Finance Prsntation

8/2/2019 Finance Prsntation

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SEBI AND STOCK EXCHANGES

IN INDIA

PRESENTED BY

AADIL AHMAD ZARGAR


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SEBI(SECURITIES AND EXCHANGE BOARD

OF INDIA)

Securities & Exchange Boardof India (SEBI)

formed under the SEBI Act, 1992 with the prime

objective of

Protecting the interests of investors in securities,

Promoting the development of the securities.

Making rules and regulations or the securities market for matters

connected there with or incidental thereto,

Focus being the greater investor protection, SEBI has

become a vigilant watchdog


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History Set up originally in 1988 by Govt. of India.

It was formed officially by the Government of India in 1992 withSEBI Act 1992 being passed by the Indian parliament. SEBI is

headquartered in the business district of Bandra kurla complex in

Mumbai, and has Northern, Eastern, Southern and western regional

offices .

Controller of Capital Issues was the regulatory authority before SEBIcame into existence; it derived authority from the Capital Issues

(Control) Act, 1947

Initially SEBI was a non statutory body without any statutory power.

However in 1995, the SEBI was given additional statutory power bythe Government of India through an amendment to the securities

and Exchange Board of India Act 1992. In April, 1998 the SEBI was

constituted as the regulator of capital market in India under a

resolution of the Government of India.


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Why do we need a regulatory body for Investor

protection in India?

India is a non informational weak market

Boosting capital market demands restoring the confidence

of lay investors who have been beaten down by repeated

scams

Progressively softening interest rates and an under

performing economy have eroded investment options,

and require enhanced investing skills.


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FUNCTIONS OF SEBI Section 11 of the Securities and Exchange Board of India

Act.

Regulation Of Business In The Stock Exchanges

A) review of the market operations, organizational structureand administrative control of the exchange

All stock exchanges are required to be Body Corporates

The exchange provides a fair, equitable and growingmarket to investors.

The exchanges organisation, systems and practices arein accordance with the Securities Contracts (Regulation)Act (SC(R) Act), 1956


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FUNCTIONS OF SEBI(contd.) B) Registration And Regulation Of The

Working Of Intermediaries

SEBI

PRIMARY MARKET

MERCHANTBANKERS UNDERWRITERS

PORTFOLIOMANAGERS

SECONDARYMARKET

STOCKBROKERS

SUB-BROKERS


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FUNCTIONS OF SEBI(contd.)C) Registration And Regulation Of Mutual Funds,

Venture Capital Funds & Collective InvestmentSchemes

AMFI-Self Regulatory Organization-'promoting and protectingthe interest of mutual funds and their unit-holders, increasingpublic awareness of mutual funds, and serving the investors'interest by defining and maintaining high ethical andprofessional standards in the mutual funds industry'.

Every mutual fund must be registered with SEBI and registrationis granted only where SEBI is satisfied with the background ofthe fund.

SEBI has the authority to inspect the books of accounts, recordsand documents of a mutual fund, its trustees, AMC and custodianwhere it deems itnecessary


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SEBI (Mutual Funds) Regulations, 1996 lays down the provisions for theappointment of the trustees and their obligations

Every new scheme launched by a mutual fund needs to be filed with SEBI

and SEBI reviews the document in regard to the disclosures contained in suchdocuments.

Regulations have been laid down regarding listing of funds, refundprocedures, transfer procedures, disclosures, guaranteeing returns etc.

SEBI has also laid down advertisement code to be followed by a mutual fundin making any publicity regarding a scheme and its performance

SEBI has prescribed norms / restrictions for investment management with aview to minimize / reduce undue investment risks.

SEBI also has the authority to initiate penal actions against an erring MF.

In case of a change in the controlling interest of an asset managementcompany, investors should be given at least 30 days time to exercise their exitoption.


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FUNCTIONS OF SEBI(contd.)D) Promoting & Regulating Self Regulatory

Organizations

In order for the SRO to effectively execute itsresponsibilities, it would be required to be structured,

organized, managed and controlled such that it retainsits independence, while continuing to perform agenuine market development role

E) Prohibiting Fraudulent And Unfair Trade PracticesIn The Securities Market

SEBI is vested with powers to take action against thesepractices relating to securities market manipulation andmisleading statements to induce sale/purchase ofsecurities


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FUNCTIONS OF SEBI(contd.)F] Prohibition Of Insider Trading

Stock Watch System, which has been put in place, surveillance

over insider trading would be further strengthened.

