SWOT ANALYSIS
Strengths
 Original research
 Integrated technology platform
 “One Stop” shop
 Pan - India distribution network
 “IndiaInfoline.com”and “5paisa.com”
have developed into brands
Opportunities
 Changing demographics with higher
disposable income and increasingly
complex financial instruments will
drive demand for investment advisory
services
 Rapid penetration of Internet and
computers means that technology
enabled financial services will gain
market share
Weakness
 Lack of a banking arm to complete
the bank-broker-depository chain
 Insignificant presence in institutional
segment
Threats
 Economic slowdown
 Volatile movement in indices and
events like May 17, 2004
 Stock markets falls will have a
cascading effect on our mutual fund
mobilization
 Increase/decrease in interest rates
can affect our debt/ income fund
mobilizations
 Future changes in personal taxation
rules can impact insurance sales
 Increasing competition from large
and particularly foreign players
TECHNOLOGY

IIFL believes that online trading will gain market share due to significant advantages that it
offers
 It enables the customer to trade directly without any agent intervention
 It offers customers the convenience of trading from almost anywhere
 It enables rapid dissemination of information and at reduced costs
 It offers a responsive mechanism for reporting grievances, problems and bugs
HUMAN RESOURCES

IIFL’s Human Resources policy is based on the philosophy of “Owner Mindset”. We believe
that the key to our continued growth lies in unleashing the entrepreneurial energy of our
employees.
IIFL encourages all employees to behave more as 51 owners of their departments rather than
employees. Our people are highly driven and work towards increasing India Infoline’s brand
and market share across product lines.
IIFL has developed extensive in-house training modules. In addition, our staff is trained by
various Asset Management Companies and ICICI Prudential Life Insurance Company
Limited. We lay emphasis on “On the job training” where an experienced and senior person
mentors a junior executive.
In addition to salary, IIFL employees get performance-based incentives on a quarterly basis.
We have also implemented an Employee Stock Option Plan.

STRATEGY AND ITS ELEMENTS

De-risked Operational
business model excellence

Attract
Focused on
exceptional
financial
people with
services
owner mindset
Strategy
 Focused on De-risked business
financial services model

Consumer Life Equities Non-equities

finance Insurance

Retail Institutional

Investment Mutual
banking Funds Buy-side Sell-side

Wealth Retail assets Retail liabilities

Equities
Management
High net worth
Mass-affluent
individuals

Operational Attract exceptional

excellence people with owner
mindset

Innovative processes powered by Successful integration of Institutional

cutting-edge technology equities and Wealth management team s

Building up of the
Use of technology is all-pervasive
Asset Management team

Risk Management has withstood Entrepreneurial & professional

trial by fire environment

Lean and scalable platform with

Liberal ‘Ownership-sharing’
low fixed costs

"One Stop Shop" from advice to Aransactions

IIFL emerged as one of India’s leading financial information Internet portal in India. We
distribute mutual funds and life insurance products through our branches as well as directly
through our sales team.

These factors allows to provide the customers with an integrated online as well as offline
solution to fulfill all their financial information and transaction needs. We believe that our
ability to offer multiple products across broking to insurance to mutual funds to commodities
to small savings differentiates us from our competition. This also offers significant cross
selling opportunities which will help in improving margins as incremental revenue will entail
lower customer acquisition and promotion costs.
Multi Channel Delivery Model

IIFL intends providing a single convenient and reliable platform from which our users can
obtain information, trade online or purchase offline a wide range of personal financial
products. Our branches have been opened in cities after a detailed study of demographics and
investment patterns in different cities.

Expand our Retail Network

IIFL has a retail branch network of 73 branches at 36 locations across India to provide an
alternative channel for our customers to transact with us and to support our online services.
These branches allow our customers the opportunity to purchase personal financial products
and trade at such branches with the assistance of our staff. We propose to set up additional 77
branches in 50 cities across India to have a network of 150 branches to further strengthen our
geographic reach.

Leverage our content Advantage for Value Added Offerings

IIFL believes that the key to successful investment is research. We have invested
considerable resources in building our research domain skills. Our top management has hands
on experience in equity research. We will continue to expand the breadth and depth of
research and content on Indian business and finance. This research advantage will enable us
to acquire customers in high value added product offerings especially PMS.

Continuous Investments in Technology Platform

IIFL has leveraged the power of technology to offer an integrated platform to the customer to
transact. We will continue to invest in such technologies that would enhance customer
experience while interacting with us. We have facilitated integrated trading and depositary
accounts for the customer, payment gateways with multiple banks, online Internet enabled
back office and MIS. We believe that our technology investments will be a key driver in
scaling up of the business.

