Introduction to stock exchange

A stock exchange is a form of exchange which