HDFC Bank's Organizational Profile and Background

Acknowledgesment
This trifle project of mine would have been a Zyogate, if it did not achieved the support, cooperation and blessings of few people. It was indeed a great experience and opportunity for me to do my internship at HDFC Commercial Transportation Group. Without the proper guidance, I would not have been able to complete the project. First of all my humble thanks to Mr. Abhishek Sharma, Relationship Manager, Commercial Transportation Group for having full belief and faith in me and giving me an opportunity to do my internship in this esteemed organization. I am immensely grateful to him for giving me exposure far beyond my expectation. Without his gracious and genial support I would not have been able to materialize the project. I am also grateful to Mr. Chetan Chaddha, Mr. Kanwarjit Singh & Mr. Arun Kumar of Commercial Transportation Group, who were there with me throughout my training period, helping me at each step, welcoming my queries, and also did a lot of value addition to my training not only in my project but also apart from it, in spite of their busy schedule. Further more, I am indebted to Mrs Kriti Swaroop the faculty of Institute of Management Studies for her guidance & support. Last, but not least I owe a deep sense of gratitude to all the employees of HDFC Commercial Transportation Group who were cooperative and kind enough to spare their precious time for me in understanding the banking in transportation area, without which I could not have completed the project. My best wishes to all the people of this venerated organization that has been able to create such a healthy environment for people to be content with their work.
(Avinash Kumar Maurya)
Undertaking
I, Avinash Kumar Maurya, the undersigned, hereby declare that this project report entitled Commercial Transportation Working Analysis, has been written & submitted under the guidance of Mr. Abhishek Sharma and is my original work. The empirical findings in this report are based on information collected by me.
(Avinash Kumar Maurya)
Commercial Transportation Working Analysis Created by Avinash Kumar Maurya for HDFC Bank Ltd.
Contents
Chapter
Introduction
Pages
07
1. Organizational Profile
1.1 Background & Objectives 1.2 Promoter & Management 1.3 Capital Structure 1.4 Distribution Network 1.5 Technology 1.6 Business Profile 1.7 Rating 1.8 Product Range 1.9 Innovative Services 1.10 Loans 1.11 Awards & Accolades 1.12 Branch Internal Divisions
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10 11 12 12 13 14 16 17 18 19 21 23
2. Theoretical Perspective
2.1 Commercial Vehicles 2.2 Working Capital & Credit Norms 2.3 Some Useful Terms
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29 31 3
3. Research Methodology
3.1 Objectives 3.2 Marketing Research Process 3.3 Study Description 3.4 Sampling 3.5 Contact Methods
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36 37 38 41 43
4. Data Analysis and Interpretation

4.1 Data Representation 4.2 Charts & Comments
47
48 50
5. Conclusion, Recommendations & Limitations

Conclusions 5.2 Suggestions & Recommendations 5.3 Limitations
5.1
64
65 67
6. Annexure
6.1 Questionnaire 68
6.2 Bibliography
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Introduction
Commercial Transportation, as the name suggests, the term deals with all kinds or modes of transportation, which are commercially available to transport various kinds of items from one place to another. Indian scenario in this area of development is popular from a very long period even before independence. Road transportation is very much famous to make the various goods & items available in small to small area of living. There are various kind of industries associated with this field. Some of those are iron, rubber, plastic, mechanical, coal, petroleum, and most importantly service sector & information technology. Commercial Transportation Working Analysis is the study of working methodology of Transporters, how they operate their functions, their working regions etc. The purpose is to find out the market share and impact of HDFC in Working Capital Market in Transport Sector. The main considerations in the survey include the Fleet Size, Major Financiers, Overdraft Facility availed by Transporters, Tyres purchased, Diesel Buy basis & Oil Co. preferred, Payments made for Insurance, Permits, Maintenance etc, & Newspaper read by them. Each of these has some relevance in one or the other sense. This report is conducted in such a way that all the findings, data & interpretation should be useful for any kind of reader, whether it belongs to any Tyres Company, Oil Company and so on. The beginning includes the brief Organization Profile followed by Research Methodology and finally with Data Analysis & Interpretation with Conclusions, Suggestions and Bibliography.
Commercial Transportation Working Analysis Created by Avinash Kumar Maurya for HDFC Bank Ltd. 5
The survey for analysis is conducted in whole National Capital Region mainly includes Delhi, Ghaziabad & Faridabad. From the viewpoint of banking business in field of Commercial Transportation, there is sufficient increase in financing for Transporters in past few years and it will definitely go beyond on large scale for the benefits of Transporters. As far as customers or transporters point of view is concerned, there is welldefined space for their suggestions & recommendations, which are welcomed & entertained up to some extent if possible. The most important part of report is of Research Methodology, which stresses on the objectives, procedure of doing whole survey, sampling, and limitations is well-defined & presented that how the whole work has been completed using various research techniques, instruments, methods etc. to make this survey useful in every sense. Whatever the data has been collected from the survey, is represented in form of tables as well as charts are also used to show the composition of various elements in particular area or field. With these charts, few comments on every chart are also presented to make a chart more understandable even to a layman. In the end, suggestions & recommendations given by the transporters as well as on the basis of analysis are presented to help the reader in reaching at some conclusions & help in answering what to do, how to do, when to do, and where to do for the welfare of whole society and especially in the field of transportation.
Chapter 1
1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 1.10 1.11 1.12
Background & Objectives Promoter & Management Capital Structure Distribution Network Technology Business Profile Rating Product Range Innovative Services Loans Awards & Accolades Branch Internal Divisions
1.1 Background & Objectives

The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in-principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of the RBI's liberalisation of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995. HDFC Bank's mission is to be a World-Class Indian Bank. The Bank's aim is to build sound customer franchises across distinct businesses so as to be the preferred provider of banking services in the segments that the bank operates in and to achieve healthy growth in profitability, consistent with the bank's risk appetite. The bank is committed to maintain the highest level of ethical standards, professional integrity and regulatory compliance. HDFC Bank's business philosophy is based on four core values: Operational Excellence, Customer Focus, Product Leadership and People.
1.2 Promoter & Management

HDFC is India's premier housing finance company and enjoys an impeccable track record in India as well as in international markets. Since its inception in 1977, the Corporation has maintained a consistent and healthy growth in its operations to remain a market leader in mortgages. Its outstanding loan portfolio covers well over a million dwelling units. HDFC has developed significant expertise in retail mortgage loans to different market segments and also has a large corporate client base for its housing related credit facilities. With its experience in the financial markets, a strong market reputation, large shareholder base and unique consumer franchise, HDFC was ideally positioned to promote a bank in the Indian environment. Mr. Jagdish Capoor took over as the bank's Chairman in July 2001. Prior to this, Mr. Capoor was a Deputy Governor of the Reserve Bank of India. The Managing Director, Mr. Aditya Puri, has been a professional banker for over 25 years and before joining HDFC Bank in 1994 was heading Citibank's operations in Malaysia. The Bank's Board of Directors is composed of eminent individuals with a wealth of experience in public policy, administration, industry and commercial banking. Senior executives representing HDFC are also on the Board. Senior banking professionals with substantial experience in India and abroad head various businesses and functions and report to the Managing Director. Given the professional expertise of the management team and the overall focus on recruiting and retaining the best talent in the industry, the
bank believes that its people are a significant competitive strength.
1.3 Capital Structure