Acquisition & Takeover

IIFL strongly believe that to become a market leader in the investment advisory and
intermediation space, they have to expand their business. In our endeavor to do so and as per
our business strategy they may pursue inorganic growth.

COMPETITIVE ADVANTAGES

We are strategically positioned to leverage our strength in the domestic market, due to our
competitive advantages that include the following:

Research

We have our roots in equity research. Our original business model was to provide
research and information services on Indian business and capital markets to institutional
customers. Our executive directors have equity research and investment experience in leading
banks and brokerage houses.

Integrated Technology Platform

Since the launch of our website, www.indiainfoline.com, and our online trading platform,
www.5paisa.com, we have invested in building a technology platform. We use a mix of in-
house and outsourced technologies to offer a user-friendly interface for online trading. Our
Trader Terminal is an application which allows customers to trade on both the BSE and the
NSE.
We believe that our technology strengths will enable us to scale up the business without a
proportionate increase in operating costs.
Multiple Product Offerings make us a “One Stop” Shop

IIFL provides a range of products and services to our customers, either directly or through
any one of our wholly owned subsidiaries. These multiple offerings across multiple channels
– either online through Internet or offline through any of the branches or over the telephone
enables us to emerge as a financial “one stop” shop. This also offers significant cross selling
opportunities, which helps us in strengthening customer relationships and loyalty.

Pan - India Distribution Network

IIFL have 73 branches across 36 towns and cities in India. These branches help in customer
acquisition as well as customer service. This is a part of a conscious “bricks and clicks”
strategy to reach out to our customers.

“India Infoline.com” and “5paisa.com” have developed into Brands

India Infoline.com and 5paisa.com are well known brands amongst retail investors across
India. In all the cities that we have expanded into, we have been able to leverage upon brand
awareness and have established a customer base.

Experienced Management Team

IIFL’s management team has hands on experience in financial services, especially targeted at
retail sales and relationship management.

Customer Relationship Management

IIFL has developed a team of Customer Relationship Managers across India to handle key
customer accounts. These people are experienced in financial services and have undergone
in-house training. This allows them to offer unbiased advice on not only equities but also on
other investment products like mutual funds and insurance.
Robust Risk Management Systems

IIFL manages the risks associated with our broking operations through use of internally
developed credit algorithms implemented through fully automated risk management software
and selective direct monitoring of certain operating parameters. Our automated risk
management procedures rely primarily on internally developed Risk Management System
and systems provided by our vendors.

FINANCIAL PROFILES OF COMPANY

ICRA has assigned an A1+ (Pronounced A one Plus) ratings to the 5.0 billion Short-Term
(current fund based-Rs.1.65 billion and current Non-Fund based – Rs. 2.60 billion) bank
facilities of India Infoline Ltd. (IIL). The Short-Term instrument under Fund based and Non
Fund based limits are interchangeable and as such the combined utilization should not exceed
Rs. 5.0 billion. The rating indicates the highest credit quality rating assigned by ICRA to
short-term debt instruments. Instruments rated in this category carry the lowest credit risk in
the short term. ICRA also has an A1+ rating outstanding on IIL’s Rs. 5 billion short term debt
programme.

The rating is derived after considering the combined financial and business profile of all
companies in India Infoline Ltd. Group. The rating factors in IIL’s significantly enhanced net
worth following private equity placements, adequate experience in retail broking business
and its increasing market share, strengthening institutional broking business, diversified
business revenues, robust risk management systems and improving financial performance.
The rating also factors in the inherent volatility in its prime business of equity broking
business, which is prone to cyclical downturns and group’s foray into highly competitive
consumer finance business, which is perceived to be relatively riskier.

PRODUCTS AND SERVICES

EQUITIES: India Infoline provided the prospect of researched investing to its clients, which
was hitherto restricted only to the institutions. Research for the retail investor did not exist
prior to India Infoline. India Infoline leveraged technology to bring the convenience of
trading to the investor’s location of preference (residence or office) through computerized
access. India Infoline made it possible for clients to view transaction costs and ledger updates
in real time.
Service: Clients can access the customer service team through various media like toll-free
lines, emails and Internet- messenger chat for instant query resolution. The Companies
customer service executives proactively contact customers to inform them of key changes and
initiatives taken by the Company. Business World rated the Companies customer service as
Best in their survey of online trading sites carried out in December 2003.

