FINANCIAL SERVICES PROVIDED BY

SUMERU SECURITIES PRIVATE LIMITED

By:
SAGAR TIMILSINA
T.U Registration No: 7-2-0271-0391-2013

Exam Roll.no:13997/14

People’s Campus

Paknajol, Kathmandu

An Internship Report Submitted to:

Office of the Dean

Faculty of Management

Tribhuvan University

In partial fulfillment of the requirements for the degree of

Bachelor of business Administration (BBA)

Kathmandu
August, 2018
 APPROVAL SHEET

This is to certify that the Internship Report

Submitted by:
SAGAR TIMILSINA
T.U. Registration Number: 7-2-0271-0391-2013

Entitled:
“FINANCIAL SERVICES PROVIDED BY SUMERU
SECURITIES PRIVATE LIMITED”
I certify that I have read the document and in my opinion, it is satisfactory in scope
and quality as internship project report in partial fulfillment for the undergraduate

course BBA program held in People’s Campus, Tribhuvan University.

……………………………………..
Niraj Mishra
Supervisor
Date
 RECOMMENDATION LETTER

This is to certify that the Internship Report

Submitted by:
SAGAR TIMILSINA
T.U. Registration Number: 7-2-0271-0391-2013

Entitled:
“FINANCIAL SERVICES PROVIDED BY SUMERU SECURITIES
PVT. LTD
has been prepared as approved by this campus. This Internship Report is forwarded
for Examination.

……………………………
Nirmal Mani Panthi
Campus Chief
People’s Campus
Date :
 STUDENT’S DECLARATION

I hereby declare that the internship report entitled “FINANCIAL SERVICES

PROVIDED BY SUMERU SECURITIES PVT. LTD ” submitted to Office of
Dean, Faculty of Management, Tribhuvan University, is my original work done as per
the partial fulfillment of the requirement of the degree of Bachelors of Business
Administration (BBA) under the guidance and supervision of Mr. Niraj Mishra.

…………………………..
SAGAR TIMILSINA
Date:
 ACKNOWLEDGEMENT

I want to express my gratitude to Tribhuvan University and the People’s campus for
incorporating the internship program in BBA Program. This internship has been a
valuable step for me to be a good analyst in the field of Management. The internship
has helped me a lot to be familiar with the organization working environment and
explore my academic knowledge in providing solution to the real world problem.

I am very much indebted to our respected Campus Chief Nirmal Mani Panthi and our
Program Coodinator Rameshwor Karmacharya, for their motivational suggestions. I
would also like to thank our supervisor Mr. Niraj Mishra who has shared his
knowledge for writing and completing the internship project report. Moreover, I am
grateful to the sumeru securities family, especially Mr .sunil shrestha, compliance
officer of sumeru Securities, Mr. mr. jeevan prasai and indra dangol who has always
been there for the necessary guidance and continuous support throughout my
internship duration.

Lastly, but not the least, I would also like to thank to my respected and loving parents
for their moral support, love and encouragement and all my friends who have
supported me to complete the project in time. I am thankful to each and every
individual who has provided their valuable suggestions and wish me for the success of
the project. Without helps of the particular that mentioned above, I would face many
difficulties while doing this. So I would like to thank them all once again!

Sincerely,

Sagar Timilsina
 Table of Contents
Cover page
Approval Page ii
Recommendation iii
Student’s declaration iv
Internship Certificate v
Acknowledgements vi
Table of contents vii
List of tables ix
Acronyms x

CHAPTER I...............................................................................................................................10

INTRODUCTION......................................................................................................................10

1.1 Background...................................................................................................................10

1.2 Objectives of the study.................................................................................................11

1.3.1 Organization selection...........................................................................................11

1.3.2 Placement..............................................................................................................12

1.3.3 Duration of the internship.....................................................................................12

1.3.4 Activities performed..............................................................................................12

1.4 Limitation of the study..................................................................................................14

CHAPTER II..............................................................................................................................15

BRIEF INTRODUCTION OF BROKERAGE FIRM..........................................................................15

2.1 Meaning of brokerage firm...........................................................................................15

2.1.1 History of brokerage firm.......................................................................................15

2.1.2 Types of brokerage firm.........................................................................................16

2.1.3 Meaning of stock broker........................................................................................16

2.2 Introduction to securities market.................................................................................17

 2.2.1 History of securities market...................................................................................18

CHAPTER III.............................................................................................................................20

INTRODUCTION TO SUMERU SECURITIES PVT. LTD................................................................20

3.1 Background of the organization....................................................................................20

3.1.1 Vision of sumeru securities....................................................................................20

3.1.2 Mission of sumeru securities.................................................................................20

3.1.3 Objectivities of sumeru securities..........................................................................21

3.2 Services offering by the sumeru securities....................................................................21

3.3 Capital structure of sumeru securities..........................................................................21

3.4 Services charges of sumeru securities...........................................................................21

3.5 Departments of sumeru securities................................................................................22

CHAPTER IV.............................................................................................................................24

ANALYSIS OF ACTIVITIES DONE AND PROBLEM SOLVED........................................................24

4.1 Background...................................................................................................................24

