PROFILE OF THE STUDY AREA AND TE SAMPLE OF INVESTORS
Transcription
PROFILE OF THE STUDY AREA AND TE SAMPLE OF INVESTORS
III PROFILE OF THE STUDY AREA AND TE SAMPLE OF INVESTORS PROFILE OF THE STUDY AREA AND TE SAMPLE OF INVESTORS PART I This chapter is divided into two major Parts. Part I consists of the socioeconomic profile of Trichirappalli and Part II consists of the personal profile of the investors of this study. 3.1 Profile of the study area Tiruchirapalli was originally a Chola citadel and later, during 1st millennium AD. Then it was occupied by other South Indian dynasties such as the Pallavas, and Pandyas. The Chola regained control over Tiruchirapalli during the 10th century. Urayur, which has a known history and tradition of about 2500 years, was the capital of Early Cholas. Later, after the fall of the Chola empire, it came under the direct conrol of the Madurai Nayak Dynasty which paid tribute to the Vijayanagara empire. The Rock Fort temple, the most famous landmark in Tiruchirapalli, was built by the Nayaks. The Madurai Nayak rulers changed their capital from Madurai to Tiruchirapalli, and back, several times. The city is home to Nagaraja Cholan and it has many historic temples, monuments, churches and mosques. It was the capital of the early Chola kings. The oldest human-built dam, Kallanai, was built by Karikala Cholan across the Kaveri River about 10 miles from Urayur. With regard to the centre of origin of iron, Sir William Larke, Director of the British Iron and Steel Federation, says The centre of origin is variously placed in India, where there are historical traditions and remains indicating a highly developed iron culture. Hyderabad and Trichinopoly are considered by many to have been the centres of production of wootz. This steel was noted for centuries, being carried by 79 merchants from India to Damascus and Toledo.. Sir William gives the date of this origin of the iron age as 1400 to 1500 B.C.E Trichy was an important town in the days of the Later Cholas and of the Nayak kings, and during the early days of the British East India Company. The conquest of Tiruchirapalli by the British East India Company marked a major even step in the British conquest of India. The well-known Trichinopoly cigars are chiefly manufactured from Tobacco grown in the district at Dindigul. It was said that Winston Churchill developed a taste for the mildly aromatic Trichy cigar that was traded from Fort St George to Whitehall during the 2nd World War .One famous landmark in Tiruchirapalli is the Rock Fort, a big outcrop of rock, 83 metres in height. It is the only such outcrop of its kind. Because of it Trichy is also called as Rock City. On top of it is the Ucchi Pillayar Koil, a temple dedicated to the Hindu god Vinayaka (Ganesh), from where one can enjoy a panoramic view of Tiruchirapalli. The temple was also used as a military fort by the Nayaks for some time. On the southern face of the rock are several beautifully-carved cave temples of the Pallava period. On the eastern side is Sri Nandrudayan Vinayakar Temple, with Ganesha as the main deity. A large-sized Ganesha and depictions of other rare deities can be seen in this temple, which hosts festivals every year during the Vinayaka Chathurthi (birthday of Ganesha). Many Carnatic musicians have given concerts in this famous shrine. Around the rock temple is a busy commercial area, mainly known for its textiles and Burmese, Chinese, Japanese goods, known as Chatram. The Main Guard Gate is flooded on festive occasions such as Deepavali, Ramzan, Bakrid, Christmas, and Pongal with shoppers. Trichy is also famous for the number of Christian churches said to have the greatest number of churches in India. The most famous are Holy Redeemer's Church (Sagayamatha Kovil), Our Lady of Lourdes Church(built by Jesuits) near Chatram bus stand, and The Cathedral in Melapudur(built by 80 Jesuits), all more than a century and a half old. The most famous college in Trichy, St. Joseph's College was also built by the Jesuits, and so was St. Joseph's School, Trichy also is also famous for Arcot Nawab Masjid (one of the oldest), with its large water storage tank (Ahail) Geography and climate The river Kaveri flowing through Trichy, as seen from Rockfort temple. The topology of Trichy is flat. It lies at an altitude of 78 m above sea level. The river Kaveri (also called Cauvery) and the river Coleroon (also called Kollidam) flow through