FEATURES

 Membership on the Bombay Stock Exchange Limited and the National

Stock Exchange

 Registered with the NSDL as well as CDSL as a depository participant,

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

 Broking services in cash and derivative segments, online as well as offline.

 Presence across 350 cities and towns with a network of over 850 business
locations Equity client base of over 500,000 clients

 Provision of free and world-class research to all clients.

PORTFOLIO MANAGEMENT:

IIFL’s Portfolio Management Service is a product wherein an equity investment portfolio is

created to suit the investment objectives of a client. We at India Infoline invest your resources into
stocks from different sectors, depending on your risk-return profile. This service is particularly
advisable for investors who cannot afford to give time or don't have that expertise for day-to-day
management of their equity portfolio.

It is all about your money, being managed by the experts, while you continue with your routine
life. Isn't it simple and totally hassle free.

What's more, you can keep track of your dividends / bonus / rights issues with paperless tracking.
So you always know how fast your investment is growing. It basically means assigning the right
job to the right person.

Features
 Expert team of Research Analysts
 Stock Picking done by the Investment Committee
 Dedicated Relationship Manager
 Technology and Service driven Back-Office

RESEARCH:
IIL special research cell where some of India's finest financial analysts bring you intensive
research reports on how the stock market is faring, when is the right time to invest, when to
execute your order and more.
IIL make sure that investors are always prepared to make own investment decision when the
opportunity arises.
IIL bring you intensive research reports - whether sectoral or company-wise or more - that
tell you exactly when and where to invest. So whenever there is an exciting investment
opportunity, you are in the know and always ready to invest. Research reports IIL will help
you choose your investments wisely, without wasting time. Presented in a lucid and easy-to-
understand format; these reports help you make informed decisions.

COMMODITIES BROKING:
India Infolines extension into commodities trading reconciles its strategic intent to emerge as
a one stop solutions financial intermediary. Its experience in securities broking has
empowered it with requisite skills and technologies. Increased offering: The Companies
commodities business provides a contra-cyclical alternative to equities broking. The
Company was among the first to offer the facility of commodities trading in India’s young
commodities market (the MCX commenced operations only in 2003). Average monthly
turnover on the commodity exchanges increased from Rs 0.34 bn to Rs 20.02 bn. The
commodities market has several products with different and non-correlated cycles. On the
whole, the business is fairly insulated against cyclical gyrations in the business.
Features

 Enjoys memberships with the MCX and NCDEX, two leading

Indian commodities exchanges

 Recently acquired membership of the DGCX

 Multi-channel delivery model, making it among the select few to

offer online as well as offline trading facilities

 Extended commodity trading to retail investors, among the few

Indian financial intermediaries to do so

 Online business at 80% of revenues dominates commodities trading

revenues

Provides regular commodity updates pertaining to the Indian and

international environment

MORTAGAGES:
During the year under review, Indiainfoline acquired a 75% stake in Money tree Consultancy
Services to mark its foray into the business of mortgages and other loan products distribution.
The business is still in the investing phase and at the time of the acquisition was present only
in the cities of Mumbai and Pune. The Company brings on board expertise in the loans
business coupled with existing relationships across a number of principals in the mortgage
and personal loans businesses. Indiainfoline now has plans to roll the business out across its
pan-Indian network to provide it with a truly national scale in operations.
HOME LOANS:
Loan against residential and commercial property
Expert recommendations
Easy documentation
Quick processing and disbursal
No guarantor requirement

1. PERSONAL LOANS: Expert recommendations

Easy documentation
Quick processing and disbursal
No guarantor requirement

2. INVEST ONLINE:
India Infoline has made investing in Mutual funds and primary market so effortless. All you
have to do is register with us and that’s all. No paperwork no queues and No registration
charges.

If you are 5p customer use your existing login ID and Ledger (fund transfer) password.
India info line offers you a host of mutual fund and IPO choices under one roof; backed
by in-depth information and research to help you invest effortlessly.

3. INSURANCE:
An entry into this segment helped complete the client’s product basket; concurrently, it
graduated the Company into a one-stop retail financial solutions provider. To ensure
maximum reach to customers across India, we have employed a multi pronged approach
and reach out to customers via our Network, Direct and Affiliate channels. Following the
opening of the sector in 1999-2000, a number of private sector insurance service
providers commenced operations aggressively and helped grow the market.

