CHAPTER 1

1
1. INTRODUCTION

An organization is a planned, coordinated and purposeful action of human beings to achieve

certain specific goals through division of labour and hierarchy of authority.

Anorganisational study is the systematic study about how people - as individuals and as groups -
act withinorganizations.It involves the study of the structure and functioning of its departments.
Organizing one of the important functions of Management. Almost all the organizations
aredifferent but they have certain common features. All are collection of people, linked together
by formal andinformal relationships. They have hierarchical orders that are engaged in co-
operative activities and they allhave identical boundaries. So the study of people in organization
is important for future managers.

Structure of an organisation is very important for its functioning and growth. It provides the
basic frame workfor its progress and expansion. For future managers, it is imperative to study the
organisational structure andfunctioning of successful organisations so that they as future
managers may guide organisations towardsuccessand profitable function

2
 Objectives of the study

1. Study the functions various departments

2. To study the organizational structure and its hierarchy.
3. Have an exposure to the working environment
4. To learn the way management tries to co-ordinate activities of different departments.
5. Practical applications happening in the organization
6. To analyse strength, weakness, opportunities and threats of the company.

Scope

The study has been conducted at Geojit BNP Paribas Financial Services Ltd, Kaduthuruthy
Kottayam during the period 05-05-2010 to 05-06-2010.The study focuses on acquiring
knowledge regarding the functioning of various departments in the organization

Methodology

The study is based on both primary and secondary data. Primary data collected from the
employees and staff through formal meetings. Secondary data collected from the annual reports or
unpublished source

LIMITATIONS OF THE STUDY

1. Due to lack of time respondents were not ready to give much information.
2. It was very difficult to collect detailed data on each department within the limited

3
CHAPTER II

4
INDUSTRY PROFILE

The securities market can be divided in to primary and secondary market, primary market
means the market that deals with first hand securities, which means that the shares which are
firstly issued, or which are not already issued. Secondary market means the market that deals
with second hand securities, which means the shares which are already issued. It is also called
stock exchange. When a company wishes to raise funds from the public it has to offer IPO in the
primary market, IPO means the shares when a company issues to the public at the first time, this
is called an initial public offering. Organized exchanges constitute the main secondary market. A
security is a negotiable instrument representing financial value. Securities are broadly classified
in to debt and equity securities such as bonds and common stocks respectively .Securities may be
represented in certificate or electronic form/ demat form. The process of converting physical
form securities in to electronic form is called dematerialization

Securities are traditionally divided in to debt securities and equities. Debt securities may be
called debentures, bonds, notes or commercial paper depending on the maturity or certain other
characteristics. Debt securities are generally issued for a fixed term and redeemable by the issuer
at the end of that term. Debt securities may be protected by collateral may be unsecured .An
equity security is a share in the capital stock of the company .The holder of a share is a share
holder .In the debt securities which require regular payments, equity share holders are not
entitled to any payment, In mostly equity share holders have the control of the company .Equity
also enjoys the right to profit and capital gain.

We can trade directly in the stock market with the help of stock brokers who keeps us well
informed about the market and may sometimes able to help us with our buy or sell decisions.
Stock brokers have major role in the securities market. Geojit BNP Paribas Financial Services
Ltd , is one of the industrial pioneers that you can approach any of your financial needs ranging
from MF,STOCK BROKING,

5
LIFE INSURANCE,GENERALINSURANCE,BONDS,COMMODITY, etc… charging a
normal fee for the services rendered

COMPETITORS

a. JRG
b. INDIA INFOLINE
c. HEDGE
d. REIANCE MONEY
e. RELIGARE
f. UAE EXCHANGE
g. ICICI DIRECT
h. ALL OTER GOVT. AND PVT BANKS
i. KOTAK MAHINDRA

6
 COMPANY PROFILE

Geojit BNP Paribas Financial Services Ltd

Evolution of the company 

It all started in the year 1987 when Mr. C.J. George and Mr. Ranajit Kanjilal founded Geojit as a
partnership firm. In 1993, Mr.Ranajit Kanjilal retired from the firm and Geojit became the
proprietary concern of Mr. C .J. George. In 1994, it became a Public Limited Company named
Geojit BNP Paribas Financial Services Ltd. The Kerala State Industrial Development
Corporation Ltd. (KSIDC), in 1995, became a co-promoter of Geojit by acquiring a 24 percent
stake in the company, the only instance in India of a government entity participating in the equity
of a stock broking company.

(BSE) in the year 2000. Company’s wholly owned subsidiary, Geojit Commodities Limited,
launched Online Futures Trading in agri-commodities, precious metals and energy futures on
multiple commodity exchanges in 2003. This was also the year when the company was renamed
as Geojit BNP Paribas Financial Services Ltd. (GFSL). The Board consists of professional
directors; including a Kerala Government nominee. With effect from July 2005, the company is
also listed at The National Stock Exchange (NSE). Company is a charter member of the
Financial Planning Standards Board of India and is one of the largest Depository Participant
(DP) brokers in the country. On March 13, 2007 the formation of Geojit BNP Paribas Financial
Services Ltd

About BNP Paribas

BNP Paribas (www.bnpparibas.com) is one of the 6 strongest banks in the world according to
Standard & Poor's.* With a presence in 85 countries and more than 205,000 employees, 165,200
of which in Europe, BNP Paribas is a global-scale European leader in financial services. It holds
key positions in its three activities: Retail banking, Investment Solutions and Corporate &

7
Investment Banking. The Group benefits from its four domestic markets: Belgium, France, Italy
and Luxembourg. BNP Paribas also has a significant presence in the United States and strong
positions in Asia and the emerging markets.
BNP Paribas has been operating in India since 1860 in a number of businesses such as
Investment Banking (CIB), Private banking (BNP Paribas Wealth Management), Life Insurance
(SBI Life) and Asset Management (Sundaram BNP Paribas), Infrastructure Funding (Srei BNP
Paribas), Retail Financing (Sundaram BNP Paribas Home Finance), Car Contract Hiring (Arval),
Institutional Broking (BNP Paribas Securities India) and Securities Services (Sundaram BNP
Paribas Securities Services and BNP Paribas Sundaram Global Securities Operations).

A leading retail financial services player

Geojit BNP Paribas today is a leading retail financial services company in India with a growing
presence in the Middle East. The company rides on its rich experience in the capital market to
offer its clients a wide portfolio of savings and investment solutions. The gamut of value-added
products and services offered ranges from equities and derivatives to Mutual Funds, Life &
General Insurance and third party Fixed Deposits. The needs of over 495,000 clients are met via
multichannel services - a countrywide network of over 500 offices, phone service, dedicated
Customer Care centre and the Internet. 

Geojit BNP Paribas has membership in, and is listed on, the National Stock Exchange (NSE) and
the Bombay Stock Exchange (BSE). In 2007, global banking major BNP Paribas joined the
company’s other major shareholders - Mr. C.J.George, KSIDC (Kerala State Industrial
Development Corporation) and Mr.Rakesh Jhunjhunwala – when it took a stake to become the
single largest shareholder.

Strategic joint ventures and business partnerships in the Middle East have provided the company
access to the large Non-Resident Indian (NRI) population in the region. Now, as a part of the

8
BNP Paribas global network, Geojit BNP Paribas is well positioned to further expand its reach to
NRIs in 85 countries. Barjeel Geojit Securities is the joint venture with the Al Saud group in the
United Arab Emirates that is headquartered in Dubai with branches in Abu Dhabi, Ras Al
Khaimah, Sharjah and Muscat. Aloula Geojit Brokerage Company headquartered in Riyadh is
the other joint venture with the Al Johar group in Saudi Arabia. The company also has a business
partnership with the Bank of Bahrain and Kuwait, one of the largest retail banks in Bahrain and
Kuwait.

At the forefront of the many fruitful associations between Geojit BNP Paribas and BNP Paribas
is their joint venture, namely, BNP Paribas Securities India Private Limited. This JV was created
exclusively for domestic and foreign institutional clients. An industry first was achieved when
Geojit BNP Paribas became the first broker in India to offer full Direct Market Access (DMA)
on NSE to the JV’s institutional clients.