G] Investor Education And The Training Of Intermediaries

SEBI distributed the booklet titled A Quick Reference Guide forInvestors to the investors

SEBI also issued a series of advertisement /public notices in national

as well as regional newspapers to educate and caution the investorsabout the risks associated with the investments in collectiveinvestment schemes

SEBI has also issued messages in the interest of investors on NationalChannel and Regional Stations on Doordarshan.


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FUNCTIONS OF SEBI(contd.)H) Inspection And Inquiries

I) Regulating Substantial Acquisition Of Shares And Take-overs

J) Performing Such Functions And Exercising Such Powers Under

The Provisions Of The Securities Contracts (Regulation) Act,1956 As May Be Delegated To It By The Central Government;

K) Levying Fees Or Other Charges For Carrying Out ThePurposes Of This Section

L) Conducting Research For The Above Purposes


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ROLE OF SEBI

Power to make rule for controlling stock Exchange

To provide license to dealers and brokers

To Stop fraud in Capital Market

To Control the Merge, Acquisition and Takeover thecompanies

To audit the performance of stock market

To make new rules on carry - forward transactions

To Require report of Portfolio Management Activities

To educate the investors


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STOCK MARKET AND ITS

ROLE A stock market or equity market is a public market for the

trading of company stock and derivatives at an agreed price;these are securities listed on a stock exchange as well as thoseonly traded privately.

ROLE AND IMPORTANCE

Provides a source of funding for organizations.

An investment avenue.

A source of income for investors.A source of revenue for government in the form of taxes.

A source of employment opportunities.

Meeting place for investors and organizations.


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List of Stock Exchanges in India Bombay Stock Exchange (BSE)

National Stock Exchange of India (NSE) United Stock Exchange of India (USE)

Multi Commodity Exchange (MCX)

MCX Stock Exchange (MCX-SX)

Over the Counter Exchange of India (OTCEI)

Inter-connected Stock Exchange of India (ISE)

Madras Stock Exchange (MSE) Ahmedabad Stock Exchange (ASE)

Bhubaneshwar Stock Exchange (BhSE)

Cochin Stock Exchange (CSE)

Hyderabad Stock Exchange (HSE)

Calcutta Stock Exchange (CSE)

Delhi Stock Exchange (DSE) Bangalore Stock Exchange

Madhya Pradesh Stock Exchange, Indore

Jaipur Stock Exchange (JSE)

Magadh Stock Exchange, Patna

UP Stock Exchange (UPSE)

