Summer project report

on
Comparative Analysis of Broking Companies and Financial performance of Edelweiss Broking
Ltd.

From

IN PARTIAL FULLFILMENT OF POST GRADUATE DIPLOMA IN MANAGEMENT

Submitted to Submitted by

Puneet Dublish Ankit Kapoor

1
2
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 ACKNOWLEDGEMENT

This report bears the imprint of many people. Right from the experienced staff of Edelweiss
Capital, to the staff of without whose support and guidance I would have not got the unique
opportunity to successfully complete my internship in this esteemed organization.
I take this opportunity to express my deep gratitude to all the employees of, Edelweiss
Capital,Carol Bagh. Also I am indebted for the rich guidance, knowledge and suggestions
provided by my guide, Mr. Sachin Arora and Mr.Siddhraj who took sincere efforts and
illustrated the Concept of Wealth Management, with their vast knowledge in the field, which
helped me in carrying out my internship.
I am gratified to Puneet Dublish for their earnest coordination owing to which, I had the leg-up
of undertaking the internship at the prominent organization, Edelweiss Capital Pvt. ltd.

Last but not least, I also thank all those people whom I met in the industry during my internship
and helped me to accomplish my assignments in the most efficient and effective manner.

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CONTENTS

1. ACKNOWLEDGEMENT 7

2. INTRODUCTION 10
 Introduction to stock exchange
 Introduction of the company
3. COMPANY PROFILE 18
4. REVIEW OF LITERATURE 37
5. RESEARCH METHODOLOGY 40
 Objective of study
 Type of research
 Sample design
 Size of sample
 Sources of data collection
6. COMPARATIVE ANALYSIS 46
7. FINDING & ANALYSIS 50
8. SUGGESTIONS 60
9. LIMITATIONS 61
10. CONCLUSION 62
11. APPENDIX(Questionnaire) 63
12. BIBLIOGRAPHY 67

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 PREFACE
“A good broker system must be able to cope with an extremely complex and dynamic
environment.”

The microstructure of the stock market in which brokers work is highly dynamic and volatile.
Many stocks are available to be bought and sold, each exhibiting its own patterns and
characteristics that are highly unpredictable. With so many options and considerations that need
to be taken into account, it is an extremely arduous task for a broker to investigate aspects of the
stock market and consistently provide effective advice to their clients.

Thus, brokers perform their day-to-day tasks with the aid of a broker system. Such a system
should provide tools for interacting with exchanges and performing analysis. As a consequence,
these broker systems are quite large and complicated by themselves.

This research aims is to analysis Stock broker on the basis of their services, products,
growth, and their subsidiaries. Because Stockbrokers are one of the main participants in stock
exchanges worldwide, they often act as an agent for their clients, making trades on their behalf.
They also act as advisors, providing suggestions to their clients on what stocks to buy and sell.

6
 Executive Summary

There is growing competition between brokerage firms in post reform India. For investor it is
always difficult to decide which brokerage firm to choose.

Research was carried out to find which brokerage house people prefer and to figure out what
people prefer while investing in stock market.

This study suggest that people are reluctant while investing in stock and commodity market due
to lack of knowledge

Main purpose of investment is returns and liquidity, commodity market is less preferred by
investors due to lack of awareness. The major findings of this study are that people are
interested to invest in stock market but they lack knowledge.

Through this report we were also able to understand, what are our Company’s (Edelweiss
Broking Ltd.) positive and strong points, on the basis of which we come to know what can be the
basis of pitching to a potential client. We also gave suggestions to the company, what
improvement can be done to our product.

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 INTRODUCTION

In most industrialized countries, a substantial part of financial wealth is not managed

directly by savers, but through a financial intermediary, which implies the existence of an
agency contract between the investor (the principal) and a broker or portfolio manager (the
agent). Therefore, delegated brokerage management is arguably one of the most important
agency relationships intervening in the economy, with a possible impact on financial market and
economic developments at a macro level.

In most of the metros, people like to put their money in stock options instead of dumping
it in the bank-lockers. Now, this trend pick pace in small but fast developing cities like Gurgaon,
Noida etc. My research is based on the Delhi-NCR.

As the per-capita-income of the city is on the higher side, so it is quite obvious that they
want to invest their money in profitable ventures. On the other hand, a number of brokerage
houses make sure the hassle free investment in stocks. Asset management firms allow investors
to estimate both the expected risks and returns, as measured statistically. There are mainly two
types of Portfolio management strategies.

1. Passive Portfolio Strategy

2. Active Portfolio Strategy

1. Passive Portfolio Strategy: A strategy that involves minimal expectation input, and
instead relies on diversification to match the performance of some market index. A
passive strategy assumes that the marketplace will reflect all available information in the
price paid for securities
2. Active Portfolio Strategy: A strategy that uses available information and forecasting
techniques to seek a better performance than a portfolio that is simply diversified
broadly.

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BACKGROUND OF STOCK EXCHANGE IN INDIA

The emergence of stock market can be traced back to 1830. In Bombay, business passed in the
shares of banks like the commercial bank, the chartered mercantile bank, the chartered bank, the
oriental bank and the old bank of Bombay and shares of cotton presses. In Calcutta, Englishman
reported the quotations of 4%, 5%, and 6% loans of East India Company as well as the shares of
the bank of Bengal in 1836. This list was a further broadened in 1839 when the Calcutta
newspaper printed the quotations of banks like union bank and Agra bank. It also quoted the
prices of business ventures like the Bengal bonded warehouse, the Docking Company and the
storm tug company.

Between 1840 and 1850, only half a dozen brokers existed for the limited business. But during
the share mania of 1860-65, the number of brokers increased considerably. By 1860, the number
of brokers was about 60 and during the exciting period of the American Civil war, their number
increased to about 200 to 250. The end of American Civil war brought disillusionment and many
failures and the brokers decreased in number and prosperity. It was in those troublesome times
between 1868 and 1875 that brokers organized an informal association and finally as recited in
the Indenture constituting the “Articles of Association of the Exchange”. On or about 9th day of
July,1875, a few native brokers doing brokerage business in shares and stocks resolved upon
forming in Bombay an association for protecting the character, status and interest of native
share and stock brokers and providing a hall or building for the use of the members of such
association.

