mid cap and small cap

A STUDY ON THE ROLE OF MIDCAP AND SMALL CAP IN ESTABLISHING STOCK MARKET
PROJECT REPORT

Submitted to the Amrita Vishwa Vidyapeetham in partial fulfilment of the requirements for the award of
MASTER OF COMMERCE (FINANCE AND SYSTEMS) SUBMITTED BY JEFFIN GEORGE KH.AR.P2COM09008

Under the Supervision of
Mr. K. R. Shabu Faculty Guide

Department of Commerce and Management Amrita School of Arts and Sciences Kochi-682 024
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CERTIFICATE

This is to certify that the project work titled A Study On The Role Of Midcap And Small Cap In Establishing Stock Market submitted to Amrita Vishwa Vidyapeetham in partial fulfillment of the requirements for the award of the Degree of Master of Commerce is a record of original work done by Jeffin George under my supervision and guidance and that this project work has not formed the basis of the award of any Degree /Diploma /Fellowship of similar title to any candidate of any University.

(Seal) Guide

Signature with Name and Designation of the

Submitted for the University Examinations held on __________________ ____

Internal Examiner

External Examiner

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DECLARATION

I hereby declare that this project titled A Study On The Role Of Midcap And Small Cap In Establishing Stock Market is a record of original work done by me under the supervision and guidance of Mr. K. R. Shabu and that this project work had not formed the basis of award of any Degree/Diploma /Fellowship or similar title to any candidate of any university

Place : Date :

Name and Signature of Student

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ACKNOWLEDGEMENT I thank almighty god for guiding me throughout this study with his boundless blessings Firstly, my sincere thanks to Mr. Francis Lewis, the Deputy General Manager of CSE for giving me an opportunity to do the project work and also his support and encouragement. I take this opportunity to place on record the whole hearted thanks to Mr. Varghese Mathew, Senior Faculty, CSE institute of Capital Market and Broker Cochin Stock Exchange Ltd. whose immense support helped me to make this project a fruitful and a successful one.

I am greatly indebted to Prof. Dr N Ajith Kumar, Department of Commerce and Management, ASAS, without whose support and co-operation, this project would have been incomplete.

I extend my sincere thanks to Mr. K. R. Shabu, Faculty Guide, Department of Commerce and Management, ASAS, my project guide who give enthusiastic support throughout my project work.

I express my profound gratitude to the faculty members especially my Head of the Department Dr. M.V. Kamalakshi for guiding me in this study I am immensely grateful to all workers, supervisors and manager of Cochin Stock Exchange Ltd I extend my sincere thanks to all my friends for their encouragement and valuable suggestions throughout this study.
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TABLE OF CONTENTS Chapter1: Introduction««««««««««««««««««««.1-5 1.1 Introduction 1.2 Basics about share 1.3 Basics about share price movement 1.4 Title of the project 1.5 Midcap and small cap 1.6 Statement of the problem 1.7 Objectives of the study 1.8 Research methodology 1.9Limitations of the study Chapter 2: Literature Review«««««««..«««««««««6-25 2.1 Story of market capitalisation 2.2 All-cap history 2.3 What are mid cap stocks? 2.4 What are small cap stocks? 2.5 BSE midcap and BSE small cap index 2.6 Nifty midcap 50 2.7 Sensex beats midcap, small cap indices 2.8 Small/mid cap equity index fund as of September -30- 2010 Chapter 3. Profile of the Industry««««««««««««««26-43 3.1 Evolution 3.2 Stock Exchange ± An Introduction 3.3 Trading in the Indian stock exchanges 3.4 Bombay stock exchange (BSE) 3.5 National Stock Exchange (NSE) 3.6 Over the Counter Exchange of India (OTCEI) 3.7 Regulatory framework 3.8 Capital market regulations 3.9 Status of Stock Exchange

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Chapter 4: Organization Profile ± Cochin Stock Exchange««.«.«.44-60 4.1 Cochin Stock Exchange 4.2 Present Status of cochin Stock Exchange 4.3 Cochin Stock Brokers Limited (CSBL) 4.4 Products And Services 4.5 Departments 4.6 SWOT analysis Chapter 5: Data Analysis and Interpretations««««««.««.61-80 5.1 Analysis and Interpretation 5.2 Portfolio Construction 5.3 Data Size 5.4 Mid cap company details 5.5 Small cap company details 5.6 Analysis of Portfolio 5.7 Portfolio Values 5.8 Return calculation of mid cap and NIFTY mid cap 5.9 Return calculation of small cap and BSE small cap Chapter 6: Findings, Suggestions and Conclusions..................... 6.1 Findings 6.2 Suggestion 6.3 Conclusion

Bibliography ««««««««««««..««««««««««

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LIST OF TABLES
Table No.
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

Data
PERFORMANCE SETTLEMENT DEPARTMENT DATA SIZE MID CAP COMPANIES PORT FOLIO SMALL CAP COMPANIES PORT FOLIO PORT FOLIO AS ON 03-JAN-2011 PORT FOLIO AS ON 04-JAN-2011 PORT FOLIO AS ON 05-JAN-2011 PORT FOLIO AS ON 06-JAN-2011 PORT FOLIO AS ON 07-JAN-2011 PORT FOLIO AS ON 10-JAN-2011 PORT FOLIO AS ON 11-JAN-2011 PORT FOLIO AS ON 12-JAN-2011 PORT FOLIO AS ON 13-JAN-2011 PORT FOLIO AS ON 14-JAN-2011 PORT FOLIO AS ON 17-JAN-2011 PORT FOLIO AS ON 18-JAN-2011 PORT FOLIO AS ON 19-JAN-2011 PORT FOLIO AS ON 20-JAN-2011 PORT FOLIO AS ON 21-JAN-2011 PORT FOLIO AS ON 24-JAN-2011 PORT FOLIO AS ON 25-JAN-2011 PORT FOLIO AS ON 27-JAN-2011

Page No.
29 55 65 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90

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24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46

PORT FOLIO AS ON 28-JAN-2011 PORT FOLIO AS ON 31-JAN-2011 PORT FOLIO AS ON 01-FEB-2011 PORT FOLIO AS ON 02-FEB-2011 PORT FOLIO AS ON 03-FEB-2011 PORT FOLIO AS ON 04-FEB-2011 PORT FOLIO AS ON 07-FEB-2011 PORT FOLIO AS ON 08-FEB-2011 PORT FOLIO AS ON 09-FEB-2011 PORT FOLIO AS ON 10-FEB-2011 PORT FOLIO AS ON 11-FEB-2011 PORT FOLIO AS ON 14-FEB-2011 PORT FOLIO AS ON 15-FEB-2011 PORT FOLIO AS ON 16-FEB-2011 PORT FOLIO AS ON 17-FEB-2011 PORT FOLIO AS ON 18-FEB-2011 PORT FOLIO AS ON 21-FEB-2011 PORT FOLIO AS ON 22-FEB-2011 PORT FOLIO AS ON 23-FEB-2011 PORT FOLIO AS ON 24-FEB-2011 PORT FOLIO AS ON 25-FEB-2011 PORT FOLIO AS ON 28-FEB-2011 RETURN OF MIDCAP PORTFOLIO AND NIFTY MIDCAP INDEX RETURN OF SMALL CAP PORTFOLIO AND BSE SMALL CAP INDEX

91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113

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117

8

LIST OF FIGURES
Figure No.
1 2

Data
ORGANIZATION STRUCTURE MID CAP PORTFOLIO RETURN AND NIFTY MIDCAP RETURN SMALL CAP PORTFOLIO RETURN AND BSE SMALL CAP RETURN

Page No.
50 116

3

120

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CHAPTER -1

INTRODUCTION

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1.1 INTRODUCTION
An investor means people who invest their savings. Investment is an activity, which is different from savings. Savings are generated when a person obtain from present consumption for a future use. Savings kept as cash are barren and do not earn anything. Hence, the saver has to find a temporary repository for his saving until they are required for his future, this result in investment. This is an era in which the investor or public are thinking of changing their investment from bank deposit to share market. They get better return from the investment in capital market than in case of bank deposit. Today, investment has become a household word and is very popular with people of all lifestyle. It is because of increase in working population, higher family incomes and consequent savings, availability of large and attractive investment alternatives, increase in investment related publicity and so on. Investment is a word of many interpretations. A person has advanced some money to others; he may consider his loan as an investment. He expects to get back the principal along with the interest at a future date. Another person may purchase a land for the purpose of price appreciation and may consider it as an investment. In the above cases, it can be seen that investment involves the employment of money with an aim of achieving additional income or growth in the values. Thus, investment may be defined as, ³a commitment of funds made in the expectations of some positive rates of return´ The capital market is a market for long-term funds-shares, debentures and bonds. Today the Indian capital market offers a variety of financial products with varied features and

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benefits, for investors to choose from them. Investing in stock is most popular method of investment.

1.2 BASICS ABOUT SHARE
Plain and simple, a ³stock´ is a share in the ownership of a company. A stock represents a claim on the company¶s assets and earnings. As you acquire more stocks, your ownership stake in the company becomes greater. Holding a company¶s stock means that you are one of the many owners (shareholders) of the company and as such you have a claim to everything the company owns. This means that technically you own a tiny little piece of all the furniture, every trademark, and every contract of the company. As an owner you are entitled to your share of the companies earning as well. These earning are called ³dividends´ and are given to the shareholders from time to time. A stock is represented by a ³stock certificate´

1.3 BASICS ABOUT SHARE PRICE MOVEMENT
Stock prices change every day because of market forces. By this we mean that stock prices change because of ³supply and demand´. If more people want to buy a stock (demand) than sell it (supply), then the price moves up. Conversely, if more people wanted to sell a stock than to buy it, there would be greater supply than demand, and the price would fall (Basics of economics). Understanding supply and demand is easy. What is difficult to understand is what makes people like a particular stock and dislike another stock. If investor is able to understand this he can know what people are buying and what people are selling. If he knows this he can know what price goes up and what price go down.
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1.4 TITLE OF THE PROJECT
³The role of midcap and small cap in establishing stock market´

1.5 MIDCAP AND SMALL CAP
Cap is short for capitalisation which is a measure by which we can classify a company's size. Midcap means Medium capitalization and small cap means small capitalization. The technical definition of Mid Cap in the Indian context is companies with market capitalization between $ 2 billion and $ 10 billion.

Small-cap means different things to different people, the common definition in the Indian context are companies with market capitalization is less than $ 2 billion. Study the role of midcap and small cap companies in establishing the stock market and the changes in midcaps and small caps in market

1.5.1 FEATURES Small-cap stocks tend to be younger companies--those with explosive growth potential but unproven earnings capability. Most of these are speculative companies subject to either boom or bust. Bio-tech companies, for example, often rely on large initial capital investments to fund research and development before they produce products and generate earnings, or are bought by a larger company. Mid-caps are more established companies, with demonstrable earnings and notable growth potential.

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1.5.2 EFFECTS

The nature of small- and mid-cap stocks is such that they are subject to volatility. It requires a smaller amount of capital to cause fluctuations in the price of a small-cap, as opposed to a larger stock. Small caps are likely to be affected primarily by company-specific news, such as financing or product development. Mid caps are not immune from these fluctuations, but they are also influenced by their sector of the economy and the investment climate in general. Many mid-cap stocks have a higher "beta," or correlation to a benchmark market index. Thus, they can be subject to larger swings in both directions when the market moves as a whole.

1.5.3 CONSIDERATIONS Most mutual funds or large institutional investors are unable to meaningfully invest in small- and even some mid-cap stocks. Federal regulations require disclosure when more than a certain minimal percentage of the outstanding shares are held by a single entity. The dollar value of the limited number of shares permitted without triggering these disclosures is too small to have a notable effect on the overall performance of the fund, and, therefore, their resources are allocated elsewhere, or in multiple mid-cap companies. If the disclosures were made, other investors could purchase the stock and send the price significantly higher.

1.5.4 FUNCTION

Because large institutional investors tend to avoid small and mid caps, other investors use these to outperform the larger market players. Because mid caps
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are growth-oriented companies, they excel in periods of widespread economic growth. Small caps, too, generally need favourable economic conditions in which to thrive. Because small caps are more likely to be domestic rather than international companies, they tend to benefit from a rising dollar and a relatively strong U.S. economy.

1.6STATEMENT OF THE PROBLEM
The main focus of the study is to find out the role of midcap and small cap in stock market. As the share market is volatile i.e. changes may happen at any time, the risk and return are equally uncertain so the investor has always fear index in mind. Study some popular midcap and small cap shares and find out the variations in day to day, weekly and monthly. Finally come to a conclusion the mid cap or the small cap is good for investment and which areas share is played more roles in stock market. The study will help to find and understand about the concept of midcap and small cap, and the role of that in the stock market.