Trichy, the latter forms the northern boundary of the city. The river Cauvery flows along WNW-SSE direction through the city. There are a few hills located within the city, the prominent among them are Golden Rock, Rock Fort, Kajamalai and in Thiruverumbur. There are a few reserve forests along the river Cauvery, located at the west and the north-west parts of the city. The southern and the south-western part of the district is dotted by several hills which are thought to be part of the Western Ghats. Eastern ghats also pass through the district. The soil here is considered to be very fertile. As two rivers flow through the city, the northern part of the city is greener than other areas of the city. Trichy has a moderate and pleasant climate, with humidity slightly above normal. The city experiences mild winters and humid summers. The timing of the monsoon in this part of the country has lately become unpredictable, with the rainy season starting from mid-October until early-November and the rains then extending until early or mid-January. Demography As of 2009, Trichy had a population of 11,39,534. Males constitute 49.97% of the population and females 50.03%. Trichy has an average literacy rate of 91.45%. Male literacy is 94.17% and female literacy is 88.73%. In Trichy 9.59% of the population is under 6 years of age. The city's population is predominantly Hindu (with both Saivaite and Vaishnavaite), and there are 81 sizable population of Christians and Muslims. Sikhs and Jains are also present in smaller numbers as businessmen mainly. The most widely spoken language is Tamil, though there are also significantly large numbers of people speaking Telugu, Saurashtrian, Kannada and Thanjavur Marathi. The standard dialect is the Central Tamil dialect.[5][6] Madurai Tamil is also widely spoken. During the pre-independence era, Anglo-Indians, many of whom worked in the 'South-Indian Railways', started settling in 'Golden RockTownship' and 'Crawford' located within the city. Crawford is considered as one of the expensive areas in the city. The place is predominantly Christian. 3.4 Economy Trichy is a major engineering hub and energy equipment and fabrication center of India. BHEL - Bharat Heavy Electriclas Limited Bharat Heavy Electriclas Limited (BHEL) is ranked among the leading Power Plant Manufacturers in the world. At Tiruchirapalli, the High Pressure Boiler Plant of the Bharat Heavy Electricals Limited (BHEL) was setup in 1963. Now, it is one of the foremost manufacturing facilities within BHEL and it has 3 major plants namely, High Pressure Boiler Plant, Seamless Steel Tube Plant and Boiler Auxiliaries Plant. BHEL was set up during the period of K.Kamaraj, the then Chief Minister of Tamil Nadu and the statue of K.Kamaraj is there at the entrance of the Colony main Gate. • A number of small scale industries have also sprung up in Trichy, mostly around Thuvakudi and Mathur. • Leather Tanneries are located on the way to Pudukottai. Viralimalai, considered an industrial sub urban, has the factories. 82 • Manachanallur has numerous rice mills supplying polished rice all over Tamil Nadu and it is well known for the quality of the rise produced from its land. • The economy of the city is driven to a certain extent by IT/ITES companies encouraged by the support from state government. A dedicated stretch of land has been identified and developed to increase the state's share in national IT/ITES exports. The government had begined its work for setting up IT park in the city. The economy of the city would be increased to a great extend if this park comes into working. Which would be finished in about one year. • HCL has a carrier development centre in the city to guide the youth of the city. More over the city has many reputed MNC's are in the city, and still many to come. 3.5 Transportation a) Roadways Kaveri Bridge on NH 45 connects Trichy and Srirangam. Trichy is well connected to various parts of Tamil Nadu, by private and public bus services. There are two Bus Stands at Tiruchirappalli, as explained below: Chathiram (also called Chinthamani or Main Guard Gate Bus Stand) The Chathram (Main Guard Gate) bus stand, near Rock Fort temple, runs local and outstation (City-to-Town) bus services which connect people to nearby towns and villages such as Thuraiyur, Perambalur, Ariyalur, Cuddalore, Jeyankondacholapuram, Vriddhachalam, Chidambaram, Neyveli, and many. Bus services are frequent throughout the day and the night. The central bus stand runs long distance services to major cities and states of South India such as Tanjore,Chennai, Madurai, Coimbatore, Bangalore, Tirunelveli, Nagercoil, Tirupathi, Salem, Erode, Pudukkotai, Dindigul, Rameswaram, Theni, Tindivanam, Hosur, Vellore,Tiruvannamalai, Kumbakonam, Mayiladuthurai, Namakkal, also to other states. 