Professional Documents
Culture Documents
A Research Study
On
Investment & Wealth Management Business
A Portfolio Analysis
For HSBC Bank
SUBMITTED BY:-
IMRN HASSAN
Cell no. - +8801916266437
ACKNOWLEDGEMENT
On this threshold of my life when I look back to thank a few people who
helped me immensely in completion of my tasks, a few word seem to less.
May be I should thank a many people who have made me what I am today.
I would also like to thank to all the HSBC Jodhpur Staff Members,
Specially for CAT team for their support & co-operation.
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CONTENTS: PAGE NO:
• Introduction
-Organization structure 4
- Company milestones 5
• Financial Services
Personal Financial Services 10
Commercial Banking 12
Corporate Banking 15
Investment Banking
a) Fixed Deposits 17
b) Mutual funds 18
c) SIP 31
d) Insurance 33
• HSBC Tie-Up with TATA-AIG 38
• Research Methodology 43
• SWOT Analysis 45
• Analysis & interpretation 46
• Findings 67
• Limitation 70
• Recommendation 71
• Questionnaire 72
• Bibliography 75
• Abbreviation 77
• Conclusion 78
PREFACE
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Practical part is an essential part of management studies as it helps
one to visualize the management practices in the field and the
theoretical aspects of which we have learnt in the classroom.
INTRODUCTION
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HSBC
Company History:
The HSBC Group is named after its founding member, The Hongkong and
Shanghai Banking Corporation Limited, which
was established in 1865 to finance the growing
trade between Europe, India and China.
Soon after its formation the bank opened agencies and branches around the
world. Although that network reached as far as Europe and North America,
the emphasis was on building up representation in China and the rest of the
Asia-Pacific region. HSBC was a pioneer of modern banking practices in a
number of countries. In Japan, where a branch was established in 1866, the
bank acted as adviser to the government on banking and currency. In 1888, it
was the first bank to be established in Thailand, where it printed the
country’s first banknotes.
From the outset trade finance was a strong feature of the local and
international business of the bank, an expertise that has been recognized
throughout its history. Bullion, exchange, merchant banking and note issuing
also played an important part. By the 1880s, the bank was acting as banker
to the Hong Kong government and also participated in the management of
British government accounts in China, Japan, Penang and Singapore. In
1874 the bank handled China’s first public loan and thereafter issued most of
China’s public loans.
What is HSBC?
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We are the world’s local bank.
Headquarters in London, HSBC is one of the largest banking & financial
services organization in the world.
HSBC’s international network comprises over 9500 offices in 76 countries
& territories in Europe, the Asia-Pacific region, the Americas, the Middle
East & Africa.
With listings on the London, Hongkong, New York, Paris & Bermuda stock
exchange shares in HSBC holdings places are held by nearly 200,000
shareholders in some 100 countries & territories. The shares are traded on
the New York stock exchange in the form of American Depository Receipts.
Through an international network linked by advertisement techniques,
including a rapidly growing e-commerce capability, HSBC provides a
comprehensive range of financial services like-
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Offices in india Number Of employees
as at 31st july 2008
HBAP : 57 8,532
HSCI : 2 109
PEIN : 1 13
HDPI : 8 16,650
HPSI : 1 54
HSDI : 4 5,882
ININ : 5 20
HOPE : 13 3,274
AMIN : 18 168
HFHI : 01 01
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Zone Branch Location No. of Branches
East Kolkata 7
Bihar 1
Chhattisgarh 1
West Mumbai 9
Ahmedabad 1
Pune 2
Thane 1
Vadodara 1
Indore 1
Nagpur 1
South Chennai 2
Kochi 1
Co’atore 1
Banglore 2
Hyderabad 1
Trivandrum 1
Visakhapatnam 1
Mysore 1
TOTAL 47
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India, China & London, which the group acquired in 1959, was established
in 1853, with a branch in Bombay.
The Bank has relocated some branches in Mumbai, New Delhi, Chennai,
Banglore, Kolkata & Visakhapatnam from what were once important trade
centres to more appropriate present day locations that hold our target
customer base.
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Indian customers across India, USA, UK, Middle East & South East Asia.
HSBC’s 150 year presence in India allows it to enjoy the advantage of deep
rooted knowledge of local markets & customs. This has lead to development
of products & services, which are attuned to the financial needs of Indians in
the cities where HSBC operatives. The HSBC brand is associated with core
values such as transparency, trust & honesty. These factors enable HSBC
India to remain highly competitive & at the leading edge of the retail &
commercial banking market in the country.
