Comparative Study of NSE & BSE

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SRI GOKULA COLLEGE OF ARTS ,SCIENCE & MANAGEMENT STUDIES

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1. INTRODUCTION

1.1.INTRODUCTION TO FINANCE

Finance is one of the major elements, which activates the overall growth of economy. Finance is the lifeblood of economic activities. The study of business finance is concerned with the provision, flow and use of finance within a business organization and with demand for, and supply of, funds for business within the economy as a whole.

This would enable the country to have supply of funds to the industry and agriculture continuously. Economics problems of the nation can be solved comfortably through which self-sufficiency can be attained. Thus the financial system plays a significant role in the building up the economy. Every enterprise, whether big, medium or small needs finance to carry on its operations to achieve its targets. Hence, finance is so indispensable today that it is rightly said it is life blood of an enterprise. Without adequate finance, no enterprise can possibly accomplish its objectives. The function of finance has been traditionally classified into two type's namely private finance and public finance. It deals with the requirements, receipts and disbursement of funds in government institutions like state, local, self-government.

Private finance is concerned with the requirement, receipts and disbursement of funds in case of an individual, a profit seeking business organization and a non-profit organization. During the pre-independence period, financial constraints have hampered the rapid development of industry in the country.

1.2.DEFINITION OF FINANCE

According to Howard and Upton, "finance may be defined as that administrative area or set of administrative functions in an organization which relates with the arrangement of each and credit so that the organization may have the means to carry out the objectives as satisfactorily as possible. According to Anthony, “Financial statements essentially, are interim reports, presented annually and reflect a division of the life of an enterprise into more or less arbitrary accounting

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period more frequently a year”. The day-to-day transactions of a business are recorded in different subsidiary books.

These transactions are reported in various ledgers and their balances are taken out at the end of the financial period. The aim of maintaining various records is to determine the profitability of the enterprise from the operations of the business and the financial position.

1.3.BUSINESS FINANCE

The term 'business finance‟ is very comprehensive, as it implies finances of business activities. The term, 'business' can be categorized into three groups: commerce, industry and service. It is a process of rising, providing and managing of all the money to be used in connection with business activities.

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1. Investment Opportunities

In Finance, Investment can be explained as a utilization of money for profit or returns. Investment can be done by:-

Creating physical assets with the money (such as development of land, acquiring commercial assets, etc.),

Carrying on business activities (like manufacturing, trading, etc.), and

Acquiring financial securities (such as shares, bonds, units of mutual funds, etc.).

Investment opportunities are commitments of monetary resources at different times with an expectation of economic returns in the future.

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In Finance, Profitable opportunities are considered as an important aspiration (goal).

Profitable opportunities signify that the firm must utilize its available resources most efficiently under the conditions of cut-throat competitive markets.

Profitable opportunities shall be a vision. It shall not result in short-term profits at the expense of long-term gains.

For example, business carried on with non-compliance of law, unethical ways of acquiring the business, etc., usually may result in huge short-term profits but may also hinder the smooth possibility of long-term gains and survival of business in the future.

3.Optimal Mix of Funds

Finance is concerned with the best optimal mix of funds in order to obtain the desired and determined results respectively.

Primarily, funds are of two types, namely,

Owned funds (Promoter Contribution, Equity shares, etc.), and

Borrowed funds (Bank Loan, Bank overdraft, Debentures, etc).

The composition of funds should be such that it shall not result in loss of profits to the Entrepreneurs (Promoters) and must recover the cost of business units effectively and efficiently.

4. System of Internal Controls

Finance is concerned with internal controls maintained in the organization or workplace. Internal controls are set of rules and regulations framed at the inception stage of the organization, and they are altered as per the requirement of its business.

However, these rules and regulations are monitored at various intervals to accomplish the same which have been consistently followed.

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5. Future Decision Making

Finance is concerned with the future decision of the organization. A "Good Finance” is an indicator of growth and good returns. This is possible only with the good analytical decision of the organization. However, the decision shall be framed by giving more emphasis on the present and future perspective (economic conditions) respectively.

CORPORATE FINANCE

Corporation finance deals with the financial problems of a corporate enterprise. These problems include the financial aspects of the promotion of new enterprises and their administration during their early period ; the accounting problems connected with the distinction between capital and income, the administrative problems arising out of growth and expansion, and, finally, the financial' adjustments which are necessary to booster up to rehabilitate a corporation which has run into financial difficulties.

FINANCIAL ANALYSIS

Financial analysis is the process of identifying the financial strength and weakness of the firm by properly establishing relationships between the items of the balance sheet and the profit and loss account.

Financial Analysis can be defined as a study of relationship between many factors as disclosed by the statement and study of the trend of these factors.

The basis for financial planning, analysis and Decision-making is the financial information. Financial information is needed to predict, compare and evaluate the firm‟s earning ability.

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AIMS OF FINANCE

Acquiring sufficient funds

Proper utilization of funds

Increasing profitability Maximizing firms value

Estimating financial requirements

Deciding capital structure

Selecting a source of finance

Selecting a pattern of investment

Proper cash management

Implementing financial control

Proper use of surplus

STOCK EXCHANGE IN INDIA

Ahmedabad stock exchange Bangalore stock exchange

Bhubaneswar stock exchange BOMBAY STOCK EXCHANGE

Kolkata stock exchange Cochin stock exchange

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Guwathi stock exchange Hyderabad stock exchange

Indore stock exchange Jaipur stock exchange

Kanpur stock exchange Ludhiana stock exchange

Madras stock exchange Magadhstock exchange

Mangalore stock exchange Pune stock exchange

Saurashtra stock exchange Vadodara stock exchange

NATIONAL STOCK EXCHANGE Over the counter exchange of India [OTCEI]

Inter connected stock exchange [ICSE]

Stock exchanges are the physical location where stocks are bought and sold. They are the sisters of the Over-The - Counter (OTC) market. The OTC refers to market in which securities transactions are conducted through a telephone and computer networks connecting dealers in stocks and bonds, rather than on the floor of an exchange. Together, these two markets form the secondary market. The primary and secondary markets together form the stock mark.

