WINTER INTERNSHIP REPORT

<Importance of Financial advisory in India>

Done at

<Bajaj Capital>

By

<Sattwik Ghosh>

<Roll No: 098>

Under the guidance of

<Surajit Banerjee>

<Branch Head>
WINTER INTERNSHIP REPORT

Table of Contents
winter internship report........................................................................................ 1
2 DECLARATION........................................................................................................................ 3
3 PREFACE: ................................................................................................................................. 4
4 ABOUT THE PROJECT:........................................................................................................... 5
5 Executive Summary:.................................................................................................................. 6
5.1 Segments of the financial service sector.............................................................................7
5.2 Introduction to Bajaj Capital ............................................................................................13
5.3 DIFFERENT SERVICES OFFERED BY BAJAJ CAPITAL:..........................................13
5.3.1 INCREDIBLE RANGE OF FINANCIAL PRODUCTS:............................................14

5.4 PROJECT METHODOLOGY:........................................................................................... 15

5.4.1 ACTION PLAN:........................................................................................................... 15

5.4.2 FINANCIAL ASSESSMENT:.....................................................................................16

5.4.3 NRI SERVICES:.......................................................................................................... 17

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2 DECLARATION
I hereby declare that this report is original and based on my own work. This
report or any part thereof has not been submitted by me for any other degree
or course requirement.

NAME: SATTWIK GHOSH

BATCH: 2015-2017

INSTITUTE: PUNE INSTITUTE OF BUSINESS MANGEMENT

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3 PREFACE:
The conceptual knowledge acquired by management student is been manifested in the
project. As a part of curriculum of PGDM, I have got a chance to prepare a report on
BAJAJ CAPITAL LIMITED. The present project gives a perfect vent on my
understanding of FINANCE.

TITLE: IMPORTANCE OF FINANCIAL ADVISORY IN INDIA.

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Project Synopsis

Project Title: Importance of

financial service sector in India
Company Name: Bajaj Capital

Student Name: Sattwik Ghosh

Student Roll No: P15FC098

Project Guide Name: Surajit Banerjee

Project Guide Designation: Branch
Head
From 24.12.2015 To
Duration of project
24.01.2016

4 ABOUT THE PROJECT:

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This project basically based on financial service industry, and the explanation of financial service industry
is given below

Content
Executive Summary

Advantage in India

Segment of the financial service sector

Capital Market

Insurance

NBFCs

5 EXECUTIVE SUMMARY:

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India’s Gross Domestic Savings as a percentage of GDP. Remained above 30% since 2004 and stood at
29.02% in FY14. The IMF estimates domestic savings as a percent of GDP to remain at similar strong
levels until 2019.

HNWI population in India is expected to double and total holdings by HNWI is estimated to reach USD3
trillion in 2020 which present considerable growth opportunities for wealth management.

Mutual Fund Industry AUM recorded a CAGR of 12.05% over FY07-15 India is considered one of the
preferred Investment destination globally.

Advantage in India:
Growing Demand:

 Rising incomes driving the demand for financial services across income brackets.

 Investment corpus in Indian insurance sector can rise to USD 1 trillion by 2025.

Growing Penetration:

 Credit, Insurance and Investment penetration is rising in rural areas.

 HNI participation is growing in the wealth management segment.

Innovation:

 Product Innovation is leading to healthy growth in Insurance and NBFCs.

 India benefits from a large cross-utilization of channels to expend reach of

financial services.

Policy support:

 Government has approved new banking licenses and increased the FDI limit in the
insurance sector.
. .

 Jan Dhan Youjna launched by Prime Minister to increase the penetration of

financial services in country.

 Govt. decided the fund of PF invest in the Capital Market through MF.

5.1 Segments of the financial service sector

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 Financial
services

Capital
Insurance NBFCs
Market

Assets Management Life Assets finance Company

Broking Non-Life Investment Company

Wealth Management Loan Company

Investment Banking

Growth of the Assets Management sector since 2007:

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Top 5 AMCs in India AUM (USD Billion)

HDFC Asset Management Co. Ltd. 25.88

ICICI Prudential Asset Management Co. Ltd. 24.40

Reliance Capital Asset Management Ltd. 22.70

Birla Sun Life Asset Management Co. Ltd 19.69

UTI Asset Management Company Ltd 14.55

BROKING: EQUITY MARKET TURNOVER INCREASED SIGNIFICANTLY IN RECENT YEARS

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CAGR: 20.7%

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WEALTH MANAGEMENT:An Emarging Segement in India over the year

INSURANCE: THE LIFE INSURANCE SEGMENT HAS GROWN SIGNIFICANTLY IN

RECENT YEARS.