The distribution network in India consists of 47 branches in 26 cities
supported by 170 ATMs at 142 locations. In addition, self service banking
channels, such as Internet Banking & a 24 hour centralized all India Call
Centre provide a strong backbone to the distribution capabilities. A second
load balancing Call Centre became operational in January 2005 at HSBC
Operations & Processing Enterprise (India) Private Limited, Chennai.
Customers can apply for all products & services online at www.hsbc.co.in
The bank offers a complete suite of products & services including HSBC
Premier International, HSBC Premier, Power Vantage, Savings & Current
Accounts, International Debit Cards & Term Deposits in addition to
consumer loan products like International Credit Cards, Mortgage, Personal
Loans, Educational loans & Overdrafts. HSBC is the 6th largest Credit Card
issuer in India with over 1.3 million cards in force.
Premier & mid market customers have access to comprehensive Financial
Planning & HSBC is a market leader in the provision of Wealth
Management services. In 2005,HSBC was the largest distributor of Retail
Mutual Funds in India, & the biggest sales channel for Banc assurance
partner TATA AIG.
Non-Resident Indians (NRI’s) constitute 56% of the Bank’s deposit base.
The banking a needs of NRIs are fulfilled from branches in India & 11 NRI
centres abroad. We have over 84,000 NRI Customers, & have started
referring customers to Financial Planning Managers & the Private Bank in
the host countries, to address their needs for investment products. A free
remittance service is offered between accounts held by NRIs with HSBC
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Estate, Equity Derivatives & Commodities. This is an addition to Fixed
Income & Equities, which are already being offered. The proposition uses
“Active Advisory” as its cornerstone & key differentiator.
The Bank has sought RBI approval to establish a separate consumer finance
branch network under a non banking financial institution, which will
distribute personal loans
& ancillary products to a broader segment of the Indian consumer base than
is currently
served by the Bank’s existing product portfolio. The personal loan product is
being piloted through the bank branch network & initial results are
promising.
COMMERCIAL BANKING
HSBC is a leading provider of financial services to small, medium-sized and
middle-market enterprises. The Group has over 43,000 such customers in
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India, including sole proprietors, clubs and associations, incorporated
businesses and publicly quoted companies. Commercial Banking provides a
full range of banking services to these customers including multi-currency
business accounts, payment and cash management, trade services, factoring
and a range of borrowing solutions.
Factoring
HSBC India offers a comprehensive range of Factoring and Supply Chain
Finance Solutions, which include the following products:
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rates and will enable the company to negotiate better pricing terms with
vendors.
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Distribute Finance Program, HSBC finances company’s dealers, which will
assist the company in providing steady, assured credit to its distribution
chain.
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Corporate Banking (CB) is an integral part of the Global Banking structure,
which focuses on offering a full range of service to multinationals, large
domestic corporate and institutional clients.
Provides a wide range of banking and financial services provided to
domestic and international operations of large local corporate and local
operations of multinationals corporations. Services include access to
commercial banking products, including working capital facilities such as
domestic and international trade operations and funding, channel/distributor
financing, and overdrafts, as well as domestic and international collections
and payments, INR and Foreign currency term loans (external commercial
borrowing in foreign currency), letters of guarantee etc.
Investment Banking and Markets brings together the advisory and financing,
equity
Securities, equity linked transactions, asset management, treasury and
capital markets, and private equity activities of the Groups to complete the
Global Banking structure and provide a complete range of financial products
to our clients.
Clients are serviced by sector based client service teams that combine
relationship managers, product specialists and industry specialists to develop
customized financial solutions. These form the relationship team along with
the Investment Banking structure and provide a complete range of financial
products to our clients.
Clients are serviced by sector based client service teams that combine
relationship managers, product specialists and industry specialists to develop
customized financial solutions. These form the relationship team along with
the Investment Banking & Advisory division. Each team supports the
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HSBC assigns Global Relationship Management teams to provide structured
solutions for all its needs.
The Corporate Bank (CB) in India was top ranked (1st overall) in the 2005
Greenwich Survey with a Greenwich Quality Index (GQI) of 647. Currently
CB manages approx. 470 CB relationships with total advances of approx.
USD 1.08Bn as at end of Dec05 and total deposits of USD .98Bn.
Corporates Institutional
INVESTMENT BANKING
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When it comes to assured returns, choosing the right type of savings
scheme makes all the difference. HSBC Fixed Deposits let you make the
most of value-added benefits as you create wealth at low risk.
Certificate of Deposit
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Earn interest for funds invested from 15 days to one year, with HSBC’s
Certificate of Deposit (CDs).
CDs can be availed by individuals (other than minors), corporations,
banks, companies, trusts, funds, associations etc. Non-Resident Indians
(NRIs) may also subscribe to CDs on a non-repatriable basis only.