WORLD WIDE STOCK EXCHANGES

American Stock Exchanges

American Stock Exchange (AMEX)

Chicago Mercantile Exchange (CME)

New York Stock Exchange (NYSE)

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Toronto Stock Exchange (TSX)

European Stock Exchange:

London Stock Exchange (LSE)

London Metal Exchange (LME)

Irish Stock Exchange (ISE)

Italian Stock Exchange (BIT)

Frankfurt Stock Exchange (FSE)

OMX Stock Exchanges (OMX)

Moscow Stock Exchange(MICEX)

Athens Stock Exchange (ASE)

Asian and Pacific Stock Exchanges:

Hong Kong Stock Exchanges (HKSE)

Bombay Stock Exchange (BSE)

Tokyo Stock Exchange (TSE)

Singapore Exchange (SGX)

Australian Stock Exchange (ASX)

National Stock Exchange of India (NSE)

Karachi Stock Exchange (KSE)

Philippine Stock Exchange (PSE)

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New Zealand Stock Exchange (NZX)

Dubai Stock Exchange (DIFX)

African Stock Exchange:

Johannesburg Stock Exchange (JSE)

New Zealand Stock Exchange (NZX)

Johannesburg Stock Exchange (JSE)

List of Top Companies of NSE (National Stock Exchange)

Reliance industries ltd.

Oil and natural gas corporation ltd.

Bharti airtel limited

NTPC ltd

Reliance

Hero Honda motors ltd,

Communications ltd.

ICICI bank ltd.

Infosys technologies ltd.

Tata consultancy services ltd,s

Bhel,

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Steel authority of India,

Larsen & turbo ltd.,

Zee entertainment ltd,

Indian petrochemicals corporation ltd.,

Bharat petroleum corporation ltd.,

Videsh sanchar nigam ltd,

Mahan agar telephone nigam ltd,

Power grid corporation of India,

Reliance energy ltd, Siemens ltd, ACC limited, Ambuja cements ltd, HCL technologies ltd, Hindalco industries ltd, National aluminium co ltd,

Sun pharmaceuticals ind.,

Mahindra & mahindra ltd,

TATA power co ltd,

Punjab national bank,

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(PG BLOCK)KOLAR Page 11 Reliance petroleum ltd., HDFC ltd, Wipro ltd, HDFC bank ltd,

TATA steel limited,

Hindustan unilever ltd.

TATA motors limited,

Maruti udyog limited

INTRODUCTION OF NSE

The National Stock exchange was incorporated for the first time in November, 1992. The national stock exchange was not incorporated as the national stock exchange; rather, it had got the recognition of the recognized stock exchange in April, 1993. The National stock Exchange has increased its trading facilities in June 1994 when the WDM (Wholesale Debt Market Segment) was gone live. It is basically one of the three market segments in which the national stock Exchange works. In the same year, 1994 November, the Capital Market (CM) segment of the stock exchange goes live through VSAT.

The National Stock Exchange has become the first Clearing Corporation in India by the introduction of NSCCL in April 1995. In the same year, 1995 July, it has introduced the Investor protection fund which is a very important function introduced by the national Stock Exchange.

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The National stock Exchange had grown with leaps and bounds and had shown tremendous growth mainly in all the fields and thus making it the largest stock exchange of India by October, 1995.

The concept of NSCCL was extended by the introduction of clearing and settlement with the help of NSCCL in year 1996. The National stock Exchange has introduced its Index for the first time in year April 1996. The index was known as the S&P CNX nifty index. In year June 1996, it has introduced the Settlement Guarantee Fund. The National Securities Depositor Fund was launched by the National Stock exchange in year 1996, November, and thus making it the first stock exchange who becomes the first depository in India.

National stock exchange (NSE) is India‟s leading stock exchange covering various cities and towns across the country. NSE was set up by leading institutions to provide a modern, fully automated screen-based trading system with national reach. The exchange has brought about unparalleled transparency, speeds & efficiency, safety and market integrity. It has set up facilities that Serve a model for the securities industry in terms of systems, practices and procedures. NSE played a catalytic role in reforming the Indian securities market in terms of microstructure, market practices and trading volumes. The market today uses state art information technology to provide an efficiency and transparent trading , clearing and settlement mechanism and has witnessed several innovations in products & services viz demutualization of stock exchange governance, screen based trading compression of settlement cycles, dematerialization and electronic transfer of securities, securities lending and borrowing, professionalization of trading‟s members, fine-tuned risk management systems, counterparty risks, market of debt and derivatives instruments and intensive use of information technology.

NSE INDEX OR NIFTY:

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the 50 largest & most profitable, popular companies listed in the index. Each company that is part of the index has its own weightage in the value of the Index. The value of the Nifty Index is the weighted average of the prices of these 50 compani es.

THE ORGANISATION

The national stock exchange of the e of India limited has genesis in the report of the high powered study group on establishment of new stock exchanges, which recommended promotion of a national stock exchange by financial institutions (FIs) to provide access to investors from all across the country on an equal footing. based on the recommendations, NSE was promoted by leading financial institution at the behest of the government of India and was incorporated in November 1992 as a tax –paying company unlike other stock exchange in the country. On its recognition as a stock exchange under the securities contracts(regulation) act,1956 in April 1993, NSE commenced operations in the wholesale debt market (WDM) segment in June 1994. The capital market (equities) segment commenced operations in November 1994 and operations in derivatives segment commenced in June 2000.

MISSION

NSE's mission is setting the agenda for change in the securities markets in India. The NSE was set-up with the main objectives of:

establishing a nation-wide trading facility for equities, debt instruments and hybrids,

Ensuring equal access to investors all over the country through an appropriate communication network.

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*Providing a fair, efficient and transparent securities market to investors using electronic trading systems,

Enabling shorter settlement cycle and book entry settlements systems, and meeting the current international standards of securities markets. The standards set by NSE in terms of market practices and technologies have become industry bench market and being emulated by other market participants. NSE is more than a mere market facilitator. Its that force which is guiding industry to wards new horizons and greater opportunities.

