Oil and Petroleum Industry in India cover

Oil and Petroleum Industry in India: Where to invest?

Understand the Oil and Petroleum Industry in India and its major players: The Oil and Petroleum Industry in India has been among the eight core industries that contribute largely to the GDP of India. India is the 3rd largest Oil Consumer in the world after USA and China. It already attained 63% of the energy self-sufficiency by 2017 due to its increased attention to the promotion of alternative sources of energy namely, wind, solar and nuclear energy.

The stock market for Oil and Petroleum products also has started showing surge due to the announcement of the Government’s privatization program resulting in more global energy players showing interest in buying a majority stake in the Bharat Petroleum Corporation.

This article aims to provide the latest trends in the Oil and Petroleum Industry in India including its market size. Later, we will talk about the big players in this industry in India. Let’s get started.

India’s Economic Growth via Oil and Petroleum Industry

It is important to note that India’s economic growth is largely related to its demand for energy. The projections reveal that the need for the energy sector in oil and gas is expected to grow and therefore, investors consider investment opportunities in this sector in India.

Additionally, the Government of India has also adopted certain policies to cater to the industry with maximum investments. Hence, it has allowed 100% Foreign Direct Investment (FDI) in this sector including petroleum, natural gas, and refineries. This is evidential from the latest developments in Reliance Industries Limited, Cairn India, and Bharat Petroleum Corporation. As the fastest-growing sector, investors see promising returns in this sector.  

Market Size of Oil and Petroleum Industry in India

Now, let us talk about the numbers to understand the market size of the oil and petroleum industry in India better:

  • India gained the position of the second highest refiner in Asia as its Oil Refining Capacity was calculated to be 249.9 million metric tons (MMT) in May 2020 of which the private companies contribute about 35.36% for the year 2020.
  • India is expected to be one of the major contributors world-wide to non-OECD petroleum consumption.
  • In the year 2020, crude oil production is recorded at 30.5 MMT and natural gas consumption is expected to reach to 143.08 million MMT by 2040. 
  • Similarly, in 2020, the import of crude oil increased to 4.54 million barrels per day (mbpd) as compared to the last year and LNG import is 33.68 billion cubic meters (bcm).
  • The consumption of petroleum products has also seen a spurt of 4.5% at 213.69 MMT.
  • The export of petroleum products from the country also has risen to USD 35.8 billion as compared to USD 34.9 billion in 2019 and the quantity-wise rise is at 65.7 MMT in 2020 as compared to 60.54 MMT in 2019.
  • Currently, India as one the largest emitter of greenhouse gases has the share of natural gas in the energy sector of 6.2% which is expected to rise to 15% by 2030.
  • As the second-largest consumer of Biogas India is planning to open 5000 CBG plants by 2023 under the SATAT scheme.
  • Minister of Petroleum and Natural Gas, Government of India sets the target to reduce oil and gas import dependency by 10% by 2022 thereby giving a wide range of opportunities to foreign investors to invest in projects worth US$ 300 billion. 
  • Gas Authority of India Limited (GAIL) as of March 2020 had the biggest share of 71.61% of the country’s natural gas pipeline network.
  • Indian Oil Corporation Limited in March 2020 was leading the segment of the product pipeline network with 51.25%.
  • The energy trade between India and the USA is going to cross US$ 10 billion by the end of the year 2020.

Investment and Government Initiatives

According to the senior-most market technical expert, CK Narayan, the crude oil prices will continue to grow as he analyzed after the biggest downfall during the recent pandemic, it has risen to $44 and will continue to rally further. Mr. MK Surana, the CMD of Hindustan Petroleum also predicts the surge in the price of crude oil in the last quarter of the year 2020 over $45. He also finds the Indian refinery sector as promising due to their ability to get established at the world-class level.

It is indeed worth to mention here that the petroleum and natural gas sectors were able to grab US$ 7.82 billion during the 10 years April 2000 to March 2020, according to the Department for Promotion of Industry and Internal Trade Policy (DPIIT). The initiative from the Government to set up bio-CNG plants has allowed them to spare US$ 1.1 billion to promote clean fuel. 

Natural Gas production also is going to be increased to 15% by 2030 and the top players of the Liquified Natural Gas producers aim to have 1,000 LNG stations across the country which is something that will attract more investors. According to Rajeev Mathur, an executive director of GAIL (India) Ltd, the natural gas demand will be increased by 3-4% by end of March 2021. ONGC has raised US$ 300 billion through the External Commercial Borrowing.

The government is planning to invest US$ 9.97 billion to expand the gas pipeline network. The Government also approved fiscal incentives to improve recovery from oil fields with an intention to lead the hydrocarbon production to Rs. 50 lakh crores in the next 20 years.

Top Players in Oil and Petroleum Industry in India

— 1) Reliance Industries Limited

As the world’s largest refining hub, RIL’s Jamnagar, Gujarat’s plant has a refining capacity of 1.24 mbpd. Until June 2020, its segment revenue from oil and gas was US$ 455.53 million.

Its Petroleum segment has a vast network of over 1300 fuel retail outlets across the country. It becomes the first company to have the market capitalization of over Rs. 13.75 lakh crores in India.  

— 2) Oil and Natural Gas Corporation (ONGC)

ONGC, as the largest crude oil and natural gas company of the country, signed a Memorandum of Understanding (MoU) with NTPC to set up a Joint Venture for the renewable energy business in India. Its market cap is more than Rs. 1.04 lakh crore.

ONGC Videsh – subsidiary of ONGC, which is India’s biggest International Oil and Gas Company, has made new oil discoveries in Colombia and Brazil as part of its Energy strategy 2040. The company also signed an MoU with ExxonMobil for offshore blocks. 

— 3) Petronet LNG Limited

This company has set up the country’s first LNG receiving and regasification terminals and has a market cap of Rs. 38,227.5 crore. The company is expecting partnerships with fuel and gas retailers on LNG stations for long haul trucks and buses. With the aim to set up 300 LNG stations by 2023, it is planning to set up 1,000 LNG stations over a period of time across the country.

— 4) Indian Oil Corporation Limited (IOCL)

IOCL focuses on the safety of India’s energy sector and self-sufficiency in refining & marketing of petroleum products with over 47,800 customer touchpoints. It has a market capitalization of Rs. 1.71 crore and contributes the highest to the national exchequer by way of duties and taxes.

In March 2020, it started supply of the world’s cleanest petrol and diesel across the country and it is also planning to invest Rs. 500 crores in Karnataka.

— 5) Oil India Limited

A public sector company and the second-largest in hydrocarbon exploration and production, Oil India Limited shares are showing increasing trends. Despite blowouts at one of its sites, there are predictions from the market experts that they will be able to recover and prices will be better gradually. It has a market cap of Rs. 10,291.01 crore.

Also read: Passenger Vehicles Industry in India: How much competitive is it?

Bottom line

Succinctly, the energy sector in an Indian economy is growing faster than any other major economies. The industry experts also predict the energy demand to double by 2035. Moreover, the country’s contribution to the global primary energy consumption is also estimated by the analysts to double by 2035.

The growth in the consumption of crude oil is projected to grow at 3.6% Compound Annual Growth Rate – CAGR and the natural gas to grow at 4.31% CAGR by 2040. The Diesel demand too will be twice by 2029-30.

Therefore, the oil and petroleum sector look promising for the country and the coming years are going to be remarkable in terms of demand, consumption as well as the growth point of view.

Passenger Vehicles Industry in India- How much competitive it is?

Passenger Vehicles Industry in India: How much competitive is it?

An Analysis of Passenger Vehicles Industry in India to understand the latest trends and the key players: Indian economy holds the fifth-largest position in the auto market in 2019 and was expected to cross Germany by 2020 in terms of a number of sales. However, the recent pandemic has flipped the side to a completely opposite direction thereby causing a drop of over 17% in the industry.

Several Government initiatives and promising actions by the major automobile players of India was helping this industry to outperform at the world-class level by making the country a leader in this industry. The domestic Indian market is predominantly ruled by two-wheelers and passenger vehicles. The growing middle-class and young population has made the two-wheelers market the dominant one in terms of volume.

This article aims to study the Passenger Vehicles Industry in India including its current trends, biggest players, recent developments, and Government initiatives.

The Passenger Vehicles Industry in India

Passenger Vehicle (PV) is a motor vehicle which has at least four wheels where no more than eight seats are allowed in addition to the driver’s seat for transporting the passengers. Generally, cars are considered as passenger vehicles.

In India, the small and mid-sized cars selling is holding the highest position in terms of sales of the passenger vehicles (PV) industry. The PV industry recorded a market share of 12.9% in India until June 2020. Out of the total automobile exports of 4.77 million, PV accounted for 677,340 exports until June 2020. In 2019, over 3 million PVs were produced and sold domestically.

Currently, Maruti Suzuki and Hyundai are the top players in this industry. Maruti Suzuki with sales of over 208,000 Alto cars, 200,000 Dzire, and 192,000 swift cars reported in 2019 domestic sales of 1.75 million.

However, domestic sales in the PV industry recorded a decline of 9.1% until March 2020. Maruti Suzuki has already started selling BS-VI compliant vehicles that include Alto, Eeco, S-Presso, Celerio, WagonR, Swift, Baleno, Dzire, Ertiga, and XL6.      

Latest Trends in the PV Industry in India

The entire automobile industry attracted Foreign Direct Investment of US$ 24.21 billion in the 10 years from April 2000 to March 2020. The growing demand has made the way for the industrialists to invest more in India’s ever-growing industry.

The announcement by Jaguar Land Rover in May 2019 of the launch of its locally assembled Range Rover Velar has made JLR cars quite affordable. The deal between the Tata AutoComp Systems (Tata Group’s Auto-component segment) and Prestolite Electric (based in Beijing) happened in January 2020 aims to enter the Electric Vehicles market by starting a joint venture of their own.

Force Motors’ investment of US$ 85.85 million focuses on the development of the two new models in the coming two years. MG Motor India is also planning to launch affordable Electric Vehicles in the next 3-4 years. 

The Indian Government announced in the Budget of 2019-20 to provide tax deduction of Rs. 1.5 lakh for the interest paid on the loan taken to buy Electric Vehicles thereby promoting sales of such EVs. It is also planning to facilitate the start-ups involved in the EV space by setting up the incubation centers. 

passenger car market share

(FIG: PV Market Share Manufacture wise – FY19)

FAME II (Faster Adoption & Manufacturing of Electric Vehicles Phase II)

It is also notable to mention here about the Government’s initiative that approved the FAME II scheme (Faster Adoption and Manufacturing of Electric Vehicles Phase II) w.e.f. April 2019 under which allocation of Rs. 10,000 crores were made to promote electric mobility in the country over the three years 2019-20 to 2021-2022.

The scheme aims to provide incentives on the purchase of such vehicles to promote electric and hybrid vehicles. They primarily aim to electrify the public transportation and shared transportation.

— Bharat Stage VI Norms

Introduced in 2000, these norms are the standards implemented by the Government to control air pollution by vehicles. The norms are based on various stages and as the stage goes up the rules become stricter.

Thus, BS-VI stage compliance would require more robust technologies and investment into such technologies to upgrade the vehicles. Consequently, the buyers will also need to pay more to buy the vehicles as the making cost goes up.   

Market Leaders in the Indian PV Industry

As mentioned earlier, the PV market is predominantly led by Maruti Suzuki with more than 50% market share. The industry analysts believe this is due to their planning to empty the BS-IV inventories and keeping the BS-VI compliant vehicles available ahead of the time.

No matter what there are other players too who are contributing not as much as Maruti Suzuki, but their little contribution makes the Indian Automobile Market the fastest-growing market to be ready to compete at the global level. Let us see who these big players are, how are they contributing and what do they have in their baskets. 

Here are the top seven passenger vehicle Makers in India:

RankOriginal Equipment Manufacturers (OEMs)PV Sales FY20PV Sales FY19
1Maruti Suzuki14,36,12417,29,826
2Hyundai Motor India4,85,3095,45,243
3Mahindra & Mahindra1,86,9782,54,351
4Tata Motors1,31,1972,31,512
5Honda Cars India1,26,8991,83,787
6Toyota1,14,0811,50,525
7Ford India66,41592,937

— 1) Maruti Suzuki India Limited

The largest car maker of India, Maruti Suzuki is a subsidiary of Japan-based Suzuki Motor Corporation. They have already launched BS-VI compliant Tour S CNG & Tour S in this year. It has already crossed the 20 million sale milestone in the year 2019. It is leading the market by reaching the target of cumulative sales of one million utility vehicles. Until June 2020 it has recorded sales of more than 1.5 million units. 

— 2) Hyundai Motor India Limited (HMIL)

The subsidiary of a South Korean parent company Hyundai Motor Corporation, HMIL is the second-largest carmaker in India. Its Santro car had been recorded as a runaway success. It was the first automotive company in India to achieve the export target of 1 million cars in just 10 years. This year, its Hyundai Venue car has been awarded as the Indian car of the year. It sold in 2019 545,243 cars however its market share declined in that year.

— 3) Mahindra & Mahindra Limited

The decades-old Indian multinational vehicle manufacturing company, Mahindra & Mahindra Limited. The largest tractors manufacturer in the world records the highest production in India of cars. With the introduction of SUVs in 2019, they reported a 2.21% growth in PV sales. In a challenging time, XUV300, Alturas G4 and Marazzo have helped M&M to add sales of about 27,000 units additionally. 

— 4) Tata Motors Limited

The world’s leading automobiles manufacturer and an automobile arm of the Tata Group, Tata Motors has extended its presence globally by setting up Joint Ventures with Fiat and Marcopolo. It holds a 45.1% market share in the commercial vehicle segment in the year 2019. To improve electric mobility infrastructure in the country it has created a separate vertical by joining hands with Tata Power. 

— 5) Honda Cars India Limited

As the leading premium car manufacturer of India, Honda Cars was established with the specific purpose to cater PV industry with the latest technology-based vehicles. It is a subsidiary company of Japan-based Honda Motor Co. Limited. It recently launched WR-V compact SUV with robust features in two different trim options and in both petrol and diesel fuel choices. 

— 6) Toyota Kirloskar Motor Private Limited

It is a subsidiary of the Japanese parent company Toyota Motor Corporation. Among the carmakers, it holds the fourth largest position in India. In 2012, it started One Make Racing Series with the Etios car and witnessed an overwhelming response from the youngsters.

— 7) Ford India Private Limited (FIPL)

It is a subsidiary of Ford Motor Company and since 2019 Mahindra and FIPL joined hands to set up a Joint Venture. It is the number 1 Passenger Vehicle Exporter in India competing with Hyundai. It exports in 35 countries almost 40% of its engine production and 25% of its car production. 

Also read:

Impact of COVID-19 on the Indian PV Industry

With the current situation of the global pandemic, the biggest challenge these car makers will face is the changing customer preferences. Due to the Work from Home concept, the demand of the Passenger Vehicles has seen a sharp fall in the six months so far as compared to the last year.