4.1.1 Customer service department...............................................................................24

4.1.2 Trading department...............................................................................................25

4.1.3 DP department.......................................................................................................25

4.1.4 Account department..............................................................................................26

4.2 Problem faced...............................................................................................................27

4.3 Problem solved.............................................................................................................27

4.4 Felt or observed gap.....................................................................................................28

CHAPTER V..............................................................................................................................29

CONCLUSION AND LESSON LEARNT........................................................................................29

5.1 CONCLUSION................................................................................................................29

5.2 Lesson learnt.................................................................................................................30

5.3 Recommendation to the organization..........................................................................31

 LIST OF TABLES

TABLE NO. NAME OF TABLE PAGES

Table 1.1 Placement in Different Departments 4

Table 3.1 stock breakage charges 21

Table 3.2 Dmat services charges 22

 Acronyms
BBA : Bachelor of Business Administration

BOID : Beneficiary Owner ID

CDSC : Central Depository System and Clearing Limited

DIS : Debit Instruction slip

D-mat : Dematerialization

DP : Depositary Participant

DPID : Depository Participant ID

DRN : Dematerialization Request Number

FPO : Future Public Offering

IPO : Initial Public Offering

ISIN : International Security Identification Number

Ltd : Limited

NEPSE : Nepal Stock Exchange

OTC : Over the Counter Market

Pvt. : Private

RTS : Registrar to Share

SEBON : Security Exchange Board of Nepal

T.U. : Tribhuvan University

TDS : Tax Deduct at Service

 CHAPTER I
INTRODUCTION
1.1 Background

An internship is a period of work experience offered by an organization for a limited

period of time. They are typically undertaken by students and graduates looking to
gain relevant skills and experience in a particular field. Employers benefit from these
placements because they often recruit employees from their best interns, who have
known capabilities, thus saving time and money in the long run. Internships are
usually arranged by third-party organizations which recruit interns on behalf of
industry groups. Internship is an opportunity to observe, learn, understand and
participate in the corporate culture. It offers meaningful, practical exposure to
working environment which relates to a field of study.

In order to nourish the students with the experience of actual working environment,
internships has been made as mandatory requirement for the successful completion of
the four-year Bachelors of Business Administration (BBA) under Tribhuvan
University. BBA is four years international standard program consisting of eight
semesters along with internship program. Thus, BBA program is a blend of theoretical
and practical knowledge on the financial sector enabling the students in understanding
business environment and solving BBA is four years international standard program
consisting of eight semesters along with internship program. Thus, BBA program is a
blend of theoretical and practical knowledge on the financial sector enabling the
students in understanding business environment and solving practical business
problems.

An internship consists of an exchange of services for experience between the intern

and the organization. Internships are used to determine if the intern still has an interest
in that field after the real life experience. This helps the interns in easily
understanding the logic behind the operations carried out in the organization. It
provides the intern an opportunity to understand how the knowledge acquired through
the formal classroom discussion sessions is applied in the real working conditions.
For a student specializing in finance, internship in financial institutions is the best
option. An internship is the best way to put theoretical knowledge into practice.
1.2 Objectives of the study

An internship is a temporary position with an emphasis on on-the-job training rather

than merely employment, and it can be paid or unpaid. Internee wanted to work in a
stock brokerage firm and was always curious about it. Internee had certain hopes and
goals to achieve from my internship. Some of my goals and objectives of my study
are as follows:

1. To enhance communication, interpersonal and public relation skill through direct

interaction with customer.
2. To gain the practical knowledge on the Nepalese Share Market.
3. To know the system of buying and selling of shares (trading).
4. To learn about the Dematerialization process.
5. To develop a professional network.
6. To learn about the organizational system.
7. To learn the experience of working activities under supervisor.
8. To accumulate new skills.

1.3 Methodology

This study is mostly descriptive in nature where the facts and findings are described in
a systematic manner. Information required for the preparation of report has been
collected from observation of the activities that are performed in the broker firm and
the personal interview and consultation with the staffs involved in different
departments. Secondary data have also been used in the report such as websites,
brochures, books, newspapers and so on. But most of the information is collected
through observation.

1.3.1 Organization selection

The internee selected Sumeru Securities for learning various factors influencing
capital market and to pursue future goal of becoming a security analyst. Internee came
to know about sumeru securities at the expo conducted by NEPSE and brokerage firm
association of Nepal Firstly, Internee dropped an application at Sumeru Securities Pvt.
Ltd., Hattisar containing curriculum vitae and recommendation letter of my college
and luckily got to be a part of Sumeru Securities for eight weeks.
1.3.2 Placement

In Sumeru Securities Pvt. Ltd., the internee was given opportunity to understand and
to experience functioning of various departments. The internee was placed in
Customer Service Department, DP department, Trading Department and Account
Department. The Intern also got chance to have direct talks with staff of other
brokerage firm and banks to gain more knowledge about the capital market.