The authorized capital of HDFC Bank is Rs.450 crore (Rs.45 billion). The paid-up capital is Rs.282 crore (Rs.28.2 billion). The HDFC Group holds 24.2% of the bank's equity while about 13.1% of the equity is held by the depository in respect of the bank's issue of American Depository Shares (ADS/ADR Issue). The Indian Private Equity Fund, Mauritius (IPEF) and Indocean Financial Holdings Ltd., Mauritius (IFHL) (both funds advised by J P Morgan Partners, formerly Chase Capital Partners) together holds about 5.5% of the bank's equity. Roughly 27.5% of the equity is held by FIIs, NRIs/OCBs while the balance is widely held by about 214,000 shareholders. The shares are listed on The Stock Exchange, Mumbai and the National Stock Exchange. The bank's American Depository Shares are listed on the New York Stock Exchange (NYSE) under the symbol "HDB".
1.4 Distribution Network

HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable network of over 350 branches spread over 175 cities across the country. All branches are linked on an online real-time basis. Customers in 90 locations are also serviced through Phone-Banking. The Bank's expansion plans take into account the need to have a presence in all major industrial and commercial centers where its corporate customers are located as well as the need to build a strong retail customer base for both deposits and loan products. Being a clearing/settlement bank to various leading stock exchanges, the Bank has branches in the centers where the NSE/BSE has a strong and active member base.
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The Bank also has a network of over 900 networked ATMs across these cities. Moreover, HDFC Bank's ATM network can be accessed by all domestic and international Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American Express Credit/Charge cardholders.
1.5 Technology
HDFC Bank operates in a highly automated environment in terms of information technology and communication systems. All the bank's branches have connectivity which enables the bank to offer speedy funds transfer facilities to its customers. Multi-branch access is also provided to retail customers through the branch network and Automated Teller Machines (ATMs). The Bank has made substantial efforts and investments in acquiring the best technology available internationally to build the infrastructure for a world-class bank. In terms of software, the Corporate Banking business is supported by Flexcube, while the Retail Banking business by Finware, both from i-flex Solutions Ltd. The systems are open, scaleable and web-enabled. The Bank has prioritised its engagement in technology and the internet as one of its key goals and has already made significant progress in web-enabling its core businesses. In each of its businesses, the Bank has succeeded in leveraging its market position, expertise and technology to create a competitive advantage and build market share.
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1.6 Business Profile

HDFC Bank caters to a wide range of banking services covering both commercial and investment banking on the wholesale side and transactional / branch banking on the retail side. The bank has three key business areas : Wholesale Banking Services The Bank's target market is primarily large, blue-chip manufacturing companies in the Indian corporate sector and to a lesser extent, emerging mid-sized corporates. For these corporates, the Bank provides a wide range of commercial and transactional banking services, including working capital finance, trade services, transactional services, cash management, etc. The bank is also a leading provider of structured solutions which combine cash management services with vendor and distributor finance for facilitating superior supply chain management for its corporate customers. Based on its superior product delivery / service levels and strong customer orientation, the Bank has made significant inroads into the banking consortia of a number of leading Indian corporates including multinationals, companies from the domestic business houses and prime Public Sector companies. It is recognised as a leading provider of cash management and transactional banking solutions to corporate customers, mutual funds, stock exchange members and banks. Retail Banking Services The objective of the Retail Bank is to provide its target market customers a full range of financial products
and banking services, giving the customer a one-stop window for all his/her banking requirements. The products are backed by worldclass service and delivered to the customers through the growing branch network, as well as through alternative delivery channels like ATMs, Phone-Banking, Net-Banking and Mobile-Banking. The HDFC Bank preferred program for high net worth individuals, the HDFC Bank Plus and the Investment Advisory Services programs have been designed keeping in mind needs of customers who seek distinct financial solutions, information and advice on various investment avenues. The Bank also has a wide array of retail loan products including Auto Loans, Loans against marketable securities, Personal Loans and Loans for Two-wheelers. It is also a leading provider of Depository Services to retail customers, offering customers the facility to hold their investments in electronic form. HDFC Bank was the first bank in India to launch an International Debit Card in association with VISA (VISA Electron) and issues the Mastercard Maestro debit card as well. The debit card allows the user to directly debit his account at the point of purchase at a merchant establishment, in India and overseas. The Bank launched its credit card in association with VISA in November 2001. The Bank is also one of the leading players in the "merchant acquiring" business with over 25,000 Point-of-Sale (POS) terminals for debit / credit cards acceptance at merchant establishments. The Bank is well positioned as a leader in various net-based B2C opportunities including a wide range of internet banking services for Fixed Deposits, Loans, Bill Payments, etc. Treasury Operations Within this business, the bank has three main product areas - Foreign Exchange and Derivatives, Local Currency Money Market & Debt Securities, and Equities. With the liberalization of the financial markets in India, corporates need more sophisticated risk management information, advice and product structures. These and fine pricing on various treasury products are provided through the bank's Treasury team. To comply with statutory reserve requirements, the bank is required to hold 25% of its deposits
in government securities. The Treasury business is responsible for managing the returns and market risk on this investment portfolio.
1.7 Rating
HDFC Bank has its deposit programs rated by two rating agencies Credit Analysis & Research Limited (CARE) and Fitch Ratings India Pvt. Ltd. The Bank's Fixed Deposit program has been rated 'CARE AAA (FD)' [Triple A] by CARE, which represents instruments considered to be "of the best quality, carrying negligible investment risk". CARE has also rated the Bank's Certificate of Deposit (CD) programme "PR 1+" which represents "superior capacity for repayment of short term promissory obligations". Fitch Ratings India Pvt. Ltd. (100% subsidiary of Fitch Inc.) has assigned the "tAAA (ind)" rating to the Bank's deposit programme, with the outlook on the rating as "stable". This rating indicates "highest credit quality" where "protection factors are very high". HDFC Bank also has its long-term unsecured, subordinated (Tier-II) Bonds rated by CARE and Fitch Ratings India Pvt. Ltd. CARE has assigned the rating of "CARE AAA" for the Tier-II Bonds while Fitch Ratings India Pvt. Ltd. has assigned the rating "AAA (ind)" with the outlook on the rating as "stable". In each case referred to above, the ratings awarded were the highest assigned by the rating agency for those instruments. Corporate Governance Rating The bank was one of the first four companies which subjected itself to a Corporate Governance and Value Creation (GVC) rating by the rating agency, The Credit Rating Information Services of India Limited (CRISIL). The rating provides an independent assessment of an entitys current performance and an expectation on its "balanced value creation and corporate governance practices" in future. The bank has been assigned a CRISIL GVC Level 1' rating which indicates that the bank's capability with
respect to wealth creation for all its stakeholders while adopting sound corporate governance practices is the highest.
1.8 Product Range

Savings Account: Apart from the usual facilities, you get a free ATM
Card, Interbranch banking, NetBanking, BillPay, PhoneBanking, Debit Card and MobileBanking, among others.
HDFC Bank Preferred: A preferential Savings Account where you
are assigned a dedicated Relationship Manager, who is your onepoint contact. You also get privileges like fee waivers, enhanced ATM withdrawal limit, priority locker allotment, free Demat Account and lower interest rates on loans, to name a few.
Sweep-In Account: A fixed deposit linked to your Savings Account.
So, even if your Savings Account runs a bit short, you can issue a cheque (or use your ATM Card). The money is automatically swept in from your fixed deposit into your Savings Account.
Super Saver Account: Gives you an overdraft facility up to 75% of
your Fixed Deposit. In an emergency, you can access your funds while your Fixed Deposit continues to earn high interest.
HDFC Bank Plus: Apart from Regular and Premium Current
accounts we also have HDFC Bank Plus, a Current Account and then some more. You can transfer up to Rs. 50 lakh per month at no extra charge, between the four metros. You can also avail of cheque clearing between the four metros, get cash delivery/pickup upto Rs.
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25,000/-, home delivery of Demand Drafts, at-par cheques, outstation cheque clearance facility, etc.
Demat Account: Conduct hassle-free transactions on your shares.
You can also access your Demat Account on the Internet.
1.9 Innovative Services

PhoneBanking:
24-hour automated banking services with 39 PhoneBanking numbers available. pay your utility bills and transfer funds, at any of our ATMs across the country all year round.
ATM 24-hour banking: Apart from routine transactions, you can also
Inter-city/Inter-branch Banking: Access your account from any of our
350 branches in 175 cities.