The industry experts estimate that the customers’ preference during this time has gone back to the original small and compact cars for which Maruti Suzuki is leading the market as always. However, for SUVs and MPVs the market may not be as good as for the small and affordable cars.

The luxury cars will too see a downfall. The predictions are also against the promotion of EV sales as they need advanced technology and are quite costly. Many startups are under a red zone meaning they are already falling short of cash and liquidity making it difficult for them to survive. Interestingly, the used car business will gain as the customers may face liquidity crunch to some extent.

KETAN PAREKH SCAM cover

Ketan Parekh Scam – The Infamous Stock Market Fraud!

Demystifying how Ketan Parekh Scam was executed: One of the biggest stock market frauds that became an eye-opening event for not only the equity investors but also for the Securities Exchange Board of India and such other regulatory authorities was Ketan Parekh Scam. The Market Rip-off was done in such a way that he was able to make multiple times the annual return on the stocks he manipulated.

Ketan Parekh was the God for many investors as he created a delusion that whatever he touched turned into the Gold and whatever he wished the market seemed to grant him. Just within two years of time, Ketan deceived so many investors as well as banks and the stock market that it became a case study for many these days.

The stock market has the power to make someone rich and the others lose their money in just a matter of seconds. On one hand, we have examples of people successfully trading in the stock market such as Warren Buffet, Carl Icahn and George Soros who became the multi-millionaires by investing in the stock markets. And on the other hand, we have Harshad Mehta and Ketan Parekh who not only ruled the stock markets but also found guilty of the economic crimes.

Let us understand in detail what the Ketan Parekh scam was, how did he succeed in fooling the investors and shaking the stock markets, which next-level chicanery he had planned and how he got caught.

Ketan Parekh –  Background and Foundation

ketan parekh stock market scam

Famously known as a ‘Bombay Bull’ during 1999-2000, Ketan Parekh was a mentee of Harshad Mehta (who was also involved in another scam that shook the stock market in India). Ketan, CA by profession, started his career in the late 1980s and was running a family business of NH Securities – a stockbroking firm that was started by his father. This was how he managed to thoroughly understand the inside outs of the stock market trends and the investors’ mindsets.

During his peak, marketmen literally followed his every move blindly as he used to exploit the stock prices to gain the trust of these investors. Not only this, but he also enjoyed close connections with many celebrities from Bollywood, political parties and business managers which helped him connect with Kerry Packer, leading Australian Media Entrepreneur. Kerry and Ketan joined hands to start a venture capital firm, KPV venture with $250 million that focused on investing money into the new start-ups.

How Ketan Parekh Scam was Executed

Ketan Parekh was the strong believer of the ICE sector – Information, Communication, and Entertainment and that was the time during 1999 and 2000 when the dotcom boom had just started. This enabled him to prove his predictions to be true to many other investors. Moreover, many investment firms, overseas corporates, and banks, businessmen from listed companies many of them gave their money to be managed by him as during 1999-2000, Ketan Parekh was ruling the stock market.

Ketan Parekh used Kolkata stock exchange to trade as this was the stock exchange where no strict and pivotal rules and regulations were not formed. He misused such exchange and also tied up with many other brokers to trade on his behalf and gave the commission. With these huge amounts of money, he would buy some less known companies’ 20-30% stake and suddenly such companies’ share price would skyrocket and become the talk of the town all of a sudden. Once the price would reach to a certain level, he would silently exit and sell the securities and make countless profits.

He not only manipulated stock prices but also played games with banks in order to get funds to swindle the share prices and rule over the market. He firstly bought shares of the Madhavpura Mercantile Commercial Bank’s shares so that he could gain the confidence of the bank when he approached them for a loan in the form of Pay Orders.

Pay Order is an instrument similar to the cheque but it is issued by the bank upon the payment of small advance money from the customer. When he successfully managed to rip-off the price of MMCB’s shares, he approached the other financial institutions including HCFL and UTI and pledged the pay orders with them. His loan accumulated to Rs. 750 million.

He had created a portfolio called K-10 which consists of top ten hit picks by Ketan Parekh himself. This included Aftek Infosys, Zee Telefilms, Pentamedia Graphics, Mukta Arts and so on. He was interested in low profile corporates with low market capitalization and liquidity. That is how he was able to manipulate the prices of such companies using the ‘Pump and Dump’ formula. He was also reported to have done the insider trading by purposefully influencing the stock price of certain companies who would bribe him to do so and take the advantage of the price rise to exploit the investors’ minds.

How Whatever Ketan Parekh Touched Turned into Gold?

  • The ICE sector was booming during that time and Ketan would invest majorly into these sectors which helped him gain the trust of the investors.
  • He was trading in Kolkata Stock Exchange which was lacking strict regulations itself. Hence, there was no one to watch his moves.
  • He would buy shares of low profile companies when they were trading at low prices and joined hands with certain other traders to frequently buy and sell the stocks of such companies which enabled the sudden price rise.
  • The financing method of buying shares and getting pay orders and later getting them pledged when the prices shoot up also helped him create a Bull Run in the stock market.
  • Many investors believed that slipshod reactions and regulations of SEBI who could have noticed the unusual price movements in the market helped the scam to accumulate more losses to them.
  • His connections with celebrities, political and religious leaders also aided him to get the majority of the fund from large corporates and businessmen.

Allegations and Unraveling of Ketan Parekh Scam

The SEBI and RBI started investigating into this case after the huge market crash of 176 points in a day in 2001 just one day post the budget was declared. Ketan Parekh was accused of being involved in the Insider Trading, Circular Trading, Pump and Dump and misrepresentation of facts to borrow from the banks.

Ketan Parekh declared to be guilty of a criminal offense for ripping off the Indian stock market and was barred from trading in the Bombay Stock Exchange (BSE) for 15 years up to 2017. He was also found to be involved in a Circular Trading with many banks and Insider Trading for which he was sentenced to rigorous imprisonment of one year.

However, SEBI investigated and found that despite being prohibited from trading, he used his network well and made certain companies trade on his behalf. Later in 2008, many such companies were traced by SEBI and were barred from trading too.

ketan_parekh scam found

The CBI in 2014 found the malpractices followed by him and sentenced him for two years rigorous imprisonment with a fine up to Rs. 50,000. He also siphoned off the money outside the country too. The SEBI in April 2001 reported that he had an outstanding amount to large corporates worth Rs. 12.73 billion and to MMCB Rs. 8.88 billion while to Global Trust Bank Rs. 2.66 billion. The said amount was reported in 2006 to touch the surprising level of Rs. 400 billion.

He was also reported to use Overseas Corporate Bodies and sub-accounts of Foreign Institutional Investors to receive shares from various corporate entities so as to move the money out of the country. To sum up Ketan Parekh scam allegations, he was found involved in cheating with banks by misrepresenting facts, falsifying accounts, ripping-off the stock market prices and exploiting investors’ decisions, mishandling public money, bribing company directors to enable him to do insider trading.

Also read:

Closing Thoughts

In this article, we discussed how Ketan Parekh was able to induce investors’ decisions by his malpractices. Not only the exchanges and investors but Ketan Parekh also bluffed with the banks. And all of that piled up to huge debt and one day in 2001 it became a historical event of the biggest scam in an Indian Stock Market.

It is still a part of the investigation as of now that how many other companies are still operating in the stock market after himself and other companies were barred from trading.

Company Bankruptcy What will happens to your shares?

Company Goes Bankrupt: What will happen to your shares?

Understanding what happens to the equity shares when a company files bankruptcy: During the economic volatility period, investors tend to become more alert with regards to their investments in the form of shares of various companies. Generally, they try to sell their stocks if they find out that the company may not do well in the future or it may take longer than expected to recover. In such cases, companies get hit quite badly because investors are reducing and the market volatility affects the share price too.

The current unprecedented time of COVID-19 too is such that the majority of the investors have already taken necessary actions in order to safeguard their investments. The fear of losing money if the company goes bankrupt has made everyone scratch their heads quite often. However, it is not necessary that if a company is bankrupt then investors will certainly lose all of their money but the fact is that the common stockholders are the last ones on the list of preference for payment. There has also been a misconception of using insolvency and bankruptcy as a synonym but they both are different.

In this write-up, we will be discussing what happens to the shares of the equity shareholders when a company files bankruptcy. Here, we’ll be covering do we mean by insolvency and bankruptcy, options under the bankruptcy, the preference of the payment when any company files bankruptcy and relaxations, and exemptions provided by the government under the stimulus package during the global disease outbreak.

Understanding Insolvency and Bankruptcy

Solvency is a financial state or a condition when a person, firm, company, or any other legal entity’s total assets exceed its total liabilities at any point in time and it can meet its long-term debts and financial obligations. The opposite of it is called “Insolvency”.

The inability to repay its debts/obligations is a state of insolvency and it can be temporary as well. Such a situation may rise from poor cash management, increased expenses, reduction in cash inflow, or because of some unpredictable accidents, mishappenings or pandemic situations resulting in huge losses to the entity/firm. Here, the person or an entity is not even able to raise enough cash in order to pay off its liabilities and obligations in the due course.

The state of insolvency usually leads to filing for bankruptcy, although, it can be avoided by taking corrective actions such as negotiating terms with credits and other lenders, cutting down overhead costs to a large extent, and by generating surplus cash.

Understanding Bankruptcy and Insolvency

The Bankruptcy, on the other hand, is a legal procedure when an insolvent person or an organization declares its inability to pay off its debts. Under bankruptcy, the person or an entity seeks help from the government to repay its debts and obligations. The bankruptcy does not mean the closure of the company as there may be a chance for the company to recover to its normal state.

When a company files for its bankruptcy, it may ask the government to help the company restructure or reorganize its debts and repayment terms to ease out the repayments. The other option the company may seek from the government is to liquidate the company and decide the order of repayment by realizing cash from its assets.

Technically, the companies themselves file for their bankruptcy but sometimes, creditors may also file the application in the relevant court to declare the company as bankrupt. The Registrar of Companies may also pass a special resolution to declare an entity as bankrupt.

Also read: Is Debt always bad for a company?

What happens when Company Goes Bankrupt?

Restructuring Debts Vs Liquidation Procedures

As discussed earlier, the two options under the Bankruptcy filing procedure provides flexibility to the corporates to either reorganize its debts and get some time to recover or to liquidate the company if the operations have already started closing down.

The Insolvency and Bankruptcy are now solely controlled by the Insolvency and Bankruptcy Code (IBC), 2016. In case of a reorganization, the relevant court appoints a resolution professional who will decide the terms of reorganization considering relevant laws and regulations of the code along with creditors’ and other lenders’ considerations.

Not only that, but the company is also given 180 days (further extended by 90 days upon presenting a valid reason) of the moratorium period. In this period, the company cannot transfer its assets or raise cash by itself, no creditor or any other lender can initiate any legal proceedings or enforcement against the company.

The common stockholders’ shares may reduce in value as the restructuring under insolvency affects the company’s share price. Also, since all other creditors and lenders will have more preference over the restructuring terms, the stock value after the reorganization may also get terribly hit. However, if the company proposes a strong plan post the restructuring then investors may be able to get the same value or more in the long term.

The second option of liquidation is more menacing and never liked by the investors. Under the liquidation procedure, the liquidator appointed by the court prepares liquidation terms and order of preference of payment where the common stockholders are the last ones to be paid back their investment. Sometimes, investors may not even get anything against the stock they hold.

— The Order of Preference for the Payment

While liquidating, an important point to mention is that everybody is not always equal in the tiers of creditors. Moreover, each tier must be paid in full before any money is repaid to the next tier. The order of preference under the Bankruptcy is provided under Section 178 of the Companies Act 2013 as provided below:

  • Firstly, the costs and expenses incurred by the bankruptcy professional appointed by the court, are paid.
  • Secured creditors are paid as they hold some security against their money receivable from the company.
  • Wages due to the employees
  • Financial debts payable to the unsecured creditors
  • Government and statutory dues
  • Any other debts of the unsecured creditors
  • Preference shareholders
  • Equity Shareholders

Quick Note: In the above order of Preference for the Payment, please note that the equity shareholders are last in the line and mentioned at the end. This is because the shareholders are practically the owners of the company and and therefore have accepted a greater risk compared to others.

Recent relaxations by the Government: COVID19 Stimulus Package

Due to the unprecedented time recently faced by everyone in our country and across the globe, the government as a part of the stimulus package announced the suspension of initiation of fresh insolvency proceedings for the next six months from 25th March. According to the stated announcement, there will be no default on the part of a company if the default is occurring out of the global disease outbreak.

Moreover, the minimum threshold amount to initiate the insolvency proceedings has also been increased from Rs. One Lakh to Rs. One Crore to cater many MSME sector companies. The government also declared sector-specific relaxations. This indicates that the investors’ money is safe for now and if the government can provide a pre-packaged resolution plan to certain companies then that will save the investors’ investments.

The Pre-Pakaged Resolution Plan (a Pre-Pack) is kind of a remedy provided by the government to the companies facing financial stress where the company and its creditors mutually agree on the sales terms with the buyer before initiating insolvency.

Companies that bounced back post Bankruptcy

Although, no investor would like his company to file bankruptcy but if that happens, there are examples of companies that filed bankruptcy and came back from the brink of the debt. Below are a few examples of such companies:

  1. General Motors: During the economic fall down in 2009, GM had filed bankruptcy due to heavy debts and pensions exceeding its total value of assets. However, post-bankruptcy it had bounced back stronger than before.
  2. Converse: The company filed for bankruptcy but later Nike acquired the stake in this company and since than the market cap of this company is rising.
  3. Marvel Entertainment: Marvel had to file for bankruptcy due to the hefty debts as comic books sales fell badly, later on, Disney bought the stake and it managed to survive.

Closing Thoughts

The Bankruptcy and Insolvency are always scary for any investor. Being a holder of common stock of a listed company gives the last priority of being paid the invested money back. This is why it is always advisable to study the company before investing.

Studying the financials, due diligence reports, and other such statutory compliance will provide information to a greater extent about the company’s financial health and if they have any plan to file insolvency if their debts are already piling up. Moreover, post insolvency if the companies get better insolvency resolution plans then too the money will be safe.

The IBC 2016 has successfully reduced the time taken for resolution plans and not only that, but the recovery rates for the creditors have also increased over the period of time. Adding to that, the recent relaxations may also prove to be a financial booster for the majority of the MSME sector companies. However, the statistics of last year’s bankruptcy filing show a huge spurt by 123% compared to 2018.

The bottom line should be to study well before investing and be always cautious of what is happening in the company you have invested your money as the bankruptcy procedures can be sometimes painful or it may turn out to be a game-changer.

What is a Company Annual Report And How to read it Efficiently cover

What is a Company Annual Report? And How to read it Efficiently?

An overview of Company Annual Report, it’s meaning, purpose, contents and more: You might not be surprised to know that Warren Buffett, the third most richest person on this planet and one of the most successful investor of our time, reads over 500 pages each day. Most of the time, he’s busy reading the annual reports of different companies that either he’s planning to invest or already invested in. And believe me, reading the annual report of multiple companies is not an easy task as each report easily consists of 200-300 pages or more.