Advantage
2. MUTUAL FUNDS
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It is a type of investment where a number of investors money is pooled
together & used by the fund manager(referred to as the Asset
Management Company or AMC) to invest in underline securities inline
with the objectives of the scheme.
By this method you can achieve a much wider spread of investments than
if you were investing directly in the underlying investments. It is
generally accepted that by spreading your investment you are spreading
your risk, therefore investing in mutual funds is considered to be lower
risk than direct investment.
When you invest in mutual funds you do not own the underlying
investments but have a claim to a number of units in the fund
representing the size of your investment. The value of each unit of the
mutual fund scheme, calculated based on the market value of the
underlying investments after deducting expenses and liabilities, is
referred to as the ’Net Asset Value’ or NAV.
The first time a mutual fund scheme is available for purchase is referred
to as a New Fund Offering or NFO.
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4- The investor’s share in the fund is denominated by “units”. The
value of the units changes in the portfolio’s value, every day.
The value of one unit of investment is called as the net asset
value of NAV.
5- The investment portfolio of the mutual fund is created
according to the stated investment objectives of the fund.
There are thousands of different mutual funds offered on the market. They
range from funds that include a broad variety of investments to funds that
invest exclusively in single securities or narrow sectors of the market. With
the many different investment styles and objectives, there’s bound to be a
number of mutual funds that are suited to your investing profile. Each of
these funds has expense, risk, and return characteristics. Be sure you
understand these characteristics before you invest. There are 15 principal
types of funds. We have listed them according to their primary objectives:
growth, income, and specialized.
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Balanced Funds
Balanced funds seek to obtain the highest return consistent with a low-risk
strategy. They hold a mix of common and preferred stocks, bonds and cash
reserves. The mix can vary according to current market conditions. Balanced
funds usually offer higher yields than pure stock funds. Balanced funds are
generally the least risky of growth-oriented mutual funds.
Growth Funds
Growth funds seek long-term appreciation by investing in the stocks of
established companies that may be poised for growth. These companies
typically pay low dividends yet offer the potential for long-term capital
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appreciation. Some growth funds limit their investments to specific sectors
of the economy. Growth funds are generally less risky than aggressive
growth funds.
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Government securities offer moderate current income and high safety.
Treasury securities are backed by the full faith and credit of the U.S.
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Sector Funds
Sector funds invest in specific industries or sectors of the economy, such as
communications, aerospace and defense, or health care. While they may be
diversified within a particular sector, they lack broad diversification. This
increases their investment risk. These funds typically seek long-term capital
appreciation.
Growth-Income Funds
Growth-income funds are specialists in blue chip stocks. These funds invest
in utilities, Dow industrials, and other seasoned stocks. They work to
maximize dividend income while also generating capital gains. These funds
are suitable as a substitute for conservative investment in the stock market.
Income Funds
Income funds focus on dividend income, while also enjoying the capital
gains that usually accompany investment in common and preferred stocks.
These funds are particularly favored by conservative investors.
Bond Funds
Bond funds invest in corporate and government bonds. A common
misunderstanding among investors is that the return on a bond fund is
similar to the returns of the bonds purchased. One might expect that a fund
that owns primarily 8 percent-yielding bonds would return 8 percent to
investors. In fact, the yield from the fund is based primarily on the trading of
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bonds, which are extraordinarily sensitive to interest rates. Thus, one could
find a bond fund that was earning double-digit returns as the prime rate
climbed from 4 percent to 6 percent.
In addition to mutual funds, there are money market funds, which are
essentially mutual funds that invest solely in government-insured short-term
instruments. These funds nearly always reflect the current interest rates, and
rarely engage in interest-rate speculation.
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Benefits of Mutual Fund
Reduction in risk:
Mutual funds invest in a portfolio of securities. This means that all funds are
not invested in the same Investment Avenue. Holding a portfolio that is
diversified across investment avenues is a wise way to manage risk. When
such a portfolio is liquid and marked to market, it enables investors to
continuously evaluate the portfolio and manage their risks more efficiently.
Portfolio Diversification:
By offering readymade diversified portfolios, mutual fund enables investors
to hold diversified portfolios. Through investors can create their own
diversified portfolios, the costs of creating and monitoring such portfolios
can be high, apart from the fact that investors may lack the professional
expertise to manage such a portfolio.
Liquidity:
Open-ended funds are very liquid as the Mutual Fund companies offer an
open window for redemption on all working days. The redemption proceeds
are normally dispatched within three to four working days.