Net-Banking: Access your bank account from anywhere in the world,
at anytime, at your own convenience. You can also view your Demat Account through Net-Banking.
International Debit Card: An ATM card you can shop with all over
the country and in over 140 countries with. You can spend in any currency, and pay in Rupees.
Mobile-Banking: Access your account on your mobile phone screen at
no airtime cost. Use SMS technology to conduct your banking transactions from your cell-phone.
Bill-Pay: Pay your telephone, electricity and mobile-phone bills
through our ATMs, Internet, phone or mobile phone. No more standing in long queues or writing cheques.
1.10 Loans
Now, our loans come to you in easy-to-pay monthly instalments, and are available with easy documentation and quick delivery.
Personal Loans: Take a loan of up to Rs. 3 lakh for a wedding,
education, purchase of a computer or an exciting holiday.

New Car Loans and Used Car Loans: Finance up to 90% of the cost
of a car, new or used! And the loans come to you with easy documentation and speedy processing at attractive interest rates.
Loans against Shares: Get an overdraft up to Rs. 10 lakh at an
attractive interest rate against physical shares, up to 50% of the market value of your shares. In case of Demat Shares, you can get loans against Shares of up to 65% of the market value of your shares, till Rs. 20 lakh.
Commercial Vehicle Loans: HDFC offers loan for all types of
commercial vehicle. We provide funding for all models of Telco, Ashok Leyland, Eicher, Swaraj Mazda, Volvo etc. HDFC spread over 22 locations across the country and expanding rapidly. If anybody have already taken a loan from elsewhere, at a higher rate can avail of HDFCs Balance Transfer facility by exchange their old loan for a commercial vehicle loan from HDFC Bank at a much lower rate.
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Two Wheeler & Consumer Loans: To help you buy the best durables
for your home.

Demat Account: Protect your shares from damage, loss and theft, by
maintaining your shares in electronic form. You can also access your demat account on the internet.
Current Account: Get a personalised cheque book, monthly account
statements, inter-branch banking and much more.

Mutual Funds: Apart from a wide choice of mutual funds to suit your
individual needs, you benefit from expert advice on choosing the right funds based on in-depth market analysis.
International Credit Card: Get an option of Silver, Gold, or Health
Plus Credit card, accepted worldwide from a world-class bank. If you have outstanding balance on your other credit card, you can transfer that balance to this card at a lower interest rate.
NRI Services: A comprehensive range, backed by unmatched features
and world-class service, ensures NRIs all the banking support they need.
Forex Facilities: Avail of foreign currency, travellers cheques,
foreign exchange demand drafts, to meet your travel needs. Insurance: HDFC Bank now brings you Life Insurance and Pension Solutions like Risk Cover Scheme, Savings Scheme, Childrens Plan and Personal Plan from HDFC Standard Life Insurance Co. Ltd.
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1.11 Awards & Accolades

HDFC Bank began operations in 1995 with a simple mission: to be a "World-class Indian Bank". HDFC Bank realized that only a single-minded focus on product quality and service excellence would help us get there. Today, HDFC Bank is proud to say that it is well on its way towards that goal. It is extremely gratifying that our efforts towards providing customer convenience have been recognized both nationally and internationally. In 2004, HDFC Bank was named "Best Overall Local/Domestic Bank India" in the Corporate Cash Management Poll conducted by the Hong Kong-based Asiamoney magazine. In 2003, Forbes Global again named us in its ranking of " Best Under a Billion, 200 Best Small Companies for 2003". Hong Kong-based Finance Asia Magazine rated us "Best Domestic Commercial Bank in India" in 1999, 2000 and 2001 respectively and "Best Local Bank in India" in 2002 and 2003. HDFC Bank has been named Best Domestic Bank in India Region in The Asset Triple A Country Awards 2003. Leading Indian business Magazine Business Today in a survey rated us "Best Private Sector Bank" in India in 1999 and " Best Bank in India" in 2003. NASSCOM and economictimes.com have named us the " Best IT User in Banking" at the IT Users Awards 2003. Leading Personal Finance magazine in India Outlook Money named HDFC Bank the "Best Bank in the Private Sector" for the year 2003.
Leading business newspaper The Financial Express named HDFC Bank the "Best New Private Sector Bank 2003" in the FE-Ernst & Young Best Banks Survey 2003.
There have been some other proud moments as well: London-based Euromoney Magazine gave us the award for "Best Bank - India" in 1999, "Best Domestic Bank" in India in 2000, and "Best Bank in India" in 2001 and 2002. Asiamoney Magazine has named us "Best Commercial Bank in India 2002". The Economic Times has conferred on us The Economic Times Awards for Corporate Excellence as the Emerging Company of the Year 2000-01. For our use of information technology we have been recognized as a "Computerworld Honors Laureate" and awarded the 21st Century Achievement Award in 2002 for Finance, Insurance & Real Estate category by Computerworld, Inc., USA. Our technology initiative has been included as a case study in their online global archives. The Economic Times has conferred on us The Economic Times Awards for Corporate Excellence as the Emerging Company of the Year 2000-01. Leading Indian business magazine Business India named us "India's Best Bank" in 2000 In the year 2000, leading financial magazine Forbes Global named us in its list of "The 300 Best Small Companies" in the world and as one of the "20 for 2001" best small companies in the world. We are aware that all these awards are mere milestones in the continuing, never-ending journey of providing excellent service to our
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customers. We are confident, however, that with your feedback and support, we will be able to maintain and improve our services
1.12 Branch Internal Divisions

The Commercial Transportation Group functioning in Gurgaon Branch located at HDFC Bank Ltd, 2nd Floor, SCO-15, Sector 14, Gurgaon-122001 has mainly seven divisions under Retail Asset Head. These are Commercial Vehicles, Channel Business, Construction Equipment, Working Capital, Credits, Collections, and Operations. This groups main area of concentration is National Capital Region i.e. Delhi, Ghaziabad, Gurgaon, Faridabad, Noida, & even Bhilai. The Organizational Structure of four divisions Commercial Vehicles, Channel Business, Construction Equipment, & Working Capital is same. The rest three i.e. Credits, Collections & Operations have the same Organization Structure in respect of the levels with only difference is in the name of designations.
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Retail Asset Head

Commercial Vehicles Capital Channel Business Construction Working Equipment
Business H e Country H e Regional M a
Business H e Country H e Regional M a Relationship M a 22
Relationship Relationship Relationship M M M a a a Commercial Transportation Working Analysis