Logo

The logo of the NSE symbolizes a single nationwide securities trading facility ensuring equal and fair access to investors, trading members and issuers all over the country. The initials of the Exchange viz., NSE have been etched on the logo and are distinctly visible. The logo symbolizes use of state of the art information technology and satellite connectivity to bring about the change within the securities industry. The logo symbolizes vibrancy and unleashing of creative energy to constantly bring about change through innovation

ABOUT BSE

Bombay stock exchange limited is the oldest stock exchange in Asia with a rich heritage. Popularly known as “BSE”. It is the first stock exchange in the country to obtain permanent recognition in 1956 from the government of India under the securities contracts (regulation) act, 1956. The exchange‟s pivotal and pre-eminent role in the development of the Indian capital market is widely recognized and its index, SENSEX, is tracked worldwide. Earlier an Association of Persons(AOP), the exchange is now a demutualized and corporatized under the

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provisions of the companies Act,1956, pursuant to the BSE (corporatization and demutualization ) scheme, 2005 notified by the securities and exchange board of India (SEBI). With demutualization, the trading rights and ownership rights have been de-linked effectively addressing concern regarding perceived and real conflicts of interest. The exchange is professionally managed under the overall direction of the board direction. The board comprises eminent professional‟s, representatives of trading members and the managing director of the exchange. The board is inclusive and is designed to benefits from the participation of market intermediaries.

In terms of organization structure, the board formulates large policy issues and exercises overall control. The committees constituted by the board are board based. The day to day operations of the exchange are managed by the managing directors and a management team of professionals. The exchange has a nation wide reach with a presence in 417 cities and towns of India. The systems and processes of the Exchange are designed to safeguard market integrity and enhance transparency in operations. During the year 2004-2005, the trading volumes on the Exchange showed robust growth. The Exchange provides an efficient and transparent market for trading in equity, debt instruments and derivatives. The BSE's On Line Trading System (BOLT) Is a proprietary system of the Exchange and is BSE certified. The surveillance and clearing & settlement functions of the exchange are ISO 9001:2000 certified.

BSE INDEX OR SENSEX:

The BSE index or the Sensex as it is popularly known, is the index of the performance of the 30 largest & most profitable, popular companies listed in the index. Each company that is part of the index has its own weightage in the value of the index. since the number of companies is lesser , the index variations are higher when compared to the Nifty index.

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LIST OF COMPANIES OF BSE 1.ACC Ltd. Cement and cement products

2.Ambuja Cements Ltd. Cement and Cement Products 3.Bajaj Auto Ltd. Automobiles – 2 and 3 Wheelers 4.Bharat Heavy Electricals Ltd. Electrical Equipment 5.Bharti Airtel Ltd. Telecommunication Services 6.Cipla Ltd. Pharmaceuticals

7.DLF Ltd. Developers/Construction 8.Grasim Industries Ltd. Diversified

9.Housing Development Finance Corporation Ltd. Finance -Housing 10.HDFC Bank Ltd. Banks

11.Hindalco Industries Ltd. Aluminium 12.Hindustan Unilever Ltd. FMCG 13.ICICI Bank Ltd. Banks

14.Infosys Technologies Ltd. Information Technology 15.ITC Ltd FMCG

16.Larsen & Toubro Ltd. Engineering1Mahindra & Mahindra Ltd. Automobile – 4 wheelers 17.Maruti Udyog Ltd. Automobiles 4 wheelers

18.NTPC Ltd. Power

19.Oil & Natural Gas Corporation Ltd. Oil Exploration/Production

Logo of BSE

The BSE is a potent symbolism of the Indian capitalist economy, and is an important landmark in the financial domain. Till the national stock exchange was found in 1992, the BSE continued to be the center of the Indian corporate world. Its traditional “open outcry” system of trading,

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with a milling crowd of brokers jostling with each other to make deals, inspired many an aspiring entrepreneur.

Over the years, BSE has been pivotal in providing the Indian business in that most vital of resources – Capital. Every Indian corporate worth its salt has tapped the Indian capital market

through the exchange, and every major company ha its shares listed on the BSE. A listing on the BSE was considered as the „holy grail‟ in the Indian corporate and business world. BSE lost a substantial amount of reputation after the securities scam perpetrated by harsh ad Mehta, and various scams in the following years have continued to pound its goodwill. Yet, the BSE continues to move from strength to strength, and continues to be the flagship of the Indian capital markets. The location of BSE – dalal street – has become the Indian equivalent of Wall Street.

Bombay Stock Exchange Building

FUNCTIONALITY AND ROLE OF BSE

BSE has pioneered various innovations into the Indian capital market. The BSE Index – called the Sensex is considered the pulse of the Indian capital system and industry. In addition to the main index – the Sensex – BSE also offers several sub-indices and sectorial indices. BSE has also introduced ETF (An Exchange Traded Fund) in collaboration with Hong Kong based Barclays Global Investors. The ETF enables foreign investors to invest in the Indian stock market.

BSE has been at the forefront of introducing transparency and successful investor friendliness in the trading of various instruments such as stocks, derivate and debt instruments. It is a global

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pioneer in achieving the coveted ISO 9001:2000 certification, and the introduction of BOLT – BSE Online Trading System. BOLT is currently available to thousands of traders across the country, and provides access to markets from the computer screens. BSEWEBX, a service introduced in 2001, was first of its kind in the world – and enabled investors to deal in shares and stocks from the comfort of their computers.

In addition to the equity market, BSE is also taking important steps to develop the retail debt market. This step will help the common investors to gain access to an alternative investment option, and provide greater diversification opportunities.

BSE is also involved in a number of initiatives to educate the investors, monitor the markets and provide training and education on various aspects related to the Indian capital markets.

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CHAPTER -2

REASRCH DESIGN

DESIGN OF THE STUDY

A background of the area chosen for study has been presented in the previous chapter. This chapter is devoted for research design.

Research design is defined as a particular procedure or a set of procedures, the analysis of principles of the enquiry in a particular field. The value of any scientific and systematic study lies in its methodology.

A central part of research design is to develop an effective research strategy. It constitutes the blue print for the collection, measurement and analysis of data.