83 b) National Highways passing through Tiruchirappalli On the road infrastructure Trichy will have four track highways from the city branching to destination Chennai, Madurai, Nagappattinam and Coimbatore. c) Railways Trichy is a hub of Southern Railway (India). Southern railway connect this central part of Tamil Nadu to various parts of India, notably regions in Kerala, Andhra Pradesh, West Bengal, Maharashtra, Karnataka, Delhi, and Madhya Pradesh. Trichy Railway Junction has five branches leading to Madurai, Rameswaram, Erode, Tanjore and Chennai and currently there are 4 platforms in operation. Platform no 5, 6, 7 is under gauge conversion which is to be finished and brought into working soon. Trichy is one of the busiest railway junctions in India. It has more than 200 train crossings per day in its division. It also has the record of a railway station to have broadgage next to Chennai. The railway station has been accredited with international standard, and the development is under process. The Electrification between Villupuram and Tiruchchirappali has been completed and service started with electric traction on the chord line. The double line is also approved for the same section and the work had started. This division has the press which supplies the printed unreserved ticket for Tamil Nadu railway stations. d) Airways Trichy has an International airport about eight kilometres from the city, which operates flights to several Indian cities, territories, and neighbouring countries including Malaysia, Singapore, Sri Lanka and the Gulf by Air Asia, Indian Airlines, Air India Express, Srilankan Airlines, Mihin 84 Lanka,Kingfisher Airlines,Paramount Airways. Trichy airport is the second largest airport in Tamil Nadu next to Chennai to get international connectivity to Colombo (Srilanka) in 1981. Nowadays, flights are operated to Gulf countries such as the United Arab Emirates and Kuwait. Plans are on to upgrade it to a full fledged international airport in the next three years.[7] The extended runway (8000 ft) was commissioned and further expansion to 12500 ft has started. The new terminal building is opened in 2009. Two aero bridge are opened to use. This is the second airport in Tamil Nadu to get it next to Chennai. An new Air Traffic Control Centre is also being planned to be constructed to cope up with growing air traffic in the region. 3.6 Administration The city is a Municipal Corporation. It also serves as the headquarters of the district with the same name. The city is headed by a Mayor, under whom the Deputy Mayor and several councilors elected by people representing work as administrative wards; as well as a corporation Commissioner of the rank of IAS to administer the city. The city has one Member of Parliament representing the Trichy constituency, Tiruchi (East) and Tiruchi (West) Srirangam, Musiri, Lalkudi and Thiruverambur assembly constituencies are part of Tiruchirappalli (Lok Sabha constituency) . The district is headed by the District Collector of the rank of IAS. 3.7 Stock Exchanges in Tamil Nadu There are two stock exchanges in Tamil Nadu. They are 1) Madras Stock Exchange Ltd (MSE) is a self regulatory organization having permanent recognition under the Securities Contracts (Regulations) Act, 1956, and the fist Stock Exchange in the southern part of the country. Established in the year 1937, the Exchange has a long history of service to the 85 nation and pioneered the development of the capital market in this part of the country by catering to the needs of the industrial entrepreneurs to raise capital for industrial promotion and providing investment opportunities to the public. The Exchange is a demutualised corporate entity pursuant to the MSE (Corporatisation and Demutualisation) Scheme, 2005 approved by the Securities and Exchange Board of India (SEBI). The stakeholders of the Exchange include Financial Institution of the Tamil Nadu State Government, leading corporate houses, high networth individuals and Trading Members of the Exchange. The Exchange is managed by the Board of