A strong brand identity and extensive industry knowledge coupled with BNP Paribas’
international expertise gives Geojit BNP Paribas a competitive advantage.

Expanding range of online products and services

Geojit BNP Paribas has proven expertise in providing online services. In the year 2000, the
company was the first stock broker in the country to offer Internet Trading. This was followed by
integrating the first Bank Payment Gateway in the country for Internet Trading, and many other
industry firsts. Riding on this experience, and harnessing BNP Paribas Personal Investors’
expertise as the leading online broker in Europe, is helping the company to rapidly expand its
business in this segment. Presently, clients can trade online in equities, derivatives, currency
futures, mutual funds and IPOs, and select from multiple bank payment gateways for online
transfer of funds. Strategic B2B agreements with Axis Bank and Federal Bank enable the
respective bank’s clients to open integrated 3-in-1 accounts to seamlessly trade via a
sophisticated Online Trading platform.

9
Further, deployment of BNP Paribas’ state-of-the-art globally accepted systems and processes is
already scaling up the sales of Mutual Funds and Insurance.

Wide range of products and services 

Certified financial advisors help clients to arrive at the right financial solution to meet their
individual needs. The wide range of products and services on offer includes -
Equities | Derivatives | Currency Futures | Custody Accounts | Mutual Funds | Life Insurance &
General Insurance | IPOs | Portfolio Management Services | Property Services | Margin Funding |
Loans against Shares

A growing footprint

With a presence in almost all the major states of India, the network of over 500 offices across
300 cities and towns presently covers Andhra Pradesh, Bihar, Chattisgarh, Goa, Gujarat,
Haryana, Jammu & Kashmir, Karnataka, Kerala, Madhya Pradesh, Maharashtra, New Delhi,
Orissa, Punjab, Rajasthan, Tamil Nadu & Pondicherry, Uttar Pradesh, Uttaranchal and West
Bengal.
1 |22 years of history in Indian Capital Market
Geojit BNP Paribas has 22 years of in-depth broking experience in the Indian Capital Market.
More than 495,000 clients and over Rs 9,900 cores (as of 30th Sep.’09) in Assets under
Management reflect the trust reposed in our expertise.

10
2 Pioneer in Online Trading in Feb. 2000 
In the year 2000, Geojit BNP Paribas pioneered the simple concept of providing
individuals with the facility to trade online. This revolution has given the company the
first mover advantage in online trading. As a creative innovator, Geojit BNP Paribas uses
advanced technology in online trading to meet client requirements such as customized
online trading platforms and many other services.

3. StrongShareholders 
Geojit BNP Paribas is backed by strong shareholders.In 2007, global banking major
BNP Paribas joined the company’s other major shareholders - Mr. C.J.George, KSIDC
(Kerala State Industrial Development Corporation) and Mr.Rakesh Jhunjhunwala – when
it took a stake to become the single largest shareholder.

4. Wide range of products

Geojit BNP Paribas offers a wide range of trading and investment products and solutions.
Certified financial advisors help clients to arrive at the right financial solution to meet
their individual needs. 
The wide range on offer includes - Equities | Derivatives | Currency Futures | Custody
Accounts | Mutual Funds | Life Insurance & General Insurance | IPOs | Portfolio
Management Services | Property Services | Margin Funding | Loans against Shares
5. Attractive brokerage slabs
We provide value for money! To start with, we offer low online brokerage charges which
further decrease automatically, as and when, your volumes increase.
0.03 to 0.01 for intra-day trades

11
 0.30 to 0.10 for delivery trades 
Rs 75 to Rs 30 for F&O

6. Learn the craft

you too can develop your trading skills by availing of the effective guidance by our
research department. We offer-
o Daily mails delivered to our client’s mailbox on market conditions and
recommendations
o Technical analysis of BSE 200 Index scrip’s
o Free monthly investment magazine
o Services of professionally qualified executives at 500 offices across India.
o Our strong research ideas have been instrumental in converting our clients into
successful traders.

7. Multichannel service- Internet, Phone, Branch trading

Trade the way that you want to by selecting from multiple channel options- Internet,
Phone or Branch.

8. First mover advantage 

Geojit BNP Paribas through its first mover advantage in different areas has been the first
to serve investors with its innovative offerings.
o 1st to launch internet trading in the year 2000.
o 1st to launch integrated internet trading system for cash and derivative segments in
the year 2002.

12
 o 1st Indian stock broking company to commence domestic retail broking operations
in any foreign country.
o 1st in the industry to have a global player offering its name thereby creating Geojit
BNP Paribas.
o 1st to launch exclusive branches for women in 2005.

9. Our deep reach

we have a pan-India network of over 500 offices with industry certified executives and a
dedicated Call Centre to provide you quality services.

10. Wide range of fund options

Geojit BNP Paribas gives you the option to choose from the 700 plus Mutual Fund
schemes offered by over 35 Asset Management companies such as SBI Mutual Fund,
Reliance Mutual Fund, Franklin Templeton India Mutual Fund, Tata Mutual Fund,
Sundaram BNP Paribas Mutual Fund, Fidelity Mutual Fund, and HDFC Mutual Fund.

13
 BOARD OF DIRECTORS

Name Designation

Mr.A.P Kurian Non-Executive and Independent

chairmen

Mr.C.J George Managing Director & Chief Promoter

Mr. Alkeshkumar Sharma Non-Executive and Independent

Director

Mr. Mahesh Vyas Non-Executive and Independent

Director
Mr. Rakesh Jhunjhunwala Non-Executive Director
Mr. Ramanathan Bupathy Non-Executive and Independent
Director

Mr.Punnoose George Non-Executive Director

Mr.Olivier Le Grand Non-Executive Director
Mr. Pierre Rousseau Non-Executive Director

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 MANAGEMENT

Name Designation

Mr.C.J. George Managing Director

Mr. Satish Menon Director(Operations)

Mr. A. Balakrishnan Chief Technology Officer

Mr. Venkitesh National Head Distribution

Mr. Martin Zachmeier Director (Planning and Control)

Mr.Binoy .V.Samuel Chief Financial Officer

Mrs. Jaya Jacob Alexander Chief of Human Resources

As per Clause 49 of the listing agreement with the stock exchanges, it shall be obligatory for the
board of directors of all listed Companies to lay down a code of conduct all board members and
senior management of the company in order to ensure good corporate governance

15
1 CORPORATE GOVERNANCE 

Corporate governance is about commitment to values and about ethical business conduct. It is
about how an organization is managed. This includes its corporate and other structures, its
culture, its policies and the manner in which it deals with various stakeholders. Accordingly,
timely and accurate disclosure of information regarding the financial situation, performance,
ownership and governance of the company, is an important part of corporate governance. This
improves public understanding of the structure, activities and policies of the organization.
Consequently, the organization is able to attract investors, and to enhance the trust and
confidence of the stakeholders. 

We believe that sound corporate governance is critical to enhance and retain investor trust.
Accordingly, we always seek to attain our performance rules with integrity. The Board extends
its fiduciary responsibilities in the widest sense of the term. Our disclosures always seek to attain
the best practices in international corporate governance. We are also responsible to enhance long
term shareholder value and respect minority rights in all our business decisions.

II. INTRODUCTION OF CODE (Preamble)

This Code of Ethics for Directors and Senior Executives (the “Code”) helps to maintain the
standards of business conduct for Geojit BNP Paribas Financial Services Limited (the
“Company”) and ensures compliance with legal requirements particularly of Companies Act,
SEBI Regulations and the Listing Agreement with Stock Exchanges. The purpose of the Code is
to deter wrongdoing and promote ethical conduct. The matters covered in this Code are of utmost
importance to the Company, our shareholders and our business partners. Further, these are
essential so that we can conduct our business in accordance with our stated values. 

16
The Code is applicable to the following persons, referred to as “Officers”:

 Directors of the Company

 Our Senior Management
 Members of the Board of Subsidiary Company

Ethical business conduct is critical to our business. Accordingly, Officers are expected to read
and understand this Code, uphold these standards in day-to-day activities, and comply with all
applicable laws, rules and regulations, the Geojit BNP Paribas Code of Conduct, Service rules
and all applicable policies and procedures adopted by the Company that govern the conduct of its
employees.