“So I do more reading and thinking, and make less impulse decisions than most people in business. I do it because I like this kind of life.” – Warren Buffett

In this article, we are going to discuss what is a company annual report, its meaning, purpose, why investors read annual reports and finally how to read annual reports efficiently. Let’s get started!

What is a Company Annual Report?

While some companies publish their Annual Reports to provide necessary information about its company’s financial performance and to comply with the statutory requirements, there are some other companies that use the Annual Reports as a tool to advertise their products and services and that is reasonable too.

The Annual Report is the medium of communication between the company and its shareholders, investors and other readers. It is the best source to know about any company’s operations, services along with its financial performance in the past, present and what are its upcoming plans and goals.

Moreover, the Annual Report is a statutory compliance every company must adhere to. It is a single source of highly useful information that is used differently by a different set of users such as Shareholders, Income Tax Authorities, Investors, Securities and Exchange Board of India (SEBI), etc. Be it either financial statements or corporate governance, or company vision and mission or ratio analysis, everything is compiled and presented in an Annual Report. The financial health is measured from these reports.  

What is Purpose of the Annual Reports?

Basically, the purpose of issuing an Annual Report is to communicate to the shareholders, stakeholders, media and other relevant authorities that how the company performed in the financial year, its vision and mission, whether the company is working towards its set targets, what all are its assets, liabilities, what are their main areas of operations and what other activities they are doing. The ultimate purpose is to showcase the financial performance and provide an assurance that the company’s financials have been audited by the professionals and they represent true and fair financial statements in all manner. 

Contents of the Annual Report

Whilst the fundamental purpose of publishing the Annual Report is to provide company information, financial performance, significant accounting policies and related notes and future goals to its shareholders, investors and other related users, many companies use Annual Report to advertise their products and services and other achievements along with the basic necessary information as discussed above. We will be highlighting the critical and important contents of every Annual Report that is required by every company by some of the other regulatory body. 

asian paints annual report 2018 19 contents

(Example: Asian Paints Annual Report for Year 2018/19 – Source)

— Director’s Report

The Director’s Report is a letter from the Board of Directors of the company to its shareholders and other investors and readers about a brief of the company’s main activity, financial performance, management’s responsibility in preparing the books of accounts and financial statements and appointment or re-appointment of auditors in the annual general meeting of the company along with other particulars of major accounting policies followed in the recently completed financial year.

The report will also communicate details if the company is planning anything major that will impact significantly on shareholders’, investors’, its payables’ or receivables’ decisions such as any merger or acquisition, or any other occurrence of extraordinary event. The Directors will also communicate the reasons if the company had losses during the financial year and their plan to recover or make it profitable. 

— Auditor’s Report

The Auditor’s Report is a letter of auditor’s opinion about the truthfulness and fairness of the financial statements and that the financial statements comply with generally accepted accounting principles and any other recognized accounting standards. Auditors address the shareholders of the company and express their opinion about the financial statements to them.

Auditors are the professional Chartered Accountants recognized and authorized by the professional bodies and government authorities to issue and certify such reports. The auditor’s report contains auditor’s opinion on the financial statement, the basis of the opinion, auditor’s responsibility to carry out the audit and to issue such report, management’s responsibility and any other reporting responsibility such as compliance to legal and regulatory requirements. 

For the readers of the financial statement, an auditor’s report and his opinion provide very crucial details. The opinion can be unqualified opinion, qualified opinion or the auditors may give a disclaimer of opinion. 

The unqualified opinion means that in an auditor’s opinion, the financial statements give a true and fair view of the financial statements. Whereas, the qualified opinion means the auditors believe that the company has deviated from its mandatory compliance to represent true and fair financial statements or certain accounting policies and principles are not complied by the company. The disclaimer of opinion represents that the auditor is not able to give any opinion on the financial statements for certain reasons such as, the management might not allow them to qualify the report or they were refrained to carry out the audit as per their satisfaction or any other such matter.     

— Statement of Financial Position or Balance Sheet

The statement of financial position is a balance sheet of a company as on the last date of the financial year. The balance sheet contains assets, liabilities and shareholders’ funds or equity. This statement will indicate what are the Non-current assets, current asset a company holds, how much non-current or current liabilities a company needs to settle and how much is shareholders fund including accumulated profits and reserves.

— Statement of Income and Comprehensive Income

This is the statement where readers of the Annual Report will find financial performance during the year for a company. The statement contains Income, Expenses and other extraordinary income or expense made by the company during the financial year. The income and expenditure from operations and major services and other general, sales and distribution expenses are covered under the first part of the income statement that will give the net income or net profit during the year. The second part will include details of unrealized income, foreign currency transaction loss or gain, dividend, transfer to reserves under comprehensive income statement.

— Statement of Cash Flow

The Income statement will include only the income and expenses of that year for a company which may also include such income or expenses that are accrued but actually not paid. For example, the receipt of payment for the revenue booked in the last week of the financial year might be pending. Hence, it may happen that actual cash has not been received or paid but it is booked as it relates to that year and to comply with the accounting principles. However, from the statement of cash flow, the readers can understand that how much cash inflow or outflow has been made by a company from operational, financial and investing activities. 

Also read: How to read financial statements of a company?

— Notes Accompanying to Financial Statements and Significant Accounting Policies

This portion of an Annual Report will contain company basic information about the activities, its date of incorporation, its license number and the shareholding pattern. The significant accounting policies will contain the company’s policies for accounting income, expense, recognizing asset or liability or any other such policy as approved and issued by the relevant accounting bodies for companies to mandatorily follow. The notes will also include off-balance-sheet items such as contingencies from which the information regarding the company’s liability or gain can be guessed based on its possibility to occur.

Types of Readers of an Annual Report and their Purposes

The different kind of audience of an Annual Report would fetch different information and the focus of information will also be changing depending on who is reading the financial statement. 

Shareholders: Shareholders of the company would want to know from the company’s Annual Report whether the money they invested is being utilized properly or not, whether the company is adequately utilizing its resources and utilizing them for the main activities of the company keeping in mind the vision and mission of the company and if it makes enough profits to pay dividends.

Warren Buffett quote on reading

Investors: The investors would want to know whether the company is making money if they invest into their company’s stocks, what are company’s future plans that will raise its market value so that if they invest now, they can get more return, is the company paying the dividend to its shareholders. 

Employees: Employees would read the Annual Report to understand how much company as a whole has performed during the financial year and if the company is making necessary profits to pay their salaries and other benefits in future. Many times, employees are working at some remote location where the corporate offices are not located, when they read the Annual Report, they can understand the ‘big picture’.

Customers: Customers would focus on the quality and new additions to the products and services. The Annual Report will provide and highlight these details and ensure the sustainability of the business.

Apart from the above, there are other readers too such as suppliers who would focus on company’s business progress and how quickly they can repay their dues and receivables would focus on whether to continue buying from them as a trusted supplier or not.  

Quick Note: If you want to download the annual report of any specific publicly listed company, you can check the stock page of our Stock analysis and research portal here.

Other Key Information Provided in Annual Reports

  • The off-balance-sheet items in the notes to accounts will provide how much liability or any unrealized income company has which has yet not been effected into the financial statements since its possibility to occur or not to occur is remote. 
  • The notes will also contain whether corporate governance is maintained or not and if there are deviations to it then what caused such deviations.
  • Audit Report’s other regulatory and legal reporting section shall provide the company’s adherence to such other statutory compliances.
  • The notes will also reveal if the company has changed any particular accounting policy and if the change is made then to what extent it has impacted the financials. 
  • The notes will also communicate whether the company is undergoing any legal proceedings or not that any potential investor would want to know.

The risk analysis is also given in the notes from where various associated risks such as credit risk, interest risk, foreign currency risks are detailed. The company will also mention what steps are taken to mitigate such risks.  

Reliance Jio Stake Sales - Ambani's Quest to become DEBT-FREE cover

Reliance Jio Stake Deals: Mukesh Ambani’s DEBT-FREE Quest Story!

A study on Mukesh Ambani’s Reliance Jio Stake Deals and Right Issue: While everyone was forced to work from home during the recent pandemic, digital ecosystem transformation proves to be the need of the hour! This also caused malls and bigger retailer shops to close their premises. On the contrary, small grocery stores, vegetable and fruit vendors in India started getting more business. Simultaneously, the recent launch of JioMart, an online grocery service platform in India targets to disrupt the markets of its rivals – Amazon’s local unit and Walmart Inc’s Flipkart.

This explains the deluge of money invested into Reliance Jio Platforms in recent times. JioMart has already started delivering grocery across 200 cities all over India including Delhi, Chennai, Mumbai, Ahmedabad, Bengaluru, and Pune. Reliance locked 11 mega deals just in 2 months from Facebook, Silver Lake, Vista Equity Partners, General Atlantic, KKR, Mubadala, Abu Dhabi Investment Authority (ADIA), TPG Capital, L Catterton and Saudi Arabia’s Public Investment Fund (PIF) which comes to 24.70% stake total.

These deals have made Reliance, a net “debt-free” entity as he promised his shareholders last year and now this billionaire is in the top ten list of Forbes Magazine. Moreover, the Reliance Industries stocks is currently trading at its all-time high price and the analysts are expecting even more upsurge in the share price.

reliance industries share price june 2020

Today, in this post, we are going to discuss how these investments were planned smartly by India’s richest man, Mr. Mukesh Ambani, and what does he aim at. We’ll look into the different Reliance Jio stake deals and the ‘right issues’ from different investors all around the world.

Making RIL Net Debt-Free: Reliance Jio Stake Deals

While looking into the Reliance Jio Stake Deals, it may appear that Dollars were heavily flooding into Jio from different investors.  The latest investment in Jio has now made the total fund-raising amount by Reliance to Rs. 1,15,694.33 crore with a total stake of 24.70%. If we add money raised through Rights-Issue, the total comes to Rs. 1,68,818.63 crore which is indeed a lockdown achievement by the richest man of India. 

Name of CompanyAmount invested in Rs.Ê In Crore% of Stake Acquired
Facebook43,574.009.99
Silver Lake10,202.552.08
Vista Equity Partners11,367.002.32
The General Atlantic6,598.381.34
KKR11,367.002.32
Mubadala Investment & Co.9,093.601.85
Abu Dhabi Investment Authority (ADIA)5,683.501.16
TPG Capital4,546.800.93
L Catterrton1,894.500.39
Public Investment Fud (PIF), Saudi Arabia11,367.002.32
Total1,15,694.3324.7

— The Facebook – Jio Deal

Facebook bought a 9.99% stake that values at Rs. 43,574 crores in Jio Platforms – a wholly-owned subsidiary of Reliance Industries Limited. According to Facebook’s CEO Mark Zuckerberg, the deal aims to enable the platform to expand to products and technology in India that he plans to do all over the world. He also added that one of the goals is to provide a better shopping and commerce experience in India through WhatsApp’s communication and payments medium.

Further, his focus is to provide small businesses a lasting presence on Facebook, WhatsApp and Instagram which is also supported by billionaire Mukesh Ambani’s statement that suggests that he targets to use WhatsApp for delivery of the goods from local grocery stores to consumers.  

According to this transaction, Jio Platform’s valuation comes to Rs. 4.62 lakh crore. Although Facebook is going to get its seat on Jio Platform’s board, WhatsApp and Jio are going to continue operating as separate entities.  

— The Silver Lake – Jio Deal

An American Private Equity firm, one of the largest technology investors in the world, Silver Lake invested Rs. 5,655.75 crores which is almost 1.15% stake in Reliance Industries that comprises Jio Infocomm, its music and video streaming apps too. The deal causes Jio’s valuation to stand at Rs. 4.9 lakh crores approximately leading to extirpate Rs. 1.62 lakh crores of its net debt in the coming months. 

Recently, on Friday, 5th June 2020 Reliance announced an additional Rs. 4,546.8 crore investment by Silver Lake for 0.93% additional stake in RIL’s digital unit. This makes the total investment by Silver Lake for the total amount of Rs. 10,202.55 crore.  

The valuation comes to Rs. 4.91 lakh crore of Jio Platform and the enterprise value stands at Rs. 5.16 lakh crore for Silver Lake’s investment that makes it a 2.08% total equity stake in Jio Platforms that is purely on a diluted basis. Mukesh Ambani calls ‘it is a strong endorsement of intrinsic resilience of the Indian economy that will surely grow bigger with comprehensive digital enablement.’  

— The Vista Equity Partners – Jio Deal

One more American Private Equity and Venture Capital firm funded Jio Platforms 2.32% stake (approx. Rs. 11,367 crores) that sights to transform the Indian digital ecosystem and to deliver expanding boom in connectivity, giving the customers and small businesses to lead to the fastest growing digital economy. 

This investment values the Jio Platform at the same amount as Silver Lake’s investment valued. Mukesh Ambani is very hopeful with regards to this deal being the largest investment of all the recent deals after RIL and Facebook, he believes this Private Equity firm will enable them to bring the transformative power of technology to build a digitally sound society in India. 

— The General Atlantic – Jio Deal

One of the most leading global growth equity firm, General Atlantic also invested 1.34% stake which is worth Rs. 6,598.38 crores in Jio Platforms. This deal also aimed to leverage Global Atlantic’s global expertise and strategic insights of technology for the benefit of Jio.

Once again, the Jio Platform’s valuation is the same for this investment as it was for Silver Lake’s investment and the Vista Equity Partner’s investment. Reliance Jio Infocomm operates majorly in telecom business with over 388 million users. It also covers digital properties such as Jio Saavn, Haaptik and Jio Cinema. 

— RIL Rights Issue

The company also proposed to raise additional capital of Rs. 53,125 crore through rights issue in which the existing stakeholders will be given an opportunity to subscribe to these shares in proportion to their existing holdings. Reliance’s rights offering has been counted as the world’s largest being a non-financial company in the past 10 years and raised about $7 billion targeting to reduce the net debt to zero. The partly paid up rights shares are going to be listed on 15th June, 2020 with an estimated premium of 5-7%. 

— The KKR – Jio Deal

An American global investment firm, KKR & Co. Inc., announced recently to buy 2.32% stake in Jio Platforms. This deal once again focuses on digital transformation of ecosystem in India and worldwide. This deal too values Jio Platforms the same as previous investors. The Co-Founder of KKR praises Jio Platform’s ability and potential to transform country’s digital ecosystem.   

— The Mubadala – Jio Deal

Abu Dhabi based sovereign firm, Mubadala Investment Co., announced on 5th June 2020 to invest 1.85% stake in Jio Platforms for Rs. 9,093.60 crore. This deal once again focuses on the digital transformation of ecosystem in India and worldwide. 

The valuation of Jio Platforms for this investment too is the same – equity value of Rs. 4.91 lakh crore and enterprise value of 5.16 lakh crore. First Oil then Telecom and now heading to capture the e-Commerce market, Mr. Mukesh Ambani indeed proves to be a person with great wisdom.

