NIT GRADUATE SCHOOL OF MANAGEMENT

SURVEY NO . 13/2, MAHURZARI, KATOL ROAD, NAGPUR-441501

SYNOPSIS

ON

“COMPREHENSIVE
STUDY OF LOAN AGAINST SHARES (LAS).”

Submitted to
Rashtrasant Tukadoji Maharaj Nagpur University, Nagpur
for the award of degree of Master of Business Administration
For Academic Session
(2010 – 2011)

Submitted By:-
Manoj V. Dudhpachare

Under the Guidance of

Dr. Y Mohit Kumar
 NIT Graduate School of Management

INTRODUCTION

It is for investor in stock and mutual funds. If you want to raise money real fast and, that
too, at a cost lower than personal loan, investor can pledge yours shares to various private
or public sector banks and immediately receive a loan/overdraft facility to tide over your
cash crisis. By giving a simple lien on your shares to the bank, you can continue to let your
shares and mutual fund unit compound your investment. You don’t have to sell your shares
or redeem funds and book a profit (or a loss), especially if you are a long-term shares or
unit holder.
Among the ways in which banks offer you quick credit is through an overdraft
facility on your bank account, or a plain vanilla loan on your investment in shares and
mutual fund. It is usually the private sector banks that give you an overdraft facility.
While those in the public sector offer you a plain vanilla loan and, in some cases, even an
overdraft facility.
If borrowing is the last resort to fund your need, then overdraft against shares is
preferable to personal loan as it is cheaper by around 100 to 200 basis point in return in
terms of interest cost. An overdraft against shares makes you pay interest only for the
amount you utilize which could be for lower than your drawing power. But in a loan
against shares, you might not be optimally using all the money, but would still end up
bearing an interest cost the entire sum borrowed.
A loan against shares could be viable option if you want to raise some money quickly.

“COMPREHENSIVE STUDY OF LOAN AGAINST SHARES.” 2

By – Manoj V. Dudhpachare
 NIT Graduate School of Management

COMPANY PROFILE

I will select the banks which provide Loan against Shares.

OBJECTIVES OF THE STUDY:-

 To understand the procedure & process of LAS.

 Costing involved in LAS.
 To study the client segmentation & Profile of LAS.

RESEARCH METHODOLOGY

Source of data
 Primary data : Primary data will be collected from various Banks.

 Secondary data : Secondary data will be collected from the Bank’s websites and
internet.

“COMPREHENSIVE STUDY OF LOAN AGAINST SHARES.” 3

By – Manoj V. Dudhpachare
 NIT Graduate School of Management

BIBLIOGRAPHY

Websites:-

http://en.wikipedia.org/wiki/Dividend
www.economic times.com
www.ask.com
http://www.moneycontrol.com

Books:
 Prasanna Chandra, Investment Analysis & Portfolio Management (2008),
Third Edition, Tata McGraw- Hill Publishing Company limited.

 Dr. K. Natarajan & E. Gordon, Financial Market and Services (2009), 5th
Edition, Himalaya Publishing House.

 I.M. Pandey, Financial Management (2008), 9th Edition Vikas Publication

House Pvt.Ltd

 Ravi Kishor Financial Management (2008)

6th Edition, Taxman’s Publication

Journal & other reference:

 Outlook Money
 Trade business
 Economic times
 Business Standard

 Business India

“COMPREHENSIVE STUDY OF LOAN AGAINST SHARES.” 4

By – Manoj V. Dudhpachare
 NIT Graduate School of Management

“COMPREHENSIVE STUDY OF LOAN AGAINST SHARES.” 5

By – Manoj V. Dudhpachare