Created by Avinash Kumar Maurya for HDFC Bank Ltd.
Fig Organization Chart (4 Divisions)
Commercial Vehicles Division This is the internal division of Business under the Commercial Transportation Group. Its main concern is with the financing of Commercial Vehicles for transporters & Fleet Owners. There are various categories of customers, which are classified for the purpose of financing on the basis of number of vehicles owned by them, their financial background etc. After collecting all the details, these have to be forwarded to Credits Department, to check, verify the details. Channel Business This is an another internal division of Business under the Commercial Transportation Group, which provides the loans to needy customers for purchasing the Commercial Vehicles used in transportation of goods. Under this division, the work has been done for the customers who owned less than three Vehicles. It is done through various Small Financial Divisions spread over the region, who treat or called as Channel Partners. The job of Channel Partners are sourcing where Channel Partners have to identify the needy borrowers and convince them to get their vehicles financed from HDFC, Post Disbursements Documents, in which Channel Partners have to collect, check, verify, and send the various documents/papers, which are required, by the bank for the approval of loans, and lastly is Equated Monthly Installment, where Channel Partners have to collect the EMIs from the clients on which the commission is governed by the bank. Construction Equipment This is the third internal division of Business under the Commercial Transportation Group. This department deals with the financing of all kinds of Equipment, used in construction of roads,
buildings, flyovers, mines etc. like RT-20, GE-404, cranes, road rollers etc. These are the movable property, costly & thats why a huge importance is given while financing of such vehicles. Working Capital Under this fourth internal division of Business in the Commercial Transportation Group, the facility of credit or Overdraft Facility is provided by bank to the needy customers. An account is open in the bank with zero balance & credit limit is ranging from 20 to 200Lacs. This range is wholly divided among various categories A, B, & C on the basis of their financial capacity & fleet size, etc.
Retail Asset Head

Credits Collections Operations
Risk Head Country Head Regional Credits Man Local Credits Man ager
Risk Head Country Head Regional Collections Manage Local Collections Manage r
Risk Head Country Head Regional Operations Manage Local Operations Manage r
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Fig Organization Chart (3 Divisions)
Credits This is a department directly under Commercial Transportation Group. This department has to look after all the four divisions of Business. There are various Credit Managers, who look after the four Business Internal Divisions separately. Here, the jobs of these managers are to check, verify & then finally give decision of acceptance or rejection of the partys proposal. And then the other formalities will be done. Local Credits Manager has to report to Regional Credits Manager, who as to report to Country Head, who as to report to Risk Head, who finally has to report to top boss i.e. Retail Asset Head. Collections This department has to collect all the documents, papers etc. from the parties, whose cases has been approved by Credits Department. In other words, here the job is of disbursements. Local Collections Manager has to report to Regional Collections Manager, who as to report to Country Head, who as to report to Risk Head, who finally has to report to top boss i.e. Retail Asset Head. Operations This department has to look after all the internal operations of all the four internal divisions of Business Department. Again the various operations managers likewise Credits. Local Operations Manager has to report to Regional Operations Manager, who as to report to Country Head, who as to report to Risk Head, who finally has to report to top boss i.e. Retail Asset Head.
The difference between the four above mentioned & three divisions regarding the organization structure is of the heads position under Retail Asset Head.
Chapter 2
2.1 Commercial Transportation 2.2 Working Capital & Credit Norms 2.3 Some Useful Terms
2.1 Commercial Transportation

Commercial vehicles are defined as those involved in the transportation of goods or the provision of commercial passenger road transport services. This is an extremely diverse market, including vehicles ranging from 1.5-tonne microvans to 44-tonne tractor/trailer combinations. However, based on weight and end use, it is possible to break the market down into three main sectors: Light Commercial Vehicles (LCVs)goods-carrying vehicles weighing less than 3.5 tonnes Heavy Goods Vehicles (HGVs)goods-carrying vehicles weighing in excess of 3.5 tonnes Buses and Coachessingle- and double-decker models Light Commercial Vehicles LCVs comprise by far the largest single sector of the commercial vehicles market and include goods vehicles with a gross weight of up to 3.5 tonnes. Within this broad sector, there are three main segments:
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light vans, which consist of vehicles with a gross weight of up to 1.8 tonnes medium and heavy vans, with a gross weight of between 1.8 tonnes and 3.5tonnes 4x4 utilities.
Heavy Goods Vehicles HGVs can be defined as goods-carrying vehicles with a gross weight of between 3.5 tonnes and 44 tonnes. The market for HGVs can be further broken down into a number of different categories based on weight and axle configuration. The largest of these segments is that of 2-axle rigids. Comprising a range of vehicles from 3.5 tonnes to over 15 tonnes, this segment also includes a diverse range of body styles, from small minibuses to tipper/dump trucks. Box vans account for over a third of all 2-axle registrations, with the rest being spread fairly evenly between the other body styles. Buses and Coaches Generally speaking, the bus and coach sector is considered to be one of the most complexes of all the commercial vehicles markets. The overall sector for buses and coaches can be split into fare-stage Public Service Vehicles (PSVs) and coaches. These two categories can then be further subdivided into single- and double-deckers. Fare-stage PSVs can also be divided into midis, which are over 3.5 tonnes, up to 9 metres in length and single-decker only; and those over 9 metres long and either single- or double-decker. The coaches segment can be further divided into lightweight single-decker and heavyweight coaches, which can be either single- or
double-decker. An interesting feature of the bus and coach sector is that entire vehicles are seldom manufactured by single companies. It is common for one manufacturer to produce the chassis, which is then transported to another company which fits the bodywork.
2.2 Working Capital & Credit Norms

Working Capital can be defined as the capital need by business to operate the day-to-day operations regarding receivables, payments to creditors, cash requirements etc. The credit norms can be explained as the norms or rules set by the banks to fulfill the demands of customer regarding the working capital. The main objectives for the Working Capital Business by HDFC are as follows: To serve the needs of Working Capital for transporters & other such companies. To meet the cash needs for day to day operations of companies. Basis of the Product There are basically two kinds of products offered by HDFC Bank are of Working Capital & Bank Guarantees by the Working Capital Division. These are certain assumptions on which the product is offered to Fleet Operators:
Transporters usually ply their vehicles for either fulfilling a transportation contract awarded by the principal or for loads from the market. The credit period for any such contract is usually 2-3 months. These terms of contracts and day-to-day need of Categorization of Fleet Operators funds give rise to the need of Working Capital. There is a daily need for consumables like fuel, tyres, repairs, salary, maintenance etc.
Categorization of Fleet Operators LFO Large Fleet Operators, who own more than 50 vehicles MFO Medium Fleet Operators, who own between 10 to 50 vehicles SRFO Small Road Fleet Operators, who own less than 10 vehicles Product Details There are mainly two kinds of products offered to the customers, which are Fund Based, & Non Fund Based. There are various considerations on which the agreements have been made like the worth, sales, turnover, and also the number of qualitative factors and further the customer has been put into A, B & C category. The maximum overdraft limit offered of Rs200lacs for A category, Rs100lacs for B category, & Rs20lacs for C category under Funds Based. In case of Non Fund Based, Bank Guarantee limit of Rs50lacs offered to A, & Rs25lacs offered to B category. Non Fund Based is not applicable for C category. There are certain essential securities demanded by the bank against the products offered like Hypothecation of free vehicles to the extent of 75%. These kinds of securities are essential on the part of bank as in case of defaulters, the bank can manage to get back its funds against them.
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In this wide financial service sector, there is always a need arises of proofs, on which the demands of the customer fulfilled by the banks. These proofs, when combined, they form a complete documentation. This documentation contains all the copies of papers demanded by the financial institutions or banks. In this Working Capital product also, banks demand certain papers like Vehicle List of the customer, Financials of past few years, contracts in hand of customer, partnership deed in case of partnership firm, papers of assets under security, etc. This whole documentation should contain all the details demanded by the bank, as well as the complete overview of business of the customer.
2.3 Some Useful Terms