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Tax efficiencies:
Investing in mutual funds is tax efficient. If investors choose the growth
option and stay invested for a year, they only pay long term Capital Gains of
20.4% of indexed returns or 10.2% of un indexed returns (whichever is
lower).
Diversification:
Diversification is the core of any investment strategy. It allows you to
minimize the risks associated with any investment. However, it is very
difficult for individuals to have the requisite diversification for your
investment given smaller portfolios and transaction costs. Mutual Funds can
pool in the investments of thousands of investors and achieve the desired
level of diversification for each.
FAQ’s
Do all mutual funds carry the same investment risks?
No, they do not. Some mutual funds have been designed for investors who
are cautious, while others for investors who are aggressive in their outlook to
risk. There are also funds designed for investors having a balanced outlook
on risk. You therefore need to decide what level of investment risk you are
happy to accept and then choose a mutual fund scheme, which matches your
appetite for risk.
This will depend upon the level of risk you are prepared to take, your
investment horizon, what your investment objectives are and whether you
have a particular preference in the type of securities you would like to invest
in. However before you invest you need to ensure you fully understand the
features and risks relating to the mutual fund scheme you ultimately decide
to invest in.
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What charges are involved?
Initial charges – these expenses are incurred by the fund house for the
scheme(s) before/during its launch towards marketing, publicity, advertising,
registrar’s expenses, broker’s /agents’ commission etc. Subject to an overall
limit (as a percentage of the corpus mobilized), these are subsequently
amortized to the scheme over a few years.
• Entry load
This is a charge that is levied on investors at the time of investment into a
scheme. Entry loads are typically restricted to equity funds and balanced
funds and have the impact of reducing the net amount that is available for
investment by the scheme.
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Charge (CDSC) where the exit load is charged on graded basis and declines
with increasing time period.
The effect of the initial charge is to immediately reduce the amount available
to purchase units. This means immediately after you invest the value of your
investment will be below the amount you invested. This is one reason why
you should be happy to leave your capital invested for the medium to long
term to allow possible future growth to overcome the effect of the initial
charge.
The ARE will have the effect of reducing the overall returns you receive
either in the income you receive or the capital growth you experience. This
ARE is deducted from the overall value of the fund irrespective of whether
the fund has made a profit or not therefore deduction of the ARE can also
increase the loss the fund may have made.
The effect of Entry Load would be to reduce the net amount available for
investment by the fund.
The effect of an Exit Load will be to reduce the actual amount you receive
on encashment, which means you will receive less than market value of the
underlying investment. Such a charge acts as a deterrent to early
encashment.
You are committing to invest at least the minimum amount, which varies
from fund to fund. In case of funds designed for a medium or long term
horizon, you should also be prepared to commit your investment for the
appropriate time horizon and not use capital that you might need in the short
term, especially. With regard to close-ended funds, you should be prepared
to commit funds for the complete tenor of the specific scheme.
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Any investment in mutual funds means that you are happy to take a degree
of investment risk in return of the potential for superior returns than can be
obtained from fixed deposits, in the full knowledge that this outcome is not
guaranteed and that it is possible you could make a loss on your investment.
You should also consider carefully how much you want to commit to any;
one type of investment, as over exposure to any particular investment is not
recommended.
Yes you can. You will however incur any exit loads / CDSC as may be
applicable and if the price of the units has moved against you, then you will
experience a capital loss. In case of close-ended funds, premature exit costs
can be especially steep.
You should refer to the specific fund documentation for a full appreciation
of the tax consequences of both the fund itself and any effect this will have
on you personally. HSBC does not give tax advice and we recommend you
consult your usual tax adviser for fuller details as to how you will be
personally affected. The tax benefits and implications mentioned in any
marketing material provided by the fund house are as per currently
applicable tax laws and are subject to change in future.
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3. SYSTEMATIC INVESTMENT PLAN (SIP)
What is SIP?
It is just like a recurring deposit with the post office or bank where you put
in every month. The difference here is that the amount is invested in a
mutual fund.
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How an SIP works?
An SIP allows you to take part in the stock market without trying to second
guess movements.
An SIP means you to commit yourself to investing a fixed amount every
month. Let Rs.1000
When the NAV is high, you will get fewer units. When it drops, you will get
more
Date NAV Approx number of units you
will get at Rs.1000
Jan 1 10 100
Feb 1 10.5 95.23
Mar 1 11 90.90
Apr 1 9.5 105.26
May 1 9 111.11
Jun 1 11.5 86.95
Within six months, you would have 5,894 units by investing just Rs.1000
every month.
Also, a number of mutual funds do not charge an entry load if you opt for an
SIP a percentage of the amount you are investing. & if you do not exit (sell
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your units a year of buying the units, you do not have to pay an exit load)
(same as an entry load, except this is charged when you sell your units).