Because the principles described in this Code are general in nature, Officers should also review
the Company’s other applicable policies and procedures.

Officers should sign the acknowledgment form at the end of this Code and return the form to the
HR department indicating that they have received, read and understood, and agree to comply
with the Code. The signed acknowledgement form should be available with officers concerned.
Each year, as part of their annual review, Officers will be asked to sign an acknowledgement
indicating their continued understanding and adherence of the code. 

III. HONEST AND ETHICAL CONDUCT

We expect all Officers to act in accordance with highest standards of personal and professional
integrity, honesty and ethical conduct, while working on the Company’s premises, at offsite
locations where the Company’s business is being conducted, at Company sponsored business
and social events, or any other place where Officers are representing the Company. 

We consider honest conduct to be conduct that is free from fraud or misrepresentation or

deception. We consider ethical conduct to be conduct conforming to the accepted professional

17
standards of conduct. Ethical conduct includes ethical handling of actual or apparent conflicts of
interest between personal and professional relationships. This is discussed in more detail in
Section IV below. 

IV. CONFLICTS OF INTEREST

An Officer’s duty to the Company demands that he or she avoids and discloses actual and
apparent conflicts of interest. A conflict of interest exists where the interests or benefits of one
person or entity conflict with the interests or benefits of the Company. Examples include:

A. Employment/Outside employment: With regard to the employment with the Company,

Officers are expected to devote their full attention to the business interests of the
Company. Officers are prohibited from engaging in any activity that interferes with their
employment with the Company. Our policies prohibit Officers from accepting
simultaneous employment with suppliers, customers, developers or competitors of the
Company, or from taking part in any activity that enhances or supports a competitor’s
position. Additionally, Officers must disclose to the Company’s Audit Committee, any
interest that they have that may conflict with the business of the Company.

B. Outside directorships: It is a conflict of interest to serve as a director of any company that

competes with the Company. Officers must first obtain approval from the Company’s
audit committee before accepting a directorship.

C. Business Interests: If an Officer is considering investing in any customer, supplier,

developer or competitor of the Company, he or she must first take care to ensure that

18
 these investments do not compromise on their responsibilities to the Company. Our
policy requires that Officers first obtain approval from the Company’s Audit Committee
before making such an investment. Many factors should be considered in determining
whether a conflict exists, including the size and nature of the investments, the Officer’s
ability to influence the Company’s decisions, his or her access to confidential information
of the Company or of the other company, and nature of the relationship between the
Company and the other company. At the time of application for approval, full facts of the
proposed investment shall be placed before the Committee.

D. Related parties: As a general rule, Officers should avoid conducting Company’s business
with a relative, or have business in which a relative is associated in any significant role. A
relative means and includes spouse, children, parents, grandparents, grandchildren, aunts,
uncles, nieces, nephews, cousins, step relationships, and in-laws. Subject to the rules and
regulation, the Company discourages the employment of relatives of Officers in key
positions or assignments within the same department. Further, the Company prohibits the
employment of such individuals in positions that have a financial dependence or
influence (e.g. an auditing or control relationship, or a supervisor/subordinate
relationship). Every employee drawing a monthly salary of Rs.10, 000/- or more shall
disclose whether he is a relative or not of any of our directors.

E. Payments or gifts from others: Under no circumstance the Officers shall accept any offer,
payment, promise to pay, or authorization to pay any money, gift, or anything of value
from customers, vendors, consultants, etc., that is perceived as intended, directly or
indirectly, to influence any business decision, any act or failure to act, any commitment
of fraud, or opportunity for the commitment of any fraud. Inexpensive gifts, infrequent
business meals, celebratory events and entertainment, provided that they are not
excessive or create an appearance of impropriety, do not violate this policy. Questions
19
 regarding whether a particular payment or gift violates this policy are to be directed to
Finance Department. Gifts given by the Company to suppliers or customers should be
appropriate to the circumstances and should never be of a kind that could create an
appearance of impropriety. The nature and cost must always be accurately recorded in the
Company’s books and records.

F. Corporate opportunities: Officers may not exploit for their own personal gain,
opportunities that are discovered through the use of corporate property, information or
position, unless the opportunity is disclosed fully in writing to the Company’s Board of
Directors and the Board declines to pursue such opportunity.

G. Interested Contracts: Except with the consent of the Board of Directors of the Company,
any of the Director or his relative or a firm in which a director or his relative is a partner,
any other partner in such a firm, or a private company of which the director is a member
or director shall enter into any contract with the Company for sale, purchase or supply of
goods, materials or services, or for underwriting the subscription of any shares in or
debentures of the Company except for purchase or sale of goods for market price or such
contracts which either party regularly trades or does business. For any clarification in this
regard, the officers are requested to contact to the Finance Department / Secretarial
Department / Legal Department.

H. Whistle Blower Policy: Employees who came across any unethical or improper practice
(not necessarily a violation of law) shall be free to approach the Audit Committee without
necessarily informing their supervisors. All officers are requested to inform their
subordinates about their this right through an effective manner. For any clarification in

20
 this regard please contact Finance Department / Secretarial Department / Legal
Department.

I. Other Situations: It would be impractical to attempt to list all possible situations. If a

proposed transaction or situation raises any questions or doubts, please contact Finance
Department.

V. COMPLIANCE WITH GOVERNMENTAL LAWS, RULES AND

REGULATIONS
Officers must comply with all applicable governmental laws, rules and regulations, Officers must
acquire appropriate knowledge of the legal requirements relating to their duties sufficient to
enable them to recognize potential dangers, and to know when to seek advice from the Finance
Department. Violations of applicable governmental laws, rules and regulations will lead to penal
action as specified in the respective statutes. In any doubt about the compliance with laws
rules/regulations /guidelines contact appropriate department of the Company.

VI. VIOLATIONS OF THE CODE

Part of an Officer’s job, and of his or her ethical responsibility, is to help enforce this Code.
Officers should be alert against possible violations and report this to appropriate department.
Officers must co-operate in any internal or external investigations of possible violations.
Reprisal, threat, retribution or retaliation against any person who has, in good faith, reported a
violation or a suspected violation of law, this Code or other Company policies, or against any
person who is assisting in any investigation or process with respect to such a violation, is
prohibited.

The Company will take appropriate action against any Officer whose actions are found to violate

21
the Code or any other policy of the Company. Disciplinary actions may include immediate
termination of employment at the Company’s sole discretion. Where the Company has suffered a
loss, it may pursue its remedies against the individuals or entities responsible. Where laws have
been violated, the Company will cooperate fully with the appropriate authorities. 

VII. WAIVERS AND AMENDMENTS OF THE CODE 

We are committed to continuously reviewing and updating our policies and procedures.
Therefore, this Code is subject to modification. Any amendment or waiver of any provision of
this Code must be approved in writing by the Company’s Board of Directors and promptly
disclosed on the Company’s website and in applicable regulatory filings pursuant to applicable
laws and regulations, together with details about the nature of amendment or waiver.

Overseas Joint Ventures

Barjeel Geojit Securities, LLC, Dubai, is a joint venture of Geojit BNP Paribas with Al Saud
Group belonging to Sultan Bin Saud Al Qassemi having diversified interests in the area of equity
markets, real estates and trading. Barjeel Geojit is a financial intermediary and the first licensed
brokerage company in UAE. It has facilities for off-line and on-line trading in Indian capital
market and also in US, European and Far-Eastern capital markets. It also provides Depository
services and deals in Indian and International Funds. An associate company, Global Financial
Investments S.A.O.G provides similar services in Oman

Aloula Geojit Brokerage Company is Geojit BNP Paribas's joint venture in Saudi Arabia with
the Al Johar Group. Saudi is home to the world’s single largest NRI population. The Saudi
national and the NRI would be able to invest in the Saudi capital market. The NRI would also be
able to invest in the Indian stock market and in Indian mutual funds. This joint venture makes
Geojit BNP Paribas the first Indian stock broking company to commence domestic retail
brokerage operations in any foreign country.