Major private players in the life insurance segment (as of FY14)

Name Total premiums (USD

billion)
ICICI Prudential 2.1
HDFC Standard 2.0
SBI Life 1.8
Bajaj Allianz 1.0
Max Life 1.2

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 CAGR: 14.75%

INSURANCE: NON-LIFE SEGMENT HAS BEEN RISING

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NBFC: GROWING IN PROMINENCE

5.2 Introduction to Bajaj Capital

Bajaj Capital Limited ("Bajaj Capital") is India's premier "Investment Services" Company, with nearly 50
years of experience in helping people protect and grow their wealth, Another main duty of Bajaj capital is
to advice people regarding different investment plans. We've helped to create more millionaires than any
other firm in India. But it's our deep personal relationships with clients that truly set us apart.
No other firm can match the depth of our experience and our dedication to personal service. The markets
may fluctuate, but our dependability never does.
Bajaj Capital has been granted the Certificate of Registration (“CoR”) by the Securities and Exchange
Board of India (“SEBI”) to carry on the business of Merchant Bankers (Cat-I) [INM000010544];
Underwriter [INU000001132]; Stock Broker, as Trading Member of BSE Ltd (Cash Segment)
[INZ000007732]; Depository Participant of NSDL [IN-DP-NSDL-267-2006]. Further, Bajaj Capital has
been granted the CoR by AMFI [ARN 0010], to carry on the business of distribution of mutual funds and
has also been granted the CoR [Regn.No.03310 (currently under renewal) to act as Point of Presence
(“PoP”) by the Pension Fund Regulatory Authority for the NPS Schemes

5.3 DIFFERENT SERVICES OFFERED BY BAJAJ CAPITAL:

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Personalized investment services: It requires creating a customized snapshot of
proprietary 360 degree financial assessment tool at no extra charge.

360 degree financial assessment tool: This is an unique scientific method that takes all
round view of investments using 3 steps that are discussed
Need Analysis: "Know Your Client" principle is at the heart of our business. We believe
that we need to know our clients risk profile, basic financial situation, to present them the
right selection of investment products/schemes.
Scheme Selection: We will use our best judgment and ability to present you with the best of
the breed investment schemes, for you to choose.
Efficient Execution: Our service really begins when you have completed your first
transaction through us. Our aim is to be continuously in touch with you with new
offerings.

Bajaj Capital is a distributor of financial products and is remunerated by the product

providers. Bajaj Capital is not an Investment Adviser or Financial Planners.

5.3.1 INCREDIBLE RANGE OF FINANCIAL PRODUCTS:

As distributors of financial products, we are truly unbiased in scheme selection and help
you in efficient execution of your transactions.
Hassle-free:
Timely updates, regular portfolio reviews and 24x7 online call centre support to keep
your investments on track.
Pan-India:
With over 120 offices in 70 cities across India, we strive to maintain a consistency of
relationship and experience. So if you happen to relocate, there will be a nearby Bajaj
Capital office with the same standard of service.

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5.4 PROJECT METHODOLOGY:
This research paper attempts to identify the factors affecting the financial planning of
customers towards their life.

To achieve the social objectives a questionnaire containing 26 questions are used.

The study s based on the primary as well as secondary data.

5.4.1 ACTION PLAN:

A set of 26 questions are prepared for the survey.

Got response from at least 50 respondents for analysis.

Learning how to analyse financial planning of clients.

Interacting with new clients with financial planning form.

Targeted to acquire some new clients for the company.

We also approached to various financial institutions to get an idea about the statement of
clients.

We also distributed leaflets containing the detals of different mutual funds & SIP plans to
various persons who according to us ares suitable for investment in the company.

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5.4.2 FINANCIAL ASSESSMENT:
Financial assessment is unique software based simulations that take a holistic view of life
long financial needs & charts personalized investment solutions to help persons meeting
them.

It is an unique proprietary assessment tool that takes a holistic view of all our future
financial needs in life. so that one can funds for things like our child education, buying a
home are available when the need arises. Some examples of financial assessment are:

 Owning a new car

 Buying a dream house.

 Providing children with the best education.

 Planning a great wedding for our children.

 Having a great time after our retirement.

USEFULNESS OF FINANCIAL ASSESSMENT:

Investment decisions.

Cash Flow management.

Minimization of tax liability.

Insurance Requirement.

Children's future needs.