The Company’s entry into the insurance sector derisked the Company from a
predominant dependence on broking and equity-linked revenues. The annuity based
 income generated from insurance intermediation result in solid core revenues across the
tenure of the policy.

4. WEALTH MANAGEMENT:
The key to achieving a successful Investment Portfolio is to have a carefully planned
financial strategy based on a thorough understanding of the client's investment needs and
risk appetite.

The IIFL Private Wealth Management Team of financial experts will recommend an
appropriate financial strategy to effectively meet your investment requirements.
Our Financial Advisor will
analyze:

 Your cash-flow requirements

 Your risk appetite
 Desired investment horizon
 Long-term goals

5. NEWS LETTER:
The Daily Market Strategy is your morning dose on the health of the markets. Five intra-day
ideas, unless the markets are really choppy coupled with a brief on the global markets and
any other cues, which could impact the market. Occasionally an investment idea from the
research team and a crisp round up of the previous day's top stories. That's not all. As a
subscriber to the Daily Market Strategy, you even get research reports of India Infoline
research team on a priority basis.

The India Infoline Weekly Newsletter is your flashback for the week gone by. A weekly
outlook coupled with the best of the web stories from India Infoline and links to important
investment ideas, Leader Speak and features is delivered in your inbox every Friday evening.
 List of News letter provide :

 Daily Newsletters

 Weekly Newsletters

 Monthly Newsletters

 Yearly Newsletters

 Commodity Newsletters

 Mutual Fund Newsletters

COMPETITORS

 India Bulls Securities Ltd.

 Reliance Money Ltd.
 ICICI Direct.com
 Share Khan.com
 Angel Broking Ltd.
 Motilal Oswal Securities Ltd.
 Religare Securities Ltd.
 Edelweiss

Why India Infoline

Paisa sense - Simple, we offer an unbeatable value for money proposition. Our brokerage
rates are rock bottom, we charge only 5 paise for Rs100 of trade done, which is 0.05%
brokerage. In the real world, brokers charge anywhere from 0.25% to 1.5% depending on
your net worth and traded volumes. While others talk about democracy, we practice it. We
offer the most competitive rates, independent of your net worth or volumes. In case of trades
that result in delivery, we charge an additional 0.20% for back office and securities handling.
Personalized Service - At India Infoline, we are committed to providing you with
unparalleled service, using e-mail, call centers and support staff. For us the customer comes
first, always and all times. We have invested in physical infrastructure also, so that you can
use the phone also to contact us. Please feel free to call us any time and our representative
will help you. If need be, our representatives will contact you in person to help you, either in
filling forms or answering any queries you might have.
Probity - In normal life, most brokers trade on their own account. This means that every time
you execute a trade through him, there is a potential conflict of interest. What if he executes
his personal trade before executing yours: you lose out. With India Infoline, you have no such
worries as we do not trade on our own account. We are a broker in the true sense of the word.
You may wonder that our employees may be biased and misuse information. No way, we
follow stringent compliance standards and every employee has to sign an agreement that
forbids him to trade without proper authorization. To ensure transparency, they have to use
5paisa.com to trade and not any friendly neighborhood broker. This means that our interests
are aligned - we work for your best interest.
Protection - Most people are apprehensive about using the net to trade, primarily from
fear of misuse of information. The communications with our servers is fast and secure. All
transactions are secure and confidential. The orders are electronically routed via our
sophisticated trading systems for execution. We have followed world class security systems
that enable us to protect from any fraud or hacking. Even the user password would be
generated by the system and supplied such that, not even employees of India Infoline would
know about it. Also, it would be stored in our database in encrypted format so no one can
know the actual password. To be on a safer side you will be requested periodically to change
your password.
Pedigree - We come from the India Infoline.com stable, known to produce thoroughbreds. A
brand renowned for quality of information and services, we are professionally managed, with
a skill set which is unbeatable. Our top management has years of experience in financial
services with leading banks and institutions. We believe that quality information is the only
ingredient for successful investments. On India Infoline, you will get company analysis,
market commentary, breaking news and scoops, stock market data and much more. We also
have unlimited access to India Infoline.com library.
 TRADING TERMINALS

India Infoline offers 2 different online trading terminals to its customers

1. Trader Terminal (TT) Browser web based

2. Trader Terminal (TT) Advance

How to open Account with India Infoline

There are few steps to open an account with India Infoline.