SRTO Small Road Transport Operators This term is used for all those transport operators who owned not more than 10 vehicles, and for these customers, banks need details of all the owned vehicles details. MFO Medium Fleet Operators This term is used for all those transport operators who owned between 10 to 50 vehicles, and for these customers, banks need details of at least 5 owned vehicles details. LFO Large Fleet Operators This term is used for all those transport operators who owned more than 50 vehicles, and for these customers, banks need details of at least 3 owned vehicles details. LTV Loan to Value It is an amount of sum, which is provided as loan out of the total sum of purchase of any vehicle by the transporters.
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CPV Contact Point Verification This is the document describing the details find out at the time when contact is made with the customer regarding its vehicles running & other workings. POA Power of Attorney It is the procedure or document, which transfers the rights & duties or power of one to another person so that all works done by latter in case of former is absent. PDC Post Dated Cheques These are bankers cheques, which drawn in advance for any future date. These cheques are drawn by customer in favor of banks for the payment of EMIs. LOV List of Vehicles This is the list containing the details of vehicles running and owned by the customer like their making, model, number etc.
ETR Excellent Track Record This term is used for those type of customers who are having excellent record, which make them eligible for even heavy loans or who are paying the installments well in time. GTR Good Track Record This term is used for those type of customers who are having good record, which make them eligible for loans or who are paying the installments well in time but they are less reliable then those who are belong to ETR. TVR Telephone Verification Report This report is made & prepared by the employees containing all the details of information, which is given by the person who attend the telephone call made by an executive for the verification of details provided by the customer. FI Report Field Investigation Report As in TVR, this report is made on the basis of analysis of customer by go into the field, where all the workings of customer are going on.
32
FTU First Time User This term is used for those customers who apply for the loan for the first time with the bank. PDD Post Disbursement Documents These documents are preserved separately by the banks after all transactions between the bank & customer have been completed. EMI Equated Monthly Installment This is the sum of amount decided by the banks for the payment of loan by the customer on monthly basis, which includes principle & interest. CG Cash Generation This is an amount, generated by the customer or transporter for a period & it is equated by adding Depreciation into Net Profit.
Chapter 3
33
3.1 3.2 3.3 3.4 3.5
Objectives Marketing Research Process Study Description Sampling Contact Methods
3.1 Objectives
The main objectives are as follows: Assessment of Transport Market related to Commercial Vehicle Financing To know the average capacity of transporter related to Working Capital To access the Transporters Financing Problems To know HDFC Market Share in the field of Commercial Vehicles Financing & Working Capital in Transporter Sector
34
3.2 Marketing Research Process

Research may be defined as prose word. It means analysis of the subject based on borrowed materials with suitable acknowledgement and consultation in the main body of paper. Marketing Research can be defined as the systematic design, collection, analysis, & reporting of data & findings relevant to a specific marketing situation facing the company.
35
Define the Problem Develop the Research Plan Collect the Information Analyze the Information Present the Findings Make the Decision
Fig Marketing Research Process
3.3 Study Description

The type of research here is Exploratory Research Design. This kind of design is used for more precise investigation or of developing the working hypotheses from an operational point of view. It has inbuilt flexibility, which is needed because the research problem, broadly defined initially, is transformed into one with more precise meaning in exploratory studies, which in fact may necessitate changes in research procedure for gathering relevant data. The characteristic features of research are as follows: Flexible Design
Non-Probability Sampling Design No pre-planned design for analysis Unstructured instruments for collection of data No fixed decisions about the operational procedures
Data Sources
The data gathering can be from secondary data, primary data or both. Secondary data are data that are collected for another purpose and already exist somewhere. Primary data are data freshly gathered for a specific purpose or for a specific research project. The cost incurred in collecting primary data is more than secondary data. The secondary data available orally in this research, therefore whole data is collected primarily.
37
Research Approaches
Primary Data can be collected in five ways: Observational Research Focus Group Surveys Behavioral Data Experiments
In Observational Research, fresh data can be gathered by observing the relevant factors & settings. An environment is created to judge the response of respondents in that situation. In Focus Group, a group of 6 to 10 people invited to spend few hours with a skilled moderator to discuss product, service, organization or any other marketing entity. Surveys are best suited for descriptive research. Companies undertake surveys to learn about peoples knowledge, beliefs, preferences, and satisfaction, and to measure the magnitudes in the general population. Behavioral data is collected from the visits to shops, where the customers come & leave traces of their purchasing behavior in store scanning data, catalog purchases, and customer databases. Experimental Research is the most significantly valid research among all above. It studies the cause & effect relationships by eliminating competing explanations of observed findings. What is done here? The research approach in this research is followed is of survey. Here the movement in to the field of transport areas, meet the fleet owners, observer their workings, fill questionnaires personally according to answers given by them as most of the transporters feel uncomfortable in filling questionnaires themselves.
38
Research Instruments
There is a choice of mainly three instruments in collecting primary data: Questionnaires Psychological Tools Mechanical Devices Questionnaire consists of a set of questions presented to respondents. Because of its flexibility, the questionnaire is by far the most common instrument used to collect primary data. Questionnaires need to be carefully developed, tested & debugged before they are administered on a large scale. Psychological Tools such as laddering techniques, depth interviews & rorshach tests can probe a buyers deeper beliefs & feelings. Laddering involves the points set in ascending order, Depth Interview involves the questioning deeply, & rorshach involves some kind of pictures representation, graphs etc. to check the perception of respondent. Mechanical Devises are occasionally used in marketing research. All kinds of scientific instruments & mechanics used to measure the respondents characteristics. What is done here? The Questionnaire is used as research instrument in this research. This technique is useful as the same type of questions asked to all the transporters. It is non-disguised structured questionnaire, which is used to pull out important information from the secret pockets of transporters because generally transporters refuse to give any kind of information.
39
3.4 Sampling
Sampling Plan
Sampling can be defined as the technique through which an idea can be generated out of whole market by taking just a small part of it. The sampling process has the following steps: Define the population Establish the frame of population Choose method of sampling Determine the sample size Write instructions for identification of sample
Under this process, the sampling plan has to be designed. This plan deals with basically three decisions: Sampling Unit Who is to be surveyed? Sample Size How many people should be surveyed? Sampling Procedure How should the respondents be chosen? Sampling Unit By the sampling unit, the target market has to be defined that will be sampled. Once the sampling unit has been determined, a sampling frame must be developed so that everyone in the target population has an equal or known chance of being sampled. The sampling unit in this research is of transporters providing services for transportation of goods all over India from whole NCR region spread mainly over Sanjay Gandhi Transport Nagar, Tis Hazari, Delhi-UP Border, Bata Railway Crossing-FDB, Sadar Bazar, Punjabi Bagh Transport Center, Okhla Industrial Area, etc. National Capital Region includes Delhi, Ghaziabad, Faridabad, Noida, & Gurgaon.
40
Sample Size Large Samples give more reliable results than small samples. However, it is not necessary to sample the entire target population or even a substantial portion to achieve the reliable results. Samples of less than 1 percent of a population can often provide a good reliability. In this research of Commercial Transportation, the Sample Size is 400. Although there are more than 7000 transporters in whole NCR providing services, the sample size is around 5.5 percent of the target population. Sampling Procedure To obtain a representative sample, a probability sample of the sample should be drawn. Probability Sampling allows the calculation of confidence limits for sampling error. Thus, one could conclude after the sample is taken that the interval 5 to 7 trips per year has 95 chances in 100 of containing the true number of trips taken usually by 1st class passengers flying between Chicago & Tokyo. Even non probability samples are useful in many circumstances; even they do not allow sampling error to be measured. Probability Sampling is of many types zlike Simple Random Sampling, Systematic Sampling, Stratified Sampling, Cluster Sampling, & Area Sampling etc. The type of sampling in this research is Cluster Sampling under Probability Sampling. The common group here is of Fleet Owners, who run their fleets all over India. This group is extracted out of various transport areas, which are mentioned in the Sampling Unit.
41
3.5 Contact Methods