1.7OBJECTIVES OF THE STUDY

1.7.1 PRIMARY OBJECTIVES  To find out the role of midcap and small cap companies shares in stock market  To find out midcap or small cap is suitable of investment

1.7.2 SECONDARY OBJECTIVES  To suggest the short term and long term investment opportunities to investors
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 To know the price trend of equity shares of selected small cap and mid cap companies  Find the relation of Midcap & Small cap Indices with the BSE small cap and NSE NIFTY  Find the returns of selected portfolios and make a comparison with index.

1.8RESEARCH METHODOLOGY
Research refers to search for knowledge. One can define research as a scientific & systematic search for pertinent information on a specific topic. Research is an original contribution to existing stock of knowledge making for its advancement. It is the pursuit of truth with the help of observations 1.8.1 TYPE OF RESEARCH: The Research which will be carried out by me is descriptive, comparative & analytical Research. The Research is on³The role of midcap and small cap in establishing stock market´ I am focusing my research on Midcap of National Stock Exchange & Small cap of Bombay Stock Exchange. I have taken three companies each from small cap and mid cap and make a portfolio of five laks each. Select the closing prices of Midcap & Small cap companies & closing value of both Indices and find out the return of all then make comparison by using line graph.

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1.8.2 DATA COLLECTION: Secondary sources have been used for the collection of the data used in the research.  Collecting data from Internet.  Collecting data from BSE, NSE websites etc.  Collecting Information from books.  Collecting data from Magazines 1.8.3 SAMPLE SIZE: Two months data was collected as:  Daily data from BSE Small cap Indices and NSE NIFTY Indices

(Dec-6-2010 to Feb-4-2011)  Daily closing price data of three companies each of Midcap & Small cap Indices

1.8.4 TOOLS FOR ANALYSIS:  Various Graphs/Charts etc.

1.9 LIMITATIONS OF THE STUDY
 The area of mid cap and small cap wide so the overall study is not possible  The detailed study of all midcap and small caps is take time  If make study on limited stock does not give accurate result The area is not very common so the study take some difficulties in collecting data and make analysis on it.

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CHAPTER -2

LITERATURE REVIEW

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2.1 STORY OF MARKET CAPITALISATION
Basically, market capitalisation (cap) is a way to classify companies in equity market according to their size. The market cap at any given point of time shows whether the company is either a large-cap or a mid-cap or a small-cap. With the rise in stock price and issue of additional shares into the market, the market capitalisation of a company goes up. As the market cap increases, the liquidity of the stock in the market also increases. In the late 70s, Rolf Bans and Mark Reinganum, published a study that the companies with smaller capitalisation on an average gave more returns than the companies having larger capitalisation, even after adjusting for risk. This finding, also known as µthe size effect¶, has evolved into a style for managing funds. The Bombay Stock Exchange (BSE) introduced µBSE Mid-Cap¶ index and µBSE Small-Cap¶ index on 11 April 2005 to represent and keep track of companies having size smaller than the 30 stocks listed on BSE Sensex. These indices denote the ups and downs in the mid-cap and small-cap sector

Many financial experts recommend the inclusion of mega-cap industry-leaders' stocks as part of your investment portfolio. Such companies tend to dominate a portion of the market and enjoy relative security in this position. In order to categorize companies according to their size market capitalization is used. It also measures the total worth of a particular company.

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The formula for market cap estimation is:

Market Cap = Price per Share x Number of Outstanding Shares This formula provides you with an idea of the money you should pay if you are willing to purchase all of the shares of stock of the company that are circulating on the market.

Companies can be divided by size in the following way:

1. Nano Cap - less than $50 million 2. Micro Cap -$50 million to $300 million 3. Small Cap - $300 million to $2 billion 4. Mid Cap - $2 billion to $10 billion

5. Large Cap - $10 billion to $200 billion 6. Mega Cap - greater than $200 billion

2.2 ALL-CAP HISTORY
Anchor Capital has been applying its value discipline to the management of All-Cap portfolios since the inception of the firm in 1983. Applying our value discipline to purchases affords better potential for appreciation and helps to reduce overall portfolio risk. The goal of the product is to achieve a superior return to the Russell 1000 Value index, while offering lower absolute risk than the index.

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2.2.1 WHY ALL-CAP VALUE

Our All-Cap strategy is unique for the following reasons: (a) The valuation range for our All-Cap universe is broad enough ($1 billion +) to achieve very broad diversification.

(b) All stocks meet Anchor Capital's defined value criteria at purchase. This not only affords better appreciation potential, but also reduces overall portfolio risk.

(c) All stocks purchased and held are internally researched using a bottom-up philosophy. (d) Anchor's investment process utilizes modeling and screening of a large universe. It is continuous and rigorous. It is also robust in the development of new investment opportunities. (e) Emphasis is placed on investment in growing companies which meet our evaluation criteria. This set of valuation criteria includes an analysis of private market values, current net asset values, and an adherence to a maximum PEG ratio of 1.1 (at purchase).

2.3 WHAT ARE MID CAP STOCKS?
A mid-cap (mid-capitalization) stock is issued by a corporation with a market capitalization between that of a small-cap stock and a large-cap stock. A midcap stock offers a middle ground between the growth potential of a small-cap and the reduced volatility of a large-cap. A mid-cap stock tends to offer greater
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growth potential than a large-cap, and also tends to be more volatile than a large-cap stock. Like a small-cap stock, a mid-cap stock emphasizes growth, but a mid-cap stock tends to pay a relatively larger share of its earnings as dividends. A mid-cap stock tends to be less volatile than a small-cap stock and less vulnerable in economic downturns. A mid-cap stock is often defined as having a capitalization ranging from $2 billion to $10 billion, although capitalization ranges for what constitutes a mid-cap stock do vary over time.

2.3.1 ADVANTAGES OF MID CAP STOCKS:

y

Mid caps are less affected than small caps by the broader market sentiment and daily variations in the trading volume.

y y

They represent lower operational risk than small caps. Unlike the saturated large cap stocks, mid cap shares have potential to grow.

y

Typically mid caps yield higher returns than large caps in the long term.

Although mid cap shares can be lucrative investment options, they are riskier than their large cap counterparts. Also, they are more expensive and less liquid than large cap stocks.

During the financial crisis of 2008, mid cap stocks performed better than the blue chips, which were previously very popular among investors. However, amateur investors could consider beginning with mutual funds that specialize in mid cap stock investing. This will save you the bother of researching individual companies. Investing in mid cap mutual funds will minimize the risk element, while maximizing the profit potential.

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2.3.2 MID-CAP HISTORY Anchor Capital has been using Mid-Cap stocks in its equity portfolios since the inception of the firm in 1983. Before 1991 there was no index for Mid-Cap. Based upon indices one could only invest in Large and Small-Cap stocks. In 1991 the Russell Mid-Cap Index was created. At that time Anchor was using Large-Cap as well as those stocks that could be classified as Mid-Cap in its equity portfolios. In 1992, since Anchor was already investing in Mid-Cap stocks, we decided to offer a pure Mid-Cap portfolio based upon our value driven disciplines. This was the beginning of our Mid-Cap discipline.

2.3.3 WHY MID-CAP VALUE

Our Mid-Cap strategy is unique for the following reasons:

(a) The valuation range for our Mid-Cap universe is broad enough ($1 billion to $12 billion) to achieve diversification by economic sector and capitalization. (b) We are a true Mid-Cap manager since new purchases occur within the defined capitalization range.

(c) All stocks meet Anchor Capital's defined value criteria at purchase. This not only affords better appreciation potential, but also reduces overall portfolio risk

(d) All stocks purchased and held are internally researched using a bottom-up philosophy. (e) Anchor's investment process utilizes modeling and screening of over 2,500 companies. It is continuous and rigorous. It is also robust in the development of

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new investment opportunities.

(f) Emphasis is placed on investment in growing companies that meet our evaluation criteria. This set of evaluation criteria includes an analysis of private market values, current net asset values, and an adherence to a maximum PEG ratio of 1.1 (at purchase).

2.4 WHAT ARE SMALL CAP STOCKS?
Companies that have small capitalization amount are considered small companies or smaller quoted companies and are sometimes called small cap. The stocks from these companies are known as small cap stocks.

In the stock market, company size is measured not by number of employees or even by size of profits, but rather by a company's market capitalization. While this seems complicated, it really gives the best idea of the size of a company. Market capitalization is calculated by considering the number of outstanding shares or the number of shares in issue. This number is multiplied by the current price of each share. Basically, the numbers of shares available are multiplied by the current price to get a value of the price of the company on the market. Companies that have small capitalization amounts are considered small companies or smaller quoted companies (SQCs) and are sometimes called small caps. The stocks from these companies are known as small cap stocks.

2.4.1 SMALL-CAP HISTORY The Small-Cap Value product was incepted on July 1, 2002. The Small-Cap Value discipline targets stocks with market capitalizations between $50 million

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and $1.5 billion. Small-Cap Value portfolios contain 60-80 holdings on average, broadly diversified across major sectors, and expected turnover ranges from 25% to 50%. Typically, the product has a higher yield and lower P/E ratio than its benchmark index.

Small or Mini or Micro cap stocks are so popular in these days. They are stocks from companies which hold very small part of their respective markets. The term Small cap stocks are often misused with penny stocks, one of the riskier equities to trade. According to experts, there are both advantages and disadvantages of trading small cap stocks over trading large and mid cap stocks. 2.4.2 ADVANTAGES OF SMALL CAP STOCK TRADING

y

Small cap stocks are much less priced than large and mid cap stocks. So trader can trade more number of stocks with less money.

y

Small cap companies show faster growth rates than well-established large companies.

y y y y

Offers more return on investment than large companies. Good for day trading if trading volumes are sufficient. Good for novice traders to sharp their abilities. Small cap companies are keener in their business areas and future developments with minimum wastage of resources.

2.4.3 DISADVANTAGES OF SMALL CAP STOCK TRADING Riskier than mid and large cap stocks, which have fairly stable prices. Markets are highly volatile with news and disasters. Small cap stock trading yields lesser dividends, as most companies invest

y y y

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their earnings to grow more.
y y

There may be lack of sufficient company information. The trader himself has to execute the trades as there will be lesser support from brokers and advisors.

2.4.4 SMALL CAP INVESTMENT OPPORTUNITIES Smaller companies are simply more focused on gaining market share than larger companies. In fact, some large companies have difficulty finding suitable investment opportunities, and return a larger proportion of earnings back to shareholders in the form of stock dividends. On the other hand, small cap companies will often take their earnings and reinvest the money right back into their business.

Small companies are often much leaner organizations, being thriftier with the money they have at their disposal. While many larger companies may be flying their executives around the country in private jets and helicopters, this would be an unusual expense for a small cap company.

2.5 BSE MIDCAP AND BSE SMALLCAP INDEX
BSE introduced the new index series called 'BSE Midcap' index and 'BSE Small cap' index on April 11, 2005 with base index value 1000 to track the performance of companies with relatively smaller market capitalization. BSE500 Index - represents more than 93% of the listed universe. Companies with large market capitalization bias the movement of BSE-500 index. This necessitated construction of a separate indicator to capture the trend in

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companies with lower market capitalization. Over the years, BSE Mid-Cap and BSE Small-Cap indices have proven to be a great utility to the investing community.

The market capitalisation of the company represents the total dollar value of the company's outstanding shares. This is equal to the current market price of its stock multiplied by the number of shares of stock that it has outstanding. That number gives you the market value of the company, which is one measure of the company's size. Roughly speaking, there are three basic categories of market capitalisation: large cap, midcap and small cap. The definitions for each of these might vary somewhat depending on whom you are talking to, but usually they are as follows: Large cap : Market Cap valued at more than $ 10 billion Midcap : Market cap valued between $ 2 billion and $ 10 billion

Small cap : Market cap valued at less than $ 2 billion In general, the larger the cap size, the more established the company and the more stable the price of its stock. Small cap and Midcap companies usually have a higher potential for future growth than large cap companies, but their stock tends to fluctuate more in price. Midcap stocks are more risky than large cap stocks and less risky than small cap stocks. Then what makes a small & midcap attractive to investors is the potential for growth that could result in a significant return on the shares of stock. Because the company issuing the stock is considered to be growing, there is great potential for the price per share to increase over the short term. For investors who wish to realize quick gains on their investments, these appear to be an ideal investment. However, the

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enhanced potential for growth also carries an increased level of volatility. As time goes on, the company could encounter unforeseen factors that inhibit the increase in the value of the stock. When this happens, the stock may become stagnant or even begin to fall in value.