1.3.3 Duration of the internship

There was very short period available for intern to understand and learn various
activities carried out in different departments. Intern worked in Sumeru Securities
from June 3, 2018 to July 27, 2018. The duration intern spent in different departments
during internship period is presented below:

Table 1.1 Placement in different departments

Weeks
Departments
st rd th
1 2nd 3 4 5th 6th 7th 8th
Customer                
Service
Department                
               
DP Department
               

Trading                
Department                

Accounts                
Department                

1.3.4 Activities performed

This part includes various task performed during the internship at the stock broker.
The eight weeks of internship was very important as per the activities performed.
Sumeru Securities provides a wide range of services to its clients. Internee did work
in almost all departments and gained knowledge. Some departments are Customer
Service Department (Reception), DP Department, Finance and Treasury Department
(Account Department), Trading Department, and Information Technology
Department.
1.3.4.1 General task

When internee joined Sumeru than he was not directly assigned any departments
instead he did the ordinary task. In starting period of my internship internee did
following work

1. Filing and punching of form

2. Named file alphabetically
3. Data entry of detail information about clients in excel sheet
4. Updated the KYC form systematically
5. Wrote the three generation name in a notepad and their detail regarding trading of
share.
6. And made those records in register too.

1.3.4.2 Customer service department

1. Dealt with Customers and handled Phone Calls

2. Filled KYC form and filing and Documentation
3. Statement handling and printing
4. Account opened and account updated
5. Cheque Distributed and provided balance information
6. Received certificate for dematerialization
7. Account renewed and online registration
8. Scanning

1.3.4.3 Trading department

1. Filled up the cheque with necessary information

2. Filled the NEPSE code of banks in cheque
3. Verified the signature of clients in demat account and in cheque
4. Opening Trading Account for the clients.
5. Filling up the DIS cheques for the clients.
6. Sending message to the customers about their buying and selling transaction
7. Matched the information provided in cheque with the printed sheet of detail of
clients
1.3.4.4 DP department

1. Checked the signature in share certificate and if not matched than made telephone
calls to shareholders and invited for making correction
2. Informing and collecting the DIS cheques of the customer when they sell shares.
3. Verified signature in cheque and dematerialized the physical share certificate
4. Printed the acknowledge letters of clients ad generated DRN
5. Informing and collecting the DIS cheques of the customer when they sell shares.
6. Transferring of shares by matching as per the request of the customer.
7. Mapping the shares when the clients buy the shares and when they makes the
payment then credited to their demat account.

1.3.4.5 Account department

1. Matched the balance of share in their account

2. Settlement of buying and selling of shares
3. Issued the statement of cheque
4. Made payments to the clients
5. Filling up the debit and credit vouchers.
6. Reconciling the statements of the bank and the day book of the company.

1.4 Limitation of the study

There is some limitation during the internship in sumeru securities. The study was
concerned simply as a partial requirement of BBA program. The following were the
limitations of the study:

1. Report had been prepared by using the limited information that had been gathered
during the internship period. All information are not presented in the report due to
organizational secrecy.
2. The departments perform various activities which were very much confidential.
To maintain confidentiality of information which Internee prepared during the
Intern period can’t be listed here.
 CHAPTER II
BRIEF INTRODUCTION OF BROKERAGE FIRM
2.1 Meaning of brokerage firm

A brokerage firm, or simply brokerage, is a financial institution that facilitates the

buying and selling of financial securities between a buyer and a seller. Brokerage
firms serve a clientele of investors who trade public stocks and other securities,
usually through the firm's agent stockbrokers. A traditional, or "full service",
brokerage firm usually undertakes more than simply carrying out a stock or bond
trade. The staffs of this type of brokerage firm is entrusted with the responsibility of
researching the markets to provide appropriate recommendations, and in doing so they
direct the actions of pension fund managers and portfolio managers alike.

Although some analysts view securities market in developing countries as gambling

casinos that have little positive impact on economic growth, recent evidence suggests
that securities markets gives a big boost to economic development [ CITATION Lev96 \l
1033 ]. Traditional brokerage firms have also become a source of up-to-date live stock
prices and quotes. When a brokerage firm transacts for its own account, it is known as
a broker-dealer. Brokerage firm is an entity that has polish permission of securities
and exchange, among others to offer securities in public trading acquire and sell
securities, and provide portfolio management and investment advice services to its
client.

2.1.1 History of brokerage firm

The first recorded buying and selling of shares occurred in the 2nd century BCE in the
Rome. After Rome fell, stockbroking did not become a realistic career until after the
Renaissance, when government bonds traded in Italian city-states such as Genoa or
Venice. New stock exchanges opened their doors in the 16th and 17th centuries,
including the London Stock Exchange, which was opened at a coffee shop in 1698.In
the 1800s, in the United States, the New York Stock Exchange opened its doors under
a buttonwood tree in New York City. They formally founded the London Stock
Exchange in 1801 and created regulations and memberships. The system was copied
by brokerage firms across the world, most notably on US and Europe. Most modern
stock trading is done in electronic exchanges where buying and selling occurs via
online matching of order placed buyers and sellers[ CITATION Man05 \l 1033 ].