Once the sampling plan has been determined, the decision now is to taken regarding how the subject should be contacted: Mail Questionnaire Telephone Personal Online Interview
Mail Questionnaire is the best way to reach people who would not give personal interviews or whose responses might be biased or distorted by the interviewers. Mail Questionnaires require simple & clearly worded questions. Telephone interviewing is best method for gathering information quickly; the interviewer is also able to clarify questions if respondents dont understand them. Personal Interviewing is most versatile method. The interviewer can ask more questions and record additional observations about the respondent, such as dress & body language. Online Interview is best suited for educated people or who can answer the questions through Internet. This is the economical method as at the same time, there is huge collection of responses. What is done here? Personal interview method is used to find the data in this research due to following reasons: Transporters careless behavior towards mails Transporters believe ness in face to face interaction Transporters located in large in same area Transporters dont have to fill questionnaires by self Transporters personally give more suggestions/comments
42
Chapter 4
4.1 Data Representation 4.2 Charts & Comments
43
4.1 Data Representation

Particular s
1. Fleet Size
Top (%)
20-50(36)
Average (%)
5-20(34), Above50(19)
Bottom (%)
0-5(11)
2. Major Financiers
Others/Private(25 )
TATA(21), Citibank(10), ALFinance(13), ICICI(09) KotakMahindra(11), HDFC(11) Availed(28)
3. O/D Composition 4. Availed O/D Composition 5. Not Availed O/D Reasons 6. Tyres
Not Availed(72)
Regional & Nationalized Banks(87) Not Interested(55)
HDFC(8)
Citibank(5)
Financial Soundness(45)
MRF(29)
CEAT(26), Apollo(23)
JK Tyres(22)
44
7. Tyres Life(km)
50000 to 60000 (52)
Above 60000 (35)
Below 50000 (13)
8. Pair of Tyres Cost per month(Rs) 9. Insurance & Permit Payments per annum(Rs) 10. Maintenance Cost per month 11. Diesel Buy Basis 12. Oil Company 13. Type of Vehicles 14. Newspaper Read
7000 to 10000 (55)
10000 to 15000 (45)
40000 to 50000 (43)
30000 to 40000(26), Above 50000 (17)
20000 to 30000 (14)
4000 to 5000 (41)
3000 to 4000 (33), 2000 to 3000 (16)
Above 5000 (10)
Cash basis (94)
Credit (6)
BPCL (41)
HPCL (28), IOC (27) LCV (10), MDV (10) Times of India (25), HindustanTimes(16) , Dainik Jagran (10)
Others (4)
HGV (72)
Multi-Axle (8)
Punjab Kesri (37)
Hindustan (6), NavbharatTimes(6 )

45
4.2 Charts & Comments

1. Fleet Size
Fleet Size
19% 11%
34% 36%
0 to 5
5 to 20
20 to 50
Above 50
Comments
The large number of transporters has 20-50 (36%) Fleets specially in Sanjay Gandhi Transport Nagar. The second largest number of transporters has 5-20 (34%) Fleets followed by 0-5 (19%) Fleets and the remaining are minimum has 50 & above Fleets.
The average fleet size is 30.
2. Major Financiers
Major Financiers
25% 11% 9% 10% 11% Citibank TATA Finance
21% HDFC Kotak Mahindra Others/Pvt ICICI
13%
AL Finance
Comments
The large number of transporters finances their fleets from Others/Pvt (25%) like Chola Mandalam, Sundram Finance etc. due to less serving time and also less formalities with easy terms & conditions. The second largest number of transporters finances from TATA Finance (21%) due to widely availability & well entertained the customers followed by Ashok Leyland Finance (13%).
HDFC holds the share of 11% in financing of fleets with Kotak Mahindra.
3. Overdraft Composition
O/D Composition
28%
72%
Transporters not availing O/D
Transporters availing O/D
Comments
The large number of transporters does not avail the Overdraft Facility i.e. 72% because they are not aware about overdraft schemes and even if interested, then nobody there to entertain them. Only 28% of the transporters avail the Overdraft Facility from various regional & nationalized banks.
48
4. Availed Overdraft Composition
Availed O/D Composition

8% 5%
87% Regional & Nationalized Banks HDFC Citibank
Comments
In 28% Availed Overdraft Facility Transporters, they availed this facility from the Regional & Nationalized Banks i.e. 87%. HDFCs share is 8% out of whole and Citibank is having 5%. This is due to trustworthiness among nationalized banks & even the transporters not aware of private banks policies especially HDFC. Among the private banks HDFC holds the share of 62% and the remaining is of Citibank, as in private sectors Working Capital
Facility is provided by these two only and ICICI is yet to start by August, 2004.
5. Not Availed Overdraft Reasons
No O/D Reasons
45% 55%
Not Interested
Financial Soundness
Comments
In 72% Not Availed Overdraft Facility Transporters, there are about 55% who say they are Not Interested. This is because, they dont want to open their financial details or they feel it as a complex procedure. Rests 45% say that they are Financial Sound, and they dont need any Overdraft or any such Credit Facility. On this basis, out of 100, 72 doesnt have any Overdraft Facility and HDFC has to convince those 40 transporters, who say they are Not Interested which is 55% of 70.
6. Tyres Purchased
Tyres Purchased
29%
23%
22%
26%
Apollo
Ceat
JK Tyres
MRF Tyres
Comments
The above picture of Tyres Purchased by Transporters give the 2largest preference to MRF Tyres, which holds the market share of 29% in Transport Sector. The second largest Tyre Co. Share in Transport Sector is of CEAT (26%) followed by Apollo (23%) & rest is of JK Tyres. On this basis, there is a tough competition among all the well known companies & MRF holds largest share just due to solidity, reliability in long travels.
52
7. Tyres Life
Tyre's Life (kms)

13% 35%
52%
0 to 50000
50000 to 60000
Above 60000
Comments
Most of the Transporters Fleets Tyre gives a drive for 50,000 to 60,000 Kilometers, which make their composition of 52%. There are 35% of transporters, who says that their tyres run above 60,000 Kilometers & rest of the transporters tyres life is of less than 50,000 Kilometers. On an average, the tyres will run for 55,000kms approximately.
53
8. Pair of Tyres Cost p.m.
Tyres' Pair Cost p.m. (000s)
45% 55%
7 to 10
10 to 15
Comments
Most of transporters pay around Rs7000 to Rs10000 i.e. about 55%, which shows that they buy minimum 2 pair of tyres for every fleet. Rest is all depend on the number of shifts for which the fleets are running. Then rest 45% pay from Rs10000 to Rs15000 or above to maintain the life of tyres at good speed & reliability. This is the analysis conducted for the purpose of measuring the Working Capital requirements of the transporters as this consideration forms the major portion of it.
54
9. Insurance & Permit Payments per annum
Insurance & Permit Paid p.a.