22
Bank of Bahrain and Kuwait (BBK), one of the largest retail banks in Bahrain & Kuwait
through its NRI-Business, and Geojit entered into an exclusive agreement in September 2007.
This association will provide the bank’s sophisticated client base, the opportunity to diversify
their holdings through investments in the Indian stock market. Services offered are- Investment
Advisory, Portfolio Management, Mutual Funds, Trading in Indian Equity Market, DEMAT and
Bank account, Offline Share Transactions and PAN Card

Other Subsidiary Ventures

Geojit Comtrade

Geojit Comtrade, a subsidiary of Geojit BNP Paribas Financial Services Limited is mainly
engaged in the business of Commodities Futures Trading. Geojit Comtrade is a member of:

 National Multi- Commodity Exchange of India Limited

 National Commodity & Derivative Exchange limited
 Multi-Commodity Exchange
 India Pepper and Spice Trade Association
 Singapore Commodity Exchange
 Dubai Gold commodity Exchange

Geojit Technologies (P) Ltd

Geojit Technologies a subsidiary of Geojit Comtrade is engaged in providing software solutions

using open computing and web standard where possible .Geojit Technologies has strong domain
expertise in financial services such as Broking, Depository, Derivatives, and Banking etc

Geojit Credits (P) Ltd

Geojit Credits a subsidiary of Geojit BNP Paribas Financial Services Ltd, is registered with
Reserve Bank of India as an NBFC .It is engaged in the business of margin funding for securities
trading, loan against shares etc

23
Customer Relation Initiatives

Geojit also provides a call and trade facility to its customers where in they can place track their
orders through our dedicated Call Centre Desk by dialing the toll free number 1800-425-5501

The brokerage structure makes Geojits online trading all the more attractive

0.03% for day trading

0.30 %for delivery

Vision Values and Beliefs

Vision

The vision of Geojit is to be leading financial and commodities market intermediary for
individual and institutional clients from India and overseas

Values and Beliefs

The understand and respect customers needs to consistently to deliver total quality solutions
trough constant skill up gradation

They believe that the company culture helps to attract and retain the best talent

They are committed to achieve profitable constant consistently

They freely share their investment experience across their investment experience across all ages
and strata of society to encourage wise investment for a better future

Geojit BNP Paribas Financial Services Ltd is a growing “Financial Super Market”, which gives
all modern financial capital market services under one roof. Geojit BNP Paribas Financial
Services Ltd is the “First Online Broking firm” in India. The company stands as the first member
of NSE, the first company to give depositary services in South India

24
Geojit BNP Paribas Financial Services Ltd is India’s first internet brokerage firm. It has been
active in the field of capital markets for 20 years .Geojit BNP Paribas Financial Services is a well
established corporate sector in the Indian capital market .Its rate of return is growing every year
and its role in the market is expanding every year. The company also has an institution named as
“Geojit Institute of Capital Market” also to train Geojits staff to equip with modern technology
for trading and related services. The staff is also trained for qualifying in NCFM exam conducted
by NSE

HISTORIC FOOPRINTS

1986

 Membership in Cochin Stock Exchange (CSE).

       1994 

 Becomes a Public Limited Company named Geojit Securities Ltd.

1995 

 Kerala State Industrial Development Corporation Ltd. (KSIDC) acquires 24 percent

equity stake.
 Membership in National Stock Exchange (NSE).
 Public Issue

       1996

 Launch of Portfolio Management Services with SEBI registration.

       1997 

25
  Depository Participant (DP) under National Securities Depository Limited.

       1999 

 Membership in Bombay Stock Exchange (BSE).

      
 2000

 BSE Listing.
 1st broking firm in India to offer online trading facility.
 Commences Derivative Trading with NSE.
 Integrates the 1st Bank Payment Gateway in the country for Internet Trading.

        2001

 Becomes India's first DP to launch depository transactions through Internet.

 Establishes Joint Venture in the UAE to serve NRI customers.

       2002

 1st in India to launch an integrated internet trading system for Cash & Derivatives
segments.

       2003

 Geojit Commodities Limited, wholly owned subsidiary, launched Online Futures Trading
in agri-commodities, precious metals and in energy futures on multiple commodity
exchanges.
 National launch of online futures trading in Rubber, Pepper, Gold, Wheat and Rice.
 Company renamed as Geojit BNP Paribas Financial Services Ltd.

26
       2004

 National launch of online futures trading in Cardamom.

        2005

 NSE Listing.
 Geojit Credits, a subsidiary, registers with RBI as a Non-Banking Financial Company
(NBFC).
 National launch of online futures trading in Coffee.

2006

 Charter member of the Financial Planning Standards Board of India.

     
  2007

 BNP Paribas takes a stake in the company’s equity, making it the single largest
shareholder.
 Establishes Joint Venture in Saudi Arabia to serve the Saudi national and the NRI.

27
       
2008
 BNP Paribas Securities India (P) Ltd. – a Joint Venture with BNP Paribas S.A. for
Institutional Brokerage.

 1st brokerage to offer full Direct Market Access execution in India for institutional
clients.

       2009

 Launch of Property Services division.

 Launch of online trading in Currency Derivatives.
 Consequent to BNP Paribas becoming the largest stakeholder in Geojit BNP Paribas
Financial Services, company is renamed as Geojit BNP Paribas Financial Services Ltd.

28
COPORATE SOCIAL RESPONSIBILITY

Corporate Social Responsibility (CSR) is a necessity for today's companies. To maintain a

competitive advantage, companies must expand Community Relations and Foundation programs
all over the world. Corporate Social Responsibility is the continuing commitment by business to
behave ethically and contribute to economic development while improving the quality of life of
the workforce and their families as well as of the local community and society at large.
Corporate social responsibility (CSR), also known as corporate responsibility, corporate
citizenship, responsible business, sustainable responsible business (SRB), or corporate
social performance,[1] is a form of corporate self-regulation integrated into a business model.
Ideally, CSR policy would function as a built-in, self-regulating mechanism whereby business
would monitor and ensure its support to law, ethical standards, and international norms.
Consequently, business would embrace responsibility for the impact of its activities on the
environment, consumers, employees, communities, stakeholders and all other members of
the public sphere. Furthermore, CSR-focused businesses would proactively promote the public
interest by encouraging community growth and development, and voluntarily eliminating
practices that harm the public sphere, regardless of legality. Essentially, CSR is the deliberate
inclusion of public interest into corporate decision-making, and the honoring of a triple bottom
line: People, Planet, and Profit.

29
Recent CSR activities o f the company

Geojit Company sponsored the construction of a tourist police station cum museum at
mattanchery Kerala. This is one of the recent CSR activities of the company. This police station
mainly for tourist (mainly for outside state).The complains of the tourist can be solved through
these police station. This is very helpful to the tourist

Tamil Nadu team “Go Green day” celebrations staff of various branches planted 253 saplings in
several schools, colleagues’, parks and hospitals

Donated medicines worth rupees -10000 to Vriddha Asramam (old age home) at Khadavli
village

In May 2008, sponsored Mr. Gopal international grand master and coach Lev Psakhis is an
endeavor to create an opportunity for him to play with higher ranked grand master to improve his
ratings Gopal was the first grand master in chess

Associate sponsor of a film award star nit show organized in Chennai by the world malayalee
council and kairali TV The proceeds of the show will support a social cause to raise rupees 20
million for setting up an orphanage in one acre of land to accommodate 1000 destitute children
who are mainly HIV positive.

30
CARRIER

Geojit BNP Paribas takes pride in its employees and their exceptional qualities, which form the
core strength of the Company. We continuously strive to set higher standards in transparency and
integrity in financial services industry. Our motto is to deliver quality service at competitive
rates.

With a pan-India network of Offices, Geojit BNP Paribas is an equal opportunities employer
having a workforce reflecting the diversity of our nation, with unity and strength woven through.
The work environment and HR policies of the Company aims at achieving quality work life
balance of our employees

On joining Geojit BNP Paribas, one becomes an integral part of a dedicated team working
towards achieving our organizational goals, particularly in creating investment awareness across
all ages and strata of society. Along with remuneration, employees are given a fair share of
profits. We encourage employees to continue learning, acquire new skills and grow with the
Company in its operations in India and abroad.

