Description
It explains SWOT analysis of India Infoline, Company Description, General Information about the company, it's Finance performance, SWOT analysis and Various Strategies employed by India Infoline.
Company Analysis
Introduction
India?s financial sector is expected to witness a strong growth in the next few years mainly due to increased incomes, liberalization of the financial sector and corporate restructuring. This in turn will lead to increased demand for financial products and services especially for equities, commodities and currencies, credit and finance and wealth management. Let us look at the industrial overview of each of them briefly: Equities: With the rapid growth in options, volumes, the share of the F&O segment in overall market volumes increased to 90% of total volumes in 2011-2012 leading to further pressure on yield .Given the prevailing negative sentiments in the global and Indian environment, India?s investment banking fee pool came under serious pressure last year. The equity raised through the capital markets in the last financial year was Rs 604 billion as against Rs 969 billion in the previous year. Private equity continued to be an active and alternate pool of capital and the deal value was US$ 10.1 billion in CY11 as against US$ 8.1 billion last year. Given India?s overall macro-economic growth story, long-term potential of equities and commodities trading is good on back of low penetration and return generating potential of these asset classes. Currency and commodities: Commodities markets have been experiencing huge growth. The promising nature of these markets has made them an attractive investment avenue for investors globally. Commodity markets have a huge potential in the Indian context particularly because of the agri-based economy. Trading volumes in the Indian commodity exchanges rose 54% from Rs 112,867 billion in 2010-11 to Rs 173,696 billion in 2011-12. Currencies performed well in FY12, with a contract volume of 746,057 contracts; 352% greater than 2011. Indian rupee futures surpassed previous monthly and daily records, achieving an average daily value of US$ 1.17 billion and a monthly value of US$ 26.82 billion. Financial Produce Distribution: The insurance as well as mutual fund industry is facing sectorial headwinds because of regulatory changes. The Indian insurance sector witnessed a DE growth of 13% in 2011-12. LIC, with a market share of 71%, witnessed a 6% decline in new business premium in FY12 whereas the private sector witnessed a decline of 17%.
The Mutual Fund industry faced a downtrend and saw its asset management base shrink marginally in fiscal year 2011-12. The industry lost over 0.7 million folios during the six months ended March 2012 to end with 46.4 million folios. The retail category was the biggest loser in terms of folios, especially in equity. This was mainly because of the volatile movement of the equity market. However, retail investors increased their presence in debtoriented mutual funds, which may be attributable to investors looking at alternate asset classes post the downfall in the domestic equity. Property Services and Real estate: The real estate industry is one of the fastest-growing industries in our economy with a compounded annual growth rate of around 30% (Source: Ernst & Young). Increase in the standard of living makes way for higher demand in the residential sector. There is an estimated requirement of 80 million housing units over the next fifteen years and 200 million sq. ft. of office space over the next five years. SEBI has introduced AIF guidelines creating a distinct space and operating environment for real estate funds and similar pooled investment vehicles. There continues to be significant demand for capital in the real estate sector, further opening up the space for such funds. Wealth Management: The world?s population of high net worth individuals (HNWIs) increased marginally by 0.8% to 11.0 million in 2011, but HNWIs? aggregate investable wealth as measured by asset values fell 1.7% to US$42.0 trillion. If various estimates are to be believed, Ultra High Net worth households (HNH) are slated for a three-fold increase in the next five years from an estimated 81,000 (2011-12) to 286,000 (2016-17). The total net worth of Indian ultra HNHs is expected to reach Rs 318 trillion in 2016-17 from an estimated Rs 65 trillion in 2011-12. This growth in net worth will be driven predominantly by growth in the number of ultra HNHs and the returns on wealth. Company Description:-India Infoline Ltd. India Infoline Ltd. Is a one stop financial service company that provides personalised service and advice coupled with the latest technology. The India Infoline Group which comprises of the India infoline Ltd .and its subsidiaries provides offerings ranging from Mutual funds, Life Insurances, Portfolio Investment, Commodities trading and Derivatives Trading, Gold Bonds, equity research, investment banking and loan products. The company is spread across 365towns and cities and has more than 800,000 customers .Its employee strength exceeds 10,000.It is a pubic based company and was founded in 1995 The India Infoline Group has the following subsidiaries: India Infoline Media and Research Services Limited India Infoline Commodities Limited India Infoline Marketing & Services
India Infoline Investment Services Limited IIFL (Asia) Pte Limited Today the company has established itself even in foreign countries such as China, Russia, USA, UK, Brazil, Dubai and Singapore. The company has won several awards and recognitions including the award for the “Best Broker India” from Finance Asia ,”Most Improved Brokerage” by Asia Money Magazine, “Fastest Growing Equity Brokerage House” by Dun and Bradstreet and many other awards to its name.