1. First log on to their site and fill the registration form. Once you fill the form they will
give you 2 options. Either you can receive the form by mail or one of their agent visit you
personally. Personal visit is not available in all cities.
2. After registration, you will be required to deposit a certain amount of initial margin
deposit with them. The deposit can be of any amount, but it should not be less than Rupees
Five Thousand.
3. When your account is activated, you will receive a welcome kit, which contains
details about your account, your username and password, and the user's manual. The kit will
also include a CD ROM which will allow you to install trading software.
4. It will take approximately 15 days to complete the formalities if all the correct
documents are sent and the forms are correctly filled.
5. Documents required are 2 latest passport size photos, proof of identity and address i.e.
say electricity/ telephone bill, passport photocopies and PAN number.

Advantages of India Infoline

1. Very fast execution speed.

2. Rates are very competitive then other providers.
3. Easy online fund transfer facility from leading Banks including ICICI, HDFC,
CITI and UTI banks.
 4. Free facility of subscribing to mutual funds, equity IPOs and other investment
products.

Disadvantages of India Infoline

1. Investing in IPO and Mutual Funds is not so easy like in ICICI Direct.

OTHER RELEVANT INFORMATION

 India Infoline public issue gets 6.6 Times oversubscription.

 India Infoline has been awarded as the ‘Best Broker in India’ by Finance Asia
magazine. This is an annual ritual conducted by the magazine for study of best financial
services firms in each country across Asia. The study was conducted from a period of 1 year
from June 2007 to May 2008.
 India Infoline Signs up with First Advantage for Verify Direct. The Employer
Services segment of First Advantage Corporation (NASDAQ: FADV), Asia-Pacific's
largest background screening and talent acquisition solutions provider, today announced
that India Infoline has become the first company to sign up for Ver.
 The company also won the Golden Mouse Award in India Internet World 2000 for
the Best Finance site.
 Our website was included in the Top 200 Best of the Web list by Forbes Global
under the Asia Investing category.
 The Company was among the first to offer the facility of Commodities Trading in
India’s young commodities market.
 A forerunner in the field of equity research, India Infoline’s research is acknowledged
by none other than Forbes as ‘Best of the Web’ and ‘…a must read for investors in Asia’.
 In a poll conducted by Asia Money, we were adjudged as the ‘Most Improved
Brokerage’ in India.

India's Best Websites

The first annual Business Barons - TNS mode Internet-user opinion poll indiamarkets.com
has been rated the no. 1 B2B site by the first annual Business Barons -TNS MODE Internet-
user opinion poll in the Business Barons October 31 2000 issue. In a survey that conducted
an opinion poll among regular Internet users to gauge the most popular websites across eight
subject segments, India markets was the only B2B site among the top ten Business/Personal
Finance portals in terms of aided awareness.

indiamarkets.com was rated third under the Business/Personal Finance segment with an aided
awareness of 24% amongst the respondents, the top two being Indiainfoline.com and
Sharekhan.com. Indiainfoline.com and Sharekhan.com are predominantly finance portals,
thus making indiamarkets.com the best under the Business segment.

Aided Awareness Websites visited in the last 3 months

1. indiainfoline.com 37% 1. indiainfoline.com 15%
2. Sharekhan.com 30% 2. Sharekhan.com 11%
3. indiamarkets.com 24% 3. indiamarkets.com 9%
Base: All (509) Base: All (509)

Websites ever visited Frequency of visits

1. India Infoline.com 17% Average frequency once in ... days
2. Sharekhan.com 13% 1. indiainfoline.com 12.4
3. indiamarkets.com 10% 2. Sharekhan.com 8.5
Base: All (509) 3. indiamarkets.com 11.2
Base: Those visiting in the last three months

Average time spent per visit

1. indiainfoline.com 49.7
2. Sharekhan.com 51.3
3. indiamarkets.com 65.3
4. Capitalmarkets.com 21.4
5. indiabazar.com 94.8
6. indiabulls.com 112
7. indiatrade.com 91.1
8. myris.com 75.2
9. walletwatch.com 19.5
Base: Those visiting in the last three months
 Frequency of visits
Average frequency once in days
1. indiainfoline.com 12.4
2. Sharekhan.com 8.5
3. indiamarkets.com 11.2
4. Capitalmarkets.com 5.6
5. indiabazar.com 9.2
6. indiabulls.com 9.5
7. indiatrade.com 9.2
8. myris.com 17.4
9. walletwatch.com 8.6

Sites most liked

1. India Infoline.com 24%
2. Sharekhan.com 22%
3. indiamarkets.com 14%
Base: Those ranking 1 (169)