Given below are the current job opportunities with Geojit BNP Paribas. We look forward to
candidates who would want to be a part of the Geojit BNP Paribas Team.

We welcome people with experience to submit their applications. If you have the experience but
have not found any present opening suitable to your skills you may click on the Experienced
option and submit your resume for consideration against future opportunities.

31
We also welcome Fresh Graduates to register their names for any future suitable openings. To
register you may click on the Fresher option under Current Openings and enter the details. We
shall contact you when we have an opening matching your profile.

Current Opening
Executives (HR)
Customer Care Executive ( Proficiency in French )
Customer Care Executive
Dealers
Financial Consultant
Chief Manager (Call Centre)
Chief Manager (Legal & Compliance)
Senior Manager (Corporate Communications)
Relationship Officer

32
CHAPTER III

33
Vertical Functioning of Geojit

 Operations department

 Company secretary

 Internet trading

 Risk & Settlement

 Technology department

 Distributions department

 Finance department

 Human resource department

Operations department

The operations department is headed by the Chief Operating Officer .The various functions of
the operations department are the following.

 equity and commodities trading

34
  Portfolio management services

 Research functions

 Depository functions

Equity and Commodities Trading

Trading in both cash and comTrade market is one of the main services provided by Geojit.
Separate accounts are needed for trading in commodity and cash. Trading in cash, futures and
options can be done with the help of one account .Geojit also provides a call & Trade facility to
its customers can place and track their orders through a dedicated Call Centre Desk by dialing
the toll free number.

Geojits retail spread caters to the need of individual investors .Trading in equities is made
simple, safe and interesting with smart advice from the research desk through daily SMS alerts,
market pointers, periodical research reports, stock recommendations and customer meets
organized frequently

Portfolio Management Services

The portfolio management service is another function which comes under the operations
department. The strategy of the portfolio management services is to identify growth stocks from
a select list through extensive research

The minimum investment required for portfolio management services is Rs.10 lakes for resident
Indians and Rs.25 lakes for Non-resident Indians. The investment objective of the portfolio
management service is to generate medium to long- term capital growth by identifying
undervalued stocks and those with growth opportunities from a select list of well researched
stocks

Research Functions

Sophisticated tools are used for technical analysis and research to offer recommendations,
technical analysis and research reports. The research team provides the following information

35
Daily Market View Technical Analysis

Market, a daily report on markets gives a clear picture on the expected market movements (NSE
and BSE). It also covers the key support and resistance levels .it also provides clues on market
direction and expected profit booking levels.

Daily Stock View

Technical analysis stocks, a daily report on the stock for the day. These are prepared “ Departure
Oscillators “ tool that have a high degree of accuracy on stock readings; which in turn helps
investors , day traders , high net worth individuals with stock ideas that may benefit them

F & Q Analysis

F & Q Analysis is a daily report that gives near 100% accurate reading on both Futures and
Options. It is helpful for day traders, long term holders and HNI clients

SMS

SMS alerts are sent to those who have registered for the service. These are prepared with utmost
care, ensuring that it is suitable for both the Bulls AND the Bears I It provides instantaneous
buy/sell/hold recommendations purely on technical’s .It also provides option strategies with the
use of Implied/Historical volatility study . SMS is especially hand for Index Traders

Geo Data

Geo Data is a monthly research report covering most financial instruments .It is quite
comprehensive, and provides in depth information on stocks to watch out for, recommended
Mutual Funds, performance of schemes, Futures and Options update and a review of the
commodities markets.

Depositary Function

Geojit is a depositary participant of NSDL. Investors can open demat accounts with NSDL
through Geojit. Agreement charges along with annual maintenance charge are collected upfront
while opening an account .DP facilities offered by Geojit are the following.

36
De- materialization

A share holder can convert physical shares in to electronic form by surrendering the shares for
dematerialization at the Geojit branch

Re-materialization

Re- materialization enables a share holder to convert the dematerialized shares in to physical
form

Repurchase

This facility helps the investor to submit the units of open-ended mutual funds in case of re-
purchase.

Pledge

An investor can pledge securities to avail a loan.

Transfer

An investor can transfer securities from one demat account to another this function is called off
market functions.

IPO’s

An investor who has applied for an IPO and receives an allotment then the securities are
transferred directly to his demat account. The same applies for bonus and right issues.

Commodity De-mat Account

An investor dealing in commodity may need to open a commodity de-mat account with Geojit.

Speed-e

37
If an investor has registered for Speed-e services, then transfer instruction can be placed online
over the internet to pre-notified Clearing Members Pool A/c. This does away with the need to
submit a physical delivery instruction slip.

Company Secretary

A Company Secretary is a senior position in a private company or public organization. The

company Secretary ensures that an organization complies with relevant legislation and
regulation, and keeps board members informed of their legal responsibilities. They are the
company’s named representative on legal documents and in their responsibility to ensure that the
company and its directors operate within the law. It is also ensure that dividends are paid and to
maintain company records, such as list of directors and share holders, and annual accounts

Every company having a paid up capital of Rs.2 core and above should appoint a company
Secretary. The annual general meeting of Geojit is conducted under the guidance of company
secretary. The company secretary has to collect notes from all departments and present it to the
board of directors for the board meetings.

The functioning of a company secretary is

 To conduct meetings like AGM, board Meeting etc

 Make minutes of the meeting

 Make reports on the meeting

 Reports on corporate governance

 Preparation of annual report

 Registrar report

 Report to board of directors

 To conduct share transfer meeting twice in a month

38
  Replay to the investors Grievances & Complaints

Internet Trading

Internet trading or on line trading has introduced a new phase in stock market and commodity
futures trading. Making the market literally at the fingertips of the trader. The onset of on line
trading changed the traditional value proposition of trading now investors and traders get rich,
interactive information in real time, including market data, investment research and robust
analytics. The present day environment helps any class of investors to save time, which is
‘money’ and hence, the need arises for internet trading.

In the real world one do stock market trading or commodity futures trade with the respective
exchange through a broker.

In on line trading one will access the website through their internet – enabled PC and place
orders through the internet based trading engine.

Understand this need; Geojit introduced a unique, exclusive portal for its customers to internet
trading in stock market and commodity future market. It is the ultimate on line trading platform
for shares and commodities future trading in NSE, BSE, NMCE, and NCDEX.

Risk & Settlement Department

Being a trading firm Geojit’s risk and settlement department can be considered in the life blood
of the firm. For the existence in the competitive market this department plays a major role. In a
competitive market providing proper guidance in trading is not only the function of a major
player like Geojit. So risk & settlement dept plays its part to make the customers stick to the
firm.

Its actual functioning is monitoring the transactions happening in the various branches & in the
business associates. For trading in the market a client need to have certain amount of money in
the account .They can make trading only in proportion to these amounts.

But with help of risk dept they can make trading by getting a limit up to 10 times i.e. if a client is
only having 10000/- in his a/c, he can get a limit up to 100000/- but the risk dept provides this

39
only on the basis of various factors like past trading pattern of the client, recommendation from
the branch etc. Risk dept is having the full control of all its branches & business associates. They
can square off the position of the client. By providing these limits the risk dept is actually
motivating the clients who are interested but doesn’t have enough money to trade.

Monitoring the clients accounts

Setting Margin Amount for the client

Squaring the positions of the clients if necessary

Forwarding the tips from the research department

The settlement departments mainly focus on the pay in and pay out of shares. It works in
coordination with the accounting department. All the matters related these pay ins and pay outs
are looked over by this department.

Technology Department

The system department is headed by the chief technology officer. All regional office will have
one systems department, which is responsible for all the system related activities of the branches
which come under that region. The system department will be monitoring the trading the
software that is used in the branches. The software used in Geojit is FLIP Software. A server is
there at the regional office to which all the system of the region is connected with. The server
and branch office systems are connected through ISDN. The regional offices are connected to the
head office through a leased line.

At the regional office there will be one systems manager and systems engineers who are
responsible for all the systems functions that come under that regional office. Maintenance of the
system is the responsibility of the system department.

