India Infoline

transcript

THE DOGMAS OF THE QUIET PAST ARE INADEQUATE TO THE STORMY PRESENT. AS OUR CASE IS NEW, SO WE MUST THINK ANEW AND ACT A NEW.

India Infoline – An Introduction

Product Offerings

Competitors

Our Other Businesses – Brief Overview

India Infoline – An Introduction

We were originally incorporated on October 18, 1995 as PROBITY

RESEARCH AND SERVICES PVT LTD. at Mumbai under the Companies

Act, 1956 with Registration No. 11 93797.

We became a public limited company on April 28, 2000.

The name of the Company was changed to India Infoline.com Limited

on May 23, 2000 and later to India Infoline Limited on March 23, 2001.

First Company in India to foray into the online distribution of Mutual

Funds.

We are a one-stop financial services shop, most respected for quality

of its advice, personalized service and cutting-edge technology.

The No.1Corporate agent for ICICI Prudential Life Insurance Company.

Research acknowledged by Forbes as “Must Read for investor in South

Asia”

Listed on Bombay and National Stock Exchange with a net worth of

INR 200 crore and a market cap of over INR 1970 crore.

The company has a network of 976 business locations (branches and

sub-brokers) spread across 365 cities and towns. It has more than

800,000 customers.

It is registered with NSDL as well as CDSL as a depository participant,

providing a one-stop solution for clients trading in the equities market.

PILLARS OF THE ORGANIZATION.

MBA:II

Mr Venkat Subramanian BSc, B.sc chartered Accountant

Unlike others, India Infoline has the concept of an Investment Team

The brains behind all the investment strategies and decisions regarding Wealth Management Services are:

Mr Anand Tandon MBA:IIM-A, B.Tech: IIT Kanpur

Mr Nirmal JainMBA:IIM-A, Chartered & Cost Accountant

Mr R Venkataraman MBA:IIM-B, B.Tech:IIT Kharagpur

OUR MULTI LINE BUSINESS:-

INVESTMENT BANKING:-6 Verticals for any kind of transactional requirement

INSTITUTIONAL EQUITIES:-One of the largest equity desks. Leadership in derivatives

ASSET MANAGEMENT:-Maximum risk adjusted returns

WHOLESALE FINANCING:-Customized funding for Companies, Institutions and HNWIs

WEALTH MANAGEMENT:-Life-cycle financial solutionsUnparalleled range of advisory services

PRIVATE CLIENT BROKERAGE:- Services across 976 LocationsLargest range of products

OUR UNIQUE APPROACH :-

Pr PRODUCT OFFERINGS:-

Direct Equity and F & O Trading Providing in-house research based advice on selected stocks

Structured Products

Advise on Portfolio management Services.

Portfolio Management Services

Products that offer our clients unique risk-reward equations that are customised to their investment objectives

Mutual Funds Advisory Research based recommendations on Top Picks in Mutual Funds

Insurance Advisory Life & General Insurance Advisory

Advise on Investment in Real Estate through Fund structure

Real Estate Funds

Art Funds

Advise on Investment in Art through Fund structure

Bullion Trading

Bullion buying and selling

Loan Against Securities (Margin Funding )

Provide Overdraft facility against collateral of Shares/ MF units

LAS Series (Term Loans)

Provide Term Loan facility against collateral of Shares/ MF units

Promoter Funding

Provide Term Loan facility against collateral of Shares

ESOP Funding

Provide Term Loan/ Overdraft facility against collateral of Shares to be allotted to Employees

Product Offerings (Financing Products)

IPO Funding

Advising and facilitating financing on select IPOs based on our in-house research

MILESTONES KEY:-

Incorporated on 18 October 1995 as probity research

and services.

Launched internet portal wwwindiainfoline.com in

may 1999.

Commenced distribution of personal financial

products like MF’s and RBI’s Bond in April 2000.

Launched online trading in shares branded as

www.5paisa.com in July 2000.

Started life-insurance agency business in Dec.

2000 as corporate agent.

Became a depository participant of NSDL in

September 2001.

Launched stock messaging services in May 2003.

Acquired commodities broking license in March

Launched portfolio management services in

Aug. 2004.

Listed on NSE and BSE on May 17th 2005.

COMPETITORS:-

Sharekhan.

Angel broking.

Motilal Oswal.

Karvy share broking.

ICICI Direct.