TITEL OF THE STUDY

A Comparative study of NSE & BSE

STATEMENT OF THE PROBLEM

India NSE and BSE is growing at a rapid pace, thereby giving an impetus to the Indian economy. The study has been carried out to provide a comparative analysis of 6 companies listed in NSE.

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OBJECTIVES OF NSE & BSE

To gain an insight of national stock exchange and Bombay stock exchange towards the listing procedures

To explore the benefit of listing on the stock exchange with a comparative study.

To know the recent trends in NSE&BSE

To offer suggestions based on the findings arrived from the study

LIMITATIONS OF THE STUDY

As per the study, it was supposed to collect information from many sub brokers but due to time constraint and physical constraint most of the information was not collected.

Analysis and interpretation are purely based on the data collected from various websites. The accuracy of interpretation depends upon accuracy of these data.

Data collected for analysis were only for limited period. Hence findings of study can be varying.

There are some changes in stock market in daily basis.

METHODOLOGY

The methodology used for the implementation of the assigned projects is based on primary data & secondary data & with the help of custom type pie explore chart.

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Research design for the descriptive study is of exploratory type & the forms is given to discover the possible measures by detailed analysis this report also based on descriptive research because it provide the detailed knowledge about the NSE & BSE & its listing procedures.

SOURCES OF DATA

PRIMARY DATA

SECONDARY DATA

PRIMARY DATA

Primary data are those, which are collected directly from the different company investors who are investing in BSE & NSE.

SECONDARY DATA

Secondary data is to be used in the research have been collected from various magazines, newspapers, websites, & questionnaires others sources.

Research design: descriptive types & analytical type

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CHAPTER SCHEMES

CHAPTER 1: INTRODUCTION

CHAPTER 2: RESEARCH DESIGN

CHAPTER 3: COMPANY PROFILE

CHAPTER 4: DATA ANALYSIS AND INTERPRETATION

CHAPTER 5: SUMMARY OF FINDINGS, CONCLUSIONS

AND SUGGESTIONS

ANNEXURE

BIBLIOGRAPHY

CHAPTER-3

COMPANY PROFILE

NATIONAL STOCK EXCHANGE

National stock exchange (NSE) is India‟s leading stock exchange covering various cities and towns across the country. NSE was set up by leading institutions to provide a modern, fully automated screen-based trading system with national reach. The exchange has brought about unparalleled transparency, speeds & efficiency, safety and market integrity. It has set up facilities that serve a model for the securities industry in terms of systems, practices and procedures. NSE played a catalytic role in reforming the Indian securities market in terms of microstructure, market practices and trading volumes. The market today uses state art information technology to provide an efficiency and transparent trading , clearing and settlement mechanism and has witnessed several innovations in products & services demutualization of stock exchange

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governance, screen based trading compression of settlement cycles, dematerialization and electronic transfer of securities, securities lending and borrowing, professionalization of trading‟s members, fine-tuned risk management systems, counterparty risks, market of debt and derivatives instruments and intensive use of information technology.

The national stock exchange is India‟s leading stock exchange covering various cities and towns across the country. NSE was set up by leading institutions to provide a modern, fully automated screen –based trading system with national reach. The exchange has brought about unparalleled transparency, speed & efficacy safety and market integrity.it has set up facilities that serve a model for the securities industry in terms of systems, practices and procedures. NSE has played a catalytic role in reforming the Indian securities market in terms of microstructure, market practices and trading volumes. The market today uses state-of-art information technology to provide an efficient and transparent trading, clearing and settlement mechanism, and has witnessed several innovations in products & services viz. demutualization of stock exchange governance, screen based trading, compression of settlement cycles, dematerialization and electronic transfer of securities, securities lending and borrowing, professionalization of trading members, fine –tuned risk management systems, emergence of clearing corporations to assume counterparty risks, market of debt and derivative instruments and intensive use of information technology.

AWARDS & RECOGNITION OF NSE

NSCCL Rated “CCR AAA” for fourth consecutive year - 28th Dec 2011.

For fourth consecutive year CRISIL has assigned its highest corporate credit rating of „CCR AAA‟ to the National Securities Clearing Corporation Ltd (NSCCL). 'CCR AAA' rating indicates highest degree of strength with regard to honoring debt obligations. As per CRISIL the rating reflects NSCCL‟s status as Clearing Corporation for NSE. The rating also factors in NSCCL‟s rigorous risk management controls and adequate settlement guarantee cover.

CRISIL has further stated that NSCCL‟s risk management system is comprehensive, and is regularly upgraded to pre-empt market failures. The company addresses risks in clearing and

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settlement with its stringent norms for selection of members, robust margining system, and risk-based position limits and surveillance mechanism.

NSE and NSCCL receive Asian Banker awards

NSE has been awarded 'The Asian Banker Financial Derivative Exchange of the Year Award" NSCCL has been awarded 'The Asian Banker Clearing House of the Year Award"

ACIEVEMENTS OF NSE

The industrial organization is created to meet the demands “trade” essential to the success of the project. With the concern to bring together the expertise and the knowledge strictly necessary, in an optimized configuration, with the qualities of excellence, transparency and respect for all people involved, in an economic efficiency context, functional and technical.

NSE is sized to industrialize your projects through the phases of prototype and prototyping, in order to validate the technical solutions considered.

NSE implements throughout its projects, a system of risk management related to products, under the supervision of an account manager who will be your main contact.

NSE provides a global Project management of its supply chain. NSE selects, assures the follow up and the quotation of its suppliers to ensure the quality of the process supply (mechanical, electronic card, low cost solutions).

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CORPORATE STRUCTURE

NSE is one of the first de-mutualized stock exchanges in the country, where the ownership and management of the Exchange is completely divorced from the right to trade on it. Though the impetus for its establishment came from policymakers in the country, it has been set up as a public limited company, owned by the leading institutional investors in the country.

