals that are created as a result of changing supply and
demand level in a given market. Market dynamics describe the
dynamic, or changing, price signals that result from the continual
changes in both supply and demand of any particular product or group
of products. Market dynamics is a fundamental concept in supply,
demand and pricing economic models.
There is great shift in the Indian consumption pattern that is being
observed like:
69% of the population is less than 35 years of age and has
spurred consumption demand.
54% of the population is in the working group.
High savings and investment rate (over 35% of GDP).
Indias manufacturing growth is amongst the fastest in the
world. Indias manufacturing base is the fourth largest globally.
The growth potential of the services sector in India is enormous
at $200 billion offering employment to 40 million people. The
confidence of a robust growth in the services sector is the
highest in India among the 4 BRIC countries including Brazil,
Russia, China and India service sector. Among 60% of firms
there expect a rise in activity while
The above factors along with many other factors are some of those
market dynamics which greatly affect this market.
32 | P a g e
Market Forecast
Both short and long run market forecasts are influential factors in
capital investment decisions. In order to participate in long-run
forecast for market potential critical decisions on capital investment
have to be taken.
Fiscal Incentives
Tax concessions either on new investment incomes or investment
allowance allowed on new investment decisions, the method for
allowing depreciation deduction allowance also influence new
investment decisions.
Cash Flow Budgets
The analysis of cash-flow budget which shows the flow of funds into
and out of the company may affect capital investment decision in two
ways. 'First, the analysis may indicate that a company may acquire
necessary cash to purchase the equipment not immediately but after
say, one year, or it may show that the purchase of capital assets now
may generate the demand for major capital additions after two years
and such expenditure might clash with anticipated other expenditures
which cannot be postponed. Secondly, the cash flow budget shows the
timing of cash flows for alternative investments and thus helps
management in selecting the desired investment project.
Non-economic Factors
New equipment may make the workshop a pleasant place and permit
more socializing on the job. The effect would be reduced absenteeism
and increased productivity. It may be difficult to evaluate the benefits
in monetary terms and as such we call this as non-economic factor.
Let us take one more example. Suppose the installation of a new
35 | P a g e
HDFC
FACTOR
SHAREK
HAN
MOTILA
L
OSWAL
M.T
KOTAK
INDIABULLS
BROKERAG
E
5p to 50p
5p to 25p
5p to50p,
1p-10p ( min)
3p to 25p
4p to 40p
2p to 20p or
1p to 10p (min)
MINIMUM
AMOUNT
Rs 10000,
Rs 0
(for big
corporate
clients)
Rs 10000
Rs 50000
Rs 0
Rs 10000
Rs 0
Rs 799
Nil
Rs 200
Rs 555
Rs 550
Rs 1350
-Equity, features
and options,
ETF, IPO,
mutual funds.
-Do it yourself
systematic
investment
planning, and
-NRI offerings,
loans, FD.
Trade
Tigers,
IPO, MF
online,
contract note
on paper, and
ODIN
Software.
ETF, IPO,
mutual
funds, and
NRI
offerings.
IPO,
Mutual
Funds,
and
Commod
ities
K-25 and
T-25.
Brokerage,
IPO,
Mutual
Funds,
Commodit
ies.
IPO, Mutual
Funds, Real
Estate, Home
loans, Commodity,
and Derivatives.
-J2 ME
windows,
blackberry,
android, iphone.
- Call and trade,
online and
offline services
for different time
zones.
Brokerage
services,
trade on
mobile,
online, call
and trade,
dedicated
dealer desk
at every city.
Call and
trade.
Brokerag
e-e and
banking
services.
Brokerage
and
banking
services.
Brokerage, Online
and Offline
Trading available
on all phones, No
extra charges on
calls from clients.