If, however, you do sell your units within a year, you would be charged an
exit low pays to stay invested for the long-run.
The best way to enter a mutual fund is via an SIP. But to get the benefit of
an SIP at least a three-year time frame is needed when you won’t touch your
money.
4. INSURANCE
Insurance, in law and economies, is a form of risk management primarily
used to hedge against the risk of a contingent loss. Insurance is defined as
the equitable transfer of the risk of a potential loss, from one entity to
another, in exchange for a premium. Insurer, in economics, is the company
that sells the insurance. Insurance rate is a factor used to determine the
amount, called the Premium, to be charged for a certain amount of
insurance coverage. Risk management, the practice of appraising and
controlling risk, has evolved as a discrete field of study and practice.
a. Definite Loss. The event that gives rise to the loss that is
subject to insurance should, at least in principle, take placed at a
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known time, in a known place, and from a known cause. The
classic example is death of an insured on a life insurance
policy. Fire, automobile accidents, and worker injuries may all
easily meet this criterion. Other types of losses may only be
definite in theory, Occupational disease, for instance, may
involve prolonged exposure to injurious conditions where no
specific time, place or cause is identifiable , Ideally, the time,
place and cause of a loss should be clear enough that a
reasonable person, with sufficient information,could objectively
verify all three elements.
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policy to make a reasonably definite and objective of the amount
of the loss recoverable as a result of the claim.
6. Limited risk of catastrophically large losses. The Essential risk
is often aggregation. If the same event can cause losses to
numerous policyholders of the same insurer, the ability of that
insurer to issuer policies becomes constrained, not by factors
surrounding the individual characteristics of a given policyholder,
but by the factors surrounding the sum of all policyholders so
exposed. Typically, insurers prefer to limit their exposure to a loss
from a single event to some small portion of their capital base, on the order
of 5%. Where the loss can be aggregated, or an individual policy could
produce exceptionally large claims, the capital constraint will restrict an
insurer’s appetite for additional policyholders. The classic example is
earthquake insurance, where the ability of an underwriter to issue a policy
depends on the number and size of the policies that it has already
underwritten. Wind insurance in hurricane zones, particularly along coast
lines, is another example of this phenomenon. In extreme cases, the
aggregation can affect the entire industry, since the combined capital of
insurers and reinsures can be small compared to the needs of potential
policyholders in areas exposed to aggregation risk. In commercial fire
insurance it is possible to find single properties whose total exposed value is
well in excess of any insurers, or are insured by a single insurer who
syndicates the risk into the reinsurance market.
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The most difficult aspect of the insurance business is the underwriting
of policies. Using a wide assortment of data, insurers predict the
likelihood that a claim will be made against their policies and price
products accordingly. To this end, insurers use actuarial science to
quantify the risks they are willing to assume and the premium they
will charge to assume them. Data is analyzed to fairly accurately
project the rate of future claims based on a based on a given risk.
Actuarial science uses statistics principles aura used to determine an
insurer’s overall exposure. Upon termination of a given policy, the
amount of premium collected and the investment gains thereon minus
the amount paid out in claims is the insurer’s underwriting profit on
that policy. Of course, from the insurer’s perspective, some policies
are winners (i.e., the insurers pays out more in claims and expenses
than it receives in premiums and investment income)
Types of insurance
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both legal liability claims against the driver and loss of or
damage to the insured’s vehicle itself. Throughout most of the
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Crime insurance insures the policyholder against losses from
the criminal acts of third parties. For example, a company can
obtain crime insurance to cover losses arising from theft or
embezzlement.
Tata AIG Life Insurance Company limited(Tata AIG life) is a joint venture
company, formed by the Tata Group and American International Group, Inc.
(AIG). Tata AIG life combines the Tata Group’s pre-eminent leadership
position in India and AIG’s global presence as the world’s leading
international insurance and financial services organization. The Tata Group
holds 74 percent stake in the insurance venture with AIG holding the
balance 26 percent. Tata AIG life provides insurance solutions to individuals
and corporates. Tata AIG life insurance company was licensed to operate in
India on February 12,2001 and started operations on
April 1,2001
Unit linked insurance products are different from the traditional insurance
products and are subject to the risk factors of fluctuations in investment
returns and possibility of increase in changes.
The performance of the managed portfolios and funds is not guaranteed and
the fund value may increase or decrease in accordance with the future
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experience of the managed portfolios and managed funds. The fund value
during the period of continuance of policy and at maturity may be more or
less than the premiums invested depending on market performance. Past
returns are not necessarily a guide to future performance.