From day one, NSE has adopted the form of a demutualized exchange - the ownership, management and trading is in the hands of three different sets of people. NSE is owned by a set of leading financial institutions, banks, insurance intermediaries and is managed by professionals, who do not directly or indirectly trade on the Exchange. This has completely eliminated any conflict of interest and helped NSE in aggressively pursuing policies and practices within a public interest framework. The NSE model however, does not preclude, but in fact accommodates involvement, support and contribution of trading members in a variety of ways. Its Board comprises of senior executives from promoter institutions, eminent professionals in the fields of law, economics, accountancy, finance, taxation, etc, public representatives, nominees of SEBI and one full time executive of the Exchange.

While the Board deals with broad policy issues, decisions relating to market operations are delegated by the Board to various committees constituted by it .Such committees include representatives from trading members, professionals, the public and the management. The day-to-day management of the Exchange is delegated to the Managing Director who is supported by a team of professional staff.

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NSE MILESTONES

May 13, 2013 NSE launches the first dedicated Debt Platform on the Exchange

January 10, 2013 Agreement on Launch of S&P CNX Nifty Futures in Japan

January 03, 2013 NSCCL Rated CCR AAA for fifth consecutive year

September 18, 2012 NSE launches SME operations

June 27, 2012 NSE launches financial literacy initiative ' Jagruti' in Mohali, in partnership with India Post

May 03, 2012 Futures and Options contracts on FTSE 100

March 22, 2012 NSE and India Post start Unique Financial Inclusion Initiative "Jagruti"

March 14, 2012 NSE launches “EMERGE” - SME Platform

December 2011

NSCCL Rated “CCR AAA” for fourth consecutive year - 28th Dec 2011

September 2011

Launch of derivatives on CNX PSE and CNX Infrastructure Indices

August 2011 Launch of derivatives on Global Indices

July, 2011

Commencement of trading in 91 Day GOI Treasury Bill – Futures

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MISSION

NSE's mission is setting the agenda for change in the securities markets in India. The NSE was set-up with the main objectives of:

Establishing a nation-wide trading facility for equities, debt instruments and hybrids,

Ensuring equal access to investors all over the country through an appropriate communication network.

*Providing a fair, efficient and transparent securities market to investors using electronic trading system,

Enabling shorter settlement cycle and book entry settlements systems, and meeting the current international standards of securities markets. The standards set by NSE in terms of market practices and technologies have become industry bench market and being emulated by other market participants. NSE is more than a mere market facilitator. Its that force which is guiding industry to wards new horizons and greater opportunities.

PROMOTERS

NSE has been promoted by leading financial institutions, banks, insurance companies and other financial intermediaries:

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1. Industrial Development Bank of India Limited

2. Industrial Finance Corporation of India Limited

3. Life Insurance Corporation of India

4. State Bank of India

5. ICICI Bank Limited

6. IL & FS Trust Company Limited

7. Stock Holding Corporation of India Limited

8. SBI Capital Markets Limited

9. The Administrator of the Specified Undertaking of Unit Trust of India

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11. Canara Bank

12. General Insurance Corporation of India

13. National Insurance Company Limited

14. The New India Assurance Company Limited

15. The Oriental Insurance Company Limited

16. United India Insurance Company Limited

17. Punjab National Bank

18. Oriental Bank of Commerce

19. Corporation Bank

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21. Union Bank of India

GROUP OF NSE

National Securities Clearing Corporation Ltd. (NSCCL)

The national securities clearing corporation ltd. (NSCCL), a wholly owned subsidiary of NSE, was incorporated in august 1995. It was set up to bring and sustain confidence in clearing and settlement of securities: to promote and maintain, short and consistent settlement cycles; to provide country party risk guarantee, and to operate a tight risk containment system. NSCCL commenced clearing operation on April 1996. N SCCL carries out the clearing and settlement of the trades executed in the equities and derivatives segments and operates subsidiary general ledger (SGL) for settlement of trades in government securities. It assumes the counter party risk of each member and guarantees financial settlement of transactions on other stock exchange like, the over the counter exchange of India NSCCL has successfully brought about an up gradation of the clearing and settlement procedures and has brought Indian financial markets in line with international markets.

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NSE.IT, a 100% subsidiary of National Stock Exchange of India Limited (NSE), is the information technology arm of the largest stock exchange of the country. A leading edge technology user, NSE houses state-of-the-art infrastructure and skills. NSE.IT possesses the wealth of expertise acquired in the last six years by running the trading and clearing infrastructure of largest stock exchange of the country. NSE .IT is uniquely positioned to provide products, services and solutions for the securities industry. There has been a long felt need for top of the line products, services and solutions in the areas of trading, broker front end and back- office, clearing and settlement, web- based trading, risk management, treasury management, asset liability management, banking. Insurance ect. NSE.ITs expertise in these areas is the primary focus. The company also plans to provide consultancy and implementation services in the areas of data warehousing, business continuity plans, stratus main frame facility management, site maintenance and backups, real time market analysis & financial news over NSE- Net, ect. NSE.IT is an export oriented unit with STP and plans to go global for various IT service in due course. In the near future the company plans to release new products for broker back office operations and enhance Neat XS / Neat is to support straight through processing on the net.

INDIA INDEX SERVICES & PRODUCTS LTD. (IISL)

India index services and products limited (IISL), a joint venture between NSE and CRISIL Ltd.( formerly the credit rating information services of India limited), was set up in May 1998 to provide a variety of indices and index related services and products for the Indian capital markets. It has a consulting and licensing agreement with standard and poor‟s (S &P),the world‟s leading provider of investible equity indicates, for co- branding equity indices. IISL provides a broad range of services, products and professional index services. It maintains over 80 equity

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indices comprising broad-based benchmark indices, sectorial indices and customized indices. Many investment and risk management products based on IISL indices have been developed in the recent past, within India and abroad. These include index based derivatives traded on NSE and Singapore exchange (SIMEX) and a number of index funds.

National Securities Depository Ltd. (NSDL)

In order to solve the myriad problems associated with trading in physical securities, NSE joined hands with the industrial development bank of india (IDBI) and the unit trust of India (UTI) to promote dematerialization of securities. Together they set up national securities depository limited (NSDL), the first depositary in India. NSDL commenced operations in November 1996 and has since established a national infrasture of international standards to handle trading and settlement in dematerialized from and thus completely eliminated the risks to investors associated with fake / bad / stolen paper.