17% 14%
26% 43%
20000-30000
30000-40000
40000-50000
Above 50000
Comments
The large number of transporters which are 43%, who paid Rs40,000 to Rs50,000 yearly as an expenditure on Insurance & Permit. The second largest composition is of 26% transporters, who paid Rs30,000 to Rs40,000 as Insurance & Permit Payments per annum followed by 17% who paid more than Rs50,000 and rest paid Rs20,000 to Rs30,000 for the purpose. This whole analysis & outcome regarding Insurance & Permit is based on the number of fleets, the transporters running, their lifetime & especially how much the fleets run & at what distance i.e. the number of shifts. On an average, the Insurance & Permit Payments are of Rs40,000 to Rs42,000.
56
10. Maintenance Cost per month
Maintenance Cost p.m.

10% 16%
41%
33%
2000-3000
3000-4000
4000-5000
Above 5000
Comments
The large number of transporters which are 41%, who paid Rs4,000 to Rs5,000 monthly as an expenditure on Maintenance of their fleets. The second largest composition is of 33% transporters, who paid Rs3,000 to Rs4,000 as Maintenance Cost per month followed by 16% who paid Rs2,000 to Rs,3000 and the rest paid more than Rs5,000 for the purpose. This whole analysis & outcome regarding Maintenance Cost is again based on the number of fleets, the transporters running, and their lifetime as the more old the vehicle is, the larger its Maintenance. On an average, the Maintenance Cost per month paid by transporters is Rs2,900 to Rs3,400.
57
11. Diesel Purchased Basis
Diesel Buy Basis

6%
94% Cash Credit
Comments
The large numbers of transporters buy their fuel or diesel by mode of cash payment i.e. 94%. The reasons for cash as mode of payment for diesel are due to convenience in payments & easily availability because in India there are various areas where Credit or Debit Cards facility is not available. The reasons behind such a low percentage of only 6% who avail the credit facility for buying diesel are illiteracy, inconvenience, & may be complexity.
58
12. Oil Company Preference
Oil Co. Preferred

4% 27%
28%
41% HPCL BPCL IOC CNG/Others
Comments
Bharat Petroleum Corporation Limited holds the largest market share to serve fuel in Transport Sector as about 41% of transporters give preference to BPCL. The reasons for such large share are due to purity, better service & reliable brand. Hindustan Petroleum Corporation Limited & Indian Oil Company holds 28% and 27% respectively. From this composition, there is tough competition in between HPCL & IOC, and the both companies have to do a tough job to win the heart of transporters in advertising as well as purity with interesting schemes, if they want to give tough competition to BPCL.
59
13. Type of Vehicles Owned
Owned Vehicles
8% 10%
10%
72% LCV MDV HGV Multi-Axle
Comments
Most of the transporters owned Heavy Goods Vehicles (72%). These HGVs are trucks normally have 6 to 10 tyres, which anybody can easily vie on the roads. Reasons for this are due to normal capacity, & these vehicles can take a load which is highly preferred. Light Commercial Vehicles & Medium Density Vehicles owned by 10% transporters and the rest owned Multi-Axle Vehicles. The makers of HGVs among all kinds of Transport Vehicles are at top like TATA-2213, TATA-1516 etc.
60
14. Newspaper Reading
Newspaper Read
25%
37%
10% Times of India Hindustan
6%
6%
16%
Hindustan Times Dainik Jagran
Navbharat Times Punjab Kesri
Comments
Most of the transporters read Punjab Kesri (37%). The reasons for this are the illiteracy among some transporters, especially the workers working over there. They can easily read Hindi Newspaper. Secondly is the low price. Most of the transporters then prefer to read Times of India (25%) followed by Hindustan Times (16%) and Dainik Jagran (10%). The rest include Hindustan & Navbharat Times. On this basis, the companies should prefer to give their advertisements in Punjab Kesri & Times of India with Hindustan Times.
61
The Transporters Society needs to learn more in field of education to understand the world happenings in this sector as the English Newspapers govern better knowledge of world.
Chapter 5
5.1 Conclusion 5.2 Suggestions & Recommendations

5.3 Limitations
62
5.1 Conclusions
The whole survey on Commercial Transport Working & Financing draws out some conclusions from the data, which has been already explained in previous chapter are explained in detail nowhere. The whole survey is based on Questionnaire, which ask the very first question regarding the Fleet Size. All other questions, whether related to financiers part or tyres life or Insurance & Permit payments etc. are based on the Fleet Size. 1. Working Regions On the basis of whole study, the main areas or locations of Transporters in National Capital Region are Sanjay Gandhi Transport Nagar on G T Karnal Road, Tis Hazari, Punjabi Bagh Transport Center, Qutab Industrial Area in Delhi, and Bata Railway Crossing in Faridabad, and DelhiUP Border in Ghaziabad. Although, the transporters who provide services for All India but large number of transporters located in NCR provide for Delhi, UP, Haryana, Punjab, Gujrat, & Rajasthan. 2. Fleet Size Regarding the fleet size, the normal size is of 30, which is sufficient to provide the service to potential customers exclude the case of high demand. The results show that the large number of fleet owners owned 20-50 vehicles, followed by 5-20 vehicles. In respect of8 Working Capital Division of banks, the large number of fleet owners belong to MFO i.e. Medium Fleet Owners.
3. Major Financiers As already mentioned above that the large part of financing for transport sector is done by private institutions or small bankers because due to trustworthy & reliable relationships. Secondly, the reach of these small lenders is very high in comparison to other bankers like HDFC, ICICI, Citibank etc. As far as the question of TATA Finance is concerned, transporters feel very energetic towards it. The reason behind this is lifelong reliable brand relationship. Secondly, any customer prefer to get financed its product from the maker of the product itself. 4. Overdraft Facility Overdraft term is used in place of Working Capital in questionnaire because large numbers of transporters are not aware of the term Working Capital. Again large part not availed this facility from anywhere, and if availed, then the list of such banks is too large to make. Then transporters generally not interested to avail due to inconvenience & further large number of formalities. 5. Tyres In the field of tyres, no one can compete with MRF just due to its strong ness, stability, solidity, economy & last but not least is its reliability. Others like CEAT, Apollo, & JK Tyres are giving a tough competition to each other. 6. Insurance, Permit & Maintenance Payments As far as Insurance, Permit & Maintenance Payments are concerned, they are the fixed expenditures and all these payments are based on the fleet size, the transporters owned.
7. Diesel & Oil Company The cash mode of payment for diesel is given high preference is just due to illiteracy & easy availability of cash in transport sector. BPCL is enjoying the largest market share in field of Oil Services. Even some of the transporters are enjoying & satisfied with the facility of Petro Card, which works just like prepaid schemes in mobiles. 8. Newspaper Last, but not least, the largest reading preference given to Punjab Kesri just because anyone can read Hindi, then economy & further the masala news, which most of the lower class enjoyed during their free time. Therefore, the companies, which are directly or indirectly deal with Transport Sector should have to give advertisements in Punjab Kesri, Times of India and even Hindustan Times. Example According to results on data collected, the average number of transporters owned 30 vehicles. If a transporter owned 30 vehicles, on an average he has financed his 8 vehicles from others or on indigenous bankers or financial institutions. Again, out of those 30, he has owned 22 Heavy Goods Vehicles, which run on average 55,000kms. If his major regions of working are Haryana, UP, Delhi, & Punjab & every truck has a shift of 2 days in a week, then in an year the insurance & permit payments is around Rs30,000. Then, out of 30, 20 vehicles are 5 to 7 years old, then maintenance cost paid at least Rs3,000 to 4,000. In this way, the answers to rest of the questions related to operations of fleets are all based on the fleet size, the transporters owned.
65
5.2 Suggestions & Recommendations