The premium paid in unit linked life insurance policies are subject to
investment risks associated with capital markets and the NAVs of the units
may go up or down based on the performance of the funds and factors
influencing the capital market and the insured is responsible for his/her
decisions.
Tata AIG Life Insurance Company Limited is only the name of the
insurance company. Invest Assure II is only the name of the Unit Linked
Life Insurance Contract and does not in any way indicate the quality of the
contract, future prospects or returns.
The various funds offered under this contract are the names of the funds and
do not any ways indicate the quality of the contract, future prospects and
returns.
B. Invest Assure II
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What's more, you can direct the investments by creating your own
investment fund portfolio from a range of options to suit your needs and
preferences.
Key Benefits
Choose your premium payment term; five years or for the entire
duration of the policy
Entry age: 30 days to 70years
Benefit period: for the entire life till 100 years of age
Facility to increase the premium through Top-Up Premium
Provides security to your family in case of your unfortunate death
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Facility to increase the Sum Assured through Top-Up Premium
Gives you the flexibility to choose your fund based on your risk
profile – whole Life Mid Cap Equity, whole Life income, and whole
life Short Term Fixed Income. You may choose to switch between the
Funds, anytime
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D. MahaLife: The Whole Life Plan
Tata AIG Life’s MahaLife plan is truly one of a kind. For a start, it
offers you way too many benefits:
Only a 12 year premium paying period for lifetime coverage.
th
Guaranteed annual payment for life from the 12 policy anniversary
paid. Tax-free.
th
Cash dividends from the 6 policy anniversary onwards. Tax-free.
Premiums paid eligible for tax exemption benefit. As per current tax
laws.
The minimum age of eligibility for this policy is 30 days, which means, if
you buy this policy for your child you only have to pay premiums for 12
years, after which the child gets an income as well as coverage for his
entire life. The maximum age if eligibility is 50 years, which makes it
ideal for you as well, because it provides both a pension and lifetime
coverage.
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RESEARCH METHODOLOGY
The study undertaken by me was regarding a detailed analysis of
MARKETING AND PROMOTION of HSBC products, studying its current
scenario and studying the challenges and difficulties faced by HSBC bank.
Research Objective
The main objective of my study is to find the main strategies, policies used
& various sales promotional activities of HSBC bank in & Jodhpur sector.
The data source being used under such type of study are mainly of 2 types:
1. Primary Data
2. Secondary Data
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Among which the former is being taken through the research undergone
within the organizational level itself & various other organizing reforms
only. While the latter had been taken through different statistical
approaches or we can say through different marketing reforms.
SAMPLE PLAN:
Data Source:
Primary Data:
The primary data are which are collected afresh and for the first time, and
thus happen to be original in character. A primary survey was conducted at
JODHPUR city. The survey was carried out at various levels & the target
group was retail investors, business men, builders, industrialists, exporters,
doctors etc. Questionnaires were used as an instrument to collect the primary
data.
Secondary sources:
The Secondary data are those, which have already been collected and
being processed through the statistical process.
We got the secondary data through
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PREVIOUS TRANSACTION RECORDS-
Marketing Approach:
Population Definition
Telephonic Calls:-
We approach them through telephones and take appointments & then
directly contact them for investment.
Canopies:-
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We put canopies in front of Banks, Financial Institutions & other public
gathering places. There we approach people and take their telephone
numbers. & contact them or even in canopies itself make them invest.
Through Brokers:-
Major part of our promotion & marketing is done through brokers, because
they are more reliable for knowledgeable. Thus people trust them.
SWOT ANALYSIS
STRENGTHS:-
1. Brand Name:
The biggest strength is the tag of HSBC is going to be the largest
group of MNC’s.
2. Compatible Price:
Prices of different schemes of HSBC are much more compatible than
others.
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3. Diversified Schemes:
We have diversified schemes, which is an exception case of HSBC.
4. Less Risk:
Our debt schemes are 100% free form market risk. Even as our
portfolio is that diversified so equities are also less risky than others.
WEAKNESS:-
1 Prone to Market Risk:
Mutual Funds depend on overall macro economic condition and
market scenario.
2 Tough Competitions:
There is a very tough competition because of large number of Asset
Management Companies.
3 Incapability of Customers:
HSBC only provides 2 types of account opening of which one is PVA
(Power Vantage Account) under which an aqb of 1 lakh is to be
maintained & the second one is Premier Account , under which an
aqb of 25 lakh is to be maintained. This is sometimes beyond the
reach of a middle class person.
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OPPORTUNITIES:-
1 Hoarding:
Most of the Indians have black money that too in huge amount i.e.
the do not have money in banks, so approaching them is beneficial,
so that through the opening of this account they can make further
investment.