In Small cap and Midcap indices the numbers of companies are 552 and 293 respectively.

2.5.1 INDEX SPECIFICATION:

Base Year

: 2002-03

Base Index Value : 1000 Date of Launch : April 11,2005

2.5.2 BSE MID-CAP AND BSE SMALL-CAP INDEX - SCRIP SELECTION CRITERIA:

The general guidelines for selection of constituents in BSE Mid-Cap & BSE Small-Cap Index are as follows: 1. Trading Frequency: The scrip should have been traded on 60% of the trading days in the last three months 2. Eligible universe shall comprise of companies aggregating 98.5% of average market capitalization 3. This list shall be categorized under large-cap, mid-cap and small-cap

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segment based on 80%-15%-5% market capitalization coverage respectively 4. BSE Mid-Cap Index shall comprise of scraps that gives market capitalization coverage between 80% & 95% from the list derived as per point no.3 above 5. BSE Small-Cap Index shall comprise of scraps that gives market capitalization coverage between 95% & 100% from the list derived as per point no.3 above 6. Quarterly review of these indices shall be carried out as per the above criteria subject to a buffer of 3%

2.6 NIFTY MIDCAP 50
The medium capitalized segment of the stock market is being increasingly perceived as an attractive investment segment with high growth potential. The primary objective of the Nifty Midcap 50 Index is to capture the movement of the midcap segment of the market. It can also be used for index-based derivative trading.

2.6.1 METHOD OF COMPUTATION Nifty Midcap 50 is computed using free float market capitalisation weighted method, wherein the level of the index reflects the total market value of all the stocks in the index relative to a particular base period. The method also takes into account constituent changes in the index and importantly corporate actions such as stock splits, rights, etc without affecting the index value.

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2.6.2 BASE DATE AND VALUE The Nifty Midcap 50 Index has a base date of Jan 1, 2004 and a base value of 1000.

2.6.3 CRITERIA FOR SELECTION OF CONSTITUENT STOCKS The constituents and the criteria for the selection judge the effectiveness of the index. Selection of the index set is, inter alia, based on the following criteria:

y

Stocks with average market capitalization ranging from Rs.1000 crore to Rs.5000 crore at the time of selection.

y y

Stocks which are not part of the derivatives segment are excluded. Stocks which are forming part of the S&P CNX NIFTY index are excluded.

2.6.4 OTHER STATISTICS:

y

Nifty Midcap 50 stocks represent about 6 % of the free float market capitalization as on December 31, 2010.

y

The traded volume for the last six months of all Nifty Midcap 50 stocks is approximately 9% of the traded volume of all stocks on the NSE.

Nifty Midcap 50 Index was computed using market capitalization weighted method from the launch date till February 25, 2010

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2.7 SENSEX BEATS MIDCAP, SMALL CAP INDICES
The BSE small-cap index and mid-cap index have underperformed the blue-chip companies in the year so far by witnessing an over 19 per cent fall as compared to the broader market benchmark Sensex. According to a study of the indices from December 31, 2010 to February 28, 2011, the small-cap index has shed 19.16 per cent to finally settle at 7,817.32. Similarly, the mid-cap index has saw an erosion of 18.32 per cent during the period to close at 6,373.23 in the last day of trade in the previous month.

Meanwhile, the broader market key index Sensex has fallen by 13.09 per cent during the period under review to settle at 17,823.40 as on February 28. During the review period, the mid-cap index witnessed its lowest closing level of 6,292.18 on February 10, 2011, while the small-cap index reported its poorest close of 7,585.65 on the same day. Mid-cap stocks and small-cap stocks are vulnerable to any movement in the stock market, so any good or bad news may see sharp reactions from them, an expert said. According to market players, everything was going good in the midcap and small cap stocks but reports of stock price manipulations late last year in few companies, along with a string of negative news, including rising inflation, 2G controversy and surging crude oil prices globally, has badly jolted the confidence of small investors. They also added buying sentiments have been weak and there is an uncertainty when both these sectors will make a comeback in the near future. The mid-cap

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and small-cap indices track the performance of companies with market capitalisations that are a fifth or a tenth of that of blue-chip firms.

2.8 SMALL/MID CAP EQUITY INDEX FUND AS OF SEPTEMBER -30- 2010
INVESTMENT OBJECTIVE The Fund seeks to track the performance of the Russell Small Cap Completeness Index. This Index is an unmanaged index considered indicative of the small to mid cap stock market in general. There is no assurance that the Fund will achieve its objective. Refer to ³Risks ³section. MANAGER The Fund is a collective investment trust managed by a team of State Street Global Advisors (SSGA) professionals. INVESTOR PROFILE Small/mid-cap investments may be most appropriate for someone with a longer investment horizon. The Fund may be suitable for the investor seeking long-term capital growth and willing to accept larger market fluctuations. STRATEGY The Small/Mid Cap Equity Index Fund (³Fund´) invests in SSGA¶s Russell Small/Mid Cap Index (formerly known as SSGA Russell Small Cap Completeness Index) Index Series Class Non-Lending Fund. Effective August 18, 2010, all SSGA Lending Fund assets were transferred to the SSGA NonLending Fund. The Fund is managed using a ³passive´ or ³indexing´ investing approach, by which SSGA attempts to replicate, before expenses, the performance of the Index. The Fund typically seeks to achieve its objective by

32

investing in the securities comprising the Index in the same proportions as they are represented in the Index. In some cases, it may not be possible or practicable to purchase all of the securities comprising the Index, or to hold them in the same weightings as represented in the Index. In those circumstances, SSGA may employ a sampling or optimization technique to construct the portfolio. The Fund uses futures, may use other derivatives and may invest in other investment options. RISKS There are risks involved with investing, including loss of money over short or long periods of time. Fund risks include, but are not limited to: MARKET RISK: The risk that the price of securities in a fund will rise or fall sometimes rapidly or unpredictably due to factors such as real or perceived adverse economic conditions, political developments, and/or investor sentiment generally. During a general downturn in the securities markets, multiple asset classes may decline in value simultaneously. Stocks generally have greater price volatility than bonds. BUSINESS RISK: The risk that an investment will lose value because of a decline in a specific company or industry. SMALL/MID CAP RISK: Medium-sized companies may suffer more significant losses as well as realize more substantial growth than larger more established companies. Equity securities of companies with relatively small market capitalization may be more volatile than securities of larger more established companies.

33

MANAGER RISK: The risk that manager decisions can adversely affect the ability of a fund to meet its investment objectives and/or cause a fund to underperform relevant benchmarks. PERFORMANCE Current performance may be lower or higher than performance data shown. Performance data shown represents past performance and is not a guarantee or prediction of future results. For performance data current to the most recent month-end, please visit the Web site at www.varetire.org and select a Plan under the Defined Contribution Plans tab. Choose ³Plan Investments´ and then ³Investment Performance.´ The investment return and principal value of an investment will fluctuate so that, when redeemed, shares/units may be worth more or less than their original cost.

INDEX Small/Mid Cap

1 Year

3 Years

5 Years

10 Years

Equity 15.86%

-3.61%

2.81%

2.09%

Index Fund Russell Small Cap Completeness Index 15.83% -3.85% 2.65% 2.00%

Table no:1

34

CHAPTER-3

INDUSTRY PROFILE

35

3.1 EVOLUTION
3.1.1 BRIEF HISTORY OF STOCK MARKETS The world's foremost market place New York Stock Exchange (NYSE), started its trading under a tree (now known as 68 Wall Street) over 200 years ago. Similarly, India's premier stock exchange Bombay Stock Exchange (BSE) can also trace back its origin to as far as 125 years when it started as a voluntary non-profit making association.

News on the stock market appears in different media every day. We hear about it any time it reaches a new high or a new low, and we also hear about it daily in statements like 'The BSE Sensitive Index rose 5% today'. Obviously, stocks and stock markets are important. Stocks of public limited companies are bought and sold at a stock exchange. But what really are stock exchanges? Known also as the stock market or bourse, a stock exchange is an organized marketplace for securities (like stocks, bonds, options) featured by the centralization of supply and demand for the transaction of orders by member brokers, for institutional and individual investors. The exchange makes buying and selling easy.

For example, we don't have to actually go to a stock exchange, say, BSE - we can contact a broker, who does business with the BSE, and he or she will buy or sell their stock on their behalf.

36

3.1.2 ORIGIN OF INDIAN STOCK MARKET

The origin of the stock market in India goes back to the end of the 18th century when long-term negotiable securities were first issued. However, for all practical purposes, the real beginning occurred in the middle of the 19th century after the enactment of the companies Act in 1850, which introduced the features of limited liability and generated investor interest in corporate securities.

An important early event in the development of the stock market in India was the formation of the native share and stock brokers 'Association at Bombay in 1875, the precursor of the present day Bombay Stock Exchange. This was followed by the formation of associations/exchanges in Ahmadabad (1894), Calcutta (1908), and Madras (1937). In addition, a large number of ephemeral exchanges emerged mainly in buoyant periods to recede into oblivion during depressing times subsequently.

Many more stock exchanges were established during 1980¶s, namely

y y y y y y y y

Cochin Stock Exchange (1980) Uttar Pradesh Stock Exchange Association Limited(at Kanpur, 1982) Pune Stock Exchange Limited (1982) Ludhiana Stock Exchange Association Limited (1983) Guwahati Stock Exchange Limited (1984) Kanara Stock Exchange Limited (at Mangalore, 1985) Magadh Stock Exchange Association(at Patna, 1986) Jaipur Stock Exchange Limited(1989)
37

y y y y y

Bhubaneswar Stock Exchange association Limited(1989) Saurashtra Kutch Stock Exchange Limited (at Rajkot, 1989) Vadodara Stock Exchange Limited (at Baroda, 1990) Coimbatore Stock exchange Meerut Stock Exchange

Stock exchanges are intricacy inter-woven in the fabric of a nation's economic life. Without a stock exchange, the saving of the community- the sinews of economic progress and productive efficiency- would remain underutilized. The task of mobilization and allocation of savings could be attempted in the old days by a much less specialized institution than the stock exchanges. But as business and industry expanded and the economy assumed more complex nature, the need for 'permanent finance' arose. Entrepreneurs needed money for long term whereas investors demanded liquidity ± the facility to convert their investment into cash at any given time. The answer was a ready market for investments and this was how the stock exchange came into being. Stock exchange means anybody of individuals, whether incorporated or not, constituted for the purpose of regulating or controlling the business of buying, selling or dealing in securities. These securities include: (I) Shares, scrip, stocks, bonds, debentures stock or other marketable securities of a like nature in or of any incorporated company or other body corporate; (ii) Government securities; and Rights or interest in securities.

The Bombay Stock Exchange (BSE) and the National Stock Exchange of India Ltd (NSE) are the two primary exchanges in India. In addition, there are 22

38

Regional Stock Exchanges. However, the BSE and NSE have established themselves as the two leading exchanges and account for about 80 per cent of the equity volume traded in India. The NSE and BSE are equal in size in terms of daily traded volume. The average daily turnover at the exchanges has increased from Rs 851 crore in 1997-98 to Rs 1,284 crore in 1998-99 and further to Rs 2,273 crore in 1999-2000 (April - August 1999). NSE has around 1500 shares listed with a total market capitalization of around Rs 9, 21,500 crore.

The BSE has over 6000 stocks listed and has a market capitalization of around Rs 9, 68,000 crore. Most key stocks are traded on both the exchanges and hence the investor could buy them on either exchange. Both exchanges have a different settlement cycle, which allows investors to shift their positions on the bourses. The primary index of BSE is BSE Sensex comprising 30 stocks. NSE has the S&P NSE 50 Index (Nifty) which consists of fifty stocks. The BSE Sensex is the older and more widely followed index.

Both these indices are calculated on the basis of market capitalization and contain the heavily traded shares from key sectors. The markets are closed on Saturdays and Sundays. Both the exchanges have switched over from the open outcry trading system to a fully automated computerized mode of trading known as BOLT (BSE on Line Trading) and NEAT (National Exchange Automated Trading) System.