Vadodara Stock Exchange,Vadodara (VSE)
http://en.wikipedia.org/wiki/Bombay_Stock_Exchangehttp://en.wikipedia.org/wiki/National_Stock_Exchange_of_Indiahttp://en.wikipedia.org/wiki/United_Stock_Exchange_of_Indiahttp://en.wikipedia.org/wiki/Multi_Commodity_Exchangehttp://en.wikipedia.org/wiki/MCX_Stock_Exchangehttp://en.wikipedia.org/wiki/OTC_Exchange_of_Indiahttp://en.wikipedia.org/wiki/Inter-connected_Stock_Exchange_of_Indiahttp://en.wikipedia.org/wiki/Madras_Stock_Exchangehttp://en.wikipedia.org/wiki/Ahmedabad_Stock_Exchangehttp://en.wikipedia.org/wiki/Bhubaneshwar_Stock_Exchangehttp://en.wikipedia.org/wiki/Cochin_Stock_Exchangehttp://en.wikipedia.org/wiki/Hyderabad_Stock_Exchangehttp://en.wikipedia.org/wiki/Calcutta_Stock_Exchange_Association_Limitedhttp://en.wikipedia.org/wiki/Delhi_Stock_Exchange_Associationhttp://en.wikipedia.org/wiki/Bangalore_Stock_Exchangehttp://en.wikipedia.org/wiki/Madhya_Pradesh_Stock_Exchangehttp://en.wikipedia.org/wiki/Jaipur_Stock_Exchangehttp://en.wikipedia.org/wiki/Magadh_Stock_Exchangehttp://en.wikipedia.org/wiki/UP_Stock_Exchangehttp://en.wikipedia.org/wiki/Vadodara_Stock_Exchangehttp://en.wikipedia.org/wiki/Vadodara_Stock_Exchangehttp://en.wikipedia.org/wiki/Vadodara_Stock_Exchangehttp://en.wikipedia.org/wiki/Vadodara_Stock_Exchangehttp://en.wikipedia.org/wiki/Vadodara_Stock_Exchangehttp://en.wikipedia.org/wiki/UP_Stock_Exchangehttp://en.wikipedia.org/wiki/Magadh_Stock_Exchangehttp://en.wikipedia.org/wiki/Magadh_Stock_Exchangehttp://en.wikipedia.org/wiki/Magadh_Stock_Exchangehttp://en.wikipedia.org/wiki/Jaipur_Stock_Exchangehttp://en.wikipedia.org/wiki/Jaipur_Stock_Exchangehttp://en.wikipedia.org/wiki/Jaipur_Stock_Exchangehttp://en.wikipedia.org/wiki/Madhya_Pradesh_Stock_Exchangehttp://en.wikipedia.org/wiki/Bangalore_Stock_Exchangehttp://en.wikipedia.org/wiki/Delhi_Stock_Exchange_Associationhttp://en.wikipedia.org/wiki/Calcutta_Stock_Exchange_Association_Limitedhttp://en.wikipedia.org/wiki/Hyderabad_Stock_Exchangehttp://en.wikipedia.org/wiki/Cochin_Stock_Exchangehttp://en.wikipedia.org/wiki/Bhubaneshwar_Stock_Exchangehttp://en.wikipedia.org/wiki/Bhubaneshwar_Stock_Exchangehttp://en.wikipedia.org/wiki/Bhubaneshwar_Stock_Exchangehttp://en.wikipedia.org/wiki/Ahmedabad_Stock_Exchangehttp://en.wikipedia.org/wiki/Ahmedabad_Stock_Exchangehttp://en.wikipedia.org/wiki/Ahmedabad_Stock_Exchangehttp://en.wikipedia.org/wiki/Madras_Stock_Exchangehttp://en.wikipedia.org/wiki/Inter-connected_Stock_Exchange_of_Indiahttp://en.wikipedia.org/wiki/Inter-connected_Stock_Exchange_of_Indiahttp://en.wikipedia.org/wiki/Inter-connected_Stock_Exchange_of_Indiahttp://en.wikipedia.org/wiki/OTC_Exchange_of_Indiahttp://en.wikipedia.org/wiki/MCX_Stock_Exchangehttp://en.wikipedia.org/wiki/Multi_Commodity_Exchangehttp://en.wikipedia.org/wiki/United_Stock_Exchange_of_Indiahttp://en.wikipedia.org/wiki/National_Stock_Exchange_of_Indiahttp://en.wikipedia.org/wiki/Bombay_Stock_Exchange


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Existing structure of the

stock exchanges in India

STOCK

MARKET

BSE

NSE

OTHERS


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BOMBAY STOCK EXCHANGE(BSE)

Established in 1875

It became the first stock exchange to berecognized by the Indian Government under theSecurities Contracts Regulation Act.1956.

The BSE has the largest number of listedcompanies in the world.

The equity market capitalization of the

companies listed on the BSE was US$1 trillion asof December 2011, making it the 6th largeststock exchange in Asia and the 14th largest inthe world.
http://en.wikipedia.org/wiki/Market_capitalizationhttp://en.wikipedia.org/wiki/1000000000000_(number)http://en.wikipedia.org/wiki/List_of_stock_exchangeshttp://en.wikipedia.org/wiki/List_of_stock_exchangeshttp://en.wikipedia.org/wiki/List_of_stock_exchangeshttp://en.wikipedia.org/wiki/List_of_stock_exchangeshttp://en.wikipedia.org/wiki/1000000000000_(number)http://en.wikipedia.org/wiki/Market_capitalization


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NATIONAL STOCK EXCHANGE(NSE)

Established in 1992

NSE has a market capitalization of

around US$985 billion and over 1,640 listings as

of December 2011. It is the largest stock exchange in India & 3rd

largest in the world in terms of volume of

transactions.

Its key index is the S & P Nifty, known as the

Nifty, an index of fifty major stocks weighted by

market capitalization.
http://en.wikipedia.org/wiki/1000000000_(number)http://en.wikipedia.org/wiki/1000000000_(number)


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