4 Branch Expansion:
Large no. of branches are opening day by day and even we are traping the
countries having almost same type of socio-economic condition & even same
culture etc.
THREATS:-
1 Tough Competition:
As there are so many banks having almost same kind of schemes, so
it’s tough to compete with.
2 Unawareness:
Majority of population is not aware of HSBC brand name and even
because of other banking facilities which are much cheaper than
HSBC’s services, so it’s hard to convince people.
48
3 Changing Scenario:
Our market scenario is changing day-by-day i.e. our market is
fluctuating, so this makes investor hard to invest.
49
Equity 75
Debt 60
Cash 15
50
Debt 90
Equity 45
Cash 15
51
Debt 70
Cash 10
Equity 20
52
Debt 120
Cash 15
Equity 15
In the above table 15 investors invest in Equity, 120 in Debt, &120 in Cash.
53
60K-1LAKH 62
1LAKH-2LAKH 48
2LAKH-3LAKH 24
3LAKH-ABOVE 16
In the above table 62 investors are those who fell in the income slab from 60
thousand to 1 lakh, 48 investors fell in the income slab form 1 lakh-2lakh, 24
Investor’s fell in the income slab from 2 lakh-3lakh, 16 investor’s fell in the
income slab of above 3 lakhs.
54
Aggressive Investors 18
Moderate Investors 60
Conservative Investors 47
Very Conservative
Investors 25
25%
29%
46%
55
56
1-5 Years 24
5-10 Years 55
10 Years & Above 71
57
Steadily 20
At average 92
Fast 38
58
Safety of Principal 22
Earning return above inflation rate 96
Earning High returns 32
59
Nil 12
Average 104
Good 34
In the above table 12 investors were found with no knowledge about various
investment schemes, 104 investors were found with average knowledge
about various investment schemes, 34 investors were found with good
knowledge about various investment schemes.
In the above graph out of total surveyed investors 8% were found with nil
investment knowledge, 69% were found with average investment
knowledge, 23% were found with good investment knowledge.
60
Above 50 76
Between 30-50 48
Between 20-30 26
In this above table out of the total surveyed
investors 76 investors are above 50 years, 48 are between 30-50 years & 26
investors are between 20-30 years.
In the above graph 51% were above 50 years 17% were between 20-30, &
32% were between 30-50.
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Secured 98
Not Secured 28
Doesn't affect 24
In the above table out of the total surveyed investors 98 investors were found
with job security, 28 investors were found with unsecured jobs & 24
investors were found in a no affect status.
In the above graph 65% of the investors were in a state of secured jobs, 19%
of the investors were in the state of unsecured jobs & 16% of the investors
were in the state where this factor doesn’t affect them.
62
More than 2 98
1-2 dependents 32
None 20
In the above table out of the total surveyed investors 98 investors were those
who are having more than 2 dependents, 32 investors were those who are
having 1-2 dependents, 20 investors were those who didn’t had any
dependent.
In the above graph 66% investors were those who are having more than 2
dependents, 21% investors were those who are having 1-2 dependents &
13% investors are those who having no dependents.
63
Educated View 22
Friendly
Advice 73
Guess Work 55
In the above table out of the total surveyed investors 22 investors took
educated view before investment, 73 took friendly advice before investment
& 55 made guess work.
In the above graph 48% took friendly advice, 15% took educated view &
37% made guess work.
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Withdraw 28
Wait 79
Invest 43
65
M
A
R
K STAR QUESTION MARK
E
T (F.D.) (M.F.)
G
R CASH COW DOG
O
W (SIP) (INSURANCE)
T
H
MARKET SHARE
STAR CATEGORY PRODUCT: These are the products that are not
only market leaders but are also growing fast. By this study it can be
analysed that FD is a product of STAR CATEGORY. If we analyse the
current status of investments, then all respondents have their investments &
if they are provided with Rs.10,00,000 then too they will invest a part of it in
FD. Hence presently FD has a large Market Share & in future also its market
share will increase but not decrease.
CASH COW PRODUCT: Such products are weak in both the factors
i.e., low growth & low market share. The investment avenues coming in this
category are SIP’s.
Professional have invested in SIP, but this is restricted to their future & SIP
is best option for the businessmen. Rather people would like to invest money
in post office.
66
sector. But if we point our consideration towards professionals, as it is in
this study, then Insurance comes under Cash Cow. Its market share is large,
but at the same time these people are less interested in it as a future
investment avenue.
FINDINGS
67
The basic thrust of the research is to find out types of investors & their
portfolio & their profile.