Services offered by the company: India Infoline provides various services such a sin -Equities: This is its core service and the company has the largest market share -both in retail and industrial sectors. More than million customers take interest in the research of India info line ltd. The company also boasts of several FII?s and MFs that invest billions in the organisation. -Private wealth Management: The assets for Private Wealth Management are close to Rs 25,000 crores. Over 2500 families have invested in the Private wealth management sector of India Infoline Ltd. -Investment Business Services: This service is basically used by corporates to raise capital. -Credit and Finance: This focuses on mortgages and consumer loans of over 6200 crores. -Life Insurance, Pension and other financial products-This has helped customers with a balanced portfolio. Achievements: 2011 Launching of IIFL Mutual Fund. 2010 Received membership of the Singapore Stock Exchange Received membership of the Colombo Stock Exchange 2009 Got registration for Housing Finance Obtained approval from SEBI for mutual funds
Obtained licenses for Venture Capital 2008 Launching of IIFL Wealth A change to insurance broking model 2007 Started institutional equities business under IIFL Established Singapore subsidiary, IIFL (Asia) Pte Ltd 2006 Got membership of DGCX Started lending business 2005 First IPO and listed on NSE, BSE 2004 Started commodities broking license Launching of Portfolio Management Service 2003 Launching of proprietary trading platform Trader Terminal for retail customers 2000 Launching of online trading through www.5paisa.com Started distribution of life insurance and mutual fund 1999 Launching www.indiainfoline.com 1997 Launching of research products of leading Indian companies, key sectors and the economy
Client included leading FIIs, banks and companies. 1995 Started operations as an Equity Research firm
Location of Company Headquarter Branches: IIFL Centre, B Wing, Trade Centre Kamala Mills Compound, Off Senapati Bapat Marg, Lower Parel, Mumbai – 400013
Segment wise performance of the company in the past 1 year: Equity -Average Daily turnover in equity sector was Rs 52.6 Billion for the year 2012 as compared to53.4 billion in 2011. -Equity Market Share in the National stock Exchange was 3.8%. Commodities and Currency -IIFL?s average daily turnover in commodities doubled to Rs 14.8 billion in FY12 from Rs 7.4 billion in FY11. -Commodities market share on both exchanges (MCX and NCDEX) increased to 2.3% from 1.9% in 2010-11. -Total turnover in FY12 in the currency segment was Rs 2,530 billion as against Rs 190 billion in FY11 Credit and Finance -In FY12, home loans and loans against property contributed to 44.8%of the total loan book. Loans against capital market products reduced significantly from 35.2% in 2010-11 to 11.8% due to high volatility and a downturn in the stock markets. Gold loan book size saw a considerable increase and now comprises 41% of our total loan book. -IIFL successfully completed Initial Public Offering of Secured Redeemable NonConvertible Debentures (“NCDs”) aggregating to ` 7,500 million. The issue received an overwhelming Response. These NCDs are listed and traded on NSE and BSE. -Money line Credit Limited, a step down NBFC subsidiary, was merged with India Infoline Finance Limited. This has enabled consolidation of all lending and investments businesses (except housing loans) to ensure better operations and control.