2.1.2 Types of brokerage firm

The brokerage firm varies on various basis. Depending on the needs of the investor, it
is wise to choose the one that best matches the investor needs and financial goals.
Some of the types of brokerage firms can be listed below:

 Full service brokerage firm

This brokerage firm that provides a range of financial services in addition to allowing
an investor to buy and sell securities. These firms can provide customers with
financial planning services and consulting services. They can also provide trust
services and wealth management services. This is the most expensive type of
brokerage firm and the investor will be able to place buy and sell orders over the
internet or telephone.

 Discount brokerage firms

This firm doesn’t provide any financial consulting or planning services. The
commission charged by discount brokerage firms is cheaper than those of full service
brokerage firms. Like a full service brokerage firm, the investor can make trade over
the phone or online. Some also do offer trades via a smart phones.
 Online brokerage firm

This firm provides its services through the internet. There are two types of online
brokerage firms. There is the type that doesn’t have physical offices at all. And there
are those that operate under a full service or discount brokerage firm. When the online
service is provided as an option of full service or discount firm, it is referred to as a
self-service account.

2.1.3 Meaning of stock broker

A stockbroker executes buy and sell orders submitted by investors. They connect the
buyers and sellers of stocks, thereby creating liquidity in the market. Stockbrokers
trade on behalf of individuals and companies, and for their services, they charge a flat
fee or a commission, which is a percentage of the sale or purchase price. Stockbrokers
are known by numerous professional designations, depending on the license they
hold, the type of securities they sell, or the services they provide. Stockbrokers go
through extensive training to learn about securities, and must also pass licensing
exams. Stockbrokers advise their clients whether to buy, sell or hold securities.

2.2 Introduction to securities market

A Securities market is an exchange where sale and purchase transactions of securities

are conducted on the base of demand and supply. Securities market encompasses
equity market, bond market, derivative market where price is determined by demand
and supply of the securities. The saving institutions such as banks, investment trusts
or companies, specialized financial corporations and stock exchanges are some of the
important constituents of capital market[ CITATION Bol98 \l 1033 ] . A well-functioning
securities market should be able to provide timely and accurate information on the
past transactions, liquidity, low transaction costs (internal efficiency) and securities
prices that rapidly adjusted to all available information (external efficiency).

 Primary market
Primary Market is the market for new securities issues and is facilitated by
underwriting groups. The companies sell their securities to the public directly to the
investors through the underwriters. The investment banker reduces the risk and cost of
creating a market of its securities to the issuer. When the firm is issuing shares for the
very first time, it is called Initial Public Offering (IPO). New shares issued by firms
whose shares are already trading in the market are called seasoned or secondary
Issuing Company receives cash from the sale and uses it to expand or fund the
operations. After the initial sale, the securities trading will be conducted on the
secondary market through brokerage firm.
 Secondary market

Secondary market, also known as the aftermarket, is the market where the trading of
the previous issued securities is conducted. An investor buys securities from another
investor instead of the issuer. It is important that the secondary market provides
liquidity and therefore provides continuous information about the market price of the
securities. Secondary markets are mainly organized in two ways. One is to form a
centralized and organized exchange where all buyers and sellers (or their
representative agents) meet and conduct trading. The other way is Over-the-counter
(OTC) market where securities are traded directly between two parties. Trading
occurs via dealers who carry inventories of securities and contact each other by
computer, telephone or other electronic network instead of a physical trading floor.

2.2.1 History of securities market

The history of securities market began with the floatation of shares by Biratnagar Jute
Mills Ltd. and Nepal Bank Ltd. in 1937. Introduction of the Company Act in 1964,
the first issuance of Government Bond in 1964 and the establishment of Securities
Exchange Centre Ltd. in 1976 were other significant development relating to capital
markets. Securities Exchange Centre was established with an objective of facilitating
and promoting the growth of capital markets. Nepal Government, under a program
initiated to reform capital markets converted Securities Exchange Centre into Nepal
Stock Exchange in 1993. The only secondary capital market in Nepal, NEPSE
operates under Securities Act, 2007. NEPSE had brought about a number of changes
in order to upgrade itself and provide efficient and reliable services. In August 2007,
it automated its trading system. Initially a not for profit organization, NEPSE has turn
itself in a profit seeking organization in May 2008.

2.2.1.1 Securities exchange board of Nepal (SEBON)

Securities Board of Nepal (SEBON) was established by the Government of Nepal on

June 7, 1993 as an apex regulator of Securities Markets. It has been regulating the
market under the Securities Act, 2006. The Governing Board of SEBON is composed
of seven members including one full time chairman appointed by the Government for
tenure of four years. Other members of the Board include joint secretary of Ministry
of Finance, joint secretary of Ministry of Law, Justice and Parliamentary Affairs,
representative from Nepal Rastra Bank, representative from Institute of Chartered
Accountants of Nepal, representative from Federation of Nepalese Chambers of
Commerce and Industries, and one member appointed by the Government from
amongst the experts pertaining to management of securities market.