Directors, representing the various stakeholders in the manner as stipulated in the Demutualisation Scheme. MSE has a strategic arrangement with the National Stock Exchange (NSE) which provides for the facility of trading by the members of MSE on NSE platform and also for trading of MSE listed companies on the NSE. Empowerment of the investors through education has been the focus of the Exchange. The Exchange has established an exclusive investment education centre named as the “MSE Institute of Capital Markets” to cater to the educational needs of the market participants. This Centre conducts regular and intensive training programmes, seminars and workshops throughout the State of Tamil Nadu & Pondicherry. The Exchange continuously holds monthly Investors’ Meet at its premises in Chennai on the third Saturday of every month. The Exchange also provides Depository Services as Depository Participant of CDSL and NSDL. MSE has set up subsidiary - MSE Financial Services Ltd., which is a Corporate Broking House, having membership of BSE and NSE and trading facilities are provided to the investors through the Members of MSE. 86 a) Trading Facilities The Exchange provides cost effective and efficient trading facilities through the Members of the Exchange, for which it has the following arrangements: b) Trading through the Subsidiary In terms of the guidelines issued by SEBI, the Exchange has floated a Subsidiary Company– MSE Financial Services Ltd., which is a corporate member of both NSE and BSE. The Members of the Stock Exchange are eligible to trade through the Subsidiary route, by registering themselves as Subbrokers of MSEFSL. The contract notes are issued by the Subsidiary and the funds and securities of clients are directly handled by the Subsidiary, ensuring highest level of safety and security to the investors. c) MoU with NSE The Exchange has entered into an MoU with the National Stock Exchange Ltd (NSE) and the same is duly approved by SEBI, under which the members of MSE can access the trading platform of NSE and execute the trades. Under this arrangement, the members would issue contract notes of their own, as a member of MSE. The arrangement also provides for trading of MSE listed shares at NSE, subject to eligibility criteria. d) MSE - NSE Trading Operation 1) Enablement Application for NSE Trading Existing Members of MSE New Members 2) MSE contract note 3) MSE KYC Individual 4) MSE KYC Corporate 5) User id application 87 6) System Configuration for now terminal e) Investors Education The Madras Stock Exchange (MSE) has initiated various steps to promote education in securities markets and create investor awareness. MSE strongly believes that investors are the backbone of the securities market. They not only determine the level of activity in the securities market but also the level of activity in the economy. However, many investors may not possess adequate expertise/knowledge to take informed investment decisions. Some of them may not be aware of the complete risk-return profile of the different investment options. Some investors may not be fully aware of the precautions they should take while dealing with market intermediaries and dealing in different securities. They may not be familiar with the market mechanism and the practices as well as their rights and obligations. Against this MSE launched a comprehensive education campaign aimed at creating awareness among investors about securities market, under the aegis of “Investor Awareness Campaign” initiated by SEBI. The motto of the campaign is “an Educated Investor is a Protected Investor.” The structural foundation of the campaign is based on workshops that are being conducted all across the Tamilnadu with the continued and active participation of market participants, market intermediaries, Investors Associations etc. In order to further give an impetus to this initiative, the Exchange has established the MSE Institute of Capital Markets, as a separate wing exclusively for Education & Training in the Securities and Financial Markets. MSE offers Investor Services in the following Centres in Tamilnadu : T.Nagar Chennai, Mylapore Chennai, Virudhunagar, Karaikudi, and Tirunelveli 88 2) Coimbatore Stock Exchange Limited (CSX) is the youngest stock exchange in India. It was founded by K.G. Balakrishnan in the year 1996. It is now governed by the Governing Body which consists of the member brokers. The exchange also has Screen Based