It facilitates more efficient processing, automatic order matching, faster execution of trades and transparency; the scrip's traded on the BSE have been classified into 'A', 'B1', 'B2', 'C', 'F' and 'Z' groups. The 'A' group shares
39

represent those, which are in the carry forward system (Badla). The 'F' group represents the debt market (fixed income securities) segment. The 'Z' group scrip's are the blacklisted companies. The 'C' group covers the odd lot securities in 'A', 'B1' & 'B2' groups and Rights renunciations. The key regulator governing Stock Exchanges, Brokers, Depositories, Depository participants, Mutual Funds, FIIs and other participants in Indian secondary and primary market is the Securities and Exchange Board of India (SEBI) Ltd.

3.2 STOCK EXCHANGE - AN INTRODUCTION
³Stock Exchange means anybody or individuals whether incorporated or not, constituted for the purpose of assisting, regulating or controlling the business of buying, selling or dealing in securities´. It is an association of member brokers¶ for the purpose of self regulation and protecting the interest of its members 3.2.1 FUNCTIONS Providing a central trading place Providing liquidity Supply of long term fund Ensuring safe and fare dealings Facilitating Speculation Balancing the flow of fund Evaluating the security Reflecting boom and depression

y y y y y y y y

40

3.3 TRADING IN THE INDIAN STOCK EXCHANGES
Trading in Indian stock Exchanges is limited to listed securities of limited company. They are broadly divided into two categories namely specified securities (forward list) and non specified Securities (cash list). Equity shares of dividend paying grow tormented companies swift a paid up capital of at least Rs. 50 million and a market capitalization of at least Rs. 100 million and having more than 20 shareholders are normally put in the specified group and the balance in non- specified group. Two types of transactions can be carried out on the Indian Stock Exchange. Spot Delivery Transactions: ³Delivery and payment within the time on the date of stipulated when entering into the contact which shall not be more than 14 days following the date of contract.
y

y

Forward Transactions: ³Delivery and payment can be extended by further period of 14 days each so that the overall period does not exceed 90 days from the date of contract´. The latter is permitted only in the case of specified shares.

A member broker in an Indian stock exchange can act as as agent buy and sell securities for its clients on a commission basis and also can act as a trader or dealer as a principal, buy and sell securities on his own account and risk, in contrast with the practice prevailing on New York and London stock exchanges, where a member can act as a jobber or a broker only. The natures of trading on Indian stock exchanges are that of age ±old conventional style of face - to - face trading with bid and offers being made by open outcry.

41

However there is a great amount of effort to modernize the Indian stock exchanges in the recent times.

3.4 BOMBAY STOCK EXCHANGE (BSE)
The Stock Exchange, Mumbai popularly known as ³BSE´ was established in 1875 as ³The Native Share and Stock Brokers association´. It is the oldest one in Asia, even older than the Tokyo Stock Exchange, which was established in 1878. It is voluntarily nonprofit making Associations of Persons (AOP) and is currently engaged in the process of converting itself into demutualised and corporate entity. It has evolved over the years in to present status as the premier Stock Exchange in the country. It is the first Stock Exchange in the country to have obtained permanent recognition in 1956 from the Govt. of India under the securities contracts (Regulation) Act 1956. The exchange by providing an efficient and transparent market for trading in securities, debt and derivatives upholds the interest of the investors and ensures reprisal of their grievances whether against the companies or its own member brokers. It also strives to educate and enlighten the investors by conducting investor education programs and making available to them necessary informative inputs. The exchange also serves to educate and enlighten the investors by conducting investor education programs and making available to them necessary informative inputs. A governing board having 20 directors is the apex body, which decides the policies and regulates the affairs of the Exchange.

42

A Governing Board having 20 directors is the apex body, which decides the policies and regulates the affairs of the exchange. The Governing Board consists of 9 elected directors, who are from the broking community (one third of them retire every year by rotation), three SEBI nominees, six public representatives and an Executive Director and Chief Executive Officer and a Chief Operating Officer. The Executive Director as the Chief Executive Officer is responsible for the day -to - day administration of the Exchange and he is assisted by the Chief Operating Officer and other Heads of Departments. The Exchange has inserted new Rule No. 126Ain the rules Byelaws and Regulations pertaining to constitution of the Executive Committee of the Exchange. Accordingly, an Executive Committee consisting of the three elected directors, three SEBI nominees or public representatives, Executive Director and CEO and Chief Operating Officer had been constituted. The committee considers judicial and quasi matters in which the Governing Board has powers as an Appellate Authority, matters regarding annualent of transactions, admission, continuance and suspension of member- brokers, declaration of a member broker as defaulter, norms, procedures and other matters relating to arbitrations, fees, deposits, margins and other moneys payable by the member brokers to the Exchange etc.

3.5 NATIONAL STOCK EXCHANGE (NSE)
With the liberalization of the Indian economy, it was found inevitable to lift the Indian Stock Market trading system on part the international standards. On the basis of the recommendations of high powered Pherwani committee, the National Stock Exchange was incorporated in 1992 by Industrial Development
43

Bank of India, industrial Credit and Investment Corporation of India, all Insurance Corporations, selected commercial banks and others. Trading at NSE can be classified under two board categories Wholesale debt market and Capital Market

y y

Wholesale debt market operations are similar to money market operationsinstitions and corporate bodies into high value transactions in financial instruments such as Govt. securities, treasury bills, public sector unit bonds, commercial paper, certificate of deposit etc. There are two kinds of players in NSE Trading members and Participations

y y

Recognized members of NSE are called trading members who trade on behalf of themselves and their clients. Participants include trading members and large players like banks who take direct settlement responsibilities. Trading at NSE takes place through a fully automated screen based training mechanism which adopts the principal of an order driven market. Trading members can stay at their offices and executive the trading, since they are willing to transact will appear on the screen. When the prices match the transaction will be completed a confirmation slip will be printed at the office of trading member.

44

NSE has several advantages over the traditional trading exchanges. They are as follows. NSE brings an integrated stock market trading network across the nation. Investors can trade at the same price form anywhere in the country since inter market operations are streamlined coupled with the country wide access to the securities.
y

y

Delays in communication, late payments and the malpractices prevailing in the traditional trading mechanism can be done away with greater operational efficiency and informational transparency in the stock market operations, with the support of total computerized network.

3.5.1 THE MAIN OBJECTIVES OF NSE ARE: To establish the nationwide trading facility for the equities, debt instruments and hybrids.
y

y

To ensure equal access to investors all over the country through appropriate communication network.

y y

To enable shorter settlement cycle and book entry settlement system. To meet current international standards of securities market.

3.5.2 PROMOTERS OF NSE IDBI, ICICI, IFCI, GIC, SBI, Bank of Baroda, Canara Bank, Corporation Bank, Indian Bank, Infrastructural Leasing and financial services. Stock Holding Corporation of India and SEBI capital market are the promoters of NSE.

45

3.6 OVER THE COUNTER EXCHANGE OF INDIA (OTCEI)
The traditional trading mechanism prevailed in the Indian Stock Markets gave way to many functional inefficiency, such as, absence of liquidity, lack of transparency, unduly long settlement periods and binami transactions, which affected the small investors to a great extent. To provide improved services to investors, the country¶s first ring less, scrip less, electronic Stock Exchange OTCEI ± was created to in 1992 by country¶s premier financial institutionsUnit Trust of India, industrial credit and investment corporation of India, Industrial Development Bank of India, SBI Capital markets, Industrial finance corporation of india, General Insurance Corporation and its subsidiaries and Can Bank Financial securities. Trading at OTCEI is done over the centers spread across the country. Securities traded on the OTCEI are classified into: Listed Securities ± The shares and debentures of the companies listed on the OTC can be bought or sold at any OTC counter al over the country and they should not be listed anywhere else.
y

y

Permitted Securities- Certain shares and debentures listed on other exchanges and units of mutual funds are allowed to be traded.

y

Initiated Debentures- Any equity holding at least one lakh debentures of particular scrip can offer them for trading on the OTC.

OTC has a unique feature of trading compared to other traditional exchanges. That is, certificates of listed securities and initiated debentures are not traded at OTC. The orginal certificate will be saftely with the custodian. But a counter

46

receipt is generated out at the counter that substitutes the share certificate and is used for all transactions.

3.7 REGULATORY FRAMEWORK
The four main legislations governing the security market are: The Securities Contracts(Regulation) Act 1956 The Companies Act 1956 The SEBI Act 1992 The Depository Act 1996

y y y y

3.7.1 SECONDARY MARKET AND SEBI SEBI has introduced a wide range reforms in the Secondary market. The important areas are given below. Governing Board Infrastructure Settlement and clearing Debt Market Price Stabilization Delisting Brokers Insider trading

y y y y y y y y

47

3.8 CAPITAL MARKET REGULATIONS
In keeping with the board trust of the ongoing programs of economic reforms, the mechanism of administrative control over capital issue has been dismantled and pricing of capital issue is now essentially market/regulation of the capital markets and protection of investors interests now primarily the responsibility of the securities and Exchange Board of India (SEBI) which is located in Bombay. Accordingly a SEBI¶s functions include: Regarding the business in stock exchanges and any other securities market.
y y

y

Registering and regulating the working of collective mutual funds. Prohibiting fraudulent and unfair trade practices relating the working f collective mutual funds.

y

Prohibiting fraudulent and unfair trade practices relating to securities market.

y

Promoting fraudulent and unfair trade practices relating to securities market.

y

Promoting investors education and training of intermediates f securities market.

y

Promoting investors education and training of intermediaries of securities market.

y

Prohibiting insider trading in securities with the imposition of monetary penalties, on market intermediaries.

y

Regulating substantial acquisition of share and takeover of companies.
48

y

Calling for information from carrying out inspection, conduction inquiries and audits of the stock exchange and intermediaries and self regulatory organization in the securities market.

3.9 STATUS OF STOCK EXCHANGE
The Indian Stock Market is a collection of various regional and national level stock exchanges in India. It is a platform for the masses of the country to interest their savings and also as a source of funds for various organizations and institutions that features in business category. 3.9.1 PRESENT SCENARIO The current conditions if Indian Market has drastically improved. There is absolute transparency and instant transactions. All Indian stock mar kets are now computerized and Internet Trading has become a common phenomenon. Indian stock Markets have also developed a dynamic nature and can change from a bullish temperament to a bearish slide. Any small bit of information or even a rumor from any part of the country can affect the market and is a fairly accurate indicator of the prevalent atmosphere in the region or country. People from across the country and globe get in touch with minute wise readings on the Stock market and gain a lot of trading aptitude after daily seeing BSE stock gainers or BSE top losers list which does a world of good to their investment portfolio. 3.9.2 FUTURE SCOPE OF STOCK EXCHANGE The future of stock trading appears to be electronic, as competitions growing between the reaming traditional New York Stock Exchange specialist system
49

against the relatively new, all Electronic Communications networks or ECNs. ECNs point to their speedy execution of large block trades, while specialist system proponents cite the role of specialist in maintaining orderly markets, especially under extraordinary conditions or for special types of orders The ECNs contend that an array of special interests profit at the expense of investors in even the most mundane exchange directed trades. Machine- based systems; they argue, are much more efficient, because they speed up the execution mechanism and eliminate the need to deal with an intermediary. Historically, the µmarket¶ has been slow t respond to technological innovation, thus allowing growing pure speculation to continue. Conversion to all electronic trading could eliminate the trading profits of floor specialists and the NYSE¶s ³Upstairs traders¶ who like in September and October 2008, earned billions of dollars selling they did not have, and days later buying the same amount f shares, but may be 15% cheaper, s these shares could be handed to their buyers, thereby making the market fall deeply.

50

CHAPTER -4

ORGANISATION PROFILE

51

4.1 COCHIN STOCK EXCHANGE
COCHIN STOCK EXCHANGE LTD. is one of the premier Stock Exchanges in India, established in the year 1978. The exchange had a humble beginning with just 5 companies listed in 1978 -79, and had only 14 members. Today the Exchange has more than 508 members and 240 listed companies. In 1980 the Exchange computerized its offices. In order to keep pace with the changing scenario in the capital market, CSE took various steps including trading in dematerialized shares. CSE introduced the facility for computerized trading "Cochin Online Trading (COLT)" on March 17, 1997. CSE was one of the promoters of the "Interconnected Stock Exchange of India (ISE)". The objective was to consolidate the small, fragmented and less liquid markets into a national level integrated liquid market. With the enforcement of efficient margin system and surveillance, CSE has successfully prevented defaults. Introduction of fast track system made CSE the stock exchange with the shortest settlement cycle in the country at that time. By the dawn of the new century, the regional exchanges faced a serious challenge from the NSE & BSE. To face this challenge CSE promoted a 100% subsidiary called the "Cochin Stock Brokers Ltd. (CSBL)" and started trading in the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE).