Retirement Benefits.

TAX SAVING SOLUTIONS:

Proper tax planning is the basic duty of every person. Basically there are three steps in
the tax planning exercise. These three steps are mentioned below:

• Calculate taxable income for the financial year from all sources such as income
from salaries, House properties, Profit & gain from business or profession, capital
gains & income from other sources.

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 • Calculation of tax payable on annual taxable income using a simple tax rate as per
the income slab.

• After one have calculated the amount of tax liability, he/she have two option to
choose from:

 Pay out Tax

 Minimize tax through prudent tax planning

In case of tax planning, we have to compare the advantages of several tax saving schemes
& depending on the age, social liabilities, tax slab and personal preferences, decide on the
right mix of investment/insurance plans.

5.4.3 NRI SERVICES:

REAL ESTATE: The Indian real estate developers are laying no stone unturned in
providing High-Quality construction, transparency about the projects on offer & fairness
in dealings which is attracting huge NRI investment. The NRI investor can raise finance
from institutions to purchase an apartment. The repayment of the loan can be made
through a normal banking channel by way of inward remittance. The evaluation of the
property is based on the previous projects and also on the basis of client’s buying
capacity. Then the best projects are suggested to them.

5.4.3.1 RETIRMENT SOLUTIONS:

Everyone needs a plan for his retired life & makes provision for second income in the
form of pension. Small savings during our early life can help us create a sizeable corpus
for our retirement. The path towards creating wealth for retirement can be done in various
ways:

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  We may keep investing a lump sum amount into the chosen plans at regular
intervals.

 We may chose to go through the SIP

To create a sizeable corpus for retirement there are three simple mantras:

• Start saving Early

• Choose Equity as one’s investment vehicle

• Stay invested for long.

5.4.3.2 DIFFERENT FINANCIAL PRODUCTS FOR INVESTMENT

BAJAJ CAPITAL deals with different categories of financial products for providing
different services. The products that company deals with are discussed below:

• Insurance

• Fixed Deposits

• Real Estate

• Bonds

• Mutual Funds

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INSURANCE: An arrangement by which a company or the state undertakes to provide
a guarantee of compensation for specified loss, damage, illness, or death in return for
payment of a specified premium. The different types of insurance are discussed below:

 Life Insurance

 Personal Accident Insurance

 Medical and Health Insurance

 Vehicle Insurance

 Home Insurance

These types of insurance are discussed below:

Life Insurance – Pays out a specified figure to the insured or specified beneficiaries
on a specific event such as death of the insured.

Personal Accident Insurance – This will compensate you if at any single time an
external violent event causes you disability, injury or death.

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Medical and Health Insurance – You’ll need it to ascertain continued flow of income
if you fall sick or get injured to the extent that you can’t work and earn as before. It also
covers cost of medication, hospitalization and surgery.

Vehicle Insurance – If you own a car, motor cycle or any other motor vehicle, this
insurance covers it against accident or theft. A compressive package covers all possible
losses as well as damages to third parties such as pedestrians.

Home Insurance – Take this cover to insure your home against loss or damage as a
result of fire, electricity fault, plumping malfunction, flood, etc.

GENERAL INSURANCE:

General Insurance helps us protect ourselves and the things we value, such as our homes,
our cars and our valuables, from the financial impact of risks, big and small – from fire,
flood, storm and earthquake, to theft, car accidents, and travel mishaps – and even from
the costs of legal action against us.

TYPES OF GENERAL INSURANCE:

Motor Insurance
You love long drives and speeding on the highways. But have you secured your lovable
ride? Motor insurance, that includes car insurance and two wheeler insurance, covers all
damages and liability to the vehicle. Moreover, according to the Motor Vehicles Act,
1988, driving a motor vehicle without insurance in a public place is a punishable offense.
A motor vehicle can be covered either by a Liability Only policy which is a statutory
requirement and covers the legal liability for injury, death, and/or property damage
caused to a third party in the event of an accident caused by or arising out of the use of
the vehicle, or a package policy which includes the Liability Only policy and also covers
the damage to owner’s vehicle, usually called O.D. Cover.