MINIMUM
OPENING
CHARGES
PRODUCTS
SERVICES
36 | P a g e
QUALITY OF
SALESPERSO
N
PROCESS
Good
Good
Good
Good
Good
Good
T+2 days
T+2 days
T+2 days
T+2 days
T+2 days
T+2 days
Fig: 6
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10.57
0
10.57
0.13
5.73
0
5.73
0.13
4.6
0
4.6
0.06
4.72
0
4.72
0.69
4.06
0
4.06
0.65
0
10.7
0
5.86
0
4.66
0
5.41
0
4.71
0.81
0.85
0.92
0.72
0.53
Other
Manufacturing
Expenses
Selling and
Admin
Expenses
Miscellaneous
Expenses
TotExpenses
1.09
0.22
0.21
0.36
Operating
Profit
PBDIT
Interest
PBDT
Depreciation
Other Written
Off
Profit Before
Tax
Extra-ordinary
items
PBT (Post
Extra-ord
Items)
Tax
Reported Net
Profit
Total Value
39 | P a g e
9.09
9.22
6.77
2.45
0.07
3.61
3.74
1.76
1.98
0.05
2.94
3
1.87
1.13
0.05
3.42
4.11
2.39
1.72
0.04
2.98
3.63
2.18
1.45
0.03
0.01
0.01
0.01
0.01
2.38
1.92
1.07
1.67
1.41
0.01 -0.03
0.14 -0.42
2.39
0.01
1.89
0.22
1.21
0.05
1.25
0.3
1.41
0.22
2.38
1.48
1.69
2.12
1.03
1.66
1.35
1.3
1.5
1.08
Addition
Preference
Dividend
0
Equity
Dividend
1.09
Corporate
Dividend Tax
0.03
Per share data
(annualised)
Shares in issue 108.7
(lakhs)
7
Earning Per
Share (Rs)
2.19
Equity
Dividend (%)
10
Book Value
(Rs)
63.36
0.61
0.61
68.4
62
62
57
2.47
1.66
2.18
2.64
10
57.7
8
10
55.0
2
0
46.3
6
0
36.9
7
40 | P a g e
Mar '12
Mar '11
Mar '10
Mar '09
12 mths
12 mths
12 mths
12 mths
10.92
6.78
6.14
6.14
10.92
6.78
6.14
6.14
7.03
4.82
0
57.99
0
32.74
0
27.97
0
22.6
0
68.91
13.14
0
46.55
1.73
0
34.11
3.47
0
33.56
0.81
54.23
67.37
1
2.73
1
4.47
1
1.81
136.28
49.28
38.58
35.37
Sources Of Funds
Total Share
Capital
Equity Share
Capital
Share
Application
Money
Preference
Share Capital
Reserves
Revaluation
Reserves
Networth
Secured Loans
Unsecured
Loans
Total Debt
Total
Liabilities
41 | P a g e
Mar '12
12 mths
Application Of Funds
Gross Block
1.44
Less: Accum.
Depreciation
0.67
Net Block
0.77
Capital Work
in Progress
0
Investments
25.35
Inventories
3.74
Sundry
Debtors
12.72
Cash and Bank
Balance
2.44
Total Current
Assets
18.9
Loans and
Advances
93.5
Fixed Deposits
0
Total CA,
Loans &
Advances
112.4
Current
Liabilities
0.93
Provisions
1.31
Total CL &
Provisions
2.24
Net Current
Assets
110.16
Miscellaneous
Expenses
0
Total Assets
Contingent
Liabilities
42 | P a g e
Mar '11
12 mths
Mar '10
12 mths
Mar '09
12 mths
1.18
2.74
2.97
0.61
0.57
0.55
2.19
0.5
2.47
0.07
16.1
5.91
0
17.69
0.96
0
12.44
2.99
0.1
0.37
0.86
0.47
0.27
0.46
6.48
1.6
4.31
48.07
2.83
38.24
4.79
46.1
2.31
57.38
44.63
52.72
23.6
1.24
24.66
1.27
31.74
0.54
24.84
25.93
32.28
32.54
18.7
20.44
0.01
0.01
0.02
136.28
49.29
38.59
35.37
117
141.05
67.55
45.63
Book Value
(Rs)
63.36
57.78
55.02
Mar
'11
Mar
'10
Mar
'09
Mar
'08
12
mths
12
12
12
12
mths mths mths mths
46.36
Mar
'08
10
1
10
