1. A Reliance Capital Company Month 00 2006 Why earn? Why Invest?

2. A Reliance Capital Company The Objective Wealth Creation

3. A Reliance Capital Company Comparative returns for the last 20 years What $1000 invested at the end of 1986 would be worth at the end of 2006? Instrument Value Average Annual Return Stocks (S&P500) $9310 11.80% Real Estate $8540 11.32% Commodities $6510 9.82% International Stocks $5020 8.40% Inflation (CPI) $1820 3.05% Gold $1550 2.23%

4. A Reliance Capital Company Month 00 2006 Power of Equity Unbelievable but it has happened

5. A Reliance Capital Company Just imagine… How much can you make in 26 years by just investing Rs.10,000 initially in any of financial instruments ? Take a wild guess ??? Let us look at the real example…

6. A Reliance Capital Company If you have subscribed in 100 shares of ________ company with a face value of Rs. 100 in 1980… In 1981 company declared 1:1 bonus = you have 200 shares In 1985 company declared 1:1 bonus = you have 400 shares In 1986 company split the share to Rs. 10 = you have 4,000 shares In 1987 company declared 1:1 bonus = you have 8,000 shares In 1989 company declared 1:1 bonus = you have 16,000 shares In 1992 company declared 1:1 bonus = you have 32,000 shares In 1995 company declared 1:1 bonus = you have 64,000 shares In 1997 company declared 1:2 bonus = you have 1,92,000 shares In 1999 company split the share to Rs. 2 = you have 9,60,000 shares In 2004 company declared 1:2 bonus = you have 28,80,000 shares In 2005 company declared 1:1 bonus = you have 57,60,000 shares

7. A Reliance Capital Company At the end of 2005… You have 57,60,000 shares of the company Any guess about the company ? (Hint : Its an Indian company) Any guess about the present valuation ?

8. A Reliance Capital Company The result of ‘Power of Compounding’ Your present valuation is about Rs. 200 Cr.+ & The company is ‘WIPRO’

9. A Reliance Capital Company Other such examples… CIPLA Investment of Rs. 10,000 in 1979 will fetch Rs. 95 cr.+ INFOSYS Investment of Rs. 10,000 in 1992 will fetch Rs. 1.5 cr.+ RANBAXY Investment of Rs. 1000 in 1980 will fetch Rs. 1.9 cr.+

10. A Reliance Capital Company Month 00 2006 Basics of Equity Markets

11. A Reliance Capital Company Stock Market ============== Mandi Buyer Buyer Buyer Seller Seller Seller Seller Buyer Seller’s Price – Higher offer Buyer’s Price – Lower Offer Buyers and Sellers come together

12. A Reliance Capital Company Stock Exchange (BSE / NSE)Broker Sub- Broker Client

13. A Reliance Capital Company Depository (NSDL / CDSL) Depository Participant Client Delivery Based (Primary and Secondary Markets)

14. A Reliance Capital Company Sub broker Depository Participant Bank Client Off-line Model

15. A Reliance Capital Company Broker (Reliance Securities) Sub broker Depository Participant Bank (R Money Franchisee) (Reliance Capital) UTI, IDBI, HDFC, Offline CMS Reliance Money Client On-line Model Reliance Money

16. A Reliance Capital Company Margin Trade Scenario 1 Company A Market Opens 10 am Share Price: Rs. 100/- Buy 100 shares Total Investment Rs. 10000/- At 2 pm Share Price : Rs. 120/- Sell 100 shares Profit: Rs. 2000/- Return on investment: 20%

17. A Reliance Capital Company Margin Trade Scenario 2 Company A Market Opens 10 am Share Price: Rs. 100/- Buy 100 shares Total Investment Rs. 2000/- Broker provides Rs. 8000/- At 2 pm Share Price : Rs. 120/- Sell 100 shares Profit: Rs. 2000/- Return on investment: 100%

18. A Reliance Capital Company Services Available Equities – Delivery, ATST, Margin Futures and Options IPO's online Research Inputs – Dow Jones, Saans Trading Ideas – Sachin Chavan, Deepak Mohini Overseas Equities, Commodities, Currency combinations.

19. A Reliance Capital Company Target Clients Existing Market Traders Investors IPO Applicants New Market MF Investors ULIP Investors Debt Market – FD Invetors

20. A Reliance Capital Company Futures Contract Current Share Price Rs. 100 Market assessment of value on last Thursday: Rs. 120/- Contract Value Rs. 120/- My Assessment: Rs. 125/- I ‘ll buy the contract. Counter Party Assessment: Rs. 115/- Counter party sells contract On last Thursday Price is Rs. 121: Buyer Gains. On last Thursday Price is Rs. 118: Seller Gains.

21. A Reliance Capital Company Thank You