— The ADIA – Jio Deal

Abu Dhabi Investment Authority (ADIA), has given a cheque for Jio Platforms last week on 7th June 2020 to invest 1.16% stake for Rs. 5,683.50 crore. This deal aims to generate growth opportunities in India that will enable India to take digital leadership.

The valuation of Jio Platforms for this investment too is the same – equity value of Rs. 4.91 lakh crore and enterprise value of 5.16 lakh crore. With this investment, Mukesh Ambani had managed to raise Rs. 97,885.65 crore from seven firms with total stake stands at 21.06% that too albeit COVID-19 situations and lockdown phases. This certainly leads Reliance to reach to a zero net debt position. 

— The TPG – Jio Deal

America’s Global Private Equity Firm, TPG Capital has announced to invest in Jio Platforms on Saturday 13th June 2020 0.93% stake for Rs. 4,546.80 crore. The investor aims to become a part of a group that captures one of the largest portions of internet market in the world.

The valuation of Jio Platforms for this investment too is the same. The investments now total Rs. 1,02,432.45 crore that reaches makes it 21.99% stake.   

— The L Catterton – Jio Deal

Another Private Equity firm, L Catterton also announced to acquire in Jio Platforms on Saturday 13th June 2020 0.39% stake for Rs. 1,894.50 crore. L Catterton joins hands with Jio Platforms to support the long term goal of making India a leading digital society.

The valuation of Jio Platforms for this investment too is the same. This latest investment has now made the total fund-raising amount by Reliance to Rs. 1,04,326.65 crore with the total stake of 22.38%.  

— The KSA’s Public Investment Fund – Jio Deal

Another sovereign wealth fund, Public Investment Fund (PIF) of Saudi Arabia, announced to acquire in Jio Platforms on Thursday 18th June 2020, 2.32% stake for Rs. 11,367 crore.

This tenth investor and its deal has made the RIL the net debt-free as Mr. Mukesh Ambani promised his shareholders last year in August. He truly aims to soar into the sky as an energy-led empire has started its move towards making the company a technology-led global player. The valuation of Jio Platforms for this investment too is the same.

In The Pursuit of Building Large Digital Ecosystem 

Reliance Industries, India’s highest valued company, acquired more than nine startups in the past few years. These startups are dealing in different sectors, for example, EasyGov is a citizen service firm while C-square Info Solutions is into pharma software solutions. Similarly, Grab a Grub Services deals with logistics whereas Reverie Language Technologies is an end-to-end voice technology startup.

Clearly, these startups play a crucial role in the company’s quest to become the leading tech player and JioGenNext is the medium that connects startups and Jio Ecosystem. One more step towards the digital transformation that was taken when Reliance Jio Infocomm Limited, a subsidiary of RIL and Microsoft Corporation joined hands in 2019. The purpose of this deal was to increase the adoption of leading technologies such as Artificial Intelligence, Data Analytics, Blockchain, Internet of Things, Cognitive Services and Edge Computing.

Later in 2020, when more than $23 billion was raised by some of those biggest private equity firms the above goals are clearly justified. Mukesh Ambani also suggested in one of his talks that his company’s long-term aim is to make Indian businesses globally competitive and accelerate the digital ecosystem of India by way of adopting new technologies and innovative ideas among small and medium businesses.  

AtmaNirbhar Bharat– A Bonanza for Reliance Industries  

Reliance Jio Stake Sales - Quest to become the Global Tech Player cover

In our Prime Minister’s latest speech to the general public, the PM Modi announced the concept of ‘Atma Nirbhar Bharat Abhiyan’ that emphasizes on the development of local businesses in India and globally by creating India more self-dependent post COVID scenario. With this mission, the honorable PM suggested encouraging more and more local businesses and service providers by way of utilizing their services even more.

Also read: AtmaNirbhar Bharat – How can we turn Crisis into An Opportunity?

Mr. Mukesh Ambani too sets his goal to make small Indian businesses more self-reliant and competitive by way of introducing the latest technologies and tying up with startups and attracting more foreign investments. This Abhiyan and his goal are quite similar where the underlying idea is to create a platform to foster the expansion of small and medium local businesses. 

It is gratuitous to mention that despite several uncertainties had been featured throughout COVID situations, the mastermind has taken this opportunity to not solely grow his business but also allow the native suppliers and service providers to perform at the world level to become more competitive. Mark Zuckerberg conjointly mentioned once he proclaimed Facebook-Jio deal that ‘company’s robust financial position proved to be an “important asset” that permits it to aim to a long-term growth priority in India even within the thick of a troubled world economy’.

Mukesh Ambani calls it a vote of confidence not only in his company but also in the intrinsic strength of the Indian economy both by domestic and foreign investors.

aatma nirbhar bharat abhiyan meaning

AtmaNirbhar Bharat – How can we turn Crisis into An Opportunity?

The AtmaNirbhar Bharat & Vocal for Local Concept Explained: The recent pandemic brought many changes in consumer behavior and their pattern. While shopping malls and multiplexes were closed, small grocery shop and vegetable and fruit vendors were delivering essential items at the doorstep of every citizen’s houses. Those who earlier used to buy almost everything from shopping mall and big box retailers have now turned their preference to buying from small grocery stores and vendors selling goods nearby their living area. Due to this, many multi-national retailers had to face huge revenue fall down.

The Atma Nirbhar Bharat Abhiyan (ANBA) announced by India’s honorable Prime Minister Shri Narendra Modi aims to reduce unemployment, insolvency, and poverty and increase India’s per capita GDP. According to our Prime Minister our scriptures ‘Esha Upanishadha’ talks about Self Reliance. The concept of Self-Reliant India is brought up during the times of economic slowdown with the purpose to make Indian Economy stronger and to promote local products in India as well as all over the world. This write up talks about What is Atmanirbhar Bharat Abhiyan, what is it aiming at, what is offered under this package, what will be our duty as citizens and how it will impact overall and economically.

The Mission and Vision of AtmaNirbhar Bharat Abhiyan (ANBA)

Due to the long-lasted lockdown phases, India has come to a very crucial juncture. The Indian culture and tradition have always backed the concept of being Self-Reliant. The mission of this Abhiyan was explained by our Prime Minister as not being self-centric but being self sufficient so that it can bring happiness, co-operation and peace of the world. This Abhiyan aiming to be built on the five pillars namely, economy, infrastructure, system, vibrant demography and demand. It is basically a re-packaged version of ‘Make In India’ concept with more benefits for MSME sector, encouraging private participation in various sectors, escalating FDI in the defense sector and many more. The primary mission is of the economic reform that will definitely get the economic growth back to its desired level.

Talking about the vision for this Abhiyan, The Prime Minister urged in his speech to all Indians to come up with detailed study of every sector and to think big. He added Intent, Inclusion, Investment, Infrastructure and Innovation are very important for India in responding to high growth trajectory. Such reforms according to him are systemic, planned, integrated, inter-connected and futuristic process. In his vision he not only aims to promote local products but also suggests everyone to improve quality, modernization of the supply chain and providing best products. He emphasized on inner strength and self-belief for making this Abhiyan successful.

Let’s Revise The ANBA Package – The Mega Economic Reform Package  

Prime Minister in his appeal for Atma Nirbhar Bharat Abhiyan, announced an economic package of Rs. 20 lakh crore which comes to 10% of the GDP of our country which is one of the largest relief packages in the world. In order to make this plan successful, land, labor, liquidity and laws all have been specifically considered under this package. The package will be used for cottage industry, home industry, small-scale industry, MSME, laborers, farmers, middle-class people and those Indian industries which are working to boost our economy dedicatedly. The Finance Minister of India Nirmala Sitharaman announced in a press conference the package in five tranches. This package is inclusive of Rs. 1.7 Lakh crore of free food grains to the poor and cash to poor women and old people, as well as liquidity measures and interest rate cuts by Reserve Bank of India which entirely amounts to Rs. 8.01 lakh crore.

— The First Tranche

The First Tranche of Rs. 5,94,550 crore package focusing mainly on MSME sector, Provident Fund relief, NBFCs, TDS/TCS rates, DISCOMs, RERA companies and others:

Relief in Provident Fund

  • Statutory Provident Fund Contribution by employers has been reduced to 10% (earlier 12%) for 3 months by way of Rs. 6,750 crore liquidity relief.
  • The Finance Minister also announced Rs. 2,500 liquidity support to businesses and workers for the next 3 months.

Relief in MSME Sectors

  • Rs. 50,000 crore equity infusion for MSMEs through Fund of Funds (FoFs)
  • Rs. 20,000 crore Subordinate Debts
  • Rs. 3 lack crores Collateral free Loans for MSMEs were announced under this package
  • The definition of MSMEs has been revised in order to include more businesses that will be benefitted from this package

Relief in NBFC’s

  • Rs. 30,000 crore liquidity boosts to strengthen the collapsed financials the Finance Minister announced that are collapsed due to the COVID-19 pandemic
  • Rs. 45,000 crore Partial Credit Guarantee Scheme 2.0

Relief in Other Sectors

  • Rs. 90,000 crore liquidity is provided to DISCOM (Power Distribution Companies) to reduce the piled up debts
  • Rs. 50,000 crore relief fund provided to reduce TDS and TCS rates by 25% for the payments other than salaries
  • RERA registered projects registration and completion date extended for a period of 6 months which can be further extended for up to 3 months by the Regulatory Authorities
  • To promote local companies, the government has decided to disapprove global tenders up to Rs. 200 crore
  • Due dates of statutory payments and filing of tax returns for the Financial Year 2019-2020 have also been extended to 30th November 2020 (for income tax returns) and to 31st October 2020 (for tax audit cases)

— The Second Tranche

The Second Tranche of Rs. 3,10,000 crore package aiming to cater farmers and migrant workers:

  • The introduction of ‘one nation one ration card’ under this tranche is going to allow every migrant worker to buy ration from anywhere in the country.
  • Food and Shelter facilities to migrant workers from the disaster response fund worth Rs. 11,000 crore was allowed to the state governments by the central government.
  • To enable institutional credit at a concessional rate for farmers, fishermen and animal husbandry farmers, the Finance Minister allocated Rs. 2 lakh crore through Kisan credit cards.
  • 10,000 working capital will be provided initially to all the street vendors who are around 50 lakh in numbers, making it a special credit of Rs. 5,000 crore.

— The Third Tranche

The Third Tranche of Rs. 1,50,000 crore package focusing on agriculture, dairy and its related sectors:

  • Under Pradhan Mantri Matsya Yojana, Rs. 20,000 will be provided to each fisherman and Rs. 10,000 crore strengthen micro food enterprises.
  • To develop farm-gate infrastructure considering set up for cold chains and post-harvest management infrastructure, Rs. 1,00,000 crore were allocated.
  • 500 crore allocated for bee-keeping infrastructure development.
  • 15,000 crore for Animal Husbandry Infrastructure Development fund was raised.
  • 4,000 crore were allocated for herbal agricultural produce.

— The Forth & Fifth Tranche

The Forth and Fifth Tranches of Rs. 48,100 crore catering reforms for coal, minerals, air space management, defense production, MRO, DISCOMs in UTs, and atomic energy:

  • 40,000 crore was additionally allocated for the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) to increase job creation. It would be worth to notice that earlier in the budget this year, Rs. 61,000 crore were already allocated to this scheme.
  • Setting up of a new Public Sector Enterprises Policy to enable consolidation of PSU firms in strategic sectors.
  • Once again to cater MSME sector, the Finance Minister said there will be no new Insolvency Proceedings for one year. Suspension of the initiation of fresh insolvency proceedings up to one year to help companies impacted by COVID-19.
  • Simplification of utilization of Indian air space to reduce air travel cost.
  • Commercialization of coal industry and privatization of discoms in metros for smooth-running of their functions.

The above package is also said to be leveraging the financial instruments that will improve India’s fiscal conditions. The mega stimulus package is equal to Pakistan’s GDP, five times of the personal wealth of Mukesh Ambani and 17% of BSE market value. However, there are about 44% respondents in MSME sector who want direct cash benefits and are not satisfied with what has been offered. There may be challenges by way of liquidity issues, non-existence of demand and escalated fiscal deficit. Though there are challenges against it sufficiency and proper utilization, the biggest impetus package is all set to make India a Self-Reliant Nation in the coming years.

Also read: How to Boycott China in India – The Right Way?

The Role of Every Indian Citizen in ANBA

While the stimulus package offers relief to many sectors, every Indian citizen has a crucial role to play. The Prime Minister urged each one of us to promote local products and use Indian products more and more. We use quite a lot of foreign products starting from our daily use to our leisure activities. The Prime Minister also stated in his speech that all famous global products have started from their local business and when local people started using them more, promoting them, proud of them, they became multi-national products.

Similarly, we too can promote our products to not only at the national level but also at the world level. The time has come for us to make our nation and its every citizen independent. When he urged everyone to buy and promote Khadi, he feels very proud to see the revenue growth and its reach to the new levels in a very short span of time. He is hopeful too now that when we will not only buy local products but also advertise them at the global level, it will be truly called a ‘Local for Vocal’. Our responsibility now lies on us to make the 21st century – the century of India.

‘Self-Reliance leads to happiness, satisfaction and empowerment’ so says our Prime Minister.

When the crisis takes its place, it is everyone’s duty to create an opportunity out of it for the betterment of the nation. The short-term impact of this should never be considered as we all know that the crisis has hit every sector to some or the other extent. Hence, its long-term effect should be contemplated and by adopting futuristic approach. It is important to note that the Abhiyan does not suggest to cut off relations from global platform and trade only with local products, the fundamental concept of this Abhiyan is to become not only self-sufficient but also to promote local businesses and to show off and feel proud about what invaluable assets we possess.

Certainly, this is going to be one of the biggest reforms worldwide. By nourishing local manufacturers, supply chain and with diversification in services and products the Abhiyan can be made a successful mission.

Say No to Chinese Products in India - Boycott China

How to Boycott China in India – The Right Way?

Let’s discuss how to Boycott China and Say No to Chinese Products in India the correct way: The recent announcement by The Confederation of All India Traders (CAIT) on boycotting 3,000 Chinese products has taken its toll in the entire country post the border standoffs between India and China. The CAIT believes this campaign is necessary to make China understand that they will have to bear the repercussions of standing by Pakistan. The CAIT also launched a national campaign called ‘Indian Goods- Our Pride’ to promote local goods and ban Chinese goods.

The ongoing pandemic has affected the economy so much that our Prime Minister too in his speech to the public urged everyone to support local businesses and to promote them started a ‘vocal for local’ campaign. While all of these is happening everywhere, the underlying question that remains yet to be answered is how is this campaign of boycotting Chinese products going to be effective, and what are its consequences on our GDP? Is it possible at all? If it is possible then what should be the ideal approach? Let us understand the practical impact and its impact in the future, both long-term and short-term.