Financial Product Distribution
-Insurance premium (API) grew 20% to reach Rs 3.3 billion -Initiated an online customer investment portal to enable faster turnaround time and quality service -Received consent for registration as an Aggregator under National Pension System from PFRDA
Wealth management -Launched „Wealth Bank? services to help family office clients synchronise their wills with their nominations -Launched QMS (Query Management Solution), a one-click technology platform for clients and advisors alike -A group of Senior Advisors successfully cleared a full-time mini MBA programme by NYU Stern University in Mumbai -Organised successful client conferences in Mumbai and Pune
SWOT analysis
Strengths:
1. A very diverse range of financial products
2. A hugely successful implementation of “Insurance broking” model
3. The successful advertising and brand name created as “5paisa.com”
4. Established its presence in over 2500 offices in India and over over 500 cities
5. First Indian brokerage house to get membership of Singapore Exchange.
6. IIFL has got rewards for the „Best Broker, India? , „Most improved brokerage, India? , „Fastest Growing Equity Broking House?
Weaknesses:
1) The risk of exposure is high for the conservative Indian Population
2) Not much emphasis has been laid on advertising due to which there is less visibility of the brand
Opportunities:
1) Rise in proportion of growing income middle class population 2) Its growing presence in different cities
Threats:
1) The entry of foreign markets in India 2) Stringent economic policies followed by the RBI and the government of India Corporate Social Responsibility As a part of its Corporate Social Responsibility initiative, the Company launched a comprehensive financial education and awareness initiative, FLAME - Financial Literacy Agenda for Mass Empowerment, in 2011. Under this initiative your Company has successfully completed over 250 FLAME workshops for investors and students. Over 45 schools covering 5,500 students have enrolled for the Fin-Lites distance learning programme. Our other initiatives include a comprehensive mass media campaign on financial literacy, dedicated portal and helpline and effective use of social media platforms like Twitter and Facebook to answer queries and books and publications.
Future Roadmap -Increase geographical reach to more cities and towns in India -Focus on cross-selling – bring the product offering to IIFL Finance, IIFL Wealth and Broking customers across the country -Expand structures offered to investors and investees -Be a financial planner for customers and provide research based advice on assets based on every clients? risk profile -Continuously enhance customer delight by offering the best customer service standards -Focus on creating an employee friendly work environment to retain talent -Strengthen investment banking business to position favourably to capture new emerging Opportunities -Expand presence in Tier-II and Tier-III cities -Continuously invest in technology and training to ensure robust credit and risk management processes.
doc_799921866.docx
It explains SWOT analysis of India Infoline, Company Description, General Information about the company, it's Finance performance, SWOT analysis and Various Strategies employed by India Infoline.
Company Analysis
Introduction
India?s financial sector is expected to witness a strong growth in the next few years mainly due to increased incomes, liberalization of the financial sector and corporate restructuring. This in turn will lead to increased demand for financial products and services especially for equities, commodities and currencies, credit and finance and wealth management. Let us look at the industrial overview of each of them briefly: Equities: With the rapid growth in options, volumes, the share of the F&O segment in overall market volumes increased to 90% of total volumes in 2011-2012 leading to further pressure on yield .Given the prevailing negative sentiments in the global and Indian environment, India?s investment banking fee pool came under serious pressure last year. The equity raised through the capital markets in the last financial year was Rs 604 billion as against Rs 969 billion in the previous year. Private equity continued to be an active and alternate pool of capital and the deal value was US$ 10.1 billion in CY11 as against US$ 8.1 billion last year. Given India?s overall macro-economic growth story, long-term potential of equities and commodities trading is good on back of low penetration and return generating potential of these asset classes. Currency and commodities: Commodities markets have been experiencing huge growth. The promising nature of these markets has made them an attractive investment avenue for investors globally. Commodity markets have a huge potential in the Indian context particularly because of the agri-based economy. Trading volumes in the Indian commodity exchanges rose 54% from Rs 112,867 billion in 2010-11 to Rs 173,696 billion in 2011-12. Currencies performed well in FY12, with a contract volume of 746,057 contracts; 352% greater than 2011. Indian rupee futures surpassed previous monthly and daily records, achieving an average daily value of US$ 1.17 billion and a monthly value of US$ 26.82 billion. Financial Produce Distribution: The insurance as well as mutual fund industry is facing sectorial headwinds because of regulatory changes. The Indian insurance sector witnessed a DE growth of 13% in 2011-12. LIC, with a market share of 71%, witnessed a 6% decline in new business premium in FY12 whereas the private sector witnessed a decline of 17%.