As a meeting held in the broker’ Hall on the 5 th day of February, 1887, it was resolved to execute
a formal deal of association and to constitute the first managing committee and to appoint the
first trustees. Accordingly, the Articles of Association of the Exchange and the Stock Exchange

9
was formally established in Bombay on 3rd day of December, 1887. The Association is now
known as “The Stock Exchange”.

The entrance fee for new member was Re.1 and there were 318 members on the list, when the
exchange was constituted. The numbers of members increased to 333 in 1896, 362 in 1916and
478 in 1920 and the entrance fee was raised to Rs.5 in 1877, Rs.1000 in 1896, Rs.2500 in 1916
and Rs. 48,000 in 1920. At present there are 23 recognized stock exchanges with about 6000
stock brokers. Organization structure of stock exchange varies.

14 stock exchanges are organized as public limited companies, 6 as companies limited by

guarantee and 3 are non-profit voluntary organization. Of the total of 23, only 9 stock
exchanges have been permanent recognition. Others have to seek recognition on annual basis.

These exchange do not work of its own, rather, these are run by some persons and with the help
of some persons and institution. All these are down as functionaries on stock exchange. These
are

1. Stockbrokers
2. sub-broker
3. market makers
4. Portfolio consultants etc.

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1.) Stockbrokers

Stock brokers are the members of stock exchanges. These are the persons
who buy, sell or deal in securities. A certificate of registration from SEBI is mandatory to act as
a broker. SEBI can impose certain conditions while granting the certificate of registrations. It is
obligatory for the person to abide by the rules, regulations and the buy-law. Stock brokers are
commission broker, floor broker, arbitrageur etc.

Detail of registered brokers

Total no. of registered brokers as Total no. of sub-brokers as on

on 31.03.2009 31.03.2009

9000 24,000

2.) Sub-broker

A sub-broker acts as agent of stock broker. He is not a member of a stock

exchange. He assists the investors in buying, selling or dealing in securities through
stockbroker. The broker and sub-broker should enter into an agreement in which obligations of
both should be specified. Sub-broker must be registered SEBI for a dealing in securities. For
getting registered with SEBI, he must fulfill certain rules and regulation.

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3.) Market Makers

Market maker is a designated specialist in the specified securities. They

make both bid and offer at the same time. A market maker has to abide by bye-laws, rules
regulations of the concerned stock exchange. He is exempt from the margin requirements. As per
the listing requirements, a company where the paid-up capital is Rs. 3 crore but not more than
Rs. 5 crore and having a commercial operation for less than 2 years should appoint a market
maker at the time of issue of securities.

4.) Portfolio consultants

A combination of securities such as stocks, bonds and money market

instruments is collectively called as portfolio. Whereas the portfolio consultants are the persons,
firms or companies who advise, direct or undertake the management or administration of
securities or funds on behalf of their clients.

Partial fulfillment for degree of M.B.A. programmed, we received the opportunity from
Edelweiss Broking Ltd. for our summer training project report. It is basically a stock brokering
company which deals in security and derivative market, mutual funds etc.

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Edelweiss Capital Limited: A Profile _________________________

Introduction

The Edelweiss Group is a conglomerate of 44 entities including 39 Subsidiaries and 4 Associate

companies (September‟09), engaged in the business of providing financial services, primarily
linked to the capital markets. Edelweiss Capital Limited (www.edelcap.com), incorporated in
1995, today has emerged as one of India‟s leading integrated financial services conglomerates.
The Edelweiss Group offers one of the largest range of products and services spanning varied
asset classes and diversified consumer segments. The Group‟s product offerings are broadly
divided into Investment Banking, Brokerage Services, Asset Management and Financing. The
company‟s research driven approach and consistent ability to capitalize on emerging market
trends has enabled it to foster strong relationships across corporate, institutional and HNI
clients. Edelweiss Capital Limited now employs about 1200 employees, leveraging a strong
partnership culture and unique model of employee ownership. It is a listed company since
December 2007 under the symbols NSE: EDELWEISS, BSE: 532922 and Bloomberg: EDEL.IN.

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Evolution of Edelweiss

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Business Overview

Edelweiss‟ operations are broadly divided into Agency and Capital business lines. The Agency
business line includes Investment Banking, Broking - both Institutional and HNI/Retail, Asset
Management and Investment advisory and distribution services. The Capital business line
includes Financing and Treasury Operations. The strategies employed ensure that broadly one-
third of the total revenues are contributed by each of Agency fee & commission, Treasury
Arbitrage & Trading income and Interest income thereby achieving the intended diversification
in revenue streams.

Investment Banking

Edelweiss has one of the most extensive product offerings within Investment Banking in India,
catering to different market and client segments. The verticals within Investment Banking
include Equity Capital Markets and Advisory services which offer Mergers & Acquisitions
Advisory, Private Equity Syndication, Structured Finance Advisory, Real Estate Advisory and
Infrastructure Advisory. Edelweiss‟ leadership position in Mid-market space is reflected in the #
1 ranking in both Bloomberg tables for Mid-market Private Equity placements in CY2007 and
Prime Database league tables for IPOs in Mid-market segment in FY2008. It was adjudged
winner in the Best Merchant Banker category in the Outlook Money NDTV Profit Awards 2008.

Broking

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Institutional Equities :

Edelweiss has one of the leading institutional equities businesses in India backed by a large and
experienced research team and a large and diversified client base. Intense servicing, seamless
execution and innovative research products have helped Edelweiss build strong relationships
with over 300 institutional investors, including FIIs and domestic institutional investors.
Research coverage presently extends to over 145 companies across 16 sectors accounting for
nearly 70% of total market capitalization. The quality and caliber of research associated with
Edelweiss is widely regarded across the institutional community. Our commitment to provide
cutting edge research has resulted in a pioneering effort to provide online research to our clients
through the portal www.edelresearch.com with smart features of sorting of information, analysis
and archiving.