There are various suggestions given by the transporters regarding their welfare, as well as for the improvement of Transport Sector in all aspects. Those suggestions are as follows: 1. Diesel Prices Almost all the fleet owners, and transporters demand for decrease in diesel prices. Especially after the change in government, after Congress came in to power, the prices of diesel as well as petrol going up day by day. There is an increase in diesel prices by around Rs6/litre. This rise increases the expenditures of transporters, which leads to rise in contract amounts of transporters & dealers. Heavy payments will then be curbed by the suppliers, wholesalers & further there will rise in prices of various products, especially Fast Moving Consumer Goods (FMCG) category. In this aspect, the duties charged by the govt. on diesel distribution should be curbed with low sales tax to serve the poor part of economy the Physiological needs. 2. Toll Taxes Toll Tax is a kind of tax, which is charged by the govt. for crossing the state boundaries. The rise in rates of toll taxes will again pay by transporters, which leads to same kind of results like rise in diesel prices. In this aspect, the rates of toll taxes should be curbed by the govt. for the happiness & welfare of economy.
3. Bank Formalities As far as the facility of loans, overdraft or working capital provided by the banks, most of the transporters
are not satisfied by the long list of papers demanded by the banks. Large numbers of papers always increase the serving time by banks. These kinds of complaints mainly come from small fleet owners. In this aspect, the banks should have to make the special resolution regarding such small fleet operators, which are spread on large scale among all the transporters. Further, these small fleet operators are the main source of income for the indigenous bankers, & private lenders, who already hold the largest market of financing. 4. Time Consumption As already mentioned above, that the large number of formalities leads to increase in serving time. Some complaints also came from the transporters, that banks call again & again for a simple financing. In this aspect, although the serving time is reduced in previous years, but still there are large number of transporters, who feel this kind of problem due to low reachable capacity by the banks to those. Therefore, the banks should have to increase their reaching capacity from smallest to largest customer to capture the market on a large scale.
67
3.7 Limitations
As no research is full fledged, there are certain limitations of research which are as follows: 1. Biased or Dishonest Responses This is a main drawback in this kind of survey or personal exploratory research based on questionnaire. The respondent may give false information or even hide the actual figures may be due to Income Tax or Government Interference. Even after telling by the researcher that he doesnt belong to any organization, the respondent still feel uncomfortable. And, this research deals with the transporters, who easily not believe anybody. 2. Respondents Absenteeism Most of the information in the questionnaire is directly asked to the fleet owners because only they can answer the questions regarding tyres, payments, financiers etc. Further, most of the time they are busy in outings, and in that case, other person deals with the researcher, who may give wrong information. 3. Respondents Ignorance & Refusal The transporters are mostly kind of persons, who strictly ignore or refuse to give any kind of information, which may or may not irritate them. 4. Time Shortage In a short span of time of 8 weeks, there is always a limitation of time in collection of large sample of transporters especially who either not available, and if available then only during evening & nights. Further a large sample of 400 is again a problem. This results in to some transporters incomplete or wrong details.
68
Chapter 6
6.1 Bibliography 6.2 Questionnaire
69
6.1 Bibliography
Study Material of Research Methodology of 2nd Semester, MBA Marketing Management By Philip Kotler Research Methodology By C R Kothari www.hdfcbank.com www.google.com
70
6.2 Questionnaire
Commercial Transportation Working Analysis
Name of Firm ....... Address of Firm Contact No. Nature of Firm .. Years in Business ..Working Regions .. 1. Fleet Size: 0-5 5-20 20-50 50 and above Financed Fleets . (in %) . 2. Major Financiers : HDFC Citibank ICICI Kotak Mahindra TATA Finance Ashok Leyland Finance Other(Please Specify) .... 3. Are you availing the Overdraft Facility (Yes/No) 3.1 If yes, from where? Limit .. 3.2 If not, give reasons: Not Interested Financial Soundness Unawareness Other(Please Specify).. 4. Tyres: Apollo Ceat JK Tyres MRF Tyres Other(Please Specify) .... 4.1 Life of Tyres (kms): 0-50000 50000-60000 60000 and above 4.2 Cost of Pair of Tyres p.m. (000s) : 7-10 10-15
5. Insurance & Permit Payment/year : 20000-30000 30000-40000 40000-50000 Above 50000 6. Maintenance Cost/fleet/month : 2000-3000 4000-5000 3000-4000 Above 5000
7. Diesel Purchased Basis: Cash Credit If Credit (From Where).... 7.1 Oil Company: HPCL BPCL IOC CNG Other (Please Specify) ... 8. Type of Vehicles: LCV HGV MDV Multi-Axle
9. Newspaper Read: Times of India Hindustan Times Navbharat Times Hindustan Dainik Jagran Punjab Kesri Other (Please Specify) ... 10. Suggestions/Comments on Commercial Vehicle Financing:
72

HDFC Bank's Organizational Profile and Background

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Acknowledgesment

(Avinash Kumar Maurya)

(Avinash Kumar Maurya)

4. Data Analysis and Interpretation

5. Conclusion, Recommendations & Limitations

1.1 Background & Objectives

1.2 Promoter & Management

bank believes that its people are a significant competitive strength.

1.3 Capital Structure

1.4 Distribution Network

1.6 Business Profile

1.8 Product Range

You can also access your Demat Account on the Internet.

1.9 Innovative Services

Inter-city/Inter-branch Banking: Access your account from any of our

350 branches in 175 cities.

education, purchase of a computer or an exciting holiday.

for your home.

statements, inter-branch banking and much more.

1.11 Awards & Accolades

1.12 Branch Internal Divisions

Retail Asset Head

Business H e Country H e Regional M a

Business H e Country H e Regional M a

Business H e Country H e Regional M a

Business H e Country H e Regional M a Relationship M a 22

Relationship Relationship Relationship M M M a a a Commercial Transportation Working Analysis

Fig Organization Chart (4 Divisions)

Retail Asset Head

Fig Organization Chart (3 Divisions)

2.1 Commercial Transportation

2.2 Working Capital & Credit Norms

2.3 Some Useful Terms

3.1 3.2 3.3 3.4 3.5

Objectives Marketing Research Process Study Description Sampling Contact Methods

3.2 Marketing Research Process

Fig Marketing Research Process

3.3 Study Description

3.5 Contact Methods

4.1 Data Representation 4.2 Charts & Comments

4.1 Data Representation

TATA(21), Citibank(10), ALFinance(13), ICICI(09) KotakMahindra(11), HDFC(11) Availed(28)

Regional & Nationalized Banks(87) Not Interested(55)

50000 to 60000 (52)

Above 60000 (35)

Below 50000 (13)

7000 to 10000 (55)

10000 to 15000 (45)

40000 to 50000 (43)

30000 to 40000(26), Above 50000 (17)

20000 to 30000 (14)

4000 to 5000 (41)

3000 to 4000 (33), 2000 to 3000 (16)

Above 5000 (10)

Cash basis (94)

Punjab Kesri (37)

Hindustan (6), NavbharatTimes(6 )

4.2 Charts & Comments

The average fleet size is 30.

21% HDFC Kotak Mahindra Others/Pvt ICICI

Transporters not availing O/D

Transporters availing O/D