CSBL is the first subsidiary of a stock exchange to get membership in both NSE & BSE. CSBL also became a depository participant in the Central Depository Services Ltd... The CSE has been playing a vital role in the economic development of the country in general, and Kerala in particular and striving hard to achieve the following goals:

52

‡ Providing investors with high level of liquidity whereby the cost and time involved in the entry into and exit from the market are minimized.

‡ Bringing in high tech solutions and make all operations absolutely transparent. ‡ Building infrastructure for capital market by turning CSE into a financial super market.

‡ Serve the investors of the region.

‡ Professional stock broking and investment management. ‡ Imparting Capital Market knowledge to all intermediaries on a continuous basis.

The Cochin Stock Exchange is directly under the control and supervision of Securities & Exchange Board of India (the SEBI), and is today a demutualized entity in accordance with the Cochin Stock Exchange (Demutualization) Scheme, 2005 approved and notified by SEBI on 29th of August 2005. Demutualization essentially means de-linking and separation of ownership and trading rights and restructuring the Board in accordance with the provisions of the scheme. The Exchange has been demutualised and the notification thereof published in the Gazette.

53

4.2 PRESENT STATUS OF COCHIN STOCK EXCHANGE
4.2.1 MANAGEMENT The policy decisions of the CSE are taken by the Board of Directors. The Board is constituted with 12 members of whom less than one-fourth are elected from amongst the trading member of CSE, another one forth are Public Interest Directors selected by SEBI from the panel submitted by the Exchange and the remaining are the share holder Directors. The Board appoints the Executive Director who functions as an ex-officio member of the Board and takes charge of the administration of the Exchange. The operation of any Stock Exchange can commence only with the recognition of the central government under the Securities Contract Regulation Act (SCR) 1956. The various regulations concerning the listing of companies and the trading related activities are provided under SCR rules 1957. The bye law of the Exchange gives guidelines on opening/closing of CSE, timing of trading regulation of bedlam or carryover business, fixation of margin prices, arbitration, settlement of disputes etc.

54

4.2.2 ORGANIZATION STRUCTURE

Fi no: 1 4.2.3 MEMBERSHIP PROFILE C i St Exchange currentl has 508 members. All the members of CSE

have a share each value of Rs.100 thus making the issued, subscribed and paid up capital of Rs. 50,800 the authori ed capital of CSE is Rs. 1,00,000 with total n membership limited to 1,000. As per the SEB norms CSE charges a initial deposit of Rs. 2 lakhs from each member. Based on the volume of trade each member is to contribute additional deposits. Along with this annual subscription fee of Rs. 200 for individual members and Rs. 500 for corporate members will be charged by CSE. The members are appointing their assistance
th is sub brokers bared on the guide lines gives by SEB . From the 6 to the 10th

year of membership the total amount payable is Rs. 5000 which payable at the beginning of the 6th year.

55

4.3 COCHIN STOCK BROKERS LIMITED (CSBL)
The CSBL is wholly owned subsidiary f the Cochin Stock Exchange Limited. The CSBL are a SEBI registered intermediary and corporate trading cum clearing member of the capital market segment of the NSE and BSE. At the BSE, CSBL also have a registration under the derivative segment. For the individual trading through CSBL all of the investors had to register as a client with one of the CSBL sub broker, who are also member of CSBL Ltd., commence trading after entiring into a tripartite agreement with ourselves as trading member and the sub brokers. Over 138 sub brokers are presently affiliated to CSBL, having their offices all over the kerala. The CSBL¶s trading and settlement functions are completely automated with state of art technology, in addition to our well- experienced staff catering of clients needs. CSBL bank with UTI Bank, The South Indian Bank and Federal Bank ensure a smooth funds transfer arrangement during trading operation and more importantly to reassure ourselves that client pay outs are prompt. Rapid changes taking place in the capital market and dwindled the importance of Regional Stock Exchanges. Taking into consideration all this developments and considering the future, the stock exchange decided to start a 100 % subsidiary called Cochin Stock Brokers Ltd (CSBL). This is to enable the CSE to acquire the membership other exchange through its subsidiary. CSBL was incorporated on 28th December 1999 and later it got membership in NSE and BSE. The CSBL started its operation in full swing from February 2001. At present the CSBL offers trading in BSE and NSE with

56

more than 50 registered brokers and this have been increasingly day by day. Each member is given separate terminal for online trading. The staff in the exchange provides the necessary help for various matter included in the trading activity.

4.4 PRODUCTS AND SERVICES
Cochin stock brokers ltd (CSBL),a wholly owned subsidiary company of cochin stock exchange is a corporate member of both NSE and BSE, and provides trading facilities on here exchange through the brokers if exchange. The subsidiary offers a wide range of products and services : 1. Trading on National Stock Exchange 2. Trading on Bombay Stock Exchange 3. Internet Trading 4. Depository Participant 5. IPO(Initial Public Offer) 6. Issue of new shares

4.5 DEPARTMENTS
y y y y y y y

Listing Department Membership Department Settlement department Administration Department Finance Department Networks Department Systems Department
57

y y y y y

Arbitration Department Legal Department Surveillance Departments Arbitration committee Fund management

4.5.1 LISTING DEPARTMENT The listing department guides prospective company¶s decision of being listed on the exchange by providing the knowledge base and information on the statutory requirements that have to be complied with. The major functions undertaken by the department include post- listing monitoring and compliance with the listing agreement, monitoring the listing agreements and receiving the provisions of listing agreement from time to time with specific reference to SEBI Regulations / circulars that are in force. The department also ensures diligence in scrutinizing listing applications and adhering to the Listening Norms. The department also performs the processing of the documents submitted by companies on listings/additional listing and provides them with the listing approval/trading permission and also ensures that the listing fee/processing fee is paid at the stipulated time

58

4.5.2 MEMBERSHIP DEPARTMENT The Membership Department screens applications from prospective members to ensure that they are eligible to be members of the Exchange as per provisions of the Securities Contracts Regulation Act. It is also verified whether they are µFit and Proper¶ persons eligible to be members as per the SEBI (Criteria for Fit and Proper persons) Regulation 2004. The eligible applications are processed and forwarded to SEBI for the purpose of obtaining registration with SEBI. The department continuously follows up the status of the applications with SEBI and provides necessary data if any required by SEBI. The members are informed of their fee liability as and when information in this regard is obtained from SEBI. The Membership Department also assists SEBI by ensuring proper delivery of notices and letters issued by SEBI to the concerned members. The changes in status and constitution of the Brokers are sent for approval to the Governing Board of the Exchange and thereafter to SEBI and Members are given necessary directions wherever required. Change in address and contact information are updated in the Finance and Accounting System and SEBI intimated.

4.5.3 SETTLEMENT DEPARTMENT Settlement department is a key department of the CSE. It is dealing with cash and securities. It helps the broker in setting the matters related to their payin and payout of cash and securities, recovery of dues and settling the matters related to the bad deliveries. This department is headed by a Deputy manager and assisted by two senior officers who look into the operations involved in the

59

settlement activities in the BSE and NSE. CSBL are following T+3 (T-Date of Transaction)

Settlement system as given below:

NSE/BSE Security Paying Cash Paying Cash Payout Delivery Payout Delivery Intimation Table no: 2 4.5.4 ADMINISTRATION DEPARTMENT T+3 T+3 T+3 T+3 -

CSBL T+1 T+2 T+4 T+4 T+3

A legal officer with two deputy managers for administration and compliance and management information system heads the department. Two senior officers looking after public relations and administration form part of administration. The major activities of this department include:y

Organizing council meeting, annual general meeting, extra ordinary general meeting, council meetings etc.

y y

Looking after the discharge and admission of authorized members. Taking care of all related functions needed for the smooth functioning of the exchange including regular payments of rent, bills, taxes etc.

y y

Public relations. Giving necessary guidelines and support to students and other who visit the exchange for various activities.

y y

Implementation of the guidelines given by council of management. Procedures involved in the listing. 60

y

Matters associated with various committees like arbitration, grievance, disciplinary and defaults.

4.5.5 FINANCE DEPARTMENT
This department takes care of the various financial transactions of CSE thus acting as the life blood of the organization. The department is headed by a Finance officer and assisted by a Deputy Manager and several senior and junior officers. The major activities of the department include
y y y y y y y y y y y

Annual Report Generation Fund Management Interaction with bankers Keeping general accounts of the CSE. Preparation of various financial statements of the company. Maintaining of payrolls and maintenance of petty cash register. Coordinating accounting transactions of different branches and departments. Taxation Budgeting and Expense research. Maintenance of internal control system. Interaction with external and internal audits.

4.5.6 NETWORKS DEPARTMENT
It is the heart of the various operations of CSE. The trading software used in CSBL is Multex, developed by CMC. The advantage of using Multex is that both BSE and NSE scrip s can be obtained.

CSBL has provided trading facility in equities through Multex to a large number of their clients over the Wide Area Network.

61

Currently, the clients over the wide area are connected by: (1) ISDN

y

y

(2) Dial-Up

y

(3) V sat

y

(4) Asianet

62

4.5.7 LIBRARY DEPARTMENT The Stock Exchange has emerged as a Public Service Institution catering to increasing demands of investors in the country. Of the developmental activities of CSE, education, training and research are dominant in these years bringing the Stock Exchange and Public nearer and together. The Exchange gives necessary guidelines and support to Research students and others who visit the Exchange for various activities. CSE¶s Library has categorized into 6 which is as follows: Capital Market Banking & Finance Law Tax General Management

y y y y y y

4.5.8 SYSTEMS DEPARTMENT
It is the heart of the various operations of CSE. The department provides the necessary technical supports for screen based trading and the computerized functioning of all other departments. The various activities of the department include: y

Developments of various software needed for the functioning of the exchange.

y

Maintenance of Multex software, which provides online trading with NSE and BSE.

63

y

Maintenance of an effective network of computers for the smooth functioning of the exchange.

y

Provide the necessary services to the settlement and surveillance departments.

The support of maintaining depository participants accounts with the CSBL. The major back office system software used is NESS and BOSS for NSE and BSE trades calculations respectively. These soft wares are developed in-house by CSE. This software is used to maintain the entire records of all the trades that occur each day. It also does all the required calculations for deductions and also creates all kinds of reports needed by the brokers and their clients.

4.5.9 ARBITRATION COMMITTEE
Any dispute between a member and a remised, authorized assistant, employee or other person sharing brokerage with him in respect of any matter shall be referred to arbitration and decided in accordance with the Byelaws and Regulations relating to arbitration of disputes other than between Members. All other disputes between them shall also be referred to arbitration in the same manner but if the remise, authorized assistant, employee or other person sharing brokerage so desire such disputes may be with the permission of the Council of Management or the president referred to arbitration and decided in accordance with the Bye-laws, Regulations relating to arbitration of disputes between members. The non-member arbitration panel consists of retired High Court and City Civil Court judges. Chartered accountant, company secretaries, and other professionals having in depth knowledge of the capital market.

64

4.5.10 FUND MANAGEMENT
For monitoring the fund balance of the brokers with the stock exchange. It facilitates the internal fund transfer and also carries out timely funds in the paying and payout. Provides all assistance to cost control and revenue enhancement.

4.5.11 LEGAL DEPARTMENT
CSE has a full-fledged Legal Department, headed by Manager-Legal and is primarily engaged in advising the management in the merits and demerits of legal issues involving the exchange. A major function carried by the department is that the various rules, regulations and directives of SEBI with regard to trading in the Capital Market by the brokers and sub-brokers are brought to the notice to members and the investing public. Manager-Legal is the compliance officer as per the provisions of SEBI regulations besides acting as secretary to the board of directors. The three main areas of special importance being looked after by the legal department arey y y

Investor Grievance Service Arbitration Default

4.5.12 SURVEILLANCE DEPARTMENT
The Exchange has set up Surveillance Department to keep close watch on price movements of scrip s, detect market abuses like price rigging, monitor abnormal prices and volumes which are not consistent with normal trading pattern etc. The main objectives of the department are to provide a free and fair market, to arrest unsystematic risk from entering into the system and to manage risks. The surveillance function at the exchange has assumed greater importance in the last few years. SEBI has directed the stock exchanges to setup a separate surveillance department with staff exclusively assigned for this function. 65

It also offers services like:y y y

Keeping a close watch on the price movement of scrip¶s. Detect market manipulations like price rigging. Monitor abnormal changes in prices and volumes which are not consistent with the normal trading pattern.

y

Monitor the member broker¶s positions to insure that defaults do not occur.