A. In the survey 18 investors were found aggressive out of the total of 150
surveyed investors. The asset allocations of aggressive Investors are as
follows;
They invest 50% in equity instruments, 40% in debt instruments & 10% in
cash instruments.
68
E. In the survey the data was obtained regarding the investment capacity of
the investors also in order to get the purchasing power and financial
efficiency of the investors.
25% of the total surveyed investors invested up to 5% of their monthly
income.
46% of the total surveyed investors invested up to 5% to 10% of their
monthly income.
29% of the total surveyed investors invested more than 10 to their monthly
income.
F. The investment made for the last number of years is also taken into
consideration to take into account their investment periods.
16% of the total surveyed investors were investing since last 1-5 years.
37% of the total surveyed investors were investing since last 5-10 years.
43% of the total surveyed investors were investing since last 10 years and
above.
H. The most important part of this survey was to know about the perception
of the investors with respect to returns. The following results were obtained.
15% of the total surveyed investors had a perception that safety of principal
is their primary area of concern.
64% of the total surveyed investors had a perception that earning returns
above inflation rate is their primary area of concern.
21% of the total surveyed investors had a perception that earning high
returns is their primary area of concern
69
I. As far as investor’s knowledge part regarding various investment schemes
is concerned it was found that
69% of the total surveyed investors had average knowledge about various
investment schemes.
8% of the total surveyed investors had no knowledge about various
investment schemes
23% of the total surveyed investors had good knowledge about various
investment schemes.
J. Age group was also a rational issue to know while carrying out the
research.
It was found that 17% of the total surveyed investors were between 20 to 30
years.
It was found that 32% of the total surveyed investors were between 30 to 50
years.
It was found that 51% of the total surveyed investors were above 50 years.
LIMITATIONS
70
UNCERTAINITY OF MARKET:-
HSBC’s securities investments are subject to market risks and there is no
assurance or guarantee that the objectives of the Scheme will be achieved.
As with any investment in securities, the NAV of the units issued under the
Scheme can go up or down depending on the factors and forces affecting the
capital markets.
HIGH COMPETITION:-
Due to the existence of large number of AMC’s & banks the competition is
high. Investors are confused that where they have to invest and where not.
Other banks also offers the same type of product/schemes which diversified
the investors.
71
SOCIO- ECONOMIC FACTOR:-
The standard of living is low and people have low saving so investment in
HSBC’s schemes is low & beyond their capability. The most of the people
of this country are agriculture dependent.so, they have less to invest.
POLITICAL FACTOR:-
Due to volatile govt & their policies regarding investor & investment, the
stock market is not integrated which in turn affects the mutual fund industry.
RECOMMENDATIONS
2. HSBC must lay down some sound strategies to trap more customers
by giving them more commission in comparison to other investment
centers.
QUESTIONNAIRE
72
1. NAME:
2. ADDRESS:
4. AGE:
20-30
30-50
Above 50
5. PROFESSION:
6. INCOME LEVEL:
7. FAMILY STATUS:
Dependents Non-Dependents
73
Yes No
Yes No
1. Equity:
2. Debt:
3. Cash:
11.Please tick, I Am
74
a. 1-5 years
b. 5-10 years
c. Above 10 years
14.Are you:
Long-term investor
Short-term investor
a. Safety principle
b. Earning high returns
c. Earning return above inflation rate
a. Up to 5%
b. 5%-10%
c. Above 10%
BIBLIOGRAPHY
75
BOOKS:
.
1. Kotler Philip: Marketing in New Millennium, Millennium Edition
Prentince Hall of India, New Delhi.
2. C.R Kothari: Research Methodology; Wishva Publication, New
Delhi.
3. M.J Methew : Risk & Insurance Management
MAGAZINES:-
1 Business world.
2 Invest one
3 Business Today
4 Invest time by TATA-AIG
5 Fund Fact Sheets of Reliance Mutual Fund.
6 Offer Documents of Different Schemes.
NEWSPAPERS:-
1. Financial Time.
2. Economic Times.
WEBSTIES:
www.reliancemutualfund.com
www.hsbc.co.in
www.google.com
www.yahoo.com
www.indiainfiline.com
www.bse.com
ABBREVIATION
76
SIP: Systematic investment plan
77
CONCLUSION
From the analysis of the responses received from the investors in JODHPUR
City, a majority of investors are found to be conscious and enlightened
regarding their investments, return & growth.
So my findings are that HSBC market should make little more efforts to trap
the potential investors, like Media Advertisement, Paper Advertisement,
Seminars & Business Meets & building a good relationship with
potential business, moreover friendly guidance.
RAJAT CHOUDHARY
SS-2008-10
I.I.P.M NEW DELHI
78