2.2.1.2 NEPSE

NEPSE is the only secondary capital market of Nepal. The vision of NEPSE is
creation of wealth of nation by adding value through trading of securities. The
objective of NEPSE is to provide liquidity to government bonds and corporate
securities by facilitating transaction through intermediaries. The other objective of
NEPSE is to protect investors’ rights and develop a secondary market, as prescribed
in the Memorandum of Association and Articles of Association. The function of
NEPSE is to provide trading floor to the listed securities.

In 1994, NEPSE started its trading with 62 listed companies. From 2005 government
bonds are being listed and traded at NEPSE floor. At present there are more than 240
companies listed in NEPSE. To date 47 companies which didn’t comply with the legal
requirements have been delisted from NEPSE. NEPSE has replaced the open cut
trading system with fully automated screen based trading system (ATS) since 24 th
August, 2007 under the CFG project of Government of Nepal aided by Asian
Development Bank. In Nepal, the company willing to sell its securities to the general
public shall have to get listed with Nepal Stock Exchange. Documents needed and
points to be explained to apply for listing are company objectives, ownership
structure, memorandum of association, articles of association and audited balance
sheets and profit and loss accounts and annual reports for the last three consecutive
years to the Nepal Stock Exchange[ CITATION Koi02 \l 1033 ].

2.2.1.3 CDS

CDS and Clearing Limited, a company established under the Company Act is a
company promoted by NEPSE in 2010 to provide centralized depository, clearing and
settlement services in Nepal. The company was inaugurated on 31st March, 2011. The
main objective of CDSC is to act as a central depository for various instruments
especially to handle securities in dematerialized form. This organization is entrusted
with the safekeeping, deposit and withdrawal of securities certificates and the transfer
of ownership or rights of the said instruments.
 CHAPTER III
INTRODUCTION TO SUMERU SECURITIES PVT. LTD
3.1 Background of the organization

Sumeru Securities Pvt. Ltd. is one of the leading stock broking companies and wealth
management firms headquartered at prime location of Hattisar, Kathmandu. Founded
in 2067/68, it operates on unique retail focused stock trading model that provides
revolutionary trading platforms and expertise to a diversified client base. Sumeru is
licensed broker No. 39.Sumeru Securities Pvt. Ltd. is member of Nepal Stock
Exchange Limited (NEPSE) and is also a registered Depository Participant (DP) (DP
no.40) with CDS and Clearing Limited (CDSC). Sumeru Securities Pvt. Ltd.
rendezvous with excellence in customer relations has emerged as one of the most
trusted and respected stock broking companies in our domestic context. Sumeru, as
the name of the company suggests being something majestic, vows to keep its
customers contented with its superlative trustworthiness and professional pragmatism.
After obtaining the Letter of Intent from the Securities Board of Nepal (SEBON),
Sumeru Securities Pvt. Ltd. set up the necessary infrastructure and involved in
availing the stock broking related services to its valued clients by complying with the
necessary conditions as specified by the governing agency.

3.1.1 Vision of sumeru securities

Vision represents the place where the organization wants to be in the future. So the
vision is to provide best value for money to investors through innovative products,
trading/investment strategies, state-of- the-art technology and personalized services.
Our Motto Is “Guides Towards Prosperity”. To have complete harmony between
quality in process and continuous improvement to deliver exceptional service that will
delight our Customers and Clients.

3.1.2 Mission of sumeru securities

The mission is to provide the best quality service, to have complete harmony between
quality in process and continuous improvement to deliver exceptional service to
delight our clients thereby contributing to the capital market of the country and create
excellent market growth opportunity for our employees.
3.1.3 Objectivities of sumeru securities

1. To reach to the general investors and provide them easy access to capital market.
2. To make share trading faster than ever by using high tech systems.
3. To provide competitive and customer oriented services to all customers through
competent and professional staffs.

3.2 Services offering by the sumeru securities

Sumeru Securities offers services catering to its customers. To sum up, Sumeru
Securities makes securities trading simple and accessible to all sections of society.
Some of the major products/services of the organization are as follows:

1. Buying and Selling of Shares(Trading)

2. Opening a Demat account
3. Dematerialization of securities
4. Re-Materialization of securities
5. Maintaining record of securities in electronic form
6. Settlement trades by transferring/receiving the securities from/in BO accounts
7. Settlement of off-market trades that is occurred between BOs outside NEPSE
8. Online Statement view of Demat Account
9. Any other as allowed by laws and regulations in regard to securities depository

3.3 Capital structure of sumeru securities

The authorized capital of stock broker in Nepal is Rs. 5 crore. Stock broker should
maintain minimum balance of Rs. 5 crore in its account. The issued capital is also Rs.
5 crore. However, the paid up capital of the Stock broker is Rs. 2,01,00,000.

3.4 Services charges of sumeru securities

There are two types of service charges by Sumeru Securities which can be broadly
categorized into stock brokerage service charges and Demat Services charge which
are related to Dmat operation.