Factors Accompanying and Favoring This Campaign

The Economic fall down has made everyone think twice before they buy anything from anywhere. While a lot of people are getting jobless and undergoing salary cut situations, it is also important to have a look at how compatible our infrastructure and resources are to enable those job seekers to get permanent employment that solves our country’s unemployment issue as well. Therefore, campaigns such as ‘Local for Vocal’, ‘Indian Goods – Our Pride’ are being promoted recently. Boycotting Chinese products is the first thing that comes under the Government’s eye as Chinese products share a huge market of Indian customers as they are way too cheaper than our Indian products.

China-boycott- say no to chinese products

The benefits of boycotting Chinese products are going to help our Indian local businesses only in the long run. When the local products and local businesses are uplifted our army will get the necessary equipment to fight for our nation. As Mr. Sonam Wangchuk explains in his video which has gone viral, the Chinese army is well equipped to fight against us as we use their products and pay very well for it. Instead, if we use local products and make our army stronger, it will not only boost our national goods but also help our soldiers to fight for us.

According to him, it is our utmost duty to stand by our country’s army and do whatever possible we can. On the other hand, when Chinese companies will lose the Indian market, there will also be a huge drop in their economy as well. The messages on uninstalling the TikTiok App are also flooding the social media sites these days which is quite encouraging to see how most of the people have accepted this campaign.

Analyzing the Flip Side

The traders’ body CAIT asked to implement 500% duty on imports from China after China supported Pakistan to remove article 370 in J&K. This will make Indian products costly reason being India imports many raw materials from China only. This move is called a politically inspired campaign as it sounds more impractical than realistic.

The primary factor why Chinese products are so popular in India is that they are sold at quite cheap rates as opposed to Indian products. It is also a fact that India imports seven times from China than it exports to them. Not only these, but India also imports smartphones, laptops, electrical devices, and medicinal drugs from them. Boycotting these products will only reduce India’s GDP to a large extent. The supply chains are interlinked geographically so much that banning Chinese products will break the entire production process. The reason being many small and medium businesses use components made in China or use the machineries to produce the goods that are made in China.

Many Chinese firms established their branches in India post-launch of ‘make in India’ campaign. These branches have provided employment to many Indian workers. Chinese products ban will have an adverse impact on these branches and that may result in a rise in the unemployment rates. Surprisingly, we all are so used to Chinese products that boycotting them would have a psychological impact on us. In fact, everything that we use daily has a bit of Chinese involvement in it.

Be it either an app or a smartphone, or a laptop, or any raw material for a product manufactured in India. The talks are also happening around Alibaba’s founder Jack Ma’s statement on India’s manufacturing companies’ work culture.

Name of the MarketMarket Share (Rs. In Crores)
Start-up investments29,000
Smart Phones1,44,000
Other Electronics and Telecom Equipment3,000
Television Market12,500
Other Home Appliances6,000
Auto Components1,120,600
Pharma Sector90,000

As seen from the above table, the market share of Chinese Products is huge in many sectors. Boycotting these products all of a sudden is not going to make India self-reliant. There is a still long way to go. Banning these products will not only force people to buy costlier products but also it will contract the country’s GDP drastically.

Hence, there are few reasons why we should boycott Chinese products but at the same time, strong arguments and challenges are on their ways to explain why this campaign is not going to work if a concrete strategy is not made. The trade war is not only going to decrease the market of the Chinese product in India, but it is also going to hit the Indian economy as well.

The Failure of Past such Campaigns

It is evident from the past history of such campaigns that apparently could not be successful and there were many reasons behind it. China’s campaign of boycotting Japanese goods to object against Japanese colonization, US’s campaign to ban French products to protest against France’s disagreement to send army forces to Iraq after 9/11 attack and Middle East countries’ ban on American & Israeli products to support their campaign on Palestine have witnessed failures only and did end up leaving the idea very soon.

From the above past records, it does not seem a bit pragmatic for India to implement so quickly this campaign. However, we can always look at the reasons that went wrong in the above cases and learn from that so that the implementation can be effective.

How to Boycott China and ensure the Victory on this Campaign?

Although there are some reasons and explanations argue against the idea of boycotting Chinese products, but there must be certain ways through which we all can make it possible. According to Mr. Sonam Wangchuk, in his recent video, he appeals for a ‘systematic and a phased manner’ of boycotting Chinese products.

The ‘Systematic Way’ of his appeal suggests to boycott using software that is made in China in a week’s time, hardware in one year’s time, finished products and non-essential items to be also boycotted in a year’s time and slowly and gradually once we are used to these, we can move to boycott essential products and raw materials in the coming few years. This strategy is for more than a year, and it will give the necessary time and scope for local businesses and manufacturing companies to be well prepared for the substitutes in the near future.

make in india movement

In China, the government provides corporate loans at much cheaper rates. The Indian government too can come up with a plan where local companies and businesses are encouraged to manufacture the products that are being imported from China also by reducing loan interest rates. The infrastructure and other related services should also be made easy and faster to enable our companies’ products to be competitive globally.

Also read: The Telecom War in India – Jio, Airtel, Vodafone?

Closing Thoughts

In the time of the global disease outbreak, when people are either losing their jobs or experiencing reduced income, boycotting cheaper products, and promoting expensive local products may not last long. The existence of a huge market share of Chinese products in the Indian market is definitely going to hit our GDP to a greater extent. However, a systemic approach of gradually stop using Chinese products where we can find its substitutes and there is a scope for our manufacturing industry to reach to high quality and low-cost expectation may lead this campaign to a new successful level.

As citizens, our contribution can be in the form of getting used to other substitutes and slowly stop using Chinese products to promote our local businesses, and it is indeed everyone’s duty. The government’s role in this is to provide necessary support – financial or otherwise, robust infrastructure and constant efforts to make our manufacturing industry compatible to produce cheaper products with no compromise on quality. With the mutual efforts and systematic boycott approach, we will be able to make it reach its expected level.

zerodha success story discount stockbroking India

Zerodha Success Story: Journey to Biggest Stockbroking in India!

Zerodha Success Story in Stockbroking Industry in India: Trading and Investments are the two terms everyone wishes to experiment but are reluctant to step in due to many reasons like lack of knowledge, hefty commission and brokerage charges, uncertainties in the market and so on. 2008-2010 were the years when the biggest global financial crisis happened and the world was facing a trading hush. In India, the stockbroking companies that existed also experienced a downfall and were using old technologies to provide stockbroking services. Many young generation people were not educated enough to even think of trading at a very young age.

While all of these were encountered by almost every broker in India, Bangalore based discount broking firm, Zerodha was founded in 2010 by Mr. Nithin Kamath that provides trading services at discounted brokerage fees and user-friendly interface with reliability. This firm enjoys a massive client base of over 2.5 million users. Let us deep dive into the journey of how Zerodha success story and discuss how it became the biggest discount broker in India in this article.

The founding of Zerodha: How did it start?

The Co-founder of Zerodha “Nithin Kamath”, before establishing Zerodha, was working in the call center in the night and he used to trade during the morning hours. At the age of 17, he got introduced to the stock markets by his friend and since then he started trading.

Although he made a good chunk of money by trading in stocks, he lost all the money during 2001 and 2002 when the markets crashed. Over a period of time, he was landed a cheque from a foreign HNI to manage his money. Eventually, he joined Reliance Money as a sub-broker and made a lot of money by adding big clients to Reliance money. Nevertheless, again lost a significant amount of money in the second market crash in the middle of the global financial crisis in 2008-09.

After trading for full time for over 10 years, this Maverick decided to become a broker when he thought that the time has come to provide a different kind of stockbroking services that he never came across during the 10 years span of his trading. He felt digitization and online user-friendly platform are the need of an hour when he first thought of starting Zerodha. Nitin Kamath also observed that the reason why the young generation is not willing to start trading is that there are high brokerage charges implemented on the transactions. His aim was to become an online broker using the latest technologies that is more people-first than profit-first.

Zerodha is derived from the Sanskrit word Rodha which means Obstructions. The name Zerodha means ‘No Obstructions’. Hence, the founder aimed at providing a hassle-free, low brokerage trading platform. He targeted clients who are young and more tech-savvy to contribute to the capital market ecosystem. According to him, he wanted more of a Google-like platform with a simplicity to use rather than a Yahoo-like platform. When he felt the need to change the system, he along with his younger brother, Nikhil, started Zerodha and the rest is the history or rather a case study for everyone.

The Secret Formula of Zerodha’s Success

It is indeed a fact that there is no short cut to success. However, Nithin Kamath, when founded this discount broking firm, decided to provide technology-efficient and cost-efficient services to its customers. He observed that there is a huge lag between the commissions charged by the other brokerage firms and the amount of money actually received by the customers.

In addition to that, the technology that was used was too old and Nithin felt the need to introduce a smart platform that enables users to trade online comfortably. He thought of providing services at a low cost where the idea of charging low commission clicked into his mind. He also wanted to attract more young customers who often do not enter into trading due to high commission charges. With this aim, he started his firm and today it has become the biggest discount broking firm. He believes if we do not depend too much on foreign capital and invest for our own companies, the day is not far when India will become an economically strong country.

Surprisingly, the firm hardly spent any money on advertising or marketing for its own firm. They do not run any advertisements. The founder believes in ‘the word of mouth is your true marketing’. Thus, with a very low operating cost Zerodha was able to capture a large number of customers. Interestingly, trading is provided free of cost at his stockbroking firm if the period of holding for shares is longer than a day.

They make money by charging a flat fee of Rs. 20 for futures, options, and intraday trading. While other competitors charge much more than this which is based on the percentage of a transaction traded. Its business model on which it works is ‘low margin – high volume’.

Innovation and New Additions

Zerodha brokerage calculator cover

In order to stay competitive, the firm launched many products to expand its reach and to overcome some challenges they were facing. Below is a brief on what each product provides:

— Console: It is a central dashboard of a customer’s account with Zerodha that will provide in-depth reports and visualizations to get more insightful idea.

— Kite: It is a sleek trading and investment platform using the latest technologies. It eases the customer’s experience to trade and transact in the stock market.

— Kite Connect API: This is mainly focused on independent traders and startups to enable them to build an innovative trading and investment platform. Using algorithms, retail traders can automate their trades.

— Sentinel: A platform that enables you to create market alerts. The alerts can be customized based on price, trade quantity, and open interest. The interesting aspect of this product is that you do not need to be a Zerodha customer in order to use Sentinel.

— Z Connect: This is a blog facility regarding stocks, trading, and investment with Zerodha. They publish articles and information on this blog and any user is allowed to ask questions and post comments.

— Varsity: One of the challenges faced by this firm was that it lacked in providing research services to its customers who are sometimes clueless about what and when to buy or sell. To overcome this, they come up with Varsity that gives a vast collection of stock market lessons on the go.

— Coin: It provides a commission-free purchase of mutual funds directly delivered into the customer’s Demat account.

— Rainmatter: It is an incubator that provides funding as well as mentorship to startup companies in capital markets and gives minority stake in exchange.

Source: Product information from Zerodha.com

In addition, Zerodha has also partnered with a lot of leading stock market platforms and portals like Streak, Sensibull, etc to create more value for their clients.

zerodha partners senseibull smallcase etc

Let us Talk about Challenges

Despite the tremendous success and huge customer base, Zerodha also had to confront a few challenges as described below:

  1. First of all, Zerodha does not provide stock advisory or any market-related calls that would enable its customers to decide on what to buy and sell.
  2. They also suffered from a lack of delivery of valuable advisory reports and analysis of one’s investments and trading activities be it either weekly or quarterly. Most of the big full-service brokers provide research reports.
  3. As Zerodha is mostly online and no offline support branches, inefficient customer support, and lack of quick customer service are the biggest challenges that this firm faces.
  4. Technical errors like app down for a few minutes or charting errors were reported previously which was basically because of the high market traffic situations.

Also read: 8 Best Discount Brokers in India – Stockbrokers List 2020

Closing Thoughts

To sum up, competing with big players like HDFC and ICICI is indeed a daunting task that the genius was able to cope up. However, there are other competitors too such as Upstox, Groww, SAS Online, Angle Broking, TradingBells, etc. However, the founder wishes to continue with his low margin strategy. This firm also developed a strategy to start selling Treasury bills, Government Securities, and Sovereign Gold Bonds which is everyone’s preference while the markets are facing a downfall.

Nithin strongly believes in not running after the money but to do the right things for a long period of time. This is what is the reason his firm has become one of the top-most broking firms in the country over the eight to nine years of time. To add to that, after facing so many challenges, the firm has made its way to persistently increase its customer base year by year.

That’s all for this post. I hope this Zerodha success story is inspiring for all the budding entrepreneurs and business enthusiasts who are planning to make something big in the stock market industry. Stay safe and happy investing.

Intraday Trading vs Long-term Investing: What are Pros and Cons?

Intraday Trading vs Long-term Investing: What are Pros and Cons?

An overview of Intraday Trading vs Long-term Investing: The stock market is risky but equally rewarding. There are basically two ways by which people make money in the stock market – trading or investing. Here, you may either invest for the long-term or trade to build wealth through day trading (also known as Intraday trading). However, both these are two different approaches to make money in the equity markets.

When you invest in stocks for the long-term, it primarily means that you hold on to the investment for a longer period of time, probably between three to five years or more. In comparison, intraday trading means that you square off all your positions before the end of trading hours on the same day. You do not hold the shares for more than a day i.e. do not take delivery of the shares when you undertake intraday trading.

In this post, we are going to discuss the difference between Intraday trading and long-term investment. Here, we’ll look into different factors like holding period, capital growth potential, risks involved, and more. Let’s get started.

Differences between Intraday Trading vs Long-term Investing

1. Holding period

Long-term stocks are held for several years and any fluctuations in the short-term do not affect your investment decision. Here, holding period may vary from two years to even several decades. In comparison, in Intraday trading you do not keep any position open at the end of the hours on a trading day. A holding period maybe between just a minute to a few hours.

2. Capital growth

When the price moves in the expected direction, the trader will exit his intraday stock position. For example, if you have purchased 100 shares of ABC Limited at INR 50 and the price increases to INR 55, you will sell the shares and book the profits. Similarly, you will cut your loss in case the price decreases, using tools like stop loss.

However, with long-term investments, short-term price fluctuations do not affect your decision. The stocks are held for several years allowing you to build wealth through capital appreciation.

3. Risks Involved

There are inherent risks to intraday trading as well as long-term investing. However, the risks in day trading are higher as price volatility can be significant in just a few hours. Because daily market fluctuations do not affect long-term stocks, risks involved with long-term investments are lower. Here, investors have the potential to create wealth through dividends and price appreciation over the years.

4. Art versus skill

Day traders require technical skills to analyze and study market trends. Moreover, Intraday trading is also related to market psychology. On the other hand, long-term investing requires skills to identify good and reliable stocks. Here, investment decisions are primarily based on the business model, financial strength, and company philosophy.