Dot Ex International Limited

Dot Ex was formed to provide world class internet trading platforms which allow members of NSE to offer online trading facilities to their customers. Members of NSE can service a larger clientele by using the automated risk management features and thus increase volumes. Investors get comprehensive and updated information necessary to trade, along with a single- click convenience to fulfill their obligations. The initial offering of dot Ex is dot Ex plaza where multiple market participants such as members of NSE, depository participants and banks can offer web- based services to their customers. As a neutral aggregator and infrastructure provider, dot Ex offers choice and convenience to investors. Dot Ex was a joint venture between i-flex solutions ltd. And NSE.IT ltd. Recently NSE has taken over the shareholding and management of dot Ex .

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Dot Ex product may be classified under the following broad categories;

Equity trading module

F & O trading module

NSE TECHNOLOGY

Across the globe, developments in information, communication and network technologies have created paradigm shifts in the securities market operations. Technology has enable organizations to build new sources of competitive advantages, bring about innovations in products and services, and to provide for new business opportunities. Stock exchange all over the world has realized the potential of IT and Have moved over to electronic trading systems, which are cheaper, have wider reach and provide a better mechanism for trade and post trade execution‟s believes that technology will continue to provide the necessary impetus for the organization to retain its competitive edge and ensure timeliness and satisfaction in customer service. In recognized of the fact that technology will continue to redefine the shapes of the securities industry, NSE stresses on innovation and sustained investment in technology to remain a head of competition. NSE‟S set up is the largest by any company in india . it uses satellite communication technology to energies participation from around 400 cities spread all over the country. In the recent past, capacity enhancement measures taken up in regard to the trading systems so as effectively meet the requirements of increase users and associated trading loads. With up gradation of trading hardware, NSE can handle up to 1 million trades per day‟s has also put in place NIBIS ( NSE‟s internet based information system ) for on line real time dissemination of trading information over the internet. In order to.

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EQUITIES OF NSE

NSE started trading in the equities segment (capital market segment) on November 3, 1994 and within a short span of 1 year became the largest exchange India in terms of volumes transited. Trading volumes in the equity segment have grown rapidly with average daily turnover increasing from Rs. 17 crores during 1994-95 to Rs. 4,328 crores during 2003 -04. During the year 2003-04, NSE reported a turnover of rs. 1,099,535 crores in the equities segment accounting for 68.60% of the total Indian securities market. The equities section provides you with an insight into the equities segment of NSE ans also provides real- time quotes and statistics of the equities market. In depth information regarding listing of securities, trading systems & processes, clearing and settlement, risk management, trading statistics ect. Are available here.

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LISTING OF NSE

Listing means admission of securities of an issuer to trading privileges on a stock exchange through a formal agreement. The prime objective of admission to dealing on the exchange is to provide liquidity and marketability to securities, as also to provides a mechanism for effective management of trading. Listing on NSE provides qualifying companies with the broadest access to investors, the greatest market depth and liquidity,

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Cost effective access to capital, the highest visibility, the fairest pricing, and investor benefits. NSE trading terminals are now situated in various towns across the length the eligibility criteria for listing. Various types of securities of a company are traded under a unique symbols and different series. NSE played an important role in helping an Indian companies access equity capital, by providing a liquid and well- regulated market. NSE has about 800 companies listed representing the length, breadth and diversity of the Indian economy which includes from hi-tech to heavy industry, software, refinery, public-sector units, infrastructure, and financial services. Listing on NSE raises a company‟s profile among investors in India and abroad. Trade data is distributed worldwide through various news-vending agencies.

More importantly, each and every NSE listed company is required to satisfy stringent financial, public distribution and management requirements. High listing standards foster investor confidence and also bring credibility into the markets. NSE listed securities in its capital market (equities) segment and its wholesale debt market segment.

LISTING PROCEDURES OF NSE

An issuer has to take various steps prior to making an application for listing its securities on the NSE. These steps are essential to ensure the compliance of certain requirement by the issuer before listing its securities on the NSE. The various steps to be taken include:

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1. Initial Discussions

2. Approval of Memorandum and Articles of Association

3. Approval of draft prospectus

4. Submission of Application

5. Listing conditions and requirements

LISTING PROCEDURE

Initial Discussions

Authorized persons of the concerned issuer should discussions with NSE personnel regarding various requirements to be fulfilled by the issuer for listing its securities. The discussions should particularly cover the qualifications of the issuer which are required for an issuer to be admitted for listing on the NSE and to understand all the conditions that are precedent to listing on the NSE. The proposed memorandum & articles of Association and the draft prospectus may be presented to the NSE for examination before finalizing them

Approval of draft prospectus

The Issuer shall file the draft prospectus and application forms with NSE. In case NSE is not the Regional Stock Exchange then the draft prospectus and application forms have to be filed

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simultaneously with the NSE when the same is filed with the Regional Stock Exchange pertaining to the issue, for the perusal of NSE. The draft prospectus should have been prepared in accordance with the statutes, notifications, circulars, guidelines, etc. governing preparation and issue of prospectus prevailing at the relevant time. The Issuers may particularly bear in mind the provisions of Companies Act, Securities Contracts (Regulation) Act, the SEBI Act and the relevant subordinate legislations thereto. NSE will peruse the draft prospectus only from the point of view of checking whether the draft prospectus is in accordance with the listing requirements, and therefore any approval given by NSE in respect of the draft prospectus should not be construed as approval under any laws, rules, notifications, circulars, guidelines etc. The Issuers shall file a copy of the prospectus given by the respective Regional Stock

Exchange with NSE.The Issuer should also submit the SEBI acknowledgment card or letter indicating observations on draft prospectus or letter of offer by SEBI.