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Car insurance: A comprehensive coverage against physical damage and bodily injury to
the car, and also covers against third-party liability.
Two wheeler insurance: A comprehensive two-wheeler insurance policy provides
hassle-free protection to your bike or scooter against physical damage, theft and third
party liability.
Commercial vehicle insurance: Commercial vehicle insurance is a Liability Only policy
for commercial vehicles across the various classes of vehicles like goods carrying
vehicles – private and public carrier, passenger carrying vehicles, miscellaneous and
special types of vehicles.
Health Insurance
Ill health can result in a major halt in your life and work. Moreover, the escalating price
of health care costs means that you would be shelling out a massive amount of money to
bear the brunt of these costs. This is the reason why you would need health insurance to
cover your medical expenses following hospitalization from sudden illnesses or expenses
caused by accidents. This also includes cashless facility in empanelled hospitals, pre and
post hospitalization expenses, and ambulance charges. Here are some of the common
types of health insurance policies:
Individual –A health insurance policy, such as Bajaj Allianz Health Guard Individual
policy, provides cover for an individual with cashless hospitalization and other features.
In case you feel that the sum insured of your existing health insurance plan does not
suffice for expenses due to illness or accidents then opt for a cover such as the Extra Care
health insurance policy to extend your health insurance.
Home Insurance
Your home is a priceless possession and possibly one of the largest financial investments
that you have made. It needs to be safeguarded from unforeseen events. Along with your
home, property insurance also protects the valuables and other assets that are the interest
of the insured. A comprehensive cover, such as My Home, for your house as well as the
contents ensures that your home is well protected.
Commercial Insurance
Commercial insurance offers solutions for all sectors of the industry ranging from
automotive, aviation, construction, chemicals, foods and beverages, manufacturing, oil
and gas, pharmaceuticals, power, technology, telecom, textiles, transport and logistics.
Some common types of commercial insurance include:
• Property insurance
• Marine insurance

• Liability insurance
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 • Financial lines insurance

• Engineering insurance

• Energy insurance

• Employee benefits insurance

• International insurance solutions

PORTFOLIO MANAGEMENT- IT’S ESSENCE & IMPORTANCE

Portfolio management is the art and science of making decisions about investment mix
and policy, matching investments to objectives, asset allocation for individuals and
institutions, and balancing risk against performance.

Portfolio management is all about strengths, weaknesses, opportunities and threats in the
choice of debt vs. equity, domestic vs. international, growth vs. safety, and many other
tradeoffs encountered in the attempt to maximize return at a given appetite for risk.

NEEDS FOR PORTFOLIO MANAGEMENT:

Portfolio management presents the best investment plan to the individuals as per their
income, budget, age and ability to undertake risks.

Portfolio management minimizes the risks involved in investing and also increases the
chance of making profits.

Portfolio managers understand the client’s financial needs and suggest the best and
unique investment policy for them with minimum risks involved.

Portfolio management enables the portfolio managers to provide customized investment

solutions to clients as per their needs and requirements.

TYPES OF PORTFOLIO MANAGEMENT:

Portfolio Management is further of the following types:

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  Active Portfolio Management: As the name suggests, in an active portfolio
management service, the portfolio managers are actively involved in buying and
selling of securities to ensure maximum profits to individuals.
 Passive Portfolio Management: In a passive portfolio management, the portfolio
manager deals with a fixed portfolio designed to match the current market
scenario.
 Discretionary Portfolio management services: In Discretionary portfolio
management services, an individual authorizes a portfolio manager to take care of
his financial needs on his behalf. The individual issues money to the portfolio
manager who in turn takes care of all his investment needs, paper work,
documentation, filing and so on. In discretionary portfolio management, the
portfolio manager has full rights to take decisions on his client’s behalf.
 Non-Discretionary Portfolio management services: In non discretionary
portfolio management services, the portfolio manager can merely advise the client
what is good and bad for him but the client reserves full right to take his own
decisions.

FUNDS: Funds are a form of collective investment scheme that allow you to
invest indirectly in equities and other investments. Each individual investor
buys units in a Fund. The money is pooled and invested by a fund manager in
accordance with the Fund documentation. Funds which are authorised by
regulatory authorities are generally required to publish a Prospectus and other
documentation, which set out the rules under which the Fund will be managed.
Other professionals are appointed to undertake various roles, including that of
Administrator and Trustee, amongst others. Not all investment funds are
authorised, however Davy Select make Funds available if they are appropriately
authorised.
There are mainly two types of funds. They are discussed below:

ELSS FUND: ELSS is a type of diversified equity mutual fund which is

qualified for tax exemption under section 80C of the Income Tax Act, and
offers the twin-advantage of capital appreciation and tax benefits. It comes with
a lock-in period of three years.

ULIP FUND: ULIP is a life insurance product, which provides risk cover for
the policy holder along with investment options to invest in any number of
qualified investments such as stocks, bonds or mutual funds. Fund

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