OVERVIEW OF STOCK MARKET:-

A stock market, or equity market, is a private or public

market for the trading of company stock and derivatives

at an agreed price; these are securities listed on a stock

exchange as well as those only traded privately.

The size of the world stock market is estimated at about

$36.6 trillion US at the beginning of October 2008.

The total world derivatives market has been estimated at

about $791 trillion face or nominal value,11 times the

size of the entire world economy.

MAJOR STOCK MARKET WORLDWIDE:-

1. SENSEX(BSE) 7. HANG SENG

2. NIFTY (NSE) 8. SHANGAI

3. NASDAQ 9. STRAITS

4. NYSE 10. CAC

5. DOW JONES 11. DAX

6. FTSE 12. NIKKEI

IMPACT OF GLOBAL TURMOIL ON MARKET.

BENCHMARK BEFORE RECESSION

SENSEX

DOW JONES

NASDAQ

NIKKEI

SHANGHAI

FOREX MARKET:-

The foreign exchange market (currency, forex, or FX) market

is where currency trading takes place.

It is where banks and other official institutions facilitate the

buying and selling of foreign currencies.

The FX market is one of the largest and most liquid financial

markets in the world, and includes trading between large

banks, central banks, currency speculators, corporations,

governments, and other institutions.

DERIVATIVE MARKET:-

Derivatives are financial contracts, or financial instruments, whose values are derived from the value of something else (known as the underlying). The underlying on which a derivative is based can be an asset (e.g., commodities, equities (stocks), residential mortgages, commercial real estate, loans, bonds), an index (e.g., interest rates, exchange rates, stock market indices, consumer price index (CPI) — see inflation derivatives), or other items (e.g., weather conditions, or other derivatives). Credit derivatives are based on loans, bonds or other forms of credit

Derivative is a product whose value is derived from the value of one or more basic variables.

Underlying Asset can be Equity, Forex, commodity or any other asset.

TYPES OF DERIVATIVES:-

Forwards - A forward contract is a customized contract

between two entities, where settlement takes place on a specific date in the future at today’s pre-agreed price.

Futures –

A future is contract to buy or sell an underlying asset at a specified future date, at a specified price. These contracts are traded and settled on exchanges. Future contracts can be on individual scrip's or indices.

Options –

Options are derivative instruments where one

party has a right to buy/sell the underlying while the

other party has an obligation to buy/sell . The person

with the right is called the buyer of the option. The

person with the obligation is called the writer of the

option

TERMINOLOGIES USED:-

BROKER : A marketing specialist allowed to sell

products of a number of companies.

CONSUS ‘AD IDEM’ : meeting of the minds –

having the same understanding.

HINDU UNDIVIDED FAMILY : Consists of all

persons lineally descended from a common ancestor

including their wives and unmarried children. A Hindu

family is presumed to be undivided unless stated to the

contrary.

INFLATION : An increase in the price of products and

services over time. The main measure of inflation is the

Consumer Price Index.

KARTA : Senior most male member of a Hindu

Undivided Family authorized to manage the business of

the family for the benefit of all its members.

KIOSK : Light open structure for public telephone, sale

of newspapers, food etc.

LIQUIDITY : Reflects how quickly an asset can be

converted to cash with little or no reduction in value.

NET ASSET VALUE : Market value of the assets of a

mutual fund scheme minus its liabilities

NET WORTH : Total assets minus total liabilities of an

individual.

OMBUDSMAN : Official appointed to investigate

complaints against a public authority.

WEALTH TAX : Applicable under the Wealth Tax Act, 1957, to

every individual, Hindu Undivided Family and companies having

net wealth exceeding Rs.15 lacs on the date of valuation.

Spot Price.

Futures Price.

Expiry Date.

Contract Cycle. -One month-Two month-Three month

PARTICIPANT IN STOCK MARKET:-

Hedgers

- Reduce risk

Speculators

- Bet on future movements – leverage

Arbitrageurs

- Take advantage of discrepancy in prices

Making Fortunes from Commodities

Organized commodities trading started in 1875 - Bombay Cotton Trade Association The government had banned futures trading in 1975,

saying excessive speculation had driven prices up. It allowed trading to resume three years later but

restricted it to a few commodities. Trading in some other commodities resumed only in 1997 In 2004, Government of India allowed the Multi

Commodity Exchange and the National Commodity and Derivatives Exchange Ltd. to set up new bourses with a national reach and launch online trading in a range of commodities.