Submission of Application

For issuers listing on NSE for the first time

Listing of Further issues by issuers already listed on NSE

listing fees

security deposit (for new & fresh issues and when NSE is the regional stock exchange)

supporting document

Submission of Application (For Issuers listing on NSE for the first time)

Issuers desiring to list existing/new securities on the NSE shall make application for admission of their securities to dealings on the NSE in the forms prescribed in

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This regard as per details given hereunder or in such other form or forms as the Relevant Authority may from time to time prescribe in addition thereto or in modification or substitution thereof.

Appendix 'A' - Clauses of Articles of Association

.Appendix 'B'- Application Letter for Listing.

Appendix 'C-1' - Listing Application providing pre-issue details of securities

.Appendix 'C-2' - Listing Application providing post-issue details of securities

.Appendix 'D'- Checklist for supporting documents ( as applicable to the issuer)

Appendix 'E' - Schedule of Distribution

Appendix 'F'- Listing Agreement

Submission of Application (Listing of further Issues by Issuers already listed on NSE)

Issuers whose securities are already listed on the NSE shall apply for admission to listing on the NSE of any further issue of securities made by them. The application for admission shall be made in the forms prescribed in this regard or in such other form or forms as the Relevant Authority may from time to time prescribe in addition thereto or in modification or substitution thereof.

Appendix 'E' - Schedule of Distribution

Appendix 'G'- Application Letter for Listing of further issues.

Kindly draw your Cheques/Demand Drafts favoring National Stock Exchange of India Limited, payable in Mumbai.

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Submission of Application (Security Deposit)

(Payable only for new and fresh issues and only when NSE is the Regional Stock Exchange)The Relevant Authority shall not grant admission to dealings of securities of an Issuer which is not listed or of any new (original or further) issue of securities of an Issuer excepting Mutual Funds, which is listed on the NSE unless the Issuer deposits and keeps deposited with the NSE (in cases where the securities are offered for subscription, whether through the issue of a prospectus, letter of offer or otherwise, and NSE is the Regional Stock Exchange for the Issuer) an amount calculated at 1% of the amount of securities offered for subscription to the public and or to the holders of existing securities of the Issuer, as the case may be for ensuring compliance by the Issuer within the prescribed or stipulated period of all requirements and conditions hereinafter mentioned and shall be refundable or forfeitable in the manner hereinafter stated:

The Issuer shall comply with all prevailing requirements of law including all requirements of and under any notifications, directives and guidelines issued by the Central Government, SEBI or any statutory body or local authority or any body or authority acting under the authority or direction of the Central Government and all prevailing listing requirements and conditions of the NSE and of each recognized Stock Exchange where the Issuer has applied for permission for admission to dealings of the securities, within the prescribed or stipulated period;

If the Issuer has complied with all the aforesaid requirements and

conditions including, wherever applicable, its obligation under Section 73(or any statutory modification or re-enactment thereof) of the Companies Act, 1956 and obligations arising therefrom, within the prescribed or stipulated period, and on obtaining a No Objection Certificate from SEBI and submitting it to NSE , NSE shall refund to the Issuer the said deposit without interest within fifteen days from the expiry of the prescribed or stipulated period;

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If on expiry of the prescribed or stipulated period or the extended period referred to hereafter, the Issuer has not complied with all the aforesaid requirements and conditions, the said deposit shall be forfeited by the NSE, at its discretion, and thereupon the same shall vest in the NSE. Provided the forfeiture shall not release the Issuer of its obligation to comply with the aforesaid requirements and conditions;

If Issuer is unable to complete compliance of the aforesaid requirements and conditions within the prescribed or stipulated period, the NSE, at its discretion and if the Issuer has shown sufficient cause, but without prejudice to the obligations of the Issuer under the laws in force to comply with any such requirements and conditions within the prescribed or stipulated period, may not forfeit the said deposit but may allow such further time to the Issuer as the NSE may deem fit; provided that;

the Issuer has at least ten days prior to expiry of the prescribed or stipulated period applied in writing for extension of time to the NSE stating the reasons for non-compliance, and

the Issuer, having been allowed further time by the NSE, has before expiry of the prescribed or stipulated period, published in a manner required by the NSE, the fact of such extension having been allowed; provided further that where the NSE has not allowed extension in writing before expiry of the prescribed or stipulated period, the request for extension shall be deemed to have been refused; provided also that any such extension shall not release the Issuer of its obligations to comply with the aforesaid requirements and conditions 50% of the above mentioned security deposit should be paid to the NSE in cash. The balance amount can be provided by way of a bank guarantee, in the format prescribed by or acceptable to NSE. The amount to be paid in cash is limited to Rs.3 crores.

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Submission of Application (Supporting Documents)

Issuers applying for admission of their securities to dealings on the NSE shall submit to the NSE the following:

• Documents and Information The documents and information prescribed in Appendix D or Appendix I (as the case may be) to this Regulation or such other documents and information as the Relevant Authority may from time to time prescribe, in addition thereto or in modification or substitution thereof together with any other documents and information which the Relevant Authority may require in any particular case;

• Distribution Schedules Distribution Schedules duly completed in respect of each class and kind of security in the form prescribed in Appendix E (Table I, II & III) to this Regulation or in such other form or forms as the Relevant Authority may from time to time prescribe in addition thereto or in modification or substitution thereof.

Listing conditions and requirements

All Issuers whose securities are listed on the NSE shall comply with the listing conditions and requirements contained in the Listing Agreement Form appearing in Appendix F to this

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Regulation or such other conditions and requirements as the Relevant Authority may from time to time prescribe in addition thereto or in modification or substitution thereof. After fulfilling these criteria, a company has to send the following information for further processing:

1. A brief note on the promoters and management

2. Company profile.

3. Copies of the Annual Report for last 3 years.

4. Copies of the Draft Offer Document.

5. Memorandum & Articles of Association

BORD OF DIRECTORS OF NSE

Chairman Mr. S.B Mathur

Administrator of the specified under taking of unit trust of india

Managing director Mr,Ravi Narain national stock exchange of

india ltd

Deputy managing director Ms.chitra ram krish

National stock exchange of india ltd

ABOUT BSE

Bombay Stock Exchange Limited is the oldest stock exchange in Asia with a rich heritage. Popularly known as "BSE", it was established as "The Native Share &Stock Brokers Association" in 1875. It is the first stock exchange in the country to obtain permanent

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recognition in 1956 from the Government of India under the Securities Contracts (Regulation) Act, 1956.The Exchange's pivotal and pre-eminent role in the development of the Indian capital

market is widely recognized and its index, SENSEX ,

is tracked worldwide. Earlier an Association of Persons(AOP), the Exchange is now a demutuali zed and corporatized entity incorporated under the provisions of the Companies Act, 1956,pursua nt to the BSE(Corporatization and Demutualization) Scheme, 2005 notified by the Securities and Exchange Board of India (SEBI).With demutualization, the trading rights and ownership rights

have been de-linked effectively addressing concerns

regarding perceived and real conflicts of interest.