4.5.13 INVESTIGATIONS DEPARTMENT The department conducts in-depth investigation based on preliminary enquires made into trading of the scrip as also at the instance of SEBI. Conducting Investigations involves the following stages:-.
y

Identification of scrip¶s to the investigator based on the alerts thrown by the online system and offline reports.

y

Identification of Members from home the client details have to be called for.

y

Preparation of company profile including Corporate News and Financial Results.

y y

Compilation of client details. Preparation of reports.

In case irregularities found, necessary actions are initiated.

66

4.6SWOT ANALYSIS
4.6.1 STRENGTH Good image all over India. Strong and high quality infrastructure. Premier stock exchange in India. Trading in dematerialized shares. Screen based trading. Efficient margin system and surveillance. Professional stock broking and investment management function.

y y y y y y y

4.6.2 WEAKNESS CSE failed to execute awareness about stock market among people. Turn over alone is very low. Investor are not considering CSE index.

y y y

4.6.3 OPPORTUNITY Promoting interconnected stock exchange of India. Consolidation of small, fragmented and less liquid markets into a national integrated liquid market.
y y

y y

Increasing participation in the central depository service ltd Capital market development around the area, where he exchanges is located

67

4.6.4 THREATS Competition from well established stock holders who has membership in BSE and NSE. People hesitate to invest in stock market because of higher risk.
y

y

People hesitate to invest in stock market because of higher risk.

68

CHAPTER- 5

DATA ANALYSIS AND INTERPRETATION

69

5.1 ANALYSIS AND INTERPRETATION

The overall analysis of the study is subdivided into three parts: 1. Analysis of mid cap and small cap portfolios during the period. 2. Analysis of BSE small cap index and NIFTY midcap index during the period. 3. Analysis of the returns of both portfolios and indexes.

5.2 PORTFOLIO CONSTRUCTION
The companies have been selected from different sectors. Three companies from mid cap and three from small cap are selected for construct portfolio. The index taken into consideration is BSE small cap and NIFTY mid cap. Each company is investing equally in portfolios. From these three companies make a portfolio of 5 lakhs in mid cap and small cap. And find the return of the portfolios and make comparison with index returns.

5.3 DATA SIZE
Data¶s regarding the share market of BSE small cap and NIFTY midcap from the month of 04-JAN-2011 to 28-FEB-2011 is taken. For the purpose of the study a portfolio has been built comprising of shares selected 3 companies from mid cap and 3 from small caps

70

MID CAP COMPANIES

SMALL CAP COMPANIES

MOSER-BAER (I) LIMITED

ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD JK PAPER LTD

HINDUSTAN CONSTRUCTION COMPANY LIMITED INDIAN BANK

Table no: 3

5.4 MID CAP COMPANYS DETAILS
5.4.1 MOSER-BAER (I) LIMITED Moser Baer, headquartered in New Delhi, is one of India's leading technology companies. Established in 1983, Moser Baer successfully developed cutting edge technologies to become the world's second largest manufacturer of Optical Storage media like CDs and DVDs. The company also emerged as the first to market the next-generation of storage formats like Blu-ray Discs and HD DVD. Recently, the company has transformed itself from a single business into a multi-technology organisation, diversifying into exciting areas of Solar Energy, Home Entertainment and IT Peripherals & Consumer Electronics.

Moser Baer has a presence in over 82 countries, serviced through six marketing offices in India, the US, Europe and Japan, and has strong tie-ups with all major global technology players. Moser Baer has the distinction of being preferred supplier to all top global OEM brands. Moser Baer stands committed
71

to supplying highest quality fully licensed media to its customers. Moser Baer's products are manufactured at its three state-of-the-art manufacturing facilities. It has over 6,000 full-time employees and multiple manufacturing facilities in the suburbs of New Delhi.

5.4.2 HINDUSTAN CONSTRUCTION COMPANY LIMITED As a pre-eminent Indian infrastructure company, established over eight decades ago, HCC has, over the years, strongly anchored itself to India¶s development effort. Today it is acknowledged as a company that continues to empower India, enabling the nation to surge ahead in different core sectors. At the heart of all our development efforts is the attempt to touch and improve the quality of life of people across the length and breadth of the country. In fact, HCC, as an industry leader in engineering construction, currently nurtures projects that span across such diverse segments as transportation, power, marine projects, oil and gas pipeline constructions, irrigation and water supply, utilities and urban infrastructure, all of which impact the nation of India, and the progress of its people. HCC, even as you read this, is bringing to bear its wealth of engineering and construction expertise to develop infrastructure aimed at further propelling the nation forward, into the 21st century and beyond. 5.4.3 INDIAN BANK A premier bank owned by the Government of India ‡ Established on 15th August 1907 as part of the Swadeshi movement ‡ Serving the nation with a team of over 19000 dedicated staff ‡ Total Business crossed Rs.1,74,934 Crores as on 31.12.2010

72

‡ Operating Profit increased to Rs. 2747.35 Crores as on 31.03.2010 ‡ Net Profit increased to Rs.1554.99 Crores as on 31.03.2010 ‡ Core Banking Solution (CBS) in all 1819 branches International Presence
y

Overseas branches in Singapore and Colombo including a Foreign Currency Banking Unit at Colombo

y

240 Overseas Correspondent banks in 70 countries

Diversified banking activities - 3 Subsidiary companies
y y y Indian bank Merchant Banking Services Ltd Indian Bank Housing Ltd. Indian Fund Management Ltd

A front runner in specialised banking
y

97 Forex Authorised branches inclusive of 1 Specialised Overseas Branch at Chennai exclusively for handling forex transactions arising out of Export, Import, Remittances and Non Resident Indian business

y

62 Special SME Branches extending finance exclusively to SSI units

5.5 SMALL CAP COMPANYS DETAILS
5.5.1 ADITYA BIRLA CHEMICALS (INDIA) LTD The Rs2,656-crore Aditya Birla Chemicals business is spread across India, Thailand and China. In India, the chemicals business operates through four companies: Aditya Birla Nuvo, Grasim, Aditya Birla Chemicals (India) (formerly known as Bihar Caustic and Chemicals Limited) and Tanfac. In Thailand, the business operates through two companies: Aditya Birla

73

Chemicals (Thailand) Ltd and Thai Peroxide Company Ltd. Four separate chemical companies namely Thai Organic Chemicals Company, Thai Epoxy and Allied Products Company, Thai Polyphosphate & Chemicals Company and Thai Sulphites & Chemicals Company were merged together to form Aditya Birla Chemicals (Thailand) Ltd in 2006.

In China, the chemicals business operates through Aditya Birla Grasun Chemicals (Fangchenggang) Ltd.The business covers six major product segments: chlor-alkalis, epoxy, fluorine chemicals, peroxides, phosphates and sulphites. These chemicals find application across a wide range of industries including food, food processing, personal consumer products, coating, civil engineering, wind energy, composites, electrical, pulp and paper, detergents, water treatment and metal treatment. They are exported to 58 countries across the globe. The products are manufactured at ten units ² four in India, five in Thailand and one in China. The chemicals produced at these factories are recognised the world over for their high quality. The chlor-alkali unit in Thailand, for example, is the only unit in the country to achieve the hallmark of quality excellence by obtaining FDA approval. State-of-the-art technology, stringent quality control and continuous innovative improvements guarantee that the products are of global standards.

Customer satisfaction is ensured through timely delivery and customisation of products and processes according to requirements. Research and development facilities at various locations have the latest equipment to determine the physical and chemical parameters of newly developed products and their
74

applications. Different divisions have been accredited with certifications such as ISO-9001:2000, ISO-14001, OSHAS-18001, BS-8800 and TIS-18001.

5.5.2 GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD It all started in the year 1987 when Mr. C.J. George and Mr. Ranajit Kanjilal founded Geojit as a partnership firm. In 1993, Mr.Ranajit Kanjilal retired from the firm and Geojit became the proprietary concern of Mr. C .J. George. In 1994, it became a Public Limited Company named Geojit Securities Ltd. The Kerala State Industrial Development Corporation Ltd. (KSIDC), in 1995, became a co-promoter of Geojit by acquiring a 24 percent stake in the company, the only instance in India of a government entity participating in the equity of a stock broking company. The year 1995 also saw Geojit being listed on the leading regional stock exchanges. Geojit listed at The Stock Exchange, Mumbai (BSE) in the year 2000. Company¶s wholly owned subsidiary, Geojit Commodities Limited, launched Online Futures Trading in agri-commodities, precious metals and energy futures on multiple commodity exchanges in 2003. This was also the year when the company was renamed as Geojit Financial Services Ltd. (GFSL). The Board consists of professional directors; including a Kerala Government nominee. With effect from July 2005, the company is also listed at The National Stock Exchange (NSE). Company is a charter member of the Financial Planning Standards Board of India and is one of the largest Depository Participant (DP) brokers in the country. On 31st December 2007, the company closed its commodities business and surrendered its membership in the various commodity exchanges held by Geojit Commodities Ltd. Global banking major BNP Paribas took a
75

stake in the year 2007 to become the single largest shareholder. Consequently, Geojit BNP Paribas has been renamed as Geojit BNP Paribas Financial Services Ltd Wide range of products and services Certified financial advisors help clients to arrive at the right financial solution to meet their individual needs. The wide range of products and services on offer includes Equities | Derivatives | Currency Futures | Custody Accounts | Mutual Funds | Life Insurance & General Insurance | IPOs | Portfolio Management Services | Property Services | Margin Funding | Loans against Shares 5.5.3 JK PAPER LTD JK Paper Ltd. is India¶s largest producer of branded papers and a leading player in the Fine Papers and Packaging Board segments. It operates two integrated Mills in India, in Rayagada, Orissa and Songadh, Gujarat, with a combined manufacturing capacity of 2, 40,000 tonnes per year, using contemporary technology. The products include a wide range of Coated and Uncoated Printing & Writing Papers and Packaging Boards. Both the manufacturing units of the company are ISO 9001-2000 complaint. It was the first Company to manufacture surface sized printing & writing paper, followed by copier paper. The Company¶s state-of-the-art Packaging Board plant at Central Pulp Mills produces international quality virgin boards like FBB, SBS and Cup Stock.Nearly 95% of the Company¶s product mix comprises high value products, marketed under various popular brand names such as, µJK Copier¶, µJK Bond¶, µCedar¶, µJK Excel Bond¶, µJK Cote¶, µJK
76

TuffCote¶, µJK PureFil¶ and µJK Pristine Cote¶. JK Paper is India¶s quality and price leader. Besides the strong brands, the Company has a wide distribution network in India consisting of nearly 150 distributors and over 3000 dealers. JK Paper is the only company in India with large share of branded products in its portfolio. JK Paper passionately believes in Environment and Safety and has been introducing cleaner and environment-friendly technologies. The Company has an export footprint for high value branded products and Packaging Boards.