Trading (SBT) system which commenced operations on 9th of October, 1996. The system is equiped to handle 25,000 traders per day and 400 members. Each member has been given a computer terminal which is connected in a Local Area Network (LAN). a) Location Its trading hall consists of 19000 sq.ft area. The Exchange has successfully implemented Screen Based Trading (SBT) system and commenced its operations with effect from 9th October, 1996. The system is capable of handling 25,000 trades per day. All the members of the Exchange are connected in a Local Area Network (LAN). The system can be expanded to handle upto 400 members. The SBT system has been interfaced with the existing settlement system. The margins are monitored online on the SBT system. Each member is given a computer terminal, telephone connections which are accommodated in a cubicle. The communication facilities include the terminals of Reuters and Knight Ridder constantly updating economic and capital market related news. b) Coimbatore Stock Exchange Members Currently the segregation of Coimbatore Stock Exchange are as follows: Individual Members 136 Corporate Members 57 Chartered Accountants/ Company Secretaries 40 MBAs 17 Engineers 14 Cost Accountants 10 Post Graduates 20 89 PART II 3.2.01 Profile of Investors The study of investors preferences in capital market investment with special reference to Trichirappalli District was carried out by a personal interview of 300 investors with the help of a structured interview schedule. For the purpose of sample study Tiruchirappalli district was divided into three geographical regions namely the southern region, the central region, and the northern region. The southern region consists of the following places like Manikandam, Ramji Nagar, Enamam Kolathur, Navalpattu, and Manaparai. The central region consists of the following places in Trichy city like central bus stand, Puthur, Thillai Nagar, Chathiram bus stand, Srirangam and BHEL. The northen region consists of places like Tolgate, Samayapuram, Lalgudi, Jeeyapuram, Musiri, and Thottyam. A sample of 100 investors were selected from each of the three sample regions on simple random basis from the list of investors supplied by broker firms and mutual funds agents. The personal profile of respondents who participated in the survey are presented in tables below. It is arranged in the order of age, sex, marital status, educational qualification, occupation income, and savings. The sample places chosen for the study in Trichirappalli District is shown below in the Map. 90 MAP 3.1 TRICHIRAPPALLI DISTRICT 91 Personal Profile of Respondents Age wise distribution of respondents is shown in table 3.1 reveals that 29.7 per cent of investors are in the group of 36 to 45 years, 26.7 per cent are in the group of upto 35 years and 26 per cent are in the group of 46 to 55 years. Among three regions, the major group of investors in the southern region are upto 35 years (37 per cent) those in the central region are investors between 36 years and 45 years (37 per cent) and those in the northern region are investors between 46 and 55 years (36 per cent). Table 3.1 AGE Factors Up to 35 36 – 45 46 – 55 Above 55 Total Regions All Trichy Southern Central Northern 37 22 21 80 (37.0) (22.0) (21.0) (26.7) 26 37 26 89 (26.0) (37.0) (26.0) (29.7) 20 22 36 78 (20.0) (22.0) (36.0) (26.0) 17 19 17 53 (17.0) (19.0) (17.0) (17.6) 100 100 100 300 (100.0) (100.0) (100.0) (100.0) Note: Figure in parentheses are percentage of the respective totals Source: Interview Schedule 92 The classification of respondents according to sex shown in table 3.2 reveals that 85.3 per cent of them are male members and 14.7per cent are females. In the southern region, 78 per cent are male members while 89 per cent each are male members in the central and northern region. Table 3.2 Sex Factors Male Female Southern 78 (78.0) Regions Central 89 (89.0) Northern 89 (89.0) 22 (22.0) 11 (11.0) 11 (11.0) All Trichy 256 (85.3) 44 (14.7) 100 100 100 300 (100.0) (100.0) (100.0) (100.0) Note: Figure in parentheses are percentage of the respective totals Source: Interview Schedule Total 93 Distribution according to marital status shown in table 3.3 shows that 79 per cent investors are married, 16.3 per cent are unmarried and 2.3 per cent each belong to widow and divorced group. Table 3.3 Marital Status Factors Married Unmarried Widowed Divorced Southern 70 (70.0) Regions Central 84 (84.0) Northern 83 (83.0) 21 (21.0) 5 (5.0) 13 (13.0) 2 (2.0) 15 (15.0) - 49 (16.3) 7 (2.3) 4 1 2 7 (4.0) (1.0) (2.0) (2.3) All Trichy 237 (79.0) 100 100 100 300 (100.0) (100.0) (100.0) (100.0) Note: Figure in parentheses are percentage of the respective totals Source: Interview Schedule Total 94 The distribution of respondents according to educational qualification shown in table 3.4 reveals that 38 percent are graduates and 26 percent are post-graduates and above. Professional degree holders constitute 23 percent of the total number of respondents. Slight regional difference is observed with regard to qualification of respondents. Table 3.4 Education Regions All Trichy Southern Central Northern 14 12 13 39 Below Graduation (14.0) (12.0) (13.0) (13.0) 40 51 23 114 Graduation (40.0) (51.0) (23.0) (38.0) Post-graduation 26 14 38 78 and above (26.0) (14.0) (38.0) (26.0) Professional 20 23 26 69 Degree (20.0) (23.0) (26.0) (23.0) 100 100 100 300 Total (100.0) (100.0) (100.0) (100.0) Note: Figure in parentheses are percentage of the respective totals Factors Source: Interview Schedule 95 Occupational distribution of the investors given in below Table 3.5 reveals that 45.3 percent of the respondents are employees, 20 percent are engaged in business or industry and about 14 percent are pensioners. Investors doing professional practice comes to 12.7 percent. A market difference is noted in the pattern of respondents managing business or industry in southern and northern regions. Table 3.5 Occupation Factors Employee Professional Businessman/industrialist Pensioner Others Total Regions All Trichy Southern Central Northern 41 46 49 136 (41.0) (46.0) (49.0) (45.3) 11 13 14 38 (11.0) (13.0) (14.0) (12.7) 27 22 11 60 (27.0) (22.0) (11.0) (20.0) 12 15 14 41 (12.0) (15.0) (14.0) (13.7) 9 4 12 25 (9.0) (4.0) (12.0) (8.3) 100 100 100 300 (100.0) (100.0) (100.0) Note: Figure in parentheses are percentage of the respective totals Source: Interview Schedule 96 (100.0) The distribution by income class of investors shown in table 3.6 reveals that 37.3 percent of them fall in the income group between Rs.100000 and Rs.200000, 33.3 per cent belong to the income group of Rs.200001 and Rs.500000 and 14.7 per cent have income between Rs.50001 and Rs.100000. On regional review it is observed that major part of respondents in each region is in the income group of Rs.100001 to 200000 and Rs.200001 and 500000. The average annual income of the whole sample amounted to Rs. 256083 while it is Rs.227250 in the southern region, Rs.267250 in the central and Rs.273750 in the northern region. Table 3.6 Annual Income Factors Up to 50000 50001-100000 100001-200000 200001-500000 Above 500000 Total Regions All Trichy Southern Central Northern 2 4 5 11 (2.0) (4.0) (5.0) (3.7) 23 13 8 44 (23.0) (13.0) (8.0) (14.7) 37 38 37 112 (37.0) (38.0) (37.0) (37.3) 31 31 38 100 (31.0) (31.0) (38.0) (33.3) 7 14 12 33 (7.0) (14.0) (12.0) (11.0) 100 100 100 300 (100.0) (100.0) (100.0) (100.0) Note: Figure in parentheses are percentage of the respective totals Source: Interview Schedule 97 Classification of investors according to their savings shown in Table 3.7 reveals that 33.7 per cent have savings between Rs.50001 to Rs.100000 whereas 30.3 per cent have savings above Rs.100000. Only 11.7 per cent of respondents have savings less than Rs.25000. In the southern region, 32 per cent respondents have saving between Rs.25001 to 50000 and 33 per cent have savings above 100000. While 28 per cent have savings between Rs.500001 to 100000 and 26 per cent have savings between Rs.25001 to 50000. In the northern region 40 per cent investors have savings between Rs.50001 – 100000 followed by 34 per cent in the savings group of above Rs.100000. Average annual savings of 300 investors came to Rs.81542 which is Rs.74300 in the southern region, Rs.82275 in the central region and Rs.88050 in the northern region. Table 3.7 Annual Savings Factors Up to Rs. 1000 Rs. 10001-25000 Rs. 25001-50000 Rs. 50001-100000 Above Rs. 100000 Total Regions All Trichy Southern Central Northern 3 2 4 9 (3.0) (2.0) (4.0) (3.0) 8 11 7 26 (8.0) (11.0) (7.0) (8.7.0) 32 26 15 73 (32.0) (26.0) (15.0) (24.3) 33 28 40 101 (33.0) (28.0) (40.0) (33.7) 24 33 34 91 (24.0) (33.0) (34.0) (30.3) 100 100 100 300 (100.0) (100.0) (100.0) (100.0) Note: Figure in parentheses are percentage of the respective totals Source: Interview Schedule 98
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