Distribution Department

The distributions department is headed by the head, distributions. The sale of mutual funds,
insurance products, bonds, IPO’s, fixed deposits etc come under the distributions department.

40
Geojit sells the mutual funds of all leading mutual fund companies in India like Reliance, SBI,
HDFC, ICICI, HSBC, Franklin etc

Geojit sells the insurance products of the Met life Insurance companies

Finance Department

The finance department is headed by the Chief Financial Officer. The finance department is
responsible for the maintenance of client accounts, risk and settlement and also for the NBFC
operations. It is responsible for the all fund and cash related matters. Collection of margin money
is also done by this department. This department also looks after the pay in and pays outs of
funds in the firm.

The credit worthiness of a client is determined by the finance department based on which debit
balance is allowed to him. The settlement function is another important function of the finance
department. The NBFC functions like loans against shares, loans for commodity trading etc
comes under the control of the finance department.

Human Resources

The human resource department of Geojit BNP Paribas Financial Services is headed by the Chief
of Human Resources. The human resources department is responsible for the training and
development of human resources at Geojit BNP Paribas Financial Services.

There will be human resources coordinator at each regional office, who undertakes all the HR
related functions of the branches which comes under that region. The recruitment, selection,
training and development of employees come under the functions of HR dept. The functions are:

Recruitment and Selection

The HR department will conduct interviews for new employees many of the interviews and the
selection procedure are conducted in the head office.

41
Training and Development

The department takes initiatives in conducting training and development program. Geojit usually
providing to the dealers in the branches and conducts some seminars for the clients.

Compensation

The salary package of Geojit staff is best in the industry and is mainly based on individual
performance in course. The HR department will conduct the performance appraisal by analyzing
each and every staff personally.

Products and Services

1. Equity

Geojit, a member of NSE and BSE, has a net work of over 300 branches in India and abroad,
rendering quality equity trading services. Geojit not only has a strong offline presence but also
automated on line trading service. Geojit also provides a Call & Trade facility to its customers
where in they can place and track their orders through our dedicated Call Centre Desk by dialing
the toll free number 1800-425-5501. Geojit retail spread caters to the need of individual
investors. Trading in equities is made simple, safe and interesting with smart advice from the
research desk through daily SMS alerts, market pointers, periodical research reports, stock
recommendations and customer meets organized frequently.

The online trading system allows customers to track the market by setting up their own
market watch, receiving research tips, stock alerts etc. The brokerage structure makes Geojit
online trading more attractive

2. Futures and Options

42
The national stock exchange and Mumbai stock exchange have commenced trading in
Derivatives market with Index Futures being the first instrument. Now both the exchanges
provide trading in index futures and options

A derivative is a financial contract, between two or more parties, which is derived from the
future value of an underlying asset.

At any point of time there will always be available near three months contracts periods

There are three types of members in the futures and options segment. Trading members are only
eligible to trade; their trades are settled by the clearing members. Trading cum clearing members
are members who are eligible to trade also settle on behalf of other trading members. Profession
trading members who are only specialized in the clearing and settlement activities. They do not
trade on their own behalf or on behalf of other members. Self clearing members are those who
trade and settle only their own trades

3. Margin Trading Funding Scheme

Geojit BNP Paribas Financial Services Ltd offers Margin Trading Funding facility to all offline
customers under the scheme of Margin Funding approved by SEBI.

Highlights the schemes are as follows

1. All securities defined under group 1 of NSE are eligible for margin funding

2. No processing fees

3. Easy and prompt accounting opening formalities

4. Margin funding of up to 50% of the purchase value

5. Shares purchased are credited to customers Demat account maintained specifically for the
purpose of margin trading

6. Liquidation if margins are not topped up on a 20% falls in the margin funded portfolio

43
7. Margin calls are made if there is fall of 10% of the margin funded portfolio. Margins can be
replenished by cheque or by transferring fund from normal trading account

8. Bonus and Rights are also directly credited to the customers said Demat account. Similarly
dividend shall be credited to the bank account stated in the said Demat account

9. Interest rate is 18% pa

10. No limits on time up to on which he can keep the position open.

11. Purchase can be made only against clear funds.

12. Margin trading is only permitted in NSE only

Margin Ratios

Margin Ratio: 50:50

Maintenance margin/Call margin:40%

Liquidation margin : 30%

4. Loan against shares

Geojits credit Pvt Ltd, a registered Non-Banking Finance Company and an associate of Geojit
BNP Paribas Financial Services Ltd offers loan against security of shares. The facility is
available to all customers of Geojit BNP Paribas Financial Services Ltd.

Highlights of the Scheme

1. All securities defined under group 1 of NSE are eligible for loan against securities

2. Loan is provided against a minimum of two securities and minimum loan amount is Rs.
50000/-

44
3. Loan up o 50% of the security value

4. Upper ceiling on quantum of loan shall be as determined by Geojits Credits P Ltd on a case to
case to basis.

5. Speedy disbursal through RTGS / direct credit to customer’s bank account / cheque

6. Hassle free processing and simple documentation

7. Securities are to be transferred to Geojits Credits Pvt Ltd.

8. 75% loan amount is charged upfront

9. Rate of interest is 13.5% pa annualized rate 16.5% pa.

10. Loan can be availed for a maximum period of 90 days

11. Easy roll over process, simply give a letter for the same, however, upfront charges as stated
above shall be levied.

12. Loan can also be redeemed by instructing Geojit Credits P ltd to sell the securities

13. Loans are re valued daily

14. Margin calls are made if the values of the securities fall by 10% which can be met with either
by redeeming the loan partially. And or placed additional securities.

15. Securities may be liquidated if the margins are not furnished in case of a fall of 20% value of

the securities.

5. Loans for ComTrading

Geojit Credits P Ltd offer loans against Pledge of warehouse receipts of delivery at Commodity
Exchange.

Highlights of the Scheme

1. Loans against pledge of physical and Demat warehouse receipts

2. Loans up to 80% of sale value price contracted for the future delivery

45
3. Loans are also considered against pledge of warehouse receipts without futures sell contract
on a case-to-case basis at higher margins ranging from 30% to 50% of the value

4. Loans available till sale proceeds are realized on settlement from the Commodity Exchange
else up to a maximum of three months

5. Provision to switch between different future contracts.

6. Simple documentation

7. Speedy disbursal of loans through RTGS

6. Depositary Services

A depositary can be compared to a bank, it holds securities such as shares, bonds, debentures,
and government securities etc. of investors in electronic form there are two depositories in
India .The National Securities Depository Limited and Central Depositary Securities Limited. An
individual who desires to avail the depositary services can approach a Depositary Participant,
banks, financial institutions, custodians, brokers or any other entity eligible as per SEBI
regulations, 1996 can apply to the depository to become a Depositary Participant. AS on 31 st Dec
2005 there were 221 depositary participants in India. Geojit is a depositary participant of NSDL.
Investors can open demat account with NSDL through Geojit. One can approach the nearest
branch of Geojit for opening an account. Agreement charges along with Annual Maintenance
charge are collected upfront while opening an account. It takes two or three days to pen a demat
account. Upon activation of the demat account, a welcome letter is sent to the customer along
with the Delivery Instruction Slip book.

DP facilities offered by Geojit

De- materialization

A share holder can convert physical shares in to electronic form by surrendering the shares for
dematerialization at the Geojit branch

46
Re-materialization

Re- materialization enables a share holder to convert the dematerialized shares in to physical
form

Repurchase

This facility helps the investor to submit the units of open-ended mutual funds in case of re-
purchase.

Pledge

An investor can pledge securities to avail a loan.

Transfer

An investor can transfer securities from one demat account to another this function is called off
market functions.

IPO’s

An investor who has applied for an IPO and receives an allotment then the securities are
transferred directly to his demat account. The same applies for bonus and right issues.

Commodity De-mat Account

AN investor dealing in commodity may need to open a commodity de-mat account with Geojit.

Speed-e

If an investor has registered for Speed-e services, then transfer instruction can be placed online
over the internet to pre-notified Clearing Members Pool A/c. This does away with the need to
submit a physical delivery instruction slip.

7. Portfolio Management Services

47
Geojit, a SEBI registered portfolio manager offers discretionary portfolio management services.
Geojit has a team of experts who carefully take investment decisions based on the client’s
objectives.