77

5.6 ANALYSIS OF PORTFOLIO

5.6.1 MID CAP COMPANIES PORT FOLIO

COMPANY NAME MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED INDIAN BANK

SCRIP CODE MOSERBAER HCC

NO. OF SHARES 2758 3491

INDIANB

638

Table no: 4

5.6.2 SMALL CAP COMPANIES PORT FOLIO

COMPANY NAME ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD JK PAPER LTD

SCRIP CODE ABCIL

NO. OF SHARES 1189

GEOJITBNP

4910

JKPPRQ

2849

Table no: 5

78

5.7 PORTFOLIO VALUES

PORT FOLIO AS ON 03-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 62.4

AMOUNT OF INVESTMENT 172099.2

3491

48.65

169837.15

MID CAP

INDIAN BANK

638

247.7

158032.6

TOTAL= 499968.95 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 169313.6

142.4

4910

33.35

163748.5

2849

58.55

166808.95

TOTAL= 499871.05

Table no: 6

79

PORT FOLIO AS ON 04-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 62.2

AMOUNT OF INVESTMENT 171547.6

3491

47.45

165647.95

MID CAP

INDIAN BANK

638

240.1

153183.8

TOTAL= 490379.35 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 169551.4

142.6

4910

34

166940

2849

58.25

165954.25

TOTAL= 502445.65

Table no: 7

80

PORT FOLIO AS ON 05-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 62.25

AMOUNT OF INVESTMENT 171685.5

3491

48.15

168091.65

MID CAP

INDIAN BANK

638

231.65

147792.7

TOTAL= 487569.85 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 170264.8

143.2

4910

33.45

164239.5

2849

57.85

164814.65

TOTAL= 499318.95

Table no: 8

81

PORT FOLIO AS ON 06-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 60.85

AMOUNT OF INVESTMENT 167824.3

3491

46.25

161458.75

MID CAP

INDIAN BANK

638

232.85

148558.3

TOTAL= 477841.35 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 170443.15

143.35

4910

32.7

160557

2849

57.65

164244.85

TOTAL= 495245

Table no: 9

82

PORT FOLIO AS ON 07-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 58.55

AMOUNT OF INVESTMENT 161480.9

3491

45.3

158142.3

MID CAP

INDIAN BANK

638

220.7

140806.6

TOTAL= 460429.8 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 165984.4

139.6

4910

32.3

158593

2849

55.95

159401.55

TOTAL= 483978.95

Table no: 10

83

PORT FOLIO AS ON 10-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARES 2758

SHARE PRICE 56.75

AMOUNT OF INVESTMENT 156516.5

3491

45.55

159015.05

MID CAP

INDIAN BANK

638

214.85

137074.3

TOTAL= 452605.85

ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD

1189

137.2

163130.8

4910

31.15

152946.5

2849

53.45

152279.05

TOTAL= 468356.35

Table no: 11

84

PORT FOLIO AS ON 11-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARES 2758

SHARE PRICE 57.05

AMOUNT OF INVESTMENT 157343.9

3491

45.1

157444.1

MID CAP

INDIAN BANK

638

218.2

139211.6

TOTAL= 453999.6 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 161585.1

135.9

4910

30.5

149755

2849

52.35

149145.15

TOTAL= 460485.25

Table no: 12

85

PORT FOLIO AS ON 12-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 59.9

AMOUNT OF INVESTMENT 165204.2

3491

44.4

155000.4

MID CAP

INDIAN BANK

638

220.5

140679

TOTAL= 460883.6

ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD

1189

138.7

164914.3

4910

30.85

151473.5

2849

52.9

150712.1

TOTAL= 467099.9

Table no: 13

86

PORT FOLIO AS ON 13-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED INDIAN BANK

NO.OF SHARE SHARES PRICE 2758 58.95

AMOUNT OF INVESTMENT 162584.1

3491

44.4

155000.4

638

217.2

138573.6

MID CAP TOTAL= 456158.1

ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD

1189

137.45

163428.05

4910

30.5

149755

2849

53.1

151281.9

TOTAL= 464464.95

Table no: 14

87

PORT FOLIO AS ON 14-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 56.85

AMOUNT OF INVESTMENT 156792.3

3491

43.95

153429.45

MID CAP

INDIAN BANK

638

209.7

133788.6

TOTAL= 444010.35 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 162298.5

136.5

4910

29.7

145827

2849

52.55

149714.95

TOTAL= 457840.45

Table no: 15

88

PORT FOLIO AS ON 17-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 55.3

AMOUNT OF INVESTMENT 152517.4

3491

41.5

144876.5

MID CAP

INDIAN BANK

638

205.9

131364.2

TOTAL= 428758.1 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD JK PAPER LTD 1189 158493.7

133.3

4910

28.65

140671.5

SMALL CAP

2849

51.9

147863.1

TOTAL= 447028.3

Table no: 16

89

PORT FOLIO AS ON 18-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 54.8

AMOUNT OF INVESTMENT 151138.4

3491

39.8

138941.8

MID CAP

INDIAN BANK

638

204.4

130407.2

TOTAL= 420487.4 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 150705.75

126.75

4910

28.8

141408

2849

51.95

148005.55

TOTAL= 440119.3

Table no: 17

90

PORT FOLIO AS ON 19-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 55.05

AMOUNT OF INVESTMENT 151827.9

3491 638

41.2 209

143829.2 133342

MID CAP

INDIAN BANK

TOTAL= 428999.1 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 153678.25

129.25

4910

28.45

139689.5

2849

51.3

146153.7

TOTAL= 439521.45

Table no: 18

91

PORT FOLIO AS ON 20-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 55.3

AMOUNT OF INVESTMENT 152517.4

3491

40.8

142432.8

MID CAP

INDIAN BANK

638

217.65

138860.7

TOTAL= 433810.9 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 153559.35

129.15

4910

27.9

136989

2849

51

145299 TOTAL= 435847.35

Table no: 19

92

PORT FOLIO AS ON 21-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 55.9

AMOUNT OF INVESTMENT 154172.2

3491

40.3

140687.3

MID CAP

INDIAN BANK

638

220.35

140583.3

TOTAL= 435442.8 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 159147.65

133.85

4910

27.95

137234.5

2849

51.1

145583.9

TOTAL= 441966.05

Table no: 20

93

PORT FOLIO AS ON 24-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 58.75

AMOUNT OF INVESTMENT 162032.5

3491

41.9

146272.9

MID CAP

INDIAN BANK

638

234.05

149323.9

TOTAL= 457629.3 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD JK PAPER LTD 1189 163011.9

137.1

4910

28.65

140671.5

SMALL CAP

2849

53.3

151851.7

TOTAL= 455535.1

Table no: 21

94

PORT FOLIO AS ON 25-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 57.65

AMOUNT OF INVESTMENT 158998.7

3491

41.9

146272.9

MID CAP

INDIAN BANK

638

228.4

145719.2

TOTAL= 450990.8 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 165330.45

139.05

4910

28.55

140180.5

2849

52.9

150712.1

TOTAL= 456223.05

Table no: 22

95

PORT FOLIO AS ON 27-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 54

AMOUNT OF INVESTMENT 148932

3491

39.65

138418.15

MID CAP

INDIAN BANK

638

218.35

139307.3

TOTAL= 426657.45 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 160990.6

135.4

4910

28.1

137971

2849

52.65

149999.85

TOTAL= 448961.45

Table no: 23

96

PORT FOLIO AS ON 28-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 51.9

AMOUNT OF INVESTMENT 143140.2

3491

38.4

134054.4

MID CAP

INDIAN BANK

638

211.15

134713.7

TOTAL= 411908.3 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 155105.05

130.45

4910

26.65

130851.5

2849

51

145299

TOTAL= 431255.5

Table no: 24

97

PORT FOLIO AS ON 31-JAN-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 51.2

AMOUNT OF INVESTMENT 141209.6

3491

36.65

127945.15

MID CAP

INDIAN BANK

638

210.45

134267.1

TOTAL= 403421.85 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 159504.35

134.15

4910

25.9

127169

2849

52.5

149572.5

TOTAL= 436245.85

Table no: 25

98

PORT FOLIO AS ON 01-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 50.9

AMOUNT OF INVESTMENT 140382.2

3491

36.1

126025.1

MID CAP

INDIAN BANK

638

208.95

133310.1

TOTAL= 399717.4 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 164082

138

4910

26.05

127905.5

2849

51.9

147863.1

TOTAL= 439850.6

Table no: 26

99

PORT FOLIO AS ON 02-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 51

AMOUNT OF INVESTMENT 140658

3491

35.45

123755.95

MID CAP

INDIAN BANK

638

211.35

134841.3

TOTAL= 399255.25 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 164082

138

4910

26.35

129378.5

2849

51.65

147150.85

TOTAL= 440611.35

Table no: 27

100

PORT FOLIO AS ON 03-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARES 2758

SHARE AMOUNT OF PRICE INVESTMENT 50.35 138865.3

3491 638

37.05 216.65

129341.55 138222.7

MID CAP

INDIAN BANK

TOTAL=406429.55 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 165984.4

139.6

4910

26.8

131588

2849

52

148148

TOTAL=445720.4

Table no: 28

101

PORT FOLIO AS ON 04-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE AMOUNT OF SHARES PRICE INVESTMENT 137072.6 2758 49.7 3491 638 36.25 217.25 126548.75 138605.5

MID CAP

INDIAN BANK

TOTAL=402226.85 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 164557.6

138.4

4910

26.1

128151

2849

52.35

149145.15

TOTAL=441853.75

Table no: 29

102

PORT FOLIO AS ON 07-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE AMOUNT OF SHARES PRICE INVESTMENT 2758 48.85 134728.3

3491 638

35.95 208.95

125501.45 133310.1

MID CAP

INDIAN BANK

TOTAL=393539.85 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

138

164082

4910 2849

26.65 52.3

130851.5 149002.7

TOTAL=443936.2

Table no: 30

103

PORT FOLIO AS ON 08-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE AMOUNT OF SHARES PRICE INVESTMENT 2758 46.3 127695.4

3491 638

34.7 203.35

121137.7 129737.3

MID CAP

INDIAN BANK

TOTAL=378570.4 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189 136.05 161763.45

4910 2849

25.4 51.05

124714 145441.45

TOTAL=431918.9

Table no: 31

104

PORT FOLIO AS ON 09-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE AMOUNT OF SHARES PRICE INVESTMENT 2758 40.85 112664.3

3491 638

32.35 202.25

112933.85 129035.5

MID CAP

INDIAN BANK

TOTAL=354633.65 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

128.95

153321.55

4910 2849

24.4 49.2

119804 140170.8

TOTAL=413296.35

Table no: 32

105

PORT FOLIO AS ON10-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE AMOUNT OF SHARES PRICE INVESTMENT 2758 41.35 114043.3

3491 638

31.6 206.2

110315.6 131555.6

MID CAP

INDIAN BANK

TOTAL=355914.5 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

129.45

153916.05

4910

23.75

116612.5

2849

49.2

140170.8

TOTAL=410699.35

Table no: 33

106

PORT FOLIO AS ON 11-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 40.3

AMOUNT OF INVESTMENT 111147.4

3491 638

33.55 210.8

117123.05 134490.4

MID CAP

INDIAN BANK

TOTAL= 362760.85 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

134.15

159504.35

4910

24.1

118331

2849

47.05

134045.45

TOTAL= 411880.8

Table no: 34

107

PORT FOLIO AS ON 14-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 41.95

AMOUNT OF INVESTMENT 115698.1

3491

35.05

122359.55

MID CAP

INDIAN BANK

638

219.85

140264.3

TOTAL=378321.95 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

136

161704

4910

25.25

123977.5

2849

49

139601 TOTAL= 425282.5

Table no: 35

108

PORT FOLIO AS ON 15-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 41.35

AMOUNT OF INVESTMENT 114043.3

3491

35.25

123057.75

MID CAP

INDIAN BANK

638

218.45

139371.1

TOTAL= 376472.15 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

136.9

162774.1

4910

25.45

124959.5

2849

48.4

137891.6

TOTAL= 425625.2

Table no: 36

109

PORT FOLIO AS ON 16-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 42.5

AMOUNT OF INVESTMENT 117215

3491 638

37.2 214.2

129865.2 136659.6

MID CAP

INDIAN BANK

TOTAL= 383739.8 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

136

161704

4910 2849

25.2 48.95

123732 139458.55

TOTAL=424894.55

Table no: 37

110

PORT FOLIO AS ON 17-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 43.6

AMOUNT OF INVESTMENT 120248.8

3491

37.1

129516.1

MID CAP

INDIAN BANK

638

220.55

140710.9

TOTAL= 390475.8 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

135.65

161287.85

4910

25.8

126678

2849

48.7

138746.3

TOTAL=426712.15

Table no: 38

111

PORT FOLIO AS ON 18-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 41.7

AMOUNT OF INVESTMENT 115008.6

3491 638

35.7 220.35

124628.7 140583.3

MID CAP

INDIAN BANK

TOTAL= 380220.6 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

134.3

159682.7

4910 2849

25.2 47.95

123732 136609.55

TOTAL=420024.25

Table no: 39

112

PORT FOLIO AS ON 21-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 41.25

AMOUNT OF INVESTMENT 113767.5

3491

35.1

122534.1

MID CAP

INDIAN BANK

638

219.55

140072.9

TOTAL= 376374.5 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

136.2

161941.8

4910 2849

25.1 47.75

123241 136039.75

TOTAL=421222.55

Table no: 40

113

PORT FOLIO AS ON 22-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 40.1

AMOUNT OF INVESTMENT 110595.8

3491

35.35

123406.85

MID CAP

INDIAN BANK

638

216.25

137967.5

TOTAL= 371970.15 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

133.25

158434.25

4910

24.8

121768

2849

47.8

136182.2

TOTAL= 416384.45

Table no: 41

114

PORT FOLIO AS ON 23-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED INDIAN BANK

NO.OF SHARE SHARES PRICE 2758 39.85 3491

AMOUNT OF INVESTMENT 109906.3

MID CAP

35.25 638 212.95

123057.75 135862.1

TOTAL= 368826.15 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD JK PAPER LTD 1189 131.75 4910 156650.75

SMALL CAP

24.3 2849 47.95

119313 136609.55

TOTAL= 412573.3

Table no: 42

115

PORT FOLIO AS ON 24-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED INDIAN BANK