The Exchange is professionally managed under the overall direction of the Board of Directors. T he Board comprises eminent professionals, representatives of Trading Members and the Managing Director of the Exchange. The Board is inclusive and is designed to benefit from the participation of market intermediaries.

In terms of organization structure, the Board formulates larger policy issues and exercises over-all control. The committees constituted by the Board are broad-based. The day-to-day operations of the Exchange are managed by the Managing Director and a management team of professionals. The Exchange has a nation-wide reach with a presence in 417 cities and towns of India. The systems and processes of the Exchange are designed to safeguard market integrity and enhance transparency in operations. During the year 2004-2005, the trading volumes on the Exchange showed robust growth. The Exchange provides an efficient and transparent market for trading in equity, debt instruments and derivatives. The BSE's On Line Trading System (BOLT) Is a proprietary system of the Exchange and is BS certified. The surveillance and clearing & settlement functions of the Exchange are ISO9001:2000 certified.

AWARDS & RECOGNITIONS

As a pioneering financial institution in the Indian capital market, BSE has won several awards and recognitions that acknowledge the work done and progress made.

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The Golden Peacock Global CSR Award for its initiatives in Corporate Social Responsibility

BSE has won NASSCOM - CNBC-TV18‟s IT User Awards, 2010 in Financial Services category

BSE has won Skoch Virtual Corporation 2010 Award in the BSE StAR MF category

Responsibility Award (CSR), by the World Council of Corporate Governance

Annual Reports and Accounts of BSE have been awarded the ICAI awards for excellence in financial reporting for four consecutive years from 2006 onwards

Human Resource Management at BSE has won the Asia - Pacific HRM awards for its efforts in employer branding through talent management at work, health management at work and excellence in HR through technology

ACHIEVEMENTS OF BSE

At par with international standards, BSE Ltd. has been a pioneer in several areas over the decades and has many firsts and key achievements to its credit. BSE is the first exchange in India to

Launch a special platform for trading in SME securities

Introduce Equity Derivatives

Launch a Free Float Index - S&P BSE SENSEX

Launch Exchange Enabled Internet Trading Platform

Obtain ISO certification for a stock exchange

Exclusive facility for financial training – BSE Institute Ltd.

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Host the popular opening-bell ceremony in Indian capital markets

Launch mobile-based trading in India in Sept 2010

Become securities market infrastructure member of SWIFT in India and provide corporate actions to custodians in ISO 15022 format

Launched S&P BSE SENSEX Realized S&P BSE Volatility (REALVOL) Index in Nov 2010

HERITAG OF BSE

The oldest exchange in Asia and the first exchange in the country to be granted permanent recognition under the Securities Contract Regulation Act, 1956, Bombay Stock Exchange Limited (BSE) has had an interesting rise to prominence over the past 130 years. While the BSE is now synonymous with Dalal Street, it wasn‟t always so. In fact the first venues of the earliest stock broker meetings in the 1850s were amidst rather natural environs - under banyan trees - in front of the Town Hall, where Horniman Circle is now situated. A decade later, the brokers moved their venue to another set of foliage, this time under banyan trees at the junction of Meadows Street and Mahatma Gandhi Road. As the number of brokers increased, they had to shift from place to place, and wherever they went, through sheer habit, they overflowed in to the streets. At last, in 1874,found a permanent place, and one that they could, quite literally, call their own. The new place was, aptly, called Dalal Street. The is as eventful and interesting as the history of India‟s securities market. India‟s biggest bourse, in terms of listed companies and market capitalization, BSE has played a pioneering role in the Indian securities market- one of the oldest in the world. Much before actual legislations were enacted, BSE had formulated

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comprehensive set of Rules and Regulations for the Indian Capital Markets. It also laid down best practices adopted by the Indian capital markets after India gained its independent. Perhaps, there would not be any leading corporate in India, which has not sourced BSE‟s services in resource mobilization‟s as a brand is synonymous with capital markets in India. The BSESENSEX is the benchmark equity index that reflects the robustness of the economy and finance. At par with international standards, BSE has been a pioneer in several areas. It has several firsts to its credit even in an intensely competitive environment.

First in India to introduce Equity Derivatives

First in India to launch a Free Float Index

First in India to launch US$ version of BSE Sensex

First in India to launch Exchange Enabled Internet Trading Platform

First in India to obtain ISO certification for surveillance, clearing & settlement.

'BSE On-Line Trading System‟ (BOLT) has been awarded the globally recognized the Information Security Management System standardBS7799-2: 2002.

First to have an exclusive facility for financial training

Moved from Open Outcry to Electronic Trading within just 50 days An equally important accomplishment of BSE is the launch of a nationwide investor awareness campaign - Safe Investing in the Stock Market - under which nationwide awareness campaigns and dissemination of information through print and electronic medium was undertaken. BSE also actively promoted the securities market awareness campaign of the Securities and Exchange Board of India. In 2002, the name The Stock Exchange, Mumbai, was changed to BSE. BSE ,which had introduced securities trading in India, replaced its open outcry system of trading in 1995, when the totally automated trading through the BSE Online trading (BOLT) system was put into practice. The BOLT network was expanded, nationwide, in 1997. It was at the BSE's International Convention Hall that India‟s 1st Bell ringing ceremony in the history Capital Markets were held on February 18th, 2002. It was the listing ceremony of Bharti Tele ventures Ltd. BSE with its long history of