History

Agriculture - 26% of GDP

Agro commodities thriving

Huge domestic consumption market

One of the World’s largest importer of gold, edible oils

Third largest producer of cotton

Leading coffee / tea / sugar producer

Facts - India

Energy Products

Bullion Products

Metals Agricultural Products

•Crude Oil•Furnace Oil

•Gold •Silver

•Copper•Tin•Nickel•Steel

Arabica & robusta Coffee, Wheat, Chana, Sugar, Rice, Guar Seed, Jute Sacking, Pepper, Castor Seed, Guar gum, Raw Jute, Urad, Yellow Peas, Turmeric, Soymeal crude palm oil, Cotton, Mustard seed, Mustard oil Soybean, refined soy oilGur, Maize, Raw silk, Cocoon, Jeera, Chilly, Cashew, Cottonseed oilcake, Sesame seed, Tur, metha oil, Kapas.

List of Commodities

Market Timings

Bullion/ Metals Trading: 10.00am to 12.00pm

Agro Commodities: 10.00am to 5.00pm

Major commodity exchanges

Exchange Headquarters Commodities

MCX Mumbai, INDIA Multi Commodity exchange

NCDEX Mumbai, INDIA Multi Commodity exchange

CBOT Chicago, USA Corn, Soybean, Soy Oil, Soy Meal, Rise, Wheat, Gold, Silver

CME Chicago, USA Cattle, Milk, Butter, Lumber

NYBOT New York, USA Cocoa, Cotton, Coffee, Sugar NYMEX New York, USA Crude Oil, Natural Gas, Electricity, Coal,

Gold, Silver, Copper, Aluminium

LME London, UK Aluminium, Copper, Lead, Nickel, Zinc, Tin, Plastics

LIFFE London, UK Cocoa, Robusta Coffee, Sugar, Wheat IPE London, UK Crude Oil, Gas Oil, Natural Gas TOCOM Tokyo, J APAN Gold, Silver, Aluminium, Platinum,

Kerosene, Gasoline, Crude Oil, Rubber SICOM Singapore Rubber, Coffee SFE Sydney, Australia Wool, Cattle, Electricity

MCX an independent and de-mutulised multi commodity exchange inaugurated in the year November 2003,has permanent recognition from Government of India for facilitating online trading, clearing and settlement operations for commodity futures markets across the country.

Key shareholders of MCX include Financial Technologies (I) Ltd., State Bank of India & associates, Fidelity International, National Stock Exchange of India Ltd., National Bank for Agriculture and Rural Development, HDFC Bank, SBI Life Insurance Co. Ltd., Union Bank of India, Canara Bank, Bank of India,Bank of Baroda and CorporationBank.

NCDEX is a public limited company incorporated on April 23, 2003 NCDEX is a nation-level, technology driven de-mutualized on-line commodity exchange with an independent Board of Directors and professionals not having any vested interest in commodity markets

Key promoted of NCDEX include ICICI Bank Limited (ICICI Bank), Life Insurance Corporation of India (LIC), National Bank for Agriculture and Rural Development (NABARD) and National Stock Exchange of India Limited (NSE). Punjab National Bank (PNB), CRISIL Limited (formerly the Credit Rating Information Services of India Limited), Indian Farmers Fertiliser Cooperative Limited (IFFCO) and Canara Bank

Trading in Commodities

How it really works ….

Futures

A future is contract to buy or sell an underlying

asset at a specified future date, at a specified

price.

These contracts are traded and settled on

exchanges.

Future contracts can be on individual scrips or

indices.

Futures Terminology

Spot Price

Futures Price

Expiry Date

Contract Cycle

Products Offered

Online TradingDiet Odin for Customers

Offline TradingBranch/Franchise/RM places order using Dealer Odin

Clients can trade on both on MCX and NCDEX

Brokerage Structure

ONLINE OFFLINE

Registration fees Rs.500 Rs.500

Minimum Initial Margin

Rs.10000 Rs.10000

Trading Brokerage 0.05% 0.10%

Delivery Brokerage 0.25% 0.50%

Why trade in commodities?

Driven by demand and supply

True reflector of economic activity

Impervious to intangibles like management quality or

sentiments

Not impacted by “statements”

Physical settlement

Internationally driven market

Comparison of India Asset Market

Thank you

India Infoline

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