5. Investor profile

Traders want to potentially earn higher profits from the daily price fluctuations. However, here if you miss the right time, it may result in huge losses. Intraday stocks are identified based on price volatility during the trading hours. On the other hand, long-term investors do not rely on trends and invest based on the fundamentals and value of the company over the years. They patiently hold on to the shares until the desired price levels are reached.

Let us now look at the pros and cons of intraday trading and long-term investing.

Pros and Cons of Intraday Trading vs Long-term Investing

— Pros of intraday trading

  1. While Intraday trading, substantial profits may be earned in a shorter period
  2. You require a lesser principal amount and enjoy benefits of margins.
  3. You do not have to lock-in your investment for the long-term enabling you to trade more frequently for higher profits
  4. Most reliable brokers like mastertrust offer margin trading on intraday stocks providing higher leverage for your capital

— Cons of intraday trading

  1. The price volatility increases the risk of losing money
  2. Knowledge of technical analysis is necessary and you cannot rely on tips received from others

— Pros of long-term investing

  1. Historically, when you invest in the equity market for a longer period, you are able to earn returns that are more than the rate of inflation, which allows you to build wealth over the years
  2. Long-term stocks benefit from economic growth resulting in higher revenue through an increase in consumer demand, which bodes well for an increase in its share price.
  3. Long-term investing not only provides capital growth through price appreciation but also allows you to earn more returns through periodic dividends.
  4. These days, it is very easy to invest in shares for the long-term through a stockbroker or online platforms.

— Cons of long-term investing

  1. There is an inherent risk of losing the principal in case the company does not perform as per expectations resulting in the decline of its share price.
  2. Share prices change from one minute to the next. Many times, the investment may be based on emotions rather than sticking to the fundamentals.
  3. Long-term investing means a long holding period that may last for three to five years or longer. This also means that you won’t be able to leverage your money to earn higher returns, from other alternatives.

Closing Thoughts

Both intraday trading vs long-term investing are proven ways to make money from the stock market. The decision to invest for the long-term or intraday totally depends on your requirements, financial goals, investment horizon, and risk profile. Further, here the diversification to allocate your money to various assets should be based on your financial goals.

Seek expert advice from professionals at mastertrust to know the best investment strategy to meet your goals. This stockbroker offers online broking, in-depth research and analysis, and investment advice at affordable charges. Open demat account and start trading today!

Zerodha vs Angel Broking - Stockbroker Comparison cover

Zerodha vs Angel Broking: Stockbroker Comparison

Zerodha vs Angel Broking Comparison: Zerodha and Angel Broking are two of the best and biggest discount brokers in India. In this article, we are going to compare Zerodha vs Angel Broking by looking into their brokerage charges, account opening charges, maintenance charges, exposure margin, trading platforms, pros, cons, and more.

This comparison between Zerodha vs Angel Broking will highlight the major differences between these two stockbrokers and help you choose the best between them based on your preferences.

Zerodha Introduction

zerodha demat account

Zerodha, founded in 2010 by Nitin Kamath, is the biggest stock broker in India and perfect for traders & investors looking for low brokerage, easy interface, and reliable trading platform. It has over +2.2 million clients that contribute to over 15% of daily retail trading volumes across  BSE, NSE, and MCX.

In terms of brokerage charges, Zerodha offers a zero brokerage for delivery equity investment & direct mutual fund investments. For all intraday, F&O, currency, and commodity trades across NSE, BSE, MCX, it offers a flat brokerage of ₹20 irrespective of the trading volume. Therefore, you can save a lot of brokerage charges on your trades using Zerodha as your broker.

Also read: Zerodha Review 2020 – Is Free Investing Legit? [Pros and Cons]

Angel Broking Introduction

angel broking discount broker

Incorporated in 1987, Angel broking is a big brand having +30 Years of experience in the broking world and +1 million happy customers. They have a presence in over 1800+ cities in India and a strong network of 8500+ sub-brokers. Angel Broking offers the trading facility in Equity, F&O, Commodities, and currency across BSE, NSE, NCDEX & MCX.

In the past, Angel Broking worked as a full-service broker and offered a percentage based brokerage charge to its clients for over two decades. However, they recently changed their business model (Nov 2019) from percentage brokerage to flat rates to compete with rapidly growing discount brokers like Zerodha, 5Paisa, Upstox, etc.

Angel Broking now offers a flat rate brokerage plan, named ‘Angel iTrade PRIME’. Here, the delivery trading is FREE of cost. And for all other segments i.e. Intraday, F&O, Currencies & Commodities, they charge a fixed rate of ₹20 per trade. The same simple rate is applicable across all exchanges and segments.

One of the key advantages of trading with Angel Broking is that they provide investment advisory, guidance, and recommendations to their clients for investing in the stock market. Further, they also offer research reports on companies along with many other value-adding tools and services to their clients for free.

Quick link to open your FREE account with Angel Broking.

Zerodha vs Angel Broking Comparision

NameZerodhaAngel Broking
AboutZerodha is the largest stockbroker in India with +1.5 million clients and +10% of daily retail trading volumes across NSE, BSE, MCX. Located at Bangalore, Zerodha offers zerod brokerage on delivery trading and a flat rate of 0.03% or Rs 20 per executed on all other segments.Incorporated in 1987, Angel broking is a big brand having +30 Years of experience in the broking world and +1 million happy customers. They have a presence in over 1800+ cities in India and a strong network of 8500+ sub-brokers. Angel Broking offers free delivery trades and flat charge of Rs 20 for all other trades
Founded20101987
CompanyPrivatePrivate
Main OfficeBangaloreMumbai
# of Active Clients on NSE (Nov 2019)9,09,0084,12,809
Broker ServiceDiscount BrokerFull-Service Flat rate Broker
Supported ExchangeNSE, BSE, MCX, NCDEXNSE, BSE, MCX, NCDEX
Brokerage SummaryFree for Delivery Trading and Rs 20 for all other tradesFree delivery trades and flat charge of Rs 20 for all other trades
Servies offeredEquity, Derivatives, Currency, Mutual Funds & CommoditiesEquity, Derivatives, Commodity, Currency, PMS, Life Insurance, ETFs, IPOs & Mutual Funds.
Account Opening ChargeRs 200Rs 699 (Currently Waived)
Commodity Trading Opening chargeRs 100Rs 0
Annual Maintenance ChargeRs 300Rs 450 (Second years onwards)
Trading PlatformKite 3 Web baased trading platform, Kite Mobile, Kite Connect API, Console, Pi, Sentinel, CoinAngel iTrade, Angel Broking Mobile App, Angel SpeedPro, Angel BEE
Brokerage Charges
Equity DeliveryFreeFree
Equity IntradayRs 20/ trade or 0.03% whichever is lowerRs 20 per trade
Equity Future ChargesRs 20/ trade or 0.03% whichever is lowerRs 20 per trade
Equity Options ChargesFlat Rs. 20 per executed orderRs 20 per trade
Currency future chargesRs 20/ trade or 0.03% whichever is lowerRs 20 per trade
Currency options chargesRs 20/ trade or 0.03% whichever is lowerRs 20 per trade
Commodity ChargesRs 20/ trade or 0.03% whichever is lowerRs 20 per trade
Minimum brokerage fees0.03% MinimumFlat Charges Rs 20
Call & Trade ChargesRs 20 per executed orderAdditional Rs 20 per executed order
Margin Offered
Equity Margin DeliveryNo margin for delivery - Cash and carryUpto 3x for equity cash
Equity Margin IntradayUpto 20x (Based on stock)Upto 6x
Equity margin futuresIntraday - 40%(2.5x), Carry forward - 100%(1x) of Total marginUpto 10x (Buying/Selling)
Equity margin optionsIntraday - 40%(2.5x), Carry forward - 100%(1x) of Total marginUpto 10x (Selling) and 3x (Buying)
Commodity MarginIntraday - 40%(2.5x), Carry forward - 100%(1x) of Total marginUpto 5x
Currency futuresIntraday - 40%(2.5x), Carry forward - 100%(1x) of Total marginUpto 8x
Currency OptionsIntraday - 40%(2.5x), Carry forward - 100%(1x) of Total marginUpto 8x (Selling) and 3x (Buying)
Addons
3-in-1 AccountYes, with IDFC BankNo
Research & TipsNoYes
Brokeage CalculatorYesYes
Span Margin CalculatorYesYes
Training & EducationYesYes
Interactive ChartsYesYes
Margin Against Shares (Equity Cash)YesYes
Margin Against Shares (Equity F&O)YesYes
IPO ServicesYesYes
Robo advisoryNoYes
Other FeaturesDirect Mutual fund investments, Kite APIs, Sentinel, Streak, SensibullResearch reports, Portfolio management system (PMS), Insurances
ProsZero brokerage charges for delivery trading, Simple and flat brokerage model in all other segments, Excellent trading platforms, Easy & fast online account opening, Direct mutual fund investments, Maximum brokearge of Rs 20Free delivery trades; Full-Service Broker with Flat charges; Services offered in Equity, Mutual funds, Commodities, IPOs, PMS, Life insurances; Customised trading help; Robo Order, High Margin
ConsNo stock advisory or research reportsAngel Broking doesn't offer 3-in-1 account, Higher Maintenece charges
Promotion/OfferFree delivery equity trading and Rs 20 or 0.03% wihchever is lower brokerage charge on all other tradesRight now - FREE Account Opening (Opening Charges 100% Waived)
WebsiteQuick Link to Open AccountQuick Link to Open Account

*Disclaimer: All pricing data was obtained from the published stockbroker’s web site as of 02/04/2020 and is believed to be accurate, but is not guaranteed. Account opening charges, margins, etc can vary from time to time depending on the active campaigns by the brokers and hence recommended to refer to the broker’s website for the latest updates.

Also read:

Closing Thoughts

Both Zerodha and Angel Broking offers low (flat) brokerage and fast trading platforms for their clients.

Zerodha, being the biggest discount broker in India with over 22 lakh clients obviously adds trust and brand value. Moreover, Zerodha’s innovative initiatives like educational facility (Varsity), free direct mutual fund investments through COIN, investment in IPO’s from the same dashboard, partner portals like Streak, Sensibull, etc create more value for their clients.

zerodha partners senseibull smallcase etc

On the other hand, Angel broking has built its reputation with over +30 years of experience in the broking industry. Since Angel Broking is a full-service broker, it offers a lot more segments than Zerodha like Portfolio management Services & Life Insurance. Moreover, a few notable advantages of Angel Broking over Zerodha is that they offer Research reports and robo-advisory to their clients, which Zerodha don’t.

Overall, if you’re looking for full-service facilities like investment advisory, Research reports, Robo-advisory, PMS, etc, then Angel Broking is a good alternative.

Nonetheless, if you wish to trade/invest on your own, but looking for essential add-on products like learning platform, Sensibull, Streak, etc and a user-friendly innovative trading platform, Zerodha is the go-to broker. Zerodha offers a little more benefits compared to Angel Broking for independent traders and investors.

7 Best Stock Market Discussion Forums in India cover

7 Best Stock Market Discussion Forums in India

List of Best Stock Market Discussion Forums in India in 2020: One of the easiest ways to learn anything new is by participating in the discussions. And the same rule applies when you are trying to learn trading or investing. If you are new to stocks and looking for the best stock market discussion forums in India to start participating, then you’ve entered the right page.

In this article, we are going to share the list of seven best stock market discussion forums in India where you can ask your most troublesome questions or share your ideas/knowledge with fellow investors and traders. On all these forums, you can find active discussions on stock market investing, trading, investing strategies, stock picks, IPOs, mutual funds, taxation, personal finance and more.

Besides, all these forums are FREE to join and hence, it doesn’t cost you anything to signup and start participating in interesting topics on these Indian stock market discussion forums.

7 Best Stock Market Discussion Forums in India

Here are seven of the best forums in India for healthy discussions on stock market investing and trading:

1. Traderji

traderji forum Started in 2004, Traderji is one of the oldest and most popular stock market discussion forum for investors and traders in India.

This platform has over 1.8 lakhs members participating in different threads on the stock market, derivates, Commodity and Forex trading of India. As per the statistics on this website, there are over 59,300 threads and 1,202,464 messages on this forum.

A few popular categories on the Traderji forum are Beginner’s guide, General trading and investing chat, technical analysis, mutual fund discussion forum, tools, and resources.

Here’s a quick link to join the Traderji Stock Market discussion forum.

2. Trading Q&A

trading qna forum

Trading Q&A is a famous online discussion platform for traders and investors which is managed by Zerodha, the biggest discount broker in India. With thousands of active participants on this forum, you can get all your trading queries answered here, along with sharing your own knowledge with fellow traders.

On Trading Q&A, you can ask questions about Intraday Trading, Derivatives, Commodity, Investing Strategies, Broker Review, Algo-Trading, Zerodha & its products, Taxation, IPOs and much more.

Here’s a quick link to join the Trading Q&A forum.

3. Trade Brains Discussion Forum

trade brains discussion forum

Trade Brains discussion forum is an online forum for the community of enthusiastic stock market investors and traders who are willing to learn, ask, and share their skills, thoughts, and knowledge. This forum has been listed among the top 9 Online Forums To Discuss Personal Finance and Trading in Asia by Fintech Singapore News.

On Trade Brains’ forum, you can find discussions on categories belonging to Share market investing and trading, fundamental analysis, mutual funds, IPO’s, personal finance and money management.

Here, you can participate in the forum for free by reading/writing the answers on the existing queries or asking your own questions by simply signing up for the forum.

Here’s the quick link to join Trade Brains’ forum.

4. ValuePickr Forum

valuepickr forum

One of the most active forum for stock market discussion in India. ValuePickr’s tagline is “Separating the Wheat from the Chaff” and focuses on discussions regarding the company’s Business Quality, Management Quality, Business Execution & Performance.

Here, you can find topics on stock opportunities (hidden gems, Untested but worth a good look category, top 5 picks), Investing strategies, Questions & Answers, Investor Toolkit, Investment Learning, Books and more. You can get a lot of knowledge about the Indian stock market by simply hovering over the topics and queries.

Here’s a quick link to join the forum.

5. Stock Adda

stockadda forum

Stock Adda is an Indian stock investor community where along with the stock market discussions, you can also get information like stock ideas, investing strategies, news, market movements, books, etc.

Besides, on StockAdda, you can also create a stock portfolio or view the ranking of member portfolios based on Daily and overall gains(%). Overall, it is an amazing platform for social traders/investors.

Here’s a quick link to join the forum.

6. Rakesh Jhunjhunwala Forum

rakesh jhunjhunwala stock talk forum

Stocks Talk Forum by Rakesh Jhunjhunwala is yet another popular stock market discussion forums in India.

First of all, I should mention that this site is Inspired, Not Endorsed, By Rakesh Jhunjhunwala, one of the most successful Indian stock market investors.

On this discussion forum, you can find topics on categories like stock investment queries, stock picks of wizards, portfolio of famous investors, stock advisory services, must-read interviews, articles and more. You can find over 3,250 discussions on this forum.

Here’s a quick link to join the Rakesh Jhunjhunwala forum.