The portfolio management team has a successful track record of more than 10 years in the capital
market. The team has access to Geojit strong equity research and fundamental & technical
analysis.

Investment Objective

To generate medium long term capital growth by identifying undervalued stocks and those with
growth opportunities from a select list of well researched stocks.

Strategy

Identifying growth from a select list through extensive research minimum investment

Rs.10 lakes for resident Indians and Rs.25 lakes for non – resident Indians

Reports

Portfolio and NAV are communicated bi-weekly via e-mail

Risk factors as the stocks are normally held for medium to long term, the net asset value will be
affected by market volatility.

PMS fee

Option 1: 3% p.a.

Option 2: 1% p.a.

Performance fee

20% on gain in NAV over the above 12% p.a. based on the high watermark concept charged at
the end of the year or on withdrawal

8. Research

48
Sophisticated tools are used for technical analysis and research to offer recommendations,
technical analysis and research reports. The research team provides the following information

Daily Market View Technical Analysis

Market, a daily report on markets gives a clear picture on the expected market movements (NSE
and BSE). It also covers the key support and resistance levels .it also provides clues on market
direction and expected profit booking levels.

Daily Stock View

Technical analysis stocks, a daily report on the stock for the day. These are prepared “ Departure
Oscillators “ tool that have a high degree of accuracy on stock readings; which in turn helps
investors , day traders , high net worth individuals with stock ideas that may benefit them

F & Q Analysis

F & Q Analysis is a daily report that gives near 100% accurate reading on both Futures and
Options. It is helpful for day traders, long term holders and HNI clients

SMS

SMS alerts are sent to those who have registered for the service. These are prepared with utmost
care, ensuring that it is suitable for both the Bulls AND the Bears I It provides instantaneous

Buy/sell/hold recommendations purely on technical’s .It also provides option strategies with the
use of Implied/Historical volatility study. SMS is especially hand for Index Traders

Geo Data

Geo Data is a monthly research report covering most financial instruments .It is quite
comprehensive, and provides in depth information on stocks to watch out for, recommended
Mutual Funds, performance of schemes, Futures and Options update and a review of the
commodities markets.

49
Six Sigma in Financial Institutions

Managing Quality has been the primary agenda in every organization. Quantifying quality
becomes comparatively easier for manufacturing houses where products are tangible. In contrast,
when the question of quality arises in organizations that are providing service, it becomes all the
more difficult to represent the same in numbers. This particular aspect has given rise to various
measurable metrics that strive to provide a quantifiable measure that has been universally
accepted as a standard benchmark of quality management.

EVOLUTION

The term Sigma was [in the early 1980s coined by Motorola Corporation stood as a synonym for
quality program Later, in the mid 1990s, it was adopted by General Electric [GE] and Allied
Signal. Initially, the concept hovered around manufacturing improvements. The reason being, the
knowledge of statistical tools in manufacturing functions and the ease with which one was able

50
to quantify the benefits. In simple terms, it signifies that for any manufacturing company, out of
one million opportunities, only 3.4defects are to be found. This is actually the theoretically
permissible limit of attainable quality. It is to be noted here that the philosophy behind the
concept finds an added priority as compared to the statistical significance. Six Sigma primarily
means the improvement or the design of any business process that exactly meets the customer’s
requirements that are almost completely customized to the needs of the customers and at a
minimal cost structure. Indian companies such as Wipro, Godrej-GE have also adopted the Six
Sigma strategy to improve businesses.

THE PHILOSOPHY

As stated earlier, Six Sigma is a highly disciplined approach that is used for reducing the process
variations to the extent that the levels of defects are reduced to less than 3.4per million processes,

products or service opportunities [DPMO].Sigma is a Greek letter that describes the variability of
any process. In terms of statistical quality control, signifies “standard deviation”. Let us take an
example: Consider an assembly with 30parts and five steps. This implies that there are
150(30*50)opportunities for a defect to occur, if one is able to track 100defects in every
100assemblies.This further signifies one defect per assembly or a million defects in one million
assemblies. This can now be converted in to 1,000,000*(1/150) i.e., 6,666DPMO. This
corresponds to a sigma level of 3.97.

Key elements of Six Sigma

Some of the elements that need to be considered before starting a Six Sigma initiative are as
follows:

Opportunity: An opportunity is considered as an area within the product, process, services or

other system where there is a possibility of a defect or where one fails to achieve the ideal
product in the eyes of the customer. An opportunity can be described as anything that one can
inspect, Measure or test on a unit that provides a chance of allowing a defect.

51
Unit: A unit is defined as any item that is produced or processed that is liable for the purpose of
evaluation as against already set criteria or standards.

Defect per unit: This is defined as the average number of defects that is observed while
sampling any particular population. In other words, it is defined simply as the ratio of the number
of defects over the numbers of units tested

CTQ: This stands for Critical to Quality and is considered as the key measurable characteristic
of a product or process that has to meet the performance standards or specification limits so as
satisfy the customers. CTQ S basically represents the product or service characteristics that are
defined by the customers.

DPMO: Defects Per Million Opportunities are the average number of defects per unit that is
observed during an average production run divided by the number of opportunities to make a
defect on the product under the stated circumstances.

Yield: Yield is defined as the percentage of process that is free of defects. It can also be defined
as the percentage of the commitments that are met and calculated over the total number of
opportunities for which the defect could generally appear.

 BEYOND THE REALM OF THE MANFACTURING

Traditional thoughts on Six Sigma primarily focused on the manufacturing process. Of late, the
concept has moved on to be associated with other fields as well, Today ,Six Sigma is used by
everyone from health service providers to the accountants making the process of receivables and
payables more efficient. This has clearly signified that Six Sigma is no longer confined to the
manufacturing houses. Companies are now applying the same in various allied activities, which
was once a distant dream. But it is to be remembered that every client is different. Some of the

52
client (customers) may reciprocate saying that standardizing products may lead to inferior
services. It is true to a great extent. Six Sigma cannot be applied for every service process then
one may need to adjust the same to suit even those processes for which it does not work.

THE CASE FOR FINANCIAL INSTITUTION

One of the grueling challenges that a financial institution faces is that of optimizing its staff
levels. In the process of doing so, they strive to improve their individual branch-customer
satisfactions with simultaneous reduction in the overall cost. Customers, today, demand timely
and accurate service and they don’t hesitate to switch to the company’s immediate competitor if
dissatisfied with the service s rendered by the company .Thus, it becomes very important for
service providers to focus on quality performance every time they interact with their clients. In
this regard, financial institutions find the applications of Six Sigma as an opportunity to take
corrective actions based on empirical evidences rather than on gut feeling. The recent trends in
financial institutions provide an indication of the increasing number of areas Six Sigma is being
adopted in by various companies across the globe. The adoptions are more focused in a couple of
areas namely service processes and automation. It goes beyond saying that service processes play
a crucial role in every financial institution. This can be in the form of loan processing in banking
institutions, accounts payable in accounting departments, and orientation of employees in the
human resource department o mention a few. Considerable portions of the company resources
are consumed in service process. Thus, when the task of aligning the business processes with the
expectations of the customer comes to the fore front, priority needs to be given to direct the Six
Sigma efforts towards these resources. An example of opening an account in a bank provides a
wonderful example; a customer opens an account for the purpose of transacting in diverse
products of the bank. Customers are highly sensitive towards the time that is involved in the
process. The problem of opening an account compounds when the institutions wants to cross-sell
additional products from its diverse business lines. In the traditional form of business, such an
activity might take several days to complete, cost considerably high also score pretty low in
customer satisfaction index. Six Sigma applications help in streamlining the various operations
involved and, thus, help in securing customer business resulting in quicker flow of transactions.

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Automation is yet another area where Six Sigma has made a considerable dent. Moving the
information’s in an electronic format provides a great opportunity for cost efficiencies and also
the levels of customer satisfaction for financial institutions. At the same time, it needs to be kept
in mind that paperless transactions also carry the increased risk of failures. In the case of a single
process failure, several thousand of customers can be at risk in a highly automated environment.
An example can be of check imaging that can be highly successful with proper application of Six
Sigma resulting in enhanced customer satisfaction and cost reduction.