The Mutual Fund industry faced a downtrend and saw its asset management base shrink marginally in fiscal year 2011-12. The industry lost over 0.7 million folios during the six months ended March 2012 to end with 46.4 million folios. The retail category was the biggest loser in terms of folios, especially in equity. This was mainly because of the volatile movement of the equity market. However, retail investors increased their presence in debtoriented mutual funds, which may be attributable to investors looking at alternate asset classes post the downfall in the domestic equity. Property Services and Real estate: The real estate industry is one of the fastest-growing industries in our economy with a compounded annual growth rate of around 30% (Source: Ernst & Young). Increase in the standard of living makes way for higher demand in the residential sector. There is an estimated requirement of 80 million housing units over the next fifteen years and 200 million sq. ft. of office space over the next five years. SEBI has introduced AIF guidelines creating a distinct space and operating environment for real estate funds and similar pooled investment vehicles. There continues to be significant demand for capital in the real estate sector, further opening up the space for such funds. Wealth Management: The world?s population of high net worth individuals (HNWIs) increased marginally by 0.8% to 11.0 million in 2011, but HNWIs? aggregate investable wealth as measured by asset values fell 1.7% to US$42.0 trillion. If various estimates are to be believed, Ultra High Net worth households (HNH) are slated for a three-fold increase in the next five years from an estimated 81,000 (2011-12) to 286,000 (2016-17). The total net worth of Indian ultra HNHs is expected to reach Rs 318 trillion in 2016-17 from an estimated Rs 65 trillion in 2011-12. This growth in net worth will be driven predominantly by growth in the number of ultra HNHs and the returns on wealth. Company Description:-India Infoline Ltd. India Infoline Ltd. Is a one stop financial service company that provides personalised service and advice coupled with the latest technology. The India Infoline Group which comprises of the India infoline Ltd .and its subsidiaries provides offerings ranging from Mutual funds, Life Insurances, Portfolio Investment, Commodities trading and Derivatives Trading, Gold Bonds, equity research, investment banking and loan products. The company is spread across 365towns and cities and has more than 800,000 customers .Its employee strength exceeds 10,000.It is a pubic based company and was founded in 1995 The India Infoline Group has the following subsidiaries: India Infoline Media and Research Services Limited India Infoline Commodities Limited India Infoline Marketing & Services
India Infoline Investment Services Limited IIFL (Asia) Pte Limited Today the company has established itself even in foreign countries such as China, Russia, USA, UK, Brazil, Dubai and Singapore. The company has won several awards and recognitions including the award for the “Best Broker India” from Finance Asia ,”Most Improved Brokerage” by Asia Money Magazine, “Fastest Growing Equity Brokerage House” by Dun and Bradstreet and many other awards to its name.
Services offered by the company: India Infoline provides various services such a sin -Equities: This is its core service and the company has the largest market share -both in retail and industrial sectors. More than million customers take interest in the research of India info line ltd. The company also boasts of several FII?s and MFs that invest billions in the organisation. -Private wealth Management: The assets for Private Wealth Management are close to Rs 25,000 crores. Over 2500 families have invested in the Private wealth management sector of India Infoline Ltd. -Investment Business Services: This service is basically used by corporates to raise capital. -Credit and Finance: This focuses on mortgages and consumer loans of over 6200 crores. -Life Insurance, Pension and other financial products-This has helped customers with a balanced portfolio. Achievements: 2011 Launching of IIFL Mutual Fund. 2010 Received membership of the Singapore Stock Exchange Received membership of the Colombo Stock Exchange 2009 Got registration for Housing Finance Obtained approval from SEBI for mutual funds
Obtained licenses for Venture Capital 2008 Launching of IIFL Wealth A change to insurance broking model 2007 Started institutional equities business under IIFL Established Singapore subsidiary, IIFL (Asia) Pte Ltd 2006 Got membership of DGCX Started lending business 2005 First IPO and listed on NSE, BSE 2004 Started commodities broking license Launching of Portfolio Management Service 2003 Launching of proprietary trading platform Trader Terminal for retail customers 2000 Launching of online trading through www.5paisa.com Started distribution of life insurance and mutual fund 1999 Launching www.indiainfoline.com 1997 Launching of research products of leading Indian companies, key sectors and the economy