7. Bse2Nse

bse2nse forum

Bse2Nse is another popular Indian Stock forum discussion for Equity, FnO, and commodity trading. Here you can find discussions on stock trading, investing strategies, broker reviews, IPOs, mutual funds and more. They also have a separate section on Chart Analysis which can be very helpful for technical traders.

Here’s a quick link to join this stock market discussion forum.

Closing Thoughts:

In this article, we discussed the seven best stock market discussion forums in India. However, before ending this article, let me give you a piece of final advice.

All these forums are built by active members who are willing to share useful ideas and answers. Please keep your posts relevant to the forum category and do not ‘SPAM’! Else, you will be thrown out of the forum by the admins and moderators. Be respectful to others and don’t sweat the small stuff.

Also read: 7 Best Indian Stock Market Blogs to Follow.

That’s all for this post. Comment below if you are part of any of the above-mentioned discussion forum or are willing to join soon. Else, if I missed any awesome Indian stock market discussion forum worth adding to this list, mention below in the comment box. Cheers and have a great day!

ANGEL BROKING VS 5PAISA broker comparison

Angel Broking vs 5Paisa – Which one is better?

Angel Broking vs 5Paisa Comparision: As of 2020, Angel Broking and 5Paisa are two of the leading discount brokers in India. Both of them have millions of clients and offer fast trading platforms & services. However, how do they differ and which one of them is better?

In this article, we are going to compare Angel Broking vs 5Paise by looking into their brokerage charges, account opening charges, maintenance charges, exposure margin, trading platforms, pros, cons, and more. This comparison between Angel Broking vs 5Paisa will highlight the major differences between these two discount stockbrokers and help you choose the best between them based on your preferences.

Angel Broking Introduction

Angel broking free demat account

Incorporated in 1987, Angel broking is a big brand having +30 Years of experience in the broking world and +1 million happy customers. They have a presence in over 1800+ cities in India and a strong network of 8500+ sub-brokers. Angel Broking offers the trading facility in Equity, F&O, Commodities, and currency across BSE, NSE, NCDEX & MCX.

In the past, Angel Broking worked as a full-service broker and offered a percentage based brokerage charge to its clients for over two decades. However, they recently changed their business model (Nov 2019) from percentage brokerage to flat rates to compete with rapidly growing discount brokers like Zerodha, 5Paisa, Upstox, etc.

Angel Broking now offers a flat rate brokerage plan, named ‘Angel iTrade PRIME’. Here, the delivery trading is FREE of cost. And for all other segments i.e. Intraday, F&O, Currencies & Commodities, they charge a fixed rate of ₹20 per trade. The same simple rate is applicable across all exchanges and segments.

One of the key advantages of trading with Angel Broking is that they provide investment advisory, guidance, and recommendations to their clients for investing in the stock market. Further, they also offer research reports on companies along with many other value-adding tools and services to their clients for free.

Quick link to open your FREE account with Angel Broking.

5 Paisa Introduction

5Paisa flat broker

5Paisa is a discount broker that provides you the platform to trade in stocks, futures, and options at the lowest cost of Rs 20 flat per trade, even if you trade for Rs 10 Crore. 5Paise is a public company, which means that its stocks are traded on Bombay stock exchange and National stock exchange.

It is headquartered in Mumbai and is a part of India Infoline (IIFL), a leading non-banking financial institution in India with experience of over two decades (initially incorporated in 1995). 5paisa was re-launched with a new brokerage model for online retail broking services in late 2016. Later, it got de-merged from IIFL so that it can be listed on the stock exchanges. 5Paisa Capital started trading on NSE/BSE in November 2017, making it the first such listed financial digital marketplace.

5 Paisa Capital provides a platform for all financial products including equities, derivatives, commodities, mutual funds, AIFs, bonds & debentures, insurance, and personal loans. 5Paisa provides the trading facility in mobile, browser, and desktop platforms. The account opening process for 5Paisa is totally paperless based on Aadhaar. 

Quick link to open your FREE Demat Account with 5Paisa

Angel Broking vs 5Paisa – Broker Comparision

NameAngel Broking5 Paisa
AboutIncorporated in 1987, Angel broking is a big brand having +30 Years of experience in the broking world and +1 million happy customers. They have a presence in over 1800+ cities in India and a strong network of 8500+ sub-brokers. Angel Broking offers free delivery trades and flat charge of Rs 20 for all other trades5paisa.com, second largest discount broker in India, is part of IIFL group (India Infoline), India's leading financial services company. It offers a flat brokerage of Rs 20 per trade for its clients.
Founded19872016
CompanyPrivatePublic
Main OfficeMumbaiMumbai
# of Active Clients on NSE (Nov 2019)4,12,8091,06,280
Broker ServiceFull-Service Flat rate BrokerDiscount Broker
Supported ExchangeNSE, BSE, MCX, NCDEXNSE, BSE, MCX
Brokerage SummaryFree delivery trades and flat charge of Rs 20 for all other tradesRs 20 Per Trade (Optimum Plan)
Servies offeredEquity, Derivatives, Commodity, Currency, PMS, Life Insurance, ETFs, IPOs & Mutual Funds.Equity, Derivatives, Commodity, Currency, Mutual Funds
Account Opening ChargeRs 699 (Currently Waived)Rs 650 (Currently Waived)
Commodity Trading Opening chargeRs 0Can't trade in commodity
Annual Maintenance ChargeRs 450 (Second years onwards)Rs 45 per month (only for months when you trade)
Trading PlatformAngel iTrade, Angel Broking Mobile App, Angel SpeedPro, Angel BEEInvestor terminal, trader terminal, 5 Paisa Trade Station
Brokerage Charges
Equity DeliveryFreeRs 20 per trade
Equity IntradayRs 20 per tradeRs 20 per trade
Equity Future ChargesRs 20 per tradeRs 20 per trade
Equity Options ChargesRs 20 per tradeRs 20 per trade
Currency future chargesRs 20 per tradeRs 20 per trade
Currency options chargesRs 20 per tradeRs 20 per trade
Commodity ChargesRs 20 per tradeRs 20 per trade
Minimum brokerage feesFlat Charges Rs 20Rs 10 per trader (Higher Plans)
Call & Trade ChargesAdditional Rs 20 per executed orderRs 100/ call
Margin Offered
Equity Margin DeliveryUpto 3x for equity cashUpto 4x for equity cash
Equity Margin IntradayUpto 6xUpto 20x
Equity margin futuresUpto 10x (Buying/Selling)Intra-day: 3.5x - Carry forward: 1x (no margin)
Equity margin optionsUpto 10x (Selling) and 3x (Buying)Intra-day: 1x - Carry forward: 1x
Commodity MarginUpto 5x
Currency futuresUpto 8xIntra-day: 1 time - Carry forward: 1x
Currency OptionsUpto 8x (Selling) and 3x (Buying)Intra-day: 1 time - Carry forward: 1x
Addons
3-in-1 AccountNoNo
Research & TipsYesYes (for higher plans)
Brokeage CalculatorYesYes
Span Margin CalculatorYesYes
Training & EducationYesYes
Interactive ChartsYesYes
Margin Against Shares (Equity Cash)YesYes
Margin Against Shares (Equity F&O)YesYes
IPO ServicesYesYes
Robo advisoryYesYes
Other FeaturesResearch reports, Portfolio management system (PMS), InsurancesMutual Fund Investments, Research reports
ProsFree delivery trades; Full-Service Broker with Flat charges; Services offered in Equity, Mutual funds, Commodities, IPOs, PMS, Life insurances; Customised trading help; Robo Order, High Marginflexible brokerage plans (Optimum, Platinun, Titanium), Premium plans offer Cheapest brokerage, Research reports availalble (but at extra cost)
ConsAngel Broking doesn't offer 3-in-1 account, Higher Maintenece chargesCall and trade Rs 100 per call, Higher charges of Rs per transaction on demat
Promotion/OfferRight now - FREE Account Opening (Opening Charges 100% Waived)Right now - No Opening Charges, Annual maintence charges (AMC) waived
WebsiteQuick Link to Open AccountQuick Link to Open Account

Also read:

Closing Thoughts

From the above comparison, you can find that both Angel Broking and 5Paisa offer low brokerage, high margin, and fast trading platforms for their clients. Moreover, both of these brokers also provide additional services like investment advisory services, research reports, robo-advisory, etc. Anyways, trading platforms and customer service offered by Angel Broking is a little superior compared to the 5Paisa.

On the other hand, multiple brokerage plans offered by 5Paisa can be one of the biggest cons against Angel Broking. 5Paisa offers Optimum, Platinum, and Titanium plans for their customers. Different traders can choose the plan accordingly depending on their trading frequency, volume, and strategy. 5Paisa customers can enjoy a lot less brokerage annually if they go with Platinum or Titanium plans.

5 paisa pricing plans brokerage

 

That’s all for this post. I hope this article on Angel Broking vs 5 Paisa was useful to you. If you’ve got any queries regarding these two brokers, feel free to comment below. Happy trading & investing. Cheers!

Sqrrl App Review Direct Mutual Fund Investment App

Sqrrl App Review – Direct Mutual Fund Investment App

Sqrrl App Review: Sqrrl, a fintech startup founded in 2016, offers the facility to make investments in direct mutual funds, start a SIP, save tax or simply reach your goals through your investments. If you are looking for a simple, beginner-friendly and modern technology-based app to start investing, then you should definitely check out this app.

In this article, we will review the Sqrrl app to look into some of its unique features and find out how this app stands out among all other direct mutual fund investment apps.

What is Sqrrl?

Sqrrl is a modern technology platform that helps its users to start investing in direct mutual fund schemes by opening an instant online account. As the users invest in direct mutual funds there is no distributor commission involved with this app.

With the simplified investing approach, this app aims to help young Indians save and invest their earnings without making things complicated. The basic ideology behind Sqrrl is to empower users to save small chunks of their salary, even if you are not able to put away a large portion.

Along with saving & investing, Sqrrl also provides the facility to save money on income tax by choosing the right tax-saving funds. Overall, this app aims to help the millennials to prosper financially.

Sqrrl app is available on both Android and iOS.

Key Features of Sqrrl App

One of the prominent features that differentiate the Sqrrl app from all of its competitors is an easy and hassle-free setup. As a matter of fact, the users can open an account and start investing within minutes using this app.

Now, here are a few top features and benefits that you can enjoy by using Sqrrl App:

  1. Fast Paperless A/c Setup: Users can open their instant accounts electronically by entering their bank and PAN details at no cost.
  2. Multilingual App: Unlike most other direct mutual fund investment apps, this app offers services in nine languages including Hindi, Gujarati, Telugu and more.
  3. Zero-commission: As users will be investing in direct funds, there’s no need to pay distribution commissions.
  4. High returns and minimum lock-in: Users can invest in high performing funds with easy and no minimum commitment period.
  5. Hand-picked mutual funds by experts: Sqrrl offers the best hand-picked funds curated by a team of avid financial experts and managers with a combined experience of over 90 years.

Moreover, in addition to direct investment opportunities, Sqrrl also helps its users in tracking and managing their investment portfolios within the same app.

Sqrrl App – A few other things that you should know

Sqrrl App Review Android

 — Is Sqrrl Safe to invest?

Sqrrl fintech is registered as a financial advisor with SEBI (Securities and exchange board in India) and as a distributor with AMFI (Association of Mutual Funds in India). They are a registered, compliant and eligible fintech startup to provide their services.

Moreover, the money invested by the users using Sqrrl app is entirely safe as it never touches the Sqrrl Bank account and is directly invested with the largest AMCs regulated by SEBI. Besides, the details of each transaction are always made known to users at every step of the process, by confirming and corresponding recorded statements by the underlying mutual fund.

— What is the minimum investment amount?

Sqrrl App offers different services and the minimum required investment amounts vary from products to products. However, their most popular product, Sqrrl Away, allows the users to start investing with an amount as low as Rs. 100.

Further, if you are planning to start a SIP with Sqrrl app, you can begin investing with an amount of Rs. 500. For the tax-saving and goal-based investing products, the minimum amount to get started in Rs. 1,000.

— How is the customer Care/Support offered by Sqrrl?

Sqrrl offers one of the best support to their customers. In fact, this might be the reason why their app is rated 4.4 out of 5 stars on google play store and have got over +100,000  happy users as of March 2020.

Besides, if the users need any kind of support, they can reach the Sqrrl team over phone at +91-7840877775 or via dropping an email at support@sqrrl.in

Conclusion

Sqrrl is an easy and simple to use app focused on the millennials to make their investment journey hassle-free. This app allows its users to make investments with as little savings they got by investing in direct mutual funds, tax savings funds or with goal-based investments. In addition to simple investment options, Sqrrl also helps its users in tracking and managing their portfolio within the app.

Further, as users will be investing in direct mutual funds using this app, they can save a significant amount compared to regular mutual fund investments and enjoy higher returns.

Overall, we’ll definitely recommend you check out this app. Here’s a direct link to download the app on the play store. In addition, if you’ve got any questions regarding the Sqrrl app, feel free to ask in the comment box below. We’ll be eager to help. Take care and happy Investing.

11 Best Passive Ways to Make Money While You Sleep cover

11 Best Passive Ways to Make Money While You Sleep

Passive ways to make money in India: Passive income” certainly sounds like an interesting and appealing idea, but making money while you sleep is certainly not that easy. The majority of passive income ideas won’t really work (either limited or minimal financial returns or will need a great degree of effort from your side), certainly not like making money while you sleep.

So, the question is what really works? What are the ideas that can actually get the money ball rolling for you? Here are some top picks that can help you leverage some real basic factors for that continuous stream of passive income.

#11 Best Passive Ways to Make Money While You Sleep

1. Sell your art

painter

You might be a skilled designer, a graphics expert or someone who just picks up the paint-brush as a hobby. But what if those raw pieces of your art can ensure you a continuous flow of money. There are several websites like Etsy, Zazzle, etc. that will pay you a nice amount of money for sharing your artworks with them.

These websites use your artworks to create patterns for their branded t-shirts, mobile covers, posters, mugs etc. Whenever these products are sold, you will be given a fair share of commission from the product price.  

2. Express your skills via video channels [Youtube]

guitar

Got some special dance moves, singing skills, the art of mimicry, stand-in comedy or detailed workout sessions? Showcase your talent to the world using YouTube videos from your own channel. YouTube is an immensely popular and exciting medium for earning a decent flow of passive income for yourself.  

You will be paid higher as per the number of views, likes, subscriptions, and popularity that your channel will get across different user groups.

Bdw, you can subscribe to Trade Brains youtube channel here.

3. Online educational courses

courses online

Since the introduction of the digital age, online learning platforms and resources have gained a lot of popularity. There are certain web portals like Udemy, Coursera, Edx that offer digital certifications and classes to students across the globe. If you have specialization in any academic, technical or non-technical subject then you can structure your own educational courses on these websites. You will be paid for every subscription or registration that a user makes for your course.