 Stock Brokerage service charges

Sumeru Securities is highly regulated; all of their service charges are fixed by the
regulatory authorities. Their brokerage services fixed by monitory authority, SEBON
and NEPSE can be presented as below.
 Table 3.2 Stock brokerage charges

SN Transaction Volume Percent of Turnover

1 Up to Rs.2500 Flat Rs. 25
2 From Rs.2501 to Rs.50000 0.60%
3 From Rs.50001 to Rs.500000 0.55%
4 From Rs.500001 to Rs.2000000 0.50%
5 From Rs.2000001 to Rs.10000000 0.45%
6 From Rs. 10000000 onward 0.40%
In addition to the above charges a fee of 0.015% regulatory fee is added to the above
transaction.

 Demat Services
The service charges of DMAT which is also fixed by the regulatory authorities are :

Table 3.3 Dmat Service Charges

SN Transaction Type Rs. Per Transaction

1 Demat Account Opening Fee Rs.150
2 Demat update Rs.100 per annum
3 On market transaction at DP Rs.25 per transfer
4 Pledge/Unpledge fee Rs.50
5 Share Dematerialization Free
6 Account Statement Printing Free

3.5 Departments of sumeru securities

 Front Desk

Customer Service Department is the front desk of any organization. It provides all
necessary information to the customers. For any organization, it is the main and most
important department which needs to deal with customer more than any department in
the organization. This department fills up the different types of forms if customer
asked to fill up. Interact with the customers if they fell any problems. This department
also answers the phone calls and gives information of their queries. Helping
customers to open account and verifying all the required documents. This department
is also concern with the opening the D-mat accounts for the customers. This
department gives the statement of share to the customers and all information
regarding their transaction.
 Trading Department

This is the most sensitive part of the organization where trading of shares takes place.
This is the main department where employees are much busy and cannot procrastinate
any work and also have to attend calls and individual. This department is mainly
concerned with the trading activities of the organization which involves buying and
selling of securities in the secondary market. It takes the order of the client and place
that order in the market depth. The matching of the orders in the market leads to the
execution of the order. This department has to work as per the instruction provided by
the clients and make the trade as per the order filed.

 DP Department

The DPs are intermediaries between the CD and account holders. Here all the Demat
account is managed and those account opened at the front desk needs approval from
this department. The department looks after the Dematerialization of the share
certificates. Depository Participant is an important party in the CDSC which is
responsible to provide the Dmat services, opening Dmat accounts, collection of
bonus, dividend, right shares provided by issuer to its client in clients respective
account through the stockbroker, capital market (DP).

 Account Department

Account department at Sumeru securities Pvt.Ltd is responsible for carrying out the
finance related activities. It involves the collection of cash and check from the clients,
managing the funds, making the payment to stock, paying out the cash and check to
the clients, keeping the records of all the financial and accounting activities of an
organization, etc.
 CHAPTER IV
ANALYSIS OF ACTIVITIES DONE AND PROBLEM
SOLVED
4.1 Background

This part includes various task performed during the internship at the stock broker.
Sumeru Securities provides a wide range of services to its clients. Internee did work
in almost all departments and gained knowledge from it. The internship work that the
intern performed can be called as a mix of general as well as specific tasks. General
tasks that the intern performed were normal day to day tasks assigned to any intern.
The intern also got a specific task assigned to him as well which was to work under
different departments in different time periods.

4.1.1 Customer service department

It is one of the busiest departments and it is the very place which makes an early
impression to the clients. The image and reputation of the organization depends upon
effective functioning of this department. It is the first place where the customers first
get the service. Internee was allowed to carry out all the work after a training given of
using the software. Internee deal with different activities for next two weeks which
are as follows:

 Updated KYC details into BOSS

The intern was given the task to update the KYC forms into the BOSS (Broker Office
Solution Software) where the client’s details were managed by the system. The
system helped to manage the information that is required to manage in the broker
organization. The system is very curical to maintain each and every information of all
clients regarding all transaction.

 Handled Clients
The intern interacted with the new clients who came to open a trading account and
Demat account. The clients needed to have their KYC forms filled with correct details
according to their citizenship and bank account details. The forms were accepted by
the intern after checking the forms for the correct details. The intern would instruct
the client’s process of trading of the shares and help them to fill the KYC forms and
give detail information on the total process related to trading of shares.

 Provided Statements
The clients asked for the statements of their purchases/sales of the shares and the
Demat account statement at the Customer Service Department. The intern helped the
current employees at front desk and also provided the statements in their absence.
 Helped in Dematerialization of shares
The clients come with their shares certificates to dematerialize them through Sumeru
Securities. The front desk accepts them and forwards them to the DP Department. The
intern used to instruct the clients who needed instructions to fill the forms for
dematerialization of shares.

4.1.2 Trading department

This department is responsible for actual purchase and sales of securities as per
demand of customers. This department facilitates purchase, sales, calculation of
capital gain tax, and creation of client KYC ID. Every client receives their unique
code for trading which is called NEPSE code. The client has to place their order for
buying or selling their shares through the order form provided by the broker. The
employee then places the order to the NEPSE Automated Trading System where the
system matches the order. The order is matched when there is a buyer for the shares at
the rate and quantity determined by the seller.