1
10
--
10
--
5.27
4.75
5.52
5.23
8.37
7.42
7.62
7.11
40
36.99
--
--
62.93
63.99
72.5 73.47
60.66
62.06
62.97 58.78
62.03
62.84
71.66 72.68
29.84
29.84
23.29
23.29
25.94 30.75
25.94 30.75
36.42 27.03
--
--
Margin(%)
Net Profit
Margin(%)
22.24
Adjusted Net Profit
Margin(%)
22.24
Return On Capital
Employed(%)
6.71
Return On Net
Worth(%)
3.45
Adjusted Return on
Net Worth(%)
3.44
Return on Assets
Excluding
Revaluations
63.36
Return on Assets
Including
Revaluations
63.36
Return on Long
Term Funds(%)
6.71
Liquidity And Solvency
Ratios
Current Ratio
50.34
Quick Ratio
48.6
Debt Equity Ratio
0.98
Long Term Debt
Equity Ratio
0.98
Debt Coverage Ratios
Interest Cover
1.35
Total Debt to
Owners Fund
0.98
Financial Charges
Coverage Ratio
1.36
Management Efficiency
Ratios
Inventory Turnover
Ratio
2.83
Debtors Turnover
1.65
45 | P a g e
28.88
22.04
25.11 30.01
28.88
22.04
25.11 30.01
7.46
7.63
11.39 16.68
4.28
3.01
4.7
7.14
4.28
3.01
4.7
7.14
57.77
55.01
46.33 36.93
57.77
55.01
46.33 36.93
9.04
8.35
13.45 16.94
2.05
2.06
0.07
1.37
1.68
0.13
1.58
1.54
0.06
1.1
1.04
0.11
0.03
0.03
0.04
0.09
2.1
1.59
1.72
1.81
0.07
0.13
0.06
0.11
2.12
1.61
1.71
1.81
-24.13
-7.45
-5.89
-4.43
Ratio
Investments
Turnover Ratio
Fixed Assets
Turnover Ratio
Total Assets
Turnover Ratio
Asset Turnover
Ratio
2.83
0.97
--
1.63
1.36
7.36
--
--
--
--
0.08
0.12
--
0.14
0.17
0.11
0.13
0.12
0.16
1.96
--
--
--
Average Raw
Material Holding
--Average Finished
Goods Held
--Number of Days In
3,752.0
Working Capital
7 2,045.05
Profit & Loss Account Ratios
Material Cost
Composition
--Imported
Composition of Raw
Materials Consumed
--Selling Distribution
Cost Composition
-0.98
Cash Flow Indicator Ratios
Dividend Payout
Ratio Net Profit
47.07
36.04
Dividend Payout
Ratio Cash Profit
45.74
34.88
Earning Retention
Ratio
52.74
63.96
Cash Earning
Retention Ratio
54.08
65.12
AdjustedCash Flow
Times
27.61
1.56
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---1,462.5
2 1,558.11 430.9
--
--
--
--
--
--
0.06
0.24
3.36
59.83
--
--
56.64
--
--
40.17
100
100
43.36
100
100
4.12
1.3
1.5
2.19
63.36
2.47
57.78
1.66
55.02
2.18 2.64
46.36 36.97
REFERENCES
www.mastertrust.co.in
www.moneycontrol.com
www.rediffmoney.com
www.bseindia.com
www.nseindia.com
www.wikipedia.org
www.icra.in
www.secgov/investor/pubs/financialnavigating.html
www.tradestreaming.com/2010/06/04/investment decisions
economicstimes.indiatimes.com>opinion
en.wikipedia.org/wiki/marketing_research
www.quickmba.com/strategy/matrix/bcg
www.smallbusiness.wa.gav.au/business-life-cycle
www.valueline.com/stock/industry
en.wikipedia.org/wiki/porters-five-factor
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Mar
'08
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