HNI Broking

Edelweiss offers dedicated brokerage services to high net-worth individuals with a strong
emphasis on building long-term relationships with clients. Product offerings include specialized
trading execution for active trading clients and structured products like equity linked capital
protection products.

Wealth Advisory & Investment Services

The Primary focus is on understanding each client's profile including life style, risk appetite,
growth expectations, current financial position and income requirements to create comprehensive
and tailored investment strategies. The broad range of offerings includes asset allocation
advisory to Structured Products, Portfolio Management, Mutual Funds, Insurance, Derivatives
Strategies, Direct Equity, Private Equity, and Real Estate Funds etc.

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Retail Initiatives

Retail Broking and Distribution are the new initiatives of the Group under its Retail Business
strategy. An online retail broking portal www.edelweiss.in is operational and provides advisory
and research based broking services. Distribution business focuses on giving advice and
analyzing the best financial product options available in the market. It involves the distribution
of the full range of third party financial products and services including IPO syndication for the
retail customer. For the half year ended September 30, 2009 Edelweiss is ranked #2 in NIB (non
institutional bidder) category and is ranked 4th in Retail category by the number of applications
in IPOs as per Prime Database. Edelweiss also secured 1st rank in NIB category both in NHPC
and OIL India IPOs by the number of applications.

Asset Management

Alternative Asset Management focuses on advisory/management expertise for India focused

Multi-Strategy Fund, Real Estate Fund and a Bonds Fund. Recent Initiatives that have been
announced include setting up an ARC for which RBI registration has been received. On the
Domestic AMC side, Edelweiss Mutual Fund has launched a mix of debt and equity funds. The
focus of this business is on broad basing the product portfolio.

Financing

With a deep knowledge and understanding of capital markets, the Company‟s primary offering
in the financing business includes collateralized loan products such as promoter funding, loans
against shares, IPO financing, loans against ESOPs etc. Its prudent financing norms and a
conservative margin of safety ensures low or nil non–performing loans.

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Treasury

The Treasury Operations in Edelweiss is similar to that of a Treasury in a Commercial Bank and
focuses on liquidity management and capital preservation. This business adopts a multi–
strategy/multi-book approach to diversify and grow its portfolio while imparting liquidity in the
balance sheet. The Company follows a disciplined and conservative approach to cash
management with emphasis on strong risk policies.

WORK STRUCTURE OF EDELWEISS

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

On April 17, 2009 Edelweiss launched Speed Trade, are net-based executable application that
emulates the broker terminals along with host of other information relevant to the Day Traders.
This was for the first time that a net-based trading station of this caliber was offered to the
traders. In the last six months SpeedTrade has become a de facto standard for the Day Trading
community over the net.

Enter Stock for Company Details / Stocks for Comparison. 

   SENSEX 17,700.90    166.81 ( 16:03  ) | NIFTY 5,312.50   56.35 ( 16:14 ) 

www.edelweiss.in

              

Copyright © 2009 ECSL. | Disclaimer  |  Terms & 18

Conditions  |  Privacy Policy | Browser Settings
About Us |  Customer Service |  Channel Partners |  Our Offerings |  Site Map 

Edelweiss : India`s leading Stock Broking Company provides online BSE and NSE Share Trading Services.
 Equities Go

The firm’s online trading and investment site - www.edelweiss.in - was launched on Feb 8, 2009.
The site gives access to superior content and transaction facility to retail customers across the
country. Known for its jargon-free, investor friendly language and high quality research, the site
has a registered base of over 1 Lacs customers. The number of trading members currently stands
at over 7 Lacs. While online trading currently accounts for just over 5 per cent of the daily
trading in stocks in India, Edelweiss alone accounts for 27 per cent of the volumes traded online
for HNI segment.

The Corporate Finance section has a list of very prestigious clients and has many ‘firsts’ to its
credit, in terms of the size of deal, sector tapped etc. The group has placed over US$ 5 billion in
private equity deals. Some of the clients include BPL Cellular Holding, Gujarat Pipavav, Essar,
Hutchison, Planetasia, and Shopper’s Stop.

Finally, Edelweiss shifted hands and Citi venture get holds on it.

Financial Performance

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Operations of the company

ESL’s operation can be broadly classified into equity brokerage services and proprietary
trading.
ESL focuses on the wholesale equity segment, providing broking services to Institutional and
corporate clients and high net worth individuals.

Fund Requirements

ESL’s fund requirements arise mainly on account of working capital requirement on account of
deposits to be maintained with the exchanges for obtaining trading exposure limits and for
meeting funds requirement for institutional clients. The proceeds of the proposed CP
issue are to be used for the aforesaid purposes. Unutilized margins paid to the exchanges as on
last trading day of the month ranges from 16% to 45% during the period Apr-04 to Dec-04.
However, ESL has to maintain high margins for its intraday transactions done
on its proprietary book and for its clients.
As on 31st Dec’04, ESL has fund based bank limits on 2,400 lacs and its average
utilization level has been around 50%.

BRIEF FINANCIAL

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As on/For the 2006 2007 2008 2009
Period ended
31st March
Brokerage 207 151 290 891
Income
Inc from 36 121 147 295
Securities
&derivatives
Total Income 287 301 587 1394
Employee Costs 35 65 100 229
Operating and 166 171 286 660
Other Expenses
Interest Paid 64 46 63 63
Total Expenses 287 289 462 1030
PBT 1 11 126 364
PAT -12 10 104 243
Networth 537 536 772 1015
Total Capital 527 1355 1559 2315
Employed

SOLVANCY RATIOS

Overall 1.11 1.47 0.96 1.27

Debt/Equity
Ratio
Interest 1.01 1.25 2.99 6.77
Coverage ratio
Current Ratio 1.36 1.79 2.96 1.31