Client included leading FIIs, banks and companies. 1995 Started operations as an Equity Research firm
Location of Company Headquarter Branches: IIFL Centre, B Wing, Trade Centre Kamala Mills Compound, Off Senapati Bapat Marg, Lower Parel, Mumbai – 400013
Segment wise performance of the company in the past 1 year: Equity -Average Daily turnover in equity sector was Rs 52.6 Billion for the year 2012 as compared to53.4 billion in 2011. -Equity Market Share in the National stock Exchange was 3.8%. Commodities and Currency -IIFL?s average daily turnover in commodities doubled to Rs 14.8 billion in FY12 from Rs 7.4 billion in FY11. -Commodities market share on both exchanges (MCX and NCDEX) increased to 2.3% from 1.9% in 2010-11. -Total turnover in FY12 in the currency segment was Rs 2,530 billion as against Rs 190 billion in FY11 Credit and Finance -In FY12, home loans and loans against property contributed to 44.8%of the total loan book. Loans against capital market products reduced significantly from 35.2% in 2010-11 to 11.8% due to high volatility and a downturn in the stock markets. Gold loan book size saw a considerable increase and now comprises 41% of our total loan book. -IIFL successfully completed Initial Public Offering of Secured Redeemable NonConvertible Debentures (“NCDs”) aggregating to ` 7,500 million. The issue received an overwhelming Response. These NCDs are listed and traded on NSE and BSE. -Money line Credit Limited, a step down NBFC subsidiary, was merged with India Infoline Finance Limited. This has enabled consolidation of all lending and investments businesses (except housing loans) to ensure better operations and control.
Financial Product Distribution
-Insurance premium (API) grew 20% to reach Rs 3.3 billion -Initiated an online customer investment portal to enable faster turnaround time and quality service -Received consent for registration as an Aggregator under National Pension System from PFRDA
Wealth management -Launched „Wealth Bank? services to help family office clients synchronise their wills with their nominations -Launched QMS (Query Management Solution), a one-click technology platform for clients and advisors alike -A group of Senior Advisors successfully cleared a full-time mini MBA programme by NYU Stern University in Mumbai -Organised successful client conferences in Mumbai and Pune
SWOT analysis
Strengths:
1. A very diverse range of financial products
2. A hugely successful implementation of “Insurance broking” model
3. The successful advertising and brand name created as “5paisa.com”
4. Established its presence in over 2500 offices in India and over over 500 cities
5. First Indian brokerage house to get membership of Singapore Exchange.
6. IIFL has got rewards for the „Best Broker, India? , „Most improved brokerage, India? , „Fastest Growing Equity Broking House?
Weaknesses:
1) The risk of exposure is high for the conservative Indian Population
2) Not much emphasis has been laid on advertising due to which there is less visibility of the brand
Opportunities:
1) Rise in proportion of growing income middle class population 2) Its growing presence in different cities
Threats:
1) The entry of foreign markets in India 2) Stringent economic policies followed by the RBI and the government of India Corporate Social Responsibility As a part of its Corporate Social Responsibility initiative, the Company launched a comprehensive financial education and awareness initiative, FLAME - Financial Literacy Agenda for Mass Empowerment, in 2011. Under this initiative your Company has successfully completed over 250 FLAME workshops for investors and students. Over 45 schools covering 5,500 students have enrolled for the Fin-Lites distance learning programme. Our other initiatives include a comprehensive mass media campaign on financial literacy, dedicated portal and helpline and effective use of social media platforms like Twitter and Facebook to answer queries and books and publications.
Future Roadmap -Increase geographical reach to more cities and towns in India -Focus on cross-selling – bring the product offering to IIFL Finance, IIFL Wealth and Broking customers across the country -Expand structures offered to investors and investees -Be a financial planner for customers and provide research based advice on assets based on every clients? risk profile -Continuously enhance customer delight by offering the best customer service standards -Focus on creating an employee friendly work environment to retain talent -Strengthen investment banking business to position favourably to capture new emerging Opportunities -Expand presence in Tier-II and Tier-III cities -Continuously invest in technology and training to ensure robust credit and risk management processes.
doc_799921866.docx