The activities that the intern performed at the department were very less in this
department. The intern could observe the activities performed in the department as he
was not authorized to use the system. The details entered were double checked while
entering as any mistake occurred could not be reversed and could result in problems.
The respective employee have to get orders for the clients and post it in the order list
of NEPSE to carry out the transaction, they also need to generate a particular
customer code(NEPSE code) for carrying out transaction. They also had to look after
the Debit Instruction Slip (DIS) Cheque which is received from the client who sells
the shares. This department is headed by Mr. Jeeban Prasai.

4.1.3 DP department
The DPs are intermediaries between the CD and account holders. Here all the Demat
account is managed and those account opened at the front desk needs approval from
this department. It is also liable to make letter for dematerialization of shares
generally called DRN (Dematerialization Reference Number). The first step for an
investor is to open a DMAT account. In order to dematerialize physical securities,
investors must fill in a DMAT Request Form (DRF), available with the DP and
submit the same along with physical certificates. As every security has an ISIN
(International Securities Identification Number), a separate DRF must be filled for
each ISIN.

The investor has to follow certain steps to DMAT the securities in the physical form.
The investor need to provide their BO ID (Beneficiary Owner ID) to the broker to do
trading in the dematerialized form where the broker will map the client’s shares to the
client’s dmat account. When the client buys the shares then their shares are mapped to
the client’s dmat account and once the client makes payment for the share their
account is credited with the shares. When the client sells their shares then they need to
provide the DIS (Debit Instruction Slip) to the depository participant for the
settlement of their shares. The client’s demat account will get debited after the
settlement of the transaction. The intern was given the task to make the DRF from the
system and manage them accordingly. Also, the intern managed the DIS at the
department.

4.1.4 Account department

The accounts department takes payments from the clients for the purchase and gives
payment to the client for the sale of their shares. The accounts department looks after
the transactions that are taken place in the organization. The share trading has a
unique accounting process where the settlement is done on the 3 rd day of the
transaction. The accounts department issues the bill of purchase of securities after the
trading hour of the transaction. The client has to pay the amount of bill which includes
the share amount, SEBON commission, broker commission and DP fee. The bill of
sales of securities is issued after the settlement of securities. The client receives the
payment of their securities after deducting the SEBON commission, broker
commission, DP fee and Capital gain tax. All the transactions are done from A/C
payee cheque.
In the accounts department, the intern got the idea of the accounting of share
transactions. The intern was not given the job to operate the system in the department
but the intern could observe all the activities in the department while arranging the
vouchers, bills and some documents in the departments.

4.2 Problem faced

The intern faced different types of problems in the organization while performing the
activities in the firm. They are as follows:

1. Though the instruction and required documents are easy to fill out, even then
customers ask those for time to time and reasons for documents. So, it was tough
to give them each guideline on filling different types of form as well.
2. Some the customer disagreed to accept the charges for account renewals and make
argument on this matter for long time. So, it becomes difficult to convince them
about the charges.
3. Dealing with the clients was the most difficult part in the organization. The clients
try to get smart while dealing with the interns and others as well to get their job
done. It was also necessary to give information about the trading to the new
clients where the intern did not have any space to make any mistake.
4. The client must be self-present while opening a Demat A/C with Sumeru
Securities as per the rules. The intern had the job of accepting the account opening
forms, here the intern faced the problems where the clients were not present and
they tried to become smart with me in the beginning as the intern knew very less
about dealing with such clients

4.3 Problem solved

All employees perform their duties and responsibility in the organization most of the
time. Though Internee didn’t had the authority to be involved in many financial
activities in the organization but a simple helps the senior staffs to save their time as
well as effort.
1. The intern was also given the task to organize the KYC forms and demat forms.
The forms were arranged in unsystematic manner before. We tried to make a
better file system for files by getting the information filled in excel sheet first and
then arrange them in the index file in groups. In that way, any KYC form could be
found within 2 minutes whenever asked by the authority and senior staff.
2. Sometimes as an intern Internee gave wrong information to the client due to lack
of knowledge of that department in the beginning. At that time, senior staff
 immediately corrected our mistake and gave the right information. As the intern
had done a mistake once Internee did not repeat the mistake again (own).

4.4 Felt or observed gap

Internship program in Sumeru’s different department was very interesting and

internee enjoyed working in that environment. During the period of my internship he
can observed lots of things some was very good and something need to be changed.
The gaps between theoretical and practical knowledge of the student about Brokerage
firm are as follows.
1. Students study about the different departments of brokerage firm but in real all the
departments might not be in the firm.
2. In theory the different facilities provided by the institution is studied but all the
institutions cannot provide all the facilities to its customers.
3. In theoretical knowledge student only get a chance to know out surface but in
practical student gets the chance to know the organization entirely.
4. While studying student knows only the problem of organization in written but
while facing the problem in work and do the solution of that problem was the
practical work.
5. The applicability and usefulness of business education to real-life business can be
known from the practical knowledge.
 CHAPTER V
CONCLUSION AND LESSON LEARNT
5.1 CONCLUSION

This internship program was conducted as a partial fulfillment of the BBA Course
under Tribhuvan University which provides student an opportunity to familiarize with
organizational culture and develop managerial skills exposing oneself of the real-life
functions of the business organization. The internship period is an exciting phase of a
student’s life. It is not just a requirement to pass one’s exams and get a degree, but it
is a period where one builds professional contacts, learns the art of listening and
observing. Such kind of program helps the students to broaden their horizons and
actually put whatever they have learnt into practice. It provides the students with extra
knowledge and would prepare them to face the real work environment after
graduation. It helps in making the students more competent in today’s competitive
workplace. Moreover, it helps in developing the necessary skills required to cope with
various kinds of work problems. In countries where stock discipline is effective, firms
tend to be more productive, thereby creating more wealth per unit of money
invested[ CITATION Dou82 \l 1033 ].