OPERATING EFFICIENCY

Operating 0.70 0.79 0.66 0.64

Expenses/Total
Incom
Interest 0.22 0.15 0.11 0.05
Expended/total
Income

PROFITABILITY RATIO

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PAT/Total -4.20 3.29 17.69 17.42
Income (%)
Return on Net 1.86 15.87 27.18
Worth (%)
Return on 1.05 7.13 12.54
Capital
Employed (%)

BROKERAGE INCOME

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 900
800
700
600
500
BROKERAGE
400
INCOME
300
200
100
0
2006 2007 2008 2009

COMMENT

Brokerage income of ESL has grown at CAGR of 63% from Rs. 207 lacs in FY09 to Rs. 891 lacs
in FY06. The growth has been particularly strong in FY06 and H1FY’10, on account of
buoyancy in the equity market.
Brokerage income contributed 64% of the ESL’s total income in FY09. Total
income has grown at 70% p.a. from Rs.287 lacs in FY01 to Rs.1,394 lacs in FY04. However,
from a loss of Rs.12 lacs incurred in FY01 (on account of prior period adjustment, PBT was
positive), ESL registered a profit of Rs.243 lacs in FY09.

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INCOME FROM SECURITIES AND DERIVATIVES

300

250

200

150 INCOME FROM SECURITIES

AND DERIVATIVES
100

50

0
2006 2007 2008 2009

COMMENT

The percentage of income from securities and derivatives is higher because percentages of
deleing with securities and derivatives is higher. And the continuous increasing branches in the
country.

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PROFIT AFTER TAX

250

200

150

100
East
50

-50
2006 2007 2008 2009

COMMENT

In 2006 company balance sheet shows higher depreciation and reduction of the fictitious assets
and high investment to launch on line web portal.

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NET WORTH

1200

1000

800

600
East
400

200

0
2006 2007 2008 2009

COMMENT

Company is eager to invest in the Indian market.

News Roundup: Edelweiss To Buy Anagram For Rs 150 Cr

January 13 2010, 16:04:13 IST | TEAM VCC

Edelweiss Capital, one of the largest brokerages in India, is close to buying Anagram Stock Broking for
Rs 150Cr.

Edelweiss To Buy Anagram For Rs 150 Cr - Edelweiss Capital Ltd, one of the largest brokerages in

India, is close to buying Anagram Stock Broking for Rs 150 crore. Anagram has 169 branches  and 3000,00

clients mainly in Gujarat and Maharashtra. Anagram is owned by Lalbhai group , which has companies like

Arvind Mills. Edelweiss is present in institutional equities, equity financing and investment banking, among
RETURN ON NET WORTH
others. (Mint)

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 30

25

20

15
RETURN ON NET WORTH
10

0
2007 2008 2009

COMMENT

These ratios shows response from the investors is good and supportive that’s why company
showing good returns .

PRODUCTS OFFERED BY EDELWEISS BROKING LTD.

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1- Equity Trading Platform (Online/Offline).

2- Portfolio Management Service.

REASONS TO CHOOSE EDELWEISS BROKING LIMITED

Experience

EDELWEISS has more than ten year of trust and credibility in the Indian stock market. In the
Asia Money broker's poll held recently, Edelweiss won the 'India's best research house for 2006'
award. Ever since it launched Edelweiss as its retail broking division in February 2008, it has
been providing institutional-level research and broking services to individual investors.

Technology

With their online trading account one can buy and sell shares in an instant from any PC with an
internet connection. Customers get access to the powerful online trading tools that will help
them to take complete control over their investment in shares.

Accessibility

Edelweiss provides ADVICE, EDUCATION, TOOLS AND EXECUTION services for investors.
These services are accessible through many centers across the country (Over 650 locations in
150 cities), over the Internet (through the website www.edelweiss.in) as well as over the Voice
Tool.

Knowledge

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In a business where the right information at the right time can translate into direct profits,
investors get access to a wide range of information on the content-rich portal,
www.sharekhan.com. Investors will also get a useful set of knowledge-based tools that will
empower them to take informed decisions.

Convenience

One can call Edelweiss’s Dial-N-Trade number to get investment advice and execute his/her
transactions. They have a dedicated call-center to provide this service via a Toll Free Number
1800-22-750 from anywhere in India.

Customer Service

Its customer service team assist their customer for any help that they need relating to
transactions, billing, demat and other queries. Their customer service can be contacted via a
toll-free number, email or live chat on www.sharekhan.com.

Investment Advice

Edelweiss Broking Ltd. has dedicated research teams of more than 100 people for fundamental
and technical research. Their analysts constantly track the pulse of the market and provide
timely investment advice to customer in the form of daily research emails, online chat, printed
reports etc.

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Benefits

· Free Depository A/c

· Instant Cash Tranfer

· Multiple Bank Option.

· Secure Order by Voice Tool Dial-n-Trade.

· Automated Portfolio to keep track of the value of your actual purchases.

· 24x7 Voice Tool acess to your trading account.

· Personalised Price and Account Alerts delivered instantly to your Mobile Phone & E-mail
address.

· Live Chat facility with Relationship Manager on Yahoo Messenger

· Special Personal Inbox for order and trade confirmations.

· On-line Customer Service via Web Chat.

· Enjoy Automated Portfolio.

· Buy or sell even single share

· Anytime Ordering.

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Edelweiss Broking Ltd. offers the following products:-

FREE ACCOUNT OPENING

This is a User Friendly Product which allows the client to trade through website
www.edelweiss.in and is suitable for the retail investors who is risk-averse and hence prefers to
invest in stocks or who do not trade too frequently.

Features

· Online trading account for investing in Equity and Derivatives via www.edelweiss.in

· Live Terminal and Single terminal for NSE Cash, NSE F&O & BSE.

· Integration of On-line trading, Saving Bank and Demat Account.

· Instant cash transfer facility against purchase & sale of shares.

· Competitive transaction charges.

· Instant order and trade confirmation by E-mail.

· Streaming Quotes (Cash & Derivatives).

· Personalized market watch.

· Single screen interface for Cash and derivatives and more.

· Provision to enter price trigger and view the same online in market watch.