Also read: #11 Simple Ways to make money online in India [No spam/surveys]

4. Sell-Stock Photos

stock photos

Are you someone who is amazing with a camera in his hands? If yes, then there is a good scope for earning a decent flow of money with your stock photos. There are several websites like Shutterstock, Alamy or iStockPhoto that need photography enthusiasts or experts who can deliver some really amazing and high-quality images from different niches.

5. Rent your vacant property

house

Renting your own vacant property can also be a good way to earn some easy passive bucks. Some working professions even prefer moving in shared apartments and houses in order to save their hard earned money.

6. Start your own blog

blog

Got some really exciting cooking recipes, life hacks, astrology tips or interesting hacks to share with others? Just go on and set up your web-blog. Once your blog gains popularity, you can use services like Google Adsense or AdWords to earn a considerable amount of money by displaying corporate or business advertisements on your blogs. Additionally, you can also set subscription fees for the users who want premium access to your content. 

There are a number of bloggers who are making tons of money enjoying their life on a beach or travelling by setting passive ways to make money on their blog.

Note: If you are new to blogging and planning to launch your blog soon, we’ll recommend getting a hosting from “HOSTPAPA”. They offer most affordable hosting plans starting at just Rs 99/month. Here’s a quick link to get started. Cheers!

7. Sell your Ebooks

ebook

Fond of writing? Great! This can be one big opportunity for you to earn. Convert your passion for writing into some easy money. You can fetch 5-10$ easily with short write-ups of 70-80 pages, but make sure you choose the trending titles and themes. To sell your ebooks, you can choose various platforms, Amazon and iBook are two of the best once.

Market Investment Ways to Make Passive Income

8. Mutual Funds

mutual funds

What if you can earn regular income on your basic savings?

Mutual funds are the best passive ways to make money in India. You do not need to spend much time, knowledge or even money to start investing in mutual funds. These funds are managed by professional fund managers and there are several low-risk investment schemes that offer high returns compared to the interest amount that banks pay for your deposits with them. Nevertheless, you will need to select the mutual fund smartly to reduce the risk of financial loses.

Learn more about mutual funds here: What is Mutual Fund? Definition, Type, Benefits & More.

9. Stock Market Investing

stocks

If you are willing to invest some time, then investing directly in the stocks offers the highest returns and can easily be considered the best passive ways to make money with even limited investments. You can make money in stocks through capital appreciation and dividends. If you have a good working knowledge of stock market and shares, then it can ensure high returns for your basic investments, but such investments are always subjected to risks of market fluctuations.

New to stocks? Want to learn how to invest in Indian stock market from scratch? Here is an amazing online course: INVESTING IN STOCKS- THE COMPLETE COURSE FOR BEGINNERS. Enroll now and start your share market journey today.

10. Real estate Investments

real estate

Investing in the Real-estate market is another way of ensuring a continuous income stream on a part-time basis. You can either buy a rental property to ensure a monthly fixed amount or look for those perfect deals at the perfect time (when you purchase properties at a low price and then sell the same when the market hits a high.) In both the cases, you will be getting a decent amount of income on regular basis with minimal efforts.

11. E-commerce service outsourcing

eCommerce

An e-commerce portal that bridges the gap between the local retailers and customers can be a handy way of earning a continuous stream of passive income. Your e-commerce portal, website or app can be structured to serve the requirements of a locality, zone, town or a whole city.

Who knows it might develop into a fully-fledged business venture in future?

10 Best Youtube Channels to Learn Indian Stock Market cover

10 Best Youtube Channels to Learn Indian Stock Market

10 Best Youtube Channels to Learn Indian Stock Market: With the boom of the internet, self-education has never been easier. Now, you can learn any skill that you crave by sitting on your couch and watching youtube videos. And that too for FREE. There are tons of information and resources available on youtube to learn whatever you want. And if you want to acquire financial literacy without spending a dime, Youtube is definitely one of the best places where you should be.

Anyways, if you are a newbie to investing world, you might not know the best youtube channels to learn Indian stock market. After all, there are thousands of youtube channels that discuss stocks. But which ones give the best information? We’ll answer this question today. In this post, we are going to discuss ten Best Youtube Channels to learn Indian stock market.

Quick Note: There may be a few more good channels that we might miss in this post. This may be because we never watched their videos or the channel is launched recently. If we miss any of your favorite youtube channels feel free to mention in the comment box. We’ll be glad to add it to our list of best youtube channels for Indian Stock Market. 

Nonetheless, you might not synergize with all the channels as they may cover different core areas like fundamentals, technicals or future/options trading strategies. Only subscribe to the channels that suit you the best and whose ideology you would like to follow. So, let’s get started with our list of 10 Best Youtube Channels to Learn Indian Stock Market. Here it goes.

10 Best Youtube Channels to Learn Indian Stock Market

— FinnovationZ

This channel uploads animated financial education videos on stock market tutorials, mutual fund basics, book summaries, case studies, etc. FinnovationZ has uploaded over 320 videos on their channel and had got +41 million views on their videos with +670k subscribers. The videos on this channel are mostly in the Hindi language and very simple to understand. If you are a complete newbie to the stock market, this is a definite channel to subscribe.

— Pranjal Kamra

Also known as Finology, Pranjal Kamra runs this channel and teaches the philosophy of value investing. On his channel, you can find over 130 videos on investing, stock analysis, mutual funds, and behavioral finance. Along with educational videos, Finology also offers courses, workshops, Excel tools, Advisory & research services etc on their website.

— Elearn Markets

With over 550 videos and +210,000 subscribers, Elearn Markets is definitely ranked among one of the best youtube channels to learn Indian stock market. They cover videos on financial literacy, stock market trading, fundamental analysis, technical analysis and more. Besides, one of the most popular segments on their Youtube channel is ‘Meet market rockstars’.

Quick fact: The founders of Elearn markets are also the creator of one of the most downloaded and highest rated stock analysis app in India, named Stockedge.

— Trade Brains

This channel is hosted by Kritesh Abhishek and is focused to teach stock market investing and personal finance to the do-it-yourself (DIY) Investors. On Trade brains youtube channel, you can find simplified investing videos on stock market basics, valuations, mutual funds, investing strategies and much more. You can subscribe to the channel using this link.

— Sunil Miglani

Sunil Minglani is an expert on behavioral aspects of Stock Market and has rich experience in analyzing stock chart patterns which he has co-related with human psychological patterns at a deeper level. He has uploaded over 250 videos on his channel and got over +410k subscribers. On Sunil Miglani’s channel, you can find videos on stock market basics, human psychology, Q&A with Sunil Miglani, etc.

— Nitin Bhatia

Nitin Bhatia is a Youtuber and founder of the blog nitinbhatia.in. On his youtube channel with over +549k subscribers, Nitin Bhatia uploads videos about stock trading & investing, Real Estate and Personal Finance to provide ‘Smart Ideas for Your Money’. He’s very consistent in making videos and has uploaded over 690 videos on his channel.

— Yadnya Investment Academy

This channel uploads simple investing videos in Hindi & English on the stock market, mutual funds, taxes and other investment options in India. The videos are extremely simple to understand. They have uploaded over +720 videos on their youtube channel and received over +190k subscribers. Invest Yadnya also offers different services like financial planning on their website.

— Ghanshyam Tech

This channel is run by Ghanshyam Yadav, a trader and trainer in stock market from Mumbai. This channel focuses on stock market trading and technical analysis. Ghanshyam has uploaded over 1,400 videos on his channel and here you can find videos on Nifty Trading, Technical analysis, Candlestick patterns, charting software and more.

— ProCapital.MohdFaiz

This channel is run by Mohd Faiz and the objective of this channel is to help the subscribers create wealth. Mr. Faiz has uploaded over +4,700 videos on this channel which has received over +95 million views. This channel upload videos on current news, technical analysis, stock charts, patterns and more.

— Varun Malhotra

The host of this channel, Varun Malhotra, Director EIFS, started investing at an age of 17. He dropped out of his Campus placements at IIM-A to continue his journey in the investment world. Since 2010, Varun Malhotra has trained over 500,000 Investors including the entire 250,000 strong force of Border Security Force. On his youtube channel, he uploads videos on stock market investments & mutual funds. Varun Malhotra has uploaded over +45 videos on youtube and earned+225k subscribers.

— Market Gurukul (Bonus)

The marketGurukul channel is managed by Mr. Edward and is one of the best technical analysis youtube channels in Hindi. He uploads videos on Indian Stocks, Commodity or Forex Trading including Trading Psychology, Money Management along with hardcore Technical Analysis. You can find over +170 videos on this channel teaching technical analysis, Strategies, and Indicators to know the markets better, demo trading platform and more.

 

Also read: 7 Must know websites for Indian stock investors

Closing Thoughts:

If you are not from a finance, commerce, business background or from a family of stock market enthusiasts, the chances are that you do not know the stock market lingo or even the frequently used terms like dividends, market cap, etc. Moreover, if you are in the learning stage, it’s a little difficult to master everything by yourself. Enters Youtube.

With the help of youtube channels, you can find online mentors who can help you to make your investing journey a lot easier. Further, interacting with Youtubers is also not very difficult. You can simply leave a comment on the videos and if the Youtuber is active, most likely, you’ll get the reply.

Final advice, watch the videos but do not copy their entire investment strategy or stock picks of the Youtubers. Ideally, Copycat investing doesn’t work. Be original and create your own investment style.

That’s all for this post. I hope it was useful for you. Have a great day and comment below which is your favorite YouTube channel to learn Indian stock market. Happy Investing!

Best Indian Stock Market Blogs to Follow

7 Best Indian Stock Market Blogs to Follow

Best Indian Stock Market Blogs to Follow to Learn Investing: If you are looking for a few best Indian stock market blogs to follow, then you have reached the right place. 

Although there are hundreds of stock investing blogs in India, however, in this post we have hand-picked 7 best Indian stock market blogs that every Indian equity investor should follow. (Quick note: Please read this post till the end as there’s a bonus in the last section of this article).

7 Best Indian stock market Blogs to Follow

1. Trade Brains

trade brains stock market website

Website: https://tradebrains.in

Trade Brains was founded by Kritesh Abhishek, an NIT Warangal graduate, in Jan 2017. It is a fastest growing Financial Educational Blog in India with over 42,500+ newsletter subscribers within a year and half of inception. Trade brains blog is focused to teach stock market investing and personal finance to the DIY (do-it-yourself) Investors.

You can also learn stock market investing in Trade Brains’ recently launched android mobile app. Here’s the link to download the app on play store.

2. Get Money Rich (GMR)

Best Indian stock market Blogs -get money rich-min

Website: https://www.getmoneyrich.com/

Get money rich (GMR) blog is run by Mani (founded in 2008). You can read a number of interesting articles regarding stock investing, mutual funds, real estate, income tax, personal finance etc on this blog.

This blog keeps analyzing new stocks and if you’re a beginner (or even a seasoned investor), you can read these articles to understand how to analyze stocks, which factors to consider and how to find whether a stock is undervalued or overvalued. Here’s a list of few recent stock analysis by Get money rich blog.

Because of it’s simple and easy to understand contents, it’s one of the best Indian stock market blogs to learn to invest in stocks alongside boosting your additional financial insights.

3. Fundoo Professor

Best Indian stock market Blogs -fundoo professor-min

Website: https://fundooprofessor.wordpress.com

This blog is managed by Prof. Sanjay Bakshi. He teaches MBA students (at MDI Gurgaon) two popular courses: “Behavioral Finance & Business Valuation” and “Financial Shenanigans & Governance”. On fundoo professor blog, Mr. Bakshi shares his thoughts as a teacher & practitioner of value investing and behavioral economics.

This blog consists of hundreds of free amazing lessons on investing and human behavior. It’s a great read for the Indian investors to build a strong investing foundation.

4. Safal Niveshak

Best Indian stock market Blogs -safal niveshak-min

Website: https://www.safalniveshak.com/

‘Safal Niveshak’ means a ‘successful investor’. This blog is managed by Vishal Khandelwal and Anshul Khare. Vishal has 15+ years of experience as an investor. The Safal Niveshak blog is focused to help the small investor, become intelligent, independent, and successful in your stock market investing decisions. They have a newsletter of over 47,000+ subscribers.

You can find many valuable investing lessons on this blog which definitely makes it one of the best Indian stock market blogs.

Also read: 7 Best Stock Market Apps that Makes Stock Research 10x Easier.

5. Nitin Bhatia

Best Indian stock market Blogs nitin bhatia-min

Website: https://www.nitinbhatia.in/

This blog is managed by Nitin Bhatia, who covers areas like Investment, Insurance, Stocks, Mutual Funds, Credit Score, Taxation, and Business Start-ups. They also run a youtube channel with over 290,000+ Subscribers.

6. Stable Investor

Best Indian stock market Blogs stable investor-min

Website: https://www.stableinvestor.com

Stable Investor is run by Dev Ashish, a SEBI Registered Investment Advisor.

This blog is focused to help people invest sensibly to achieve financial goals, get their personal finances in order, invest profitably in stocks. Stable Investor has over 11,000+ Newsletter subscribers.

Stable Investor also provides various financial services like financial planning, retirement planning, children future planning etc.

7. Dr. Vijay Malik

Best Indian stock market Blogs - dr vijay malik-min

Website: http://www.drvijaymalik.com/

This blog is run by Dr. Vijay Malik, a SEBI registered analyst. He has been actively involved in the Indian equity markets since 2006. The articles on his blog attempt to simplify the process of investment decision making. Dr. Vijay Malik blog provides premium services like ‘Peaceful investing’ workshop, stock analysis excel sheet, ebooks etc.

You can also read the analysis reports of various stocks published on this blog for free making it worth mentioning in our list of best Indian stock market blogs.

Also read: 7 Must Know Websites for Indian Stock Market Investors.

Bonus: A Few Youtube Channels Worth Subscribing

Besides reading blogs, watching videos is also a good alternative to learn to invest. As a bonus, here are two amazing Indian stock market youtube channels that you can subscribe for free to learn to invest in stocks.

– Trade Brains YT Channel

This channel is hosted by Kritesh Abhishek and is focused to teach stock market investing and personal finance to the do-it-yourself (DIY) Investors. On Trade brains youtube channel, you can find simplified investing videos on stock market basics, valuations, mutual funds, investing strategies and much more. You can subscribe to the channel using this link.

– Market Gurukul

Youtube Channel link

This is a popular youtube channel to learn technical analysis. Market Gurukul has over 200,000+ subscribers and +170 videos on their channel.

– FinnovationZ

Youtube Channel Link

FinnovationZ creates easy to understand video contents for beginners. Most of the videos on this channel are in Hindi and hence comfortable to grasp for the native speakers. FinnovationZ has over 270,000+ subscribers on their youtube channel.

Also read: 10 Best Youtube Channels to Learn Indian Stock Market

That’s all for this post. If you think we missed any astronishing blog on our list of best Indian stock market blogs, feel free to comment below. We’ll be happy to include it on our list if it’s worth adding. Cheers!