NO.OF SHARE SHARES PRICE 2758 38.15

AMOUNT OF INVESTMENT 105217.7

3491

33.45

116773.95

MID CAP

638

202.95

129482.1

TOTAL= 351473.75 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

127.85

152013.65

4910

23.65

116121.5

2849

45.35

129202.15

TOTAL= 397337.3

Table no: 43

116

PORT FOLIO AS ON 25-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARE SHARES PRICE 2758 38.95

AMOUNT OF INVESTMENT 107424.1

3491

33.65

117472.15

MID CAP

INDIAN BANK

638

203.6

129896.8

TOTAL= 354793.05 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

124.5

148030.5

4910

23.45

115139.5

2849

45.3

129059.7

TOTAL= 392229.7

Table no: 44

117

PORT FOLIO AS ON 28-FEB-2011

INDICES

COMPANY MOSER-BAER (I) LIMITED HINDUSTAN CONSTRUCTION COMPANY LIMITED

NO.OF SHARES 2758

SHARE PRICE 38.55

AMOUNT OF INVESTMENT 106320.9

3491

33.9

118344.9

MID CAP

INDIAN BANK

638

204.4

130407.2

TOTAL= 355073 ADITYA BIRLA CHEMICALS (INDIA) LTD GEOJIT BNP PARIBAS FINANCIAL SERVICES LTD SMALL CAP JK PAPER LTD 1189

130.2

154807.8

4910

23.8

116858

2849

45.65

130056.85

TOTAL=401722.65

Table no: 45

118

5.8 RETURN CALCULATION OF MID CAP PORTFOLIO AND NIFTY MIDCAP
The calculation is based on the total portfolio amount of midcap and the nifty midcap index. First step to find the return of midcap portfolio by using the formula: Closing ± Opening *100 Opening Second step is to find out the return of nifty midcap index using this same formula. Third step is making a comparison with these two returns by using a line graph. 5.8.1 RETURN OF MIDCAP PORTFOLIO AND NIFTY MIDCAP INDEX NIFTY MID PORTFOLIO CAP INDEX 499968.95 490379.35 487569.85 477841.35 460429.8 452605.85 453999.6 2958.05 2951.85 2912.8 2868.1 2783.65 2708.85 2690.9 -1.91803911 -0.572923799 -1.995303852 -3.643793071 -1.699270986 0.307939016 -0.209597539 -1.322899199 -1.534605878 -2.944458004 -2.68711943 -0.662642819 RETURN RETURN PORTFOLIO INDEX

119

460883.6 456158.1 444010.35 428758.1 420487.4 428999.1 433810.9 435442.8 457629.3 450990.8 426657.45 411908.3 403421.85 399717.4 399255.25 406429.55 402226.85 393539.85 378570.4 354633.65 355914.5

2747.1 2736.7 2688.2 2663.6 2683.9 2684.5 2696.4 2691.65 2725.6 2713.55 2625.95 2548.45 2553.65 2504.1 2509.4 2532.55 2493.85 2470.7 2382.95 2282.3 2307.65

1.516300895 -1.025313116 -2.663056953 -3.435111366 -1.928989796 2.024246149 1.121634055 0.376177731 5.095158308 -1.450628271 -5.39553135 -3.456906706 -2.060276523 -0.918257154 -0.115619185 1.796920642 -1.034053749 -2.159726532 -3.803795219 -6.322932274 0.36117554

2.088520569 -0.378581049 -1.772207403 -0.915110483 0.762126445 0.022355527 0.443285528 -0.176160807 1.26130812 -0.442104491 -3.228243445 -2.951312858 0.204045596 -1.940359877 0.211652889 0.922531282 -1.528104085 -0.928283578 -3.551625046 -4.223756268 1.11072164

120

362760.85 378321.95 376472.15 383739.8 390475.8 380220.6 376374.5 371970.15 368826.15 351473.75 354793.05 355073

2369.5 2449.5 2459.05 2453.2 2482.7 2421.4 2461.35 2434.45 2408.2 2309.15 2300.3 2311.4

1.923594009 4.289630482 -0.488948632 1.930461523 1.755356103 -2.626334334 -1.011544351 -1.170204145 -0.845229113 -4.70476402 0.944394852 0.078905153

2.680215804 3.376239713 0.389875485 -0.237896749 1.202511006 -2.469086076 1.649871975 -1.092896175 -1.0782723 -4.113030479 -0.383257909 0.482545755

Table no: 46

5.8.2 TOTAL RETURNS The total return of midcap portfolio = -28.98098972 The total return of nifty index = -21.86068525

121

5.8.3MID CAP PORTFOLIO RETURN AND NIFTY MIDCAP RETURN

6

4

2

0
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39

-2

PORTFOLIO RETURN

-4
INDEX RETURN

-6

-8

Fig no: 2 Interpretation The graph shows the return of portfolio and the return of index fluctuation for two month. The fluctuation never goes in a constant mode. In the above graph it is seen that the portfolio started on a negative note, but shows a positive growth by the 3rd day. Simultaneously when we study the market return we can see that it started on a positive note but then declines suddenly. The market and the portfolio return show a increasing and decreasing trend. It is also seen that by the end of the first month the market and portfolio returns move in line with each other, almost coin siding with each other.

122

5.9 RETURN CALCULATION OF SMALL CAP PORTFOLIO AND BSE SMALL CAP
The calculation is based on the total portfolio amount of small cap and the BSE small cap index. First step to find the return of small cap portfolio by using the formula: Closing ± Opening *100 Opening Second step is to find out the return of BSE small cap index using this same formula. Third step is making a comparison with these two returns by using a line graph. 5.9.1 RETURN OF SMALL CAP PORTFOLIO AND BSE SMALL CAP INDEX

BSE SMALL PORTFOLIO PORTFOLIO CAP RETURN INDEX 499871.05 502445.65 499318.95 495245 483978.95 468356.35 460485.25 9845.05 9841.17 9740.38 9639.15 9363.19 9098.66 9019.13 0.515052832 -0.622296163 -0.815901339 -2.274843764 -3.227950307 -1.680579328 -0.039410668 -1.024166842 -1.039281835 -2.862908036 -2.825212348 -0.874084755 RETURN INDEX

123

467099.9 464464.95 457840.45 447028.3 440119.3 439521.45 435847.35 441966.05 455535.1 456223.05 448961.45 431255.55 436245.85 439850.6 440611.35 445720.4 441853.75 443936.2 431918.9 413296.35 410699.35 411880.8 425282.5 425625.2

9147.63 9088.24 8993.84 8868.15 8893.27 8901.67 8905.18 8946.17 9016.54 8985.14 8864.23 8546.29 8477.82 8355.75 8362.41 8464 8331.2 8261.72 7995.27 7651.82 7585.65 7808.79 8116.62 8164.86

1.43645209 -0.564108449 -1.426264781 -2.361554118 -1.545539734 -0.135838169 -0.835931898 1.403863073 3.070156633 0.151020196 -1.59167758 -3.943746172 1.157156122 0.826311586 0.172956454 1.15953663 -0.867505728 0.471298478 -2.706988076 -4.311584883 -0.628362675 0.287667852 3.253781191 0.080581731

1.424749394 -0.649239202 -1.038704964 -1.397512075 0.283260883 0.094453446 0.039430803 0.460293896 0.786593593 -0.348248885 -1.345666289 -3.586775163 -0.801166354 -1.439874873 0.079705592 1.214841176 -1.56899811 -0.833973497 -3.225115351 -4.295664812 -0.864761586 2.94160685 3.942096023 0.594336066

124

424894.55 426712.15 420024.25 421222.55 416384.45 412573.3 397337.3 392229.7 401722.65

8247.42 8324.56 8128.91 8121.26 8061.75 8036.41 7814.04 7789.47 7817.32

-0.171665118 0.427776727 -1.567309485 0.285293052 -1.148585231 -0.915295948 -3.692919537 -1.285456966 2.420252724

1.011162469 0.935322804 -2.350274369 -0.094108558 -0.732768068 -0.314323813 -2.767031548 -0.314434019 0.357533953

Table no: 47 5.9.2 TOTAL RETURNS The total return of small cap portfolio = -19.6347438 The total return of BSE index = -20.59644187

125

5.9.3 SMALL CAP PORTFOLIO RETURN AND BSE SMALL CAP RETURN
5

4 3
2 1

0
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39

-1
-2

PORTFOLIO RETURN

-3 -4 -5

INDEX RETURN

Fig no: 3 Interpretation The graph shows the return of portfolio and the return of index fluctuation for two month. The fluctuation never goes in a constant mode. In the above graph it is seen that the portfolio started on a positive note, but shows a negative growth by the next day. The data of two month gives the picture that the portfolio and index return in most of the days show negative returns. The small changes in the market also affect the portfolios. Simultaneously when we study the market return we can see that it started on a positive note but then declines suddenly. Sometimes the return of the two is almost equal but sometimes portfolio returns more than the index return. The market and the portfolio return show an increasing and decreasing trend in this two month. It is also seen that by the end of the second month the market and portfolio returns move up.
126

CHAPTER- 6

FINDINGS, SUGGESTIONS AND CONCLUSION

127

6.1 FINDINGS

1. Market capitalization has been divided into four. They are small cap, mid cap, large cap, and mega cap. Earlier the capitalization was just one ie the large cap. But with the number of companies on the increase it was necessary for further divisions. Thus came the small cap, mid cap, and mega cap. 2. The advantage of classification of companies is as follows:  Companies that are classified as small cap have a capitalization of below $2 billion. The advantage of such division is that the capable investor who wishes to invest can study the performance of companies under the small cap. As the result they are able to analyze which companies have stable performance.  Once the company reaches above $2 billion they come to the capitalization of medium caps. An investor now can, after studying the small caps can decide in which companies to invest. Thus helping them to make a proper investment.  With the help of this classification an investor can study the performance of the company in stage wise. 3. From the recent survey conducted by the India¶s foremost and largest finance magazine ³capital market´ they found that 120 small cap

companies waiting to break free for transforming to mid caps. 4. Compared to small cap stocks mid cap stocks are less risky

128

5. A study conducted by ROXBURY capital management LLC. About ³the case for mid cap stocks in today¶s volatile markets´ find the historical performance of last 25 years shows good performance than small cap and large cap. 6. Mid cap stocks give higher return than small cap and large cap in future. 7. The price of small cap shares is less so the small investors can invest in good small cap securities. 8. Compared to large cap companies the small cap shows faster growth. 9. Mid cap companies generally have much greater growth potential than comparable large cap, with more seasoned management, liquidity, and operating histories than small caps. 10. Investing in a group of securities can reduce the risk involved in individual securities

129

6.2 SUGGESTIONS
1. Create awareness about mid cap and small caps among the investors. 2. Investor should always be aware about the current situation in the stock market. 3. The stock exchange should function like a financial institution offering investment opportunities having highest return potential rather than a facilitator. 4. The investor should consider the past record before investing. 5. The investor should not stick to one strategy in the whole time. He should change his strategies according to the market situation. 6. The investor must need news papers, business journals or websites to get an awareness about the market situation and factors that will affect the stock market. Must have a clean eye on the activities of major players of the market. 7. The investors consult the stock brokers to collect information about the market and particular stocks which give good return then make investment in that with the help of that broker.

130

6.3 CONCLUSION

Today Indian capital market offers a variety of financial product with varied features and benefit for investors to choose from them. However the knowledge about the particular investment alternative is an essential for the investor It can be concluded that the role and the performance of MID CAP and SMALL CAP help the investor to choose the better fund and asses its performance with the market. In the changing market situations an individual investor expecting an optimum risk and return. Result of study shows that the mid cap and small cap play a very significant role in today¶s capital market. But the problem is most of the investors are not aware about the small caps and mid caps. So give more priority and encourage to these companies. The researcher concludes that, if a person who is investing in shares for his future needs, he can invest in small cap or mid cap companies. That company will once become a success in its future. From the study of two month the market of small cap and mid cap shows lots of up and downs and based on that the small cap shows good return than mid cap in these months. And also the overall fact should consider the researcher concludes that investing in mid cap is better than small cap. Because the mid cap companies is less risky than small cap and large cap.

131

BIBLIOGRAPHY

1. Security Analysis and Portfolio Management - S Kevin 2. DALAL STREET Investment journal 3. CAPITAL MARKET magazine

WEBSITES

1. www.capitalmarket.com 2. www.bseindia.com 3. www.cochinstockexchange.com 4. www.dsij.in 5. www.nseindia.com 6. www.moneycontrol.com

132