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XPRESS

XPRESS is an internet-based software application that enables you to buy and sell in
an instant. It is ideal for active traders and jobbers who transact frequently during day’s session
to capitalize on intra-day price movement.

Features

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· Instant order Execution and Confirmation.

· Single screen trading terminal for NSE Cash, NSE F&O & BSE.

· Technical Studies.

· Multiple Charting.

· Real-time streaming quotes, tic-by-tic charts.

· Market summary (Cost traded scrip, highest clue etc.)

· Hot keys similar to broker’s terminal.

· Alerts and reminders.

· Back-up facility to place trades on Direct Phone lines.

· Live market debts.

Funds Transfer

 Transfer funds between your savings account and trading account.

 Avail a pay-in and pay-out option where you can transfer funds from and to your
trading account.
 Tie ups with HDFC Bank, ICICI Bank and Axis Bank, Yes Bank, Kotak bank wherein
you can easily transfer funds from any of these banks.

ORDER BOOK

33
 Along with enabling access for trade online, the CLASSIC and XPRESS ACCOUNT also
gives Dial-n-trade services. With this service, one can dial ESELWEISS’s dedicated phone lines
1-800-22-7500.

Beside this, Relationship Managers are always available on Office Phone and Mobile to
resolve customer queries.

MOBILE TRADING

34
 EDELWEISS had introduced mobile trading, A mobile based software where one can
watch Stock Prices, Intra Day Charts, Reasearch & Advice and Trading Calls live on the
Mobile.

(As per SEBI regulations, buying-selling shares through a mobile phone are
not yet permitted.)

www.edelweiss.in

MOBILE WEBSITE

KEY FEATURES

 Instant Market Updates

 All Company Stock Quotes

 Smart Financial Snapshots

 Trading Strategies

 Portfolio Tracker

ADVANCED BROKERAGE ACCOUNT

35
 Customers pay Advance Brokerage on trading Account and enjoy uninterrupted trading in
their Account. Beside this, great effective brokerages are also available (up to 50%) on
brokerage.

IPO ON-LINE

Customers can apply to all the forthcoming IPOs online. This is quite hassle-free,
paperless and time saving. Simply allocate fund to IPO Account, Apply for the IPO and Sit Back
& Relax.

Mutual Fund Online

Investors can apply to Mutual Funds of Reliance, Franklin Templeton Investments, ICICI
Prudential, SBI, Birla, Sundaram, HDFC, DSP Merrill Lynch, PRINCIPAL and TATA with
Edelweiss.

Zero Balance ICICI Saving Account

Edelweiss had tied-up with Yes bank for Zero Balance Account for Edelweiss’s Clients.
Now their customers can have a Zero Balance Saving Account with Yes Bank after your demat
Account creation with Edelweiss.

CHARGE STRUCTURE

36
 Plan Advance Validity Brokerage Rates Equivalent delivery
Brokerage Period
Fee Turnover limit

Delivery Futures and

Intraday Cash

EBSPN01      Rs 2450     12   0.33%                   0.033% 750000

months

EBSPN02 Rs 4950 12 Months 0.27% 0.027% 1800000

EBSPN03   Rs 9950 12 Months 0.22% 0.022% 4500000

EBSPN04 Rs 15000 12 Months 0.17% 0.017%         9000000

EBSPN04 Rs. 50000 12 month 0.11%                  0.011%         45000000

EBCRB06 Rs 12 month 0.09% 0.009% 125000000

1,10,000

EBCRB07 Rs 3 month 0.05% 0.005% 200000000

1,11,111

EXPOSURE: 6 TO 7 TIMES (ON MARGIN MONEY)

MAJOR PLAYERS IN THE REGION

1. Karvy

37
2. Indiainfoline

3. ICICI direct

4. HDFC security

5. Indiabulls

6.Religare

7.Edelweiss Broking Ltd.

KARVY

Karvy is a premier integrated financial services provider, and ranked among the top five in the
country in all its business segments, services over 16 million individual investors in various
capacities, and provides investor services to over 300 corporate, comprising the who is who of
Corporate India. Karvy has a professional management team and ranks among the best in
technology, operations and research of various industrial segments.

History of Karvy :- The birth of Karvy was on a modest scale in 1981. It began with the vision
and enterprise of a small group of practicing Chartered Accountants who founded the flagship
company, Karvy Consultants Limited. They started with consulting and financial accounting
automation and carved inroads into the field of registry and share accounting by 1985. Since
then, karvy utilized its experience and superlative expertise to go from strength to strength, to
better their services, to innovate, diversify and in the process, evolved as one of India’s premier
integrated financial service enterprise.

38
 PRODUCT AND SERVICES OF KARVY GROUP

1. Karvy comtrade.

2. Karvy consultant ltd.

3. Karvy merchant banking.

4. Karvy global services ltd.

ICICI DIRECT

39
ICICI Web Trade Limited (IWTL) maintains www.icicidirect.com (herein after referred to as the
"Website") whereas IWTL is an affiliate of ICICI Bank Limited and the Website is owned by
ICICI Bank Limited. IWTL has launched and established an online trading service on the
Website.

PRODUCTS AND SERVICES OF ICICI DIRECT

1. Investing in Mutual funds

2. Personal Finance

3. Customer Service Features

4. IPO’s

5. Margin Trading

6. Margin PLUS Trading

7. Call Trade

8. Trading on NSE/BSE

9. Trade in derivatives

INDIAINFOLINE SECURITY PRIVATE LTD

40
India Infoline.com Securities Pvt. Ltd. is a wholly owned subsidiary of India Infoline.com Ltd
and is the stock broking arm of India Infoline.com. The subsidiary was formed to comply with
regulatory guidelines. www.5paisa.com is a focused website for online stock market trading.
5paisa.com is a trade name owned by the India Infoline.com group. IILSPL has applied for
trading membership of the BSE under Securities and Exchange Board of India (Stock Brokers
and Sub-Brokers) Rules 1992.