MAKING SIX SIGMA SUCCESSFUI

Financial institutions along with healthcare and consumer product companies are rapidly moving
towards the application of Six Sigma in their service processes. Several key elements need to be
understood before one can reap the benefits of the entire program. Initially, it is important to
determine the parts of the service process that find the best candidate. It is essential to demarcate
among a highly customized, mass customized and stanandardized service that is provided. In a
highly customized situation, the cost incurred in applying Six Sigma is much application. In case
of standardized services such as credit card operations, the use of Six Sigma can give substantial
profit. Within the company, accounts payable and payroll structure are the areas that are the
primary beneficiaries of Six Sigma application. While Six Sigma in any enterprise, one should
clearly define what is actually meant by service defect and how one intends to measure the same.
Defending a service defect in an environment where there is no product involvement, nothing
tangible to inspect and the process being highly variable, one of the daunting challenges is the
application of Six Sigma in the service delivery system. In 1996, when Citi bank launched its

Six sigma programs for its banking services, it defined a defect as many customers rating that
were below two highest responses on a satisfaction survey. Based on that particular definition,
the bank could identify seven service process defects in its account opening process, its customer
statement process and five other processes Measuring defects requires highly skilled researched
service representatives who can pose the correct question and gather meaningful information
from the customers. Another important aspect that needs to be carefully analyzed pertains to

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probing the basic cause of the defects. Once, the aspect of identifying and measuring the service
defect is done, it is

Important probe further in to the question of why such a defect has occurred. There may not be
just one reason for the error; one may find many reasons for the defect, a company can build
system that can serve the customers in a better way. When an insurance company realizes that its
commission check that were given to its agents were mostly in accurate, it can probe in to
finding the primary causes for the same. Once the streamlining of the chief causes is carried out,
it becomes easier for the insurer to carry out better and smoother operations later on. It needs to
be kept in mind that Six Sigma program calls for a long term commitment.

ADVANTAGES OF SIX SIGMA IN FINANCIAL INSTITUTION

The application of six sigma helps in maintaining integrity of data within the system. This is turn
helps avoid repetitive work. It also aids in the standardization of calculation methods. Another
benefit arising out of six sigma application is the avoidance of recording incorrect benefit that
can affect the operations involved in the process. Results are available for the purpose of auditing
along with invitations being forwarded to other organizations to review the benefit calculation.
Above all, it needs to be remembered that six sigma brings in finance with proactive approach.

PHASES

Define- specific goals to improve the product from the perspective of the customer

Measure- current performance

Analyze- the process as is and identify causes of defects

Improve- current system by implementing possible solutions

Control- variation by setting up system to monitor performance

CRITIQUES OF SIX SIGMA

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Through the philosophy of Six Sigma has gained immense popularly among many companies,
there exists several criticism. One group of people considered that already exist and nothing new
in the way that it is propounded, In the words, the application of Six Sigma is like packaging old
wine in a new bottle. Whereas, another school of thought feels that through the tools applied
remained quiet for some time, Six Sigma takes in to account the qualification of the metrics and
establishes a direct relation to the bottom lines that makes the entire process. The huge sum of
money in implanting Six Sigma in financial institutions deters the small and medium sized
enterprises from seriously adopting the same. It is commonly observed that Six Sigma facilities
in the short and near term improvement of projects.

What’s there for Geojit?

 Increase customer relationship

 Understand customer needs and providing matching solutions
 Reduced processing and approval times
 Highly satisfaction among cross channel customer experience
 Better customer retention
 Improve business results
 Increased compliancy
 More efficient department
 Dramatically improves competency and knowledge among employees
 Develop new innovative ways to increase business and cross- sale services
 Fewer defects, transactional errors
 Reduced costs/cost savings
 Better financials and higher annual savings
 Less work and waste
 Optimized supply chain management

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  Achieve an understanding of operations and what drives them
 Financial companies which have been successful by implementing Six
Sigma Programme:
 Citi Group
 Fidelity Investment
 Nation Wide
 Bank One
 Sovereign Bank
 Cross Country Home Services
 Bank of NY
 Credit Acceptance Corporation.

 Mi Florida Federal Credit Union

 Balboa Capital
 Bank of Montreal
 African Bank Investment Ltd.
 JP Morgan Chase

CONCLUSION

It is to be kept in mind that Six Sigma is a powerful tool that facilities in achieving better and
improved performance not only in manufacturing companies but also in financial institutions.
The approach heavily relies on the advanced statistical tools that help in complementing the
process and product knowledge in order to reduce the variability of operations. It can said to be a
new way of doing business that promises to eliminate the existing defects in an efficient manner
and also prevents further errors from creeping in. Companies use various strategies to deploy Six
Sigma. Each of addressed first before adopting the same. Six Sigma offers any financial

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institutions the ability to save millions of dollars a year through quality improvements that
enhance customer satisfaction, since it’s all about Money, Honey

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 CHAPTER IV

SWOT Analysis

Strength:
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 o 22 years of experience in providing financial services
o The company has got wide range of products for its customers
o They tie up with BNP Paribas has helped the company to serve a large number of people
both from India and outside India
o Company has got a good client relationship
o The company is blessed with committed and talented work force
o Company has got a conducive working environment
o The company follows a strict work hour policy

Weakness:

o Advertisement is very limited.

o Lack of awareness programs

Opportunity:

o Geojit can get a gaining position if they enter in to the banking operations.
o The company can explore international market as they have a tie up with BNP Paribas
o The company can maximize the benefit from wide range of products
o The company should try to target the corporate clients

Threats

o From the new competition

o From the unpredictable market situation

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61
 CHAPTER V

FINDINGS

 The company has more than 22 years of experience in the brokerage business

 The company a follows a strict work hour policy.

 The company is more adapt to changes and using new methodologies and technologies.

 The attrition rate is low because the staff doesn’t want to leave the organization due to the
work culture, brand name. Independence, wages, that the company provides is unique by
it.

 The company is giving more opportunities to young graduates

 The database managed by the company is high class.

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  The company keeps very good client relation.

 The brokerage fee is less compared to other competitive firm.

 The company has fully computerized departments.

 Now the company began to face competition in the local and national markets

 Most of the branches are located in urban areas

SUGGESTIONS

 The advertisement should be increased

 The company should always take up new measures to face the competition to

remain as the market leader

 The company should try to extend the market to other foreign countries also.

 The company would open branches in both rural as well as urban areas

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 CONCLUSION
Gratitude

Here what I want to put forward is that through this organization study I have been able to
acquire an appropriate knowledge regarding the functioning of different departments.

Earlier, I had a rough idea regarding the functional processes involved in the Departments of
Finance, HR and Trading. Here I was able to gain as much as knowledge I can and whole
integration of the organization was unique.

The work or the study which I have done has helped me a lot in understanding the work culture
present in an organization. While interacting with my company guide I have been able to get
some valuable tips, useful for managing the people who are working under you and hoe to get

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the work done from them. He also told me about the importance of each and every employee in
the organization and how a manager understand his employees, their talent and uses them in
achieving the organization objective which will in turn benefit the employee and the
organization.

As a whole it was a nice experience for me to get an opportunity to do an Organizational study at

Geojit. I would like to thank each and every employee of the organization for helping me and
answering to my queries. I would also like to thank the different departmental heads for giving
me advice regarding the managerial work which an MBA Graduate will face while been on work
and how to tackle different situations.Once again I would like to thank each and everyone who
has directly or indirectly helped me in completing this OS

Bibliography
Books

1. Arun Kumar and Meenakshi, (2006), - “marketing management”, second

edition, Vikas publishing house Pvt ltd Newdelhi.

2. Aswathappa K- Human Resource & Personnel Management

Tata McGraw – Hill publishing co. ltd., 1999.

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 3. Pandey.I.M -Financial Management

Vikas publishing house Pvt ltd, 2000.

1. Www. Geojitbnpparibas .Com

2. Www. Nseindia. Com

3. Www. Mutualfundindia. Com

4. Www. Wikipedia

5. Geojit Annual Report

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