Internee was always curious to know how share market function and luckily got
chance to be intern in one of the leading share broker i.e. Sumeru Securities where
internee got to know more and more about how the share market operates and how the
trading is done. It was a great experience being an intern in Sumeru. Internee have
more knowledge and information regarding secondary market. The nine weeks of
internship program has been very fruitful. Almost all my objectives of doing
internship was fulfilled and achieved. It helped me gain tremendous knowledge and
experience with different departments. The internship added sense of responsibility to
me while performing any task. The experience of internship was incredible which
boosted my confidence level and enhanced my inter-personal communication skills. It
developed interaction skills and shaped up my personality too. Internee learnt about
various aspects of share market, socializing with the staffs and customers, forming
networks, dealing with the senior staffs, getting out of difficult situations, dealing
with the intern colleagues, and patiently solving the problems faced in the workplace.
Customer satisfaction is the key to retain the customers in the organization.
5.2 Lesson learnt

The eight weeks internship program was definitely not sufficient to understand the
vast organizational work procedures and system but it was effective enough to learn
the importance of the proper organization cultures and its effect on the professional
working environment. This internship not only gave an opportunity to learn about
basic activities of the various departments that Internee worked in but also helped me
to shape my personality and character to greater extent. The internee achievement
from internship can be listed out in the following:

1. Developed communication Skills

Communication is the key to interact with people and be successful in life. The first
objective was to improve my communication skill which internee did successfully.
CSD is one of the departments where we have to face many customers each day.
Internee learned to communicate and deal with the customers having different
perception and learned how to be gentle with them.

2. Time Management Skills

As we all know that “time and tide waits for none”. So it is us who have to move as
per time. Time management is must for professional to have balance between
personal and professional life. Keeping our self-busy, contended and punctual is what
Internee learnt through my eight weeks long internship program.

3. Improved interpersonal Skills

Interne had the opportunity to interact with a lot of customers which helped me in
improving my interpersonal skills, situational changes, decision making medium and
understanding customer- service provider relationship. Internee had to collaborate
with other all employees both senior and peers to perform tasks in groups which
taught me the proper workplace behavior to adopt.

4. Changed attitude and behavior

Employee must possess highly positive attitude, multitasking ability, and patience
behavior. Courtesy and responsiveness are equally important traits in an employee.
Internee felt how the behavior of an employee can influence the way a customer
reacts and gets his work done. Internee learnt to be more polite and patience during
those periods.
5. Team Work

Working in team, makes every difficult task easy. Internee was assisted by seniors
and collaborated with my colleagues. Everybody was eager to teach me how the
system operates and how to simplify the task. It was a wonderful team work there.

6. Networking

Internee came along a lot of people there of different nature. Many of them were so
friendly and cooperative and fun to interact with. Internee develop a good relation
with my team members and seniors as well as some of clients. Inyernee got to meet a
lot of new and energetic people who even promised to provide training over how the
share market operates and doing investment in it.

5.3 Recommendation to the organization

The internship program gave an opportunity to explore the corporate environment.

After having great working experience as an intern in Sumeru Securities and
observing its working environment and procedures, Internee found Sumeru has its
excellent working system. At the same time some area of improvement has been
identified. The major feedbacks for enhancing its performance are:
1. For the effective management of interns, there should be a proper placement
schedule for each intern in terms of the duration and departments they will work
in with some kind of small orientation program about the working policy of
organization.
2. The performance of the interns should be monitored and evaluated and job
opportunities can be offered to the best intern so that interns could actually learn
something important during the internship period and thus take internship period
as an opportunity rather than partial fulfillment of the course.
3. The software called BOSS did not respond sometimes and the customers have to
wait for balance inquiry.
4. Most of the staffs are of Newari background and they communicate in their own
language which made other staffs difficult to understand. So all staffs must
communicate with common language so all can easily understand.
5. The working space is small and work load is more. So the organization must
increase the working area or shift the location to a better place.
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Doulas, W. D., & Robert, E. V. (1982). Journal of Finance. Optimal Managerial Contracts and
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Koirala, P., & Bajracharya, P. (2002). Nepalese Capital Market:Issues and Challenges.
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Levin, R. (1996). Stock Markets: A Spur to Economic Growth. Finance and deveopment, 8-13.

Manandhar, K. D. (2005). Capital Market Development in Nepal: Need,Development,

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