IILSPL is in the business of providing broking services online via the Internet ("E-broking
Services") and has been permitted by the NSE by way of registration permission no:
NSEIL/CMO/INET/1103/2000 dated 03/July/2000, and will be applying for permission to the
BSE, to provide E-broking Services to its clients. IILSPL is a TRADING MEMBER of the
National Stock Exchange of India.

PRODUCT OFFERED BY IILSPL

Stock market:-IILSPL deals in stock market by trading in equity and derivatives.

Personal finance:- It Deals In Mutual Fund And Insurance.

Online Trading :- It provides services in stock and commodity trading (through Internet).

41
HDFC SECURITY

HDFC security is the subsidiary of HDFC (Housing Development Financial Corporation).

www.hdfcsec.com would have an exclusive discretion to decide the customers who would be
entitled to its online investing services. www.hdfcsec.com also reserves the right to decide on the
criteria based on which customers would be chosen to participate in these services .The present
web site (www.hdfcsec.com) contains features of services that they offer/propose to offer in due
course. The launch of new services is subject to the clearance of the regulators. i.e. SEBI, NSE
and BSE.

PRODUCT OFFERED BY HDFC SECURITY

 Online trading for Resident & Non Resident Indians.

 Cash-n-Carry on both NSE and BSE.
 Day trading on both NSE and BSE.
 Trade on Futures & Options on the NSE.
 Online IPO's.
 Telephone-based Broking (Equity & Derivatives).

INDIABULLS SECURITIES LIMITED

42
Indiabulls Securities Limited was incorporated as GPF Securities Private Limited on June 9,
1995. The name of the company was changed to Orbis Securities Private Limited on December
15, 1995 to change the profile of the company and subsequently due to the conversion of the
company into a public limited company; the name was further changed to Orbis Securities
Limited on January 5, 2004. The name of the company was again changed to Indiabulls
Securities Limited on February 16, 2004 so as to capitalize on the brand image of the term
“Indiabulls” in the company name. ISL is a corporate member of capital market & derivative
segment of The National Stock Exchange of India Ltd. At present, ISL accounts for
approximately 3% of the total daily turnover of the Exchange with 32,359 client relationships
and 70 branches spread across the country as of April 30, 2004.

INDIABULLS CREDIT SERVICES LIMITED:- Indiabulls Credit Services has been valued at
Rs. 263 crore with the Rs. 87.6-crore infusion. Indiabulls Credit Services Ltd, the recently
formed subsidiary of broking firm, Indiabulls Financial Services Ltd. Faralon Capital, a San
Francisco-based private equity fund, and its affiliates have acquired 33.3 per cent stake for Rs
87.6 crore.

INDIABULLS REAL ESTATE:- Indiabulls through its group companies has entered Indian
Real Estate business in 2005. It is currently evaluating several large-scale projects worth
several hundred million dollars. Indiabulls became the first company to bring FDI in Indian
Real Estate through a JV with Farallon Capital Management, a respected US based investment
firm.

PRODUCT OFFERED BY INDIA BULLS

43
Equity & Debt Stock Broking

Insurance

Commodity trading

Depository Services

Derivatives Broking Services

Equity Research Services

Mutual Fund Distribution

IPO Distribution

SHAREKHAN

44
Sharekhan is one of the leading retail brokerage of Citi Venture which is running successfully
since 1922 in the country. Earlier it was the retail broking arm of the Mumbai-based SSKI
Group, which has over eight decades of experience in the stock broking business. Sharekhan
offers its customers a wide range of equity related services including trade execution on BSE,
NSE, Derivatives, depository services, online trading, investment advice etc.

PRODUCT OFFERED BY SHAREKHAN

Equity & Debt Stock Broking

Commodity trading

Depository Services

Derivatives Broking Services

Equity Research Services

Mutual Fund Distribution

IPO Distribution

45
 Brokerage for Intraday
Online Broker Brokerage for Delivery AMC*
trading

Sharekhan
0.03% - 0.50% 0.03% - 0.10% 300
brokerage charges

Karvy
0.30% - 0.50% 0.03% - 0.15% 300
brokerage charges

ICICI direct
0.75% 0.15% 500
brokerage charges

Indiabulls
0.25% - 0.50% 0.05% - 0.10% Nil
brokerage charges

HDFC Securities
0.50% 0.15% 500
brokerage charges

Religare
0.20% - 0.30% 0.02% - 0.03% 250
brokerage charges

Reliance Money
0.01% 0.01% card system
brokerage charges

Indiainfoline
0.50% 0.10% Nil
brokerage charges

AMC=ACCOUNT MAINTENANCE CHARGES.

REVIEW OF LITERATURE

46
According to SEBI, Professional Rating of market intermediaries, as a concept, is a matter of
debate and discussions. The need for rating is felt not only from the point of view of greater
disclosure requirements for investor’s interests, considering the important role such
intermediaries play, being an interface between investors and exchanges but also from the point
of view of measuring the adequacy of systems and controls to meet internal as well as external
compliance requirements.

So that need for Intermediaries Rating services (Brokers), In view of the developments that are
taking place in the capital markets, the need to constantly upgrade and improve systems and
procedures in operation as well as skill sets has gained considerable importance. Besides
compliance with regulatory requirements both in letter and spirit has assumed significance so as
to mitigate risk and ensure adequate protection of investors’ interest.

And Rating objectives / benefits are rated entity would be in a position to brand its image and
capitalize the same for generating more business. In a nutshell, the product may accrue
significant benefits to all stakeholders including the investors, stock brokers themselves, the
regulator and others who will benefit from the transparency and the consequential focus on
efficiency.

According to SEBI and Intermediaries Regulation and Supervision Department, different factors
are consider for rating process Organization structure, Policy on Investors interest, Risk
Management Policy and System, Organization process and procedures, Management policy on
compliance, Financials, History/Background, Firm’s positioning.

According to Michal Parness, Founder & CEO

Investors don’t Make Money in the Stock Market. One reason the institutions make so much
money is that they are trading. They make money every time you buy or sell. They make
money whether you win or lose. That means that when you’re investing, you’re basically just
sitting there. You’re not going anywhere. You’re not making money as an investor.

47
Trading the Trend: The Only Way to Make Money in the Market

If you don’t know this already, “Trend Trading” means trading trends based on human
emotions. Not lagging indicators. Not complex statistical analysis and not Ph.D. level
mathematical equations. With trend trading, you look for market movement. That could mean
stocks that are going to move up or down during the course of a day (intraday). You’ll play the
gaps up and down, often several days a week.

The “Trend trading” means being aware and taking advantage of trends like the run-ups that
happen around earning sessions. These are trends that have worked time and time again in the
market. They consistently yield results.

Objective Of Research

48
Each research study has its own specific purpose. It is like to discover to Question through the
application of scientific procedure. But the main aim of our research to find out the truth that is
hidden and which has not been discovered as yet. Our research study has two objectives:-

PRIMARY OBJECTIVE: -How EDELWEISS BROKING LTD is best services providers as a

stock broker in the metros.

SECONDARY OBJECTIVE: -

1. To know about the awareness towards stock brokers and share market.

2. To study about the competitive position of Sharekhan Ltd in Competitive Market.

3. To study about the effectiveness & efficiency of Edelweiss Broking Ltd in relation to its
competitors

4. To study about whether people are satisfied with Edelweiss Services & Management System
or not

5. To study about the difficulties faced by persons while Trading in Edelweiss.

6. To study about the need of improvement in existing Trading system.

SAMPLING UNITS

Sampling unit may be a geographical one, such as Metros etc. The researcher will have to
decide one or more of such units that he has to select for his study.

In my research study Delhi NCR as a sampling unit.

SIZE OF SAMPLE

49
“This refers to the number of items to be selected from the universe to constitute a sample”

In our research sample size is 500.

But we also study the 5 stock broker companies related to security & commodity market like
India-infoline, ICICI direct, HDFC securities, Karvy consultant ltd. for the appropriate
collection of the information.

SOURES OF DATA COLLECTION

While deciding about the method of data collection to be used for the study the researcher
should keep to types of data.

1. Primary

2. Secondary Data.

We use in our research primary data, as well as secondary data. Primary means collected a
fresh, and the first time data and secondary means which are already available like annual
report, magazines etc.

Survey Method: - Survey refers to the method of securing information concerning phenomena
under study from all or selected number of respondents of the concerned area. In a survey the
investigator examines those phenomena which exist in the universe independent of his action.
We used the Scheduling Method.

50
Scheduling: - In this method the enumerators along with schedules, go to respondents, put to
them the questions from the Performa in the order the questions are listed and recorded the
replies in the space meant for the same in the Performa.

COMPARATIVE ANALYSIS

After the whole study, we find out the following results:

Results on the Basis of charges

There are the two type of the transaction:-

1. Intra-day based

2. Delivery based

51
All the figures are in paisa/100 rupees.

Comment:- According to the survey HDFC securities charge maximum brokerage as compare
to others whereas India Infoline Ltd. charge only 0.20 paisa on maximum investment.

Results On the basis of Account opening charges

HDFC securities ltd:- Account opening charges w.e.f. April 2005 are as follows:- Rs.749, if the
customer has an existing relationship with HDFC

Sharekhan ltd:- There is no ACCOUNT OPENING CHARGES but require margin money of Rs
5000 for trading purposes.

ICICI direct:- A one-time charge of Rs. 750 at the time of account opening will be charged. You
may later upgrade your Invest account to an ICICI direct.com share trading account when you
desire to trade in equity.

India Infoline:- There is a nominal charge of Rs. 500 only towards stamp duty, legal and
processing fees for opening the account. This includes the registration and account opening
charges. Bank and Depository Participant (DP) account opening charges, if applicable, are
payable separately.

52
KARVY consultants ltd:- Account Opening Charges Are 452 But now SEBI banned on opening
of new demat account of Karvy.

Indiabulls:- Account opening charges are Rs. 900. There is no AMC and no margin money is
required.

Edelweiss Broking Ltd.:- Account opening charges are nil. And the requirement of the margin
money is Rs 1000.

Comment:- India Bulls charge maximum account opening charges but there are no such
charges in Sharekhan pvt. Ltd. And Edelweiss Broking Ltd.

Results on the basis of customer preferences

1. According to survey 40 % peoples are satisfied with IndiaBull Ltd because of their RM’s
facility and power of IndiaBull Ltd software. And 90% people of exist clients are satisfied with
Edelweiss Broking Ltd.

53
 2. According to survey, Edelweiss Broking Ltd open new branches for individually handle to
their customer, but in ICICI direct, HDFC security there is no separate offices for this .

Results On The Basis Of Facilities

Basis of Sharekhan Karvy India ICICI Indiabulls HDFC Edelweiss

difference Ltd. Infoline direct Broking
Ltd.
Share Yes Yes Yes Yes Yes Yes Yes
trading

Commodity Yes Yes Yes Yes Yes Yes No

trading

d-mat Yes No Yes Yes Yes No Yes

opening
rights

Karvy and HDFC securities are not providing complete range of trading facilities.

FINDINGS & ANALYSIS

1) Do you know about investment options available?

KNOWLEDGE %AGE

Yes 80%

No 20%

TOTAL 100

54
COMMENT

Only 80% people knows the exact meaning of investment. Because of remaining 20% take
his/her residential property as an investment. According to law purpose this is not an investment
because of it is not create any profit for the owner.

2) Most preferable investment scenario.

INVESTMENT SCENARIO %AGE

Banks 24%

Derivatives & securities 28%

market

Insurance 4%

Bonds 20%

55
 Real estate 20%

Others 4%

TOTAL 100

COMMENT

Today scenario is changed so that most area covered by the derivative and securities market. It
is 28% of the total population.

56
3) What is the basic purpose of your investment?

INVESTMENT PERCENTAGE
PURPOSE

Liquidity 30%

Returns 25%
Capital 10%
appreciation

Tax benefits 20%

Risk covering 5%

Others 10%

TOTAL 100

57
COMMENT:- 75% people are interested in liquidity, returns and tax benefits. And remaining
25% are interested in capital appreciations, risk covering, and others.

4) Most important things you take into your mind while making investments?

FACTOR %AGE

Risk 8%

Returns 17%

Both 75%

TOTAL 100

58
COMMENT

75% people are considered the both factors risk as well as returns but, only 25% considered the
risk or returns factor.

5) Awareness related to security markets

KNOWLEDGE PERCENTAGE

Complete 8%

Partial 75%

Nil 17%

TOTAL 100

59
COMMENT

On that basis, we conclude that 17% people know nothing about the securities investments and
75% people have partial knowledge about it, so, some promotional activities are required for
increasing the awareness about security market.

6) Do you have any de-mat & trading account?

ACCOUNTS PERCENTAGE

Yes 60%

No 40%

TOTAL 100%

60
COMMENT

Only 75% respondents have de-mat and trading account and remaining 25% says no because
they don’t know why shares move up and down.

7) In which company you have d-mat and trading account?

COMPANY PERCENTAGE

SHAREKHAN 38%

INDIAINFOLINE 20%

ICICI DIRECT 14%

INDIA BULLS 12%

61
 KARVY 9%

Others 7%

TOTAL 100

COMMENT

In Sharekhan Ltd 38% respondents have de-mat & trading account because of better services
and no annual maintenance and other charges.

8) Specify the reason of satisfaction with the current broking house.

SATISFACTION PERCENTAGE

62
 Operating expenses 18%

Services 25%

Brokerage 57%

TOTAL 100

FINDINGS

 According to the survey most of the customers of “Sharekhan Ltd” says that it is pocket friendly.

 Coming to faith 70% say Sharekhan Ltd is better than others stock brokers due to customers
satisfaction.

 Lack of promotional activities undertaken by Sharekhan securities Ltd. in Chandigarh Region.

 Main purposes of investments are returns & liquidity.

 Investors take risk as well as returns into their mind while making the investment.

63
 Businessmen are more interested in the stock market than the others.

 Commodity market is less preferred by the investors.

 People want to invest their money in the security market but they haven’t the proper knowledge.

 People are not aware of hedging in stock market.

 People pay more emphasis on brokerage than service provided by brokerage houses.

SUGGESTIONS

 Commitment should be equalized for every person.

 Provide the facility of free demonstrations for all.

 Improvement in the opening of De-mat & contract notice procedure is required.

 There should be a limited number of clients under the relationship manger. So that he can
handle new as well as old customer properly.

 Some promotional activities are required for the awareness of the customer.

 People at young age should be encouraged to invest in stock market.

 Seminars should be held for providing information to prospective and present customers.

64
 LIMITATIONS

 As only CHANDIGARH dealt in survey so it does not represent the view of the total

Indian market.

 Size of the research may not be substantial.

 There was lack of time on the part of respondents.

 The survey was carried through questionnaire and the questions were based on

perception.

 There may be biasness in information by market participant.

 Complete data was not available due to company privacy and secrecy.

CONCLUSION

65
On the basis of the study it is found that Sharekhan Ltd is better services provider than the other
stockbrokers because of their timely research and personalized advice on what stocks to buy and
sell. Sharekhan Ltd. provide the facility of Trade tiger as well as relationship manager facility
for encouragement and protect the interest of the investors. It also provides the information
through the internet and mobile alerts that what IPO’s are coming in the market and it also
provides its research on the future prospect of the IPO.

Study also concludes that people are not much aware of commodity market and while it’s going
to be biggest market in India.

The company should also organize seminars and similar activities to enhance the knowledge of
prospective and existing customers, so that they feel more comfortable while investing in the
stock market.

APPENDIX

QUESTIONNAIRE
DATE:

NAME  

OCCUPATION  

AGE  

CONTACT NO.  

66
1) Do you know about Investment options available?

a) Yes b) No

2) Do you know about the different types of investment alternatives?

a) Insurance & mutual funds b) Banks

c) Real estate d) Share market

e) Commodity f) Others

3) What is the basic purpose of your investment?

a) Liquidity b) Returns

c) Capital appreciation d) Risk covering

e) Tax benefits

4) What are the most important things you take into account, while making any investment?

a) Risk b) Returns c) Both

5) Do you have any knowledge of share markets?

67
 a) Partial b) Complete c) Nil

6) Do you have any D-mat & Trading account?

a) Yes b) No

7) In which company you have D-mat & Trading account?

a) Sharekhan Ltd b) Karvy

c) Indiainfoline d) ICICI direct

e) Indiabulls f) HDFC securities

g) Others

8) Are you satisfied with you present broking company?

a) Yes b) No

9) What is the reason? Please specify.

a) Services _______________________________________

b) Brokerage _____________________________________

c) Operating expenses ______________________________

68
 d) Others ________________________________________

10) What is your trading exchange preference?

a) NSE b) BSE

c) MCX d) NCDEX

12) Do you know about Sharekhan Ltd?

a) Yes b) No

Suggestion:-
 
 

BIBLIOGRAPHY

Books:

69
BERI

G C. MARKETING RESEARCH

NEW DELHI, TATA Mc GRAW-HILL PUBLISHING COMPANY LIMITED.

KOTHARI

RESEARCH METHODOLOGY

NEW DELHI, VIKAS PUBLISHING HOUSE PVT.LTD.1978.

GOYAL, DR.ALOK,

FINANCIAL MARKET OPERATION

NEW DELHI, V.K. (INDIA) ENTERPRISES .

Magazines:

VALUELINE (SHAREKHAN MONTHLY RESEARCH MAGAZINE)

CAPITAL MARKET (5PASISA.COM), NEW DELHI.

THE FINAPOILS (YOUR PERSONAL FINANCE ADVISOR FROM KARVY).

70
Internet:

http://WWW.MONEYCONTROL.COM

http://WWW.CAPITALINE.COM

http://WWW.SHAREKHAN LTD.COM

http://WWW.INDIAINFOLINE.COM

http://WWW.ICICIDIRECT.COM

http://WWW.HDFCSECURITY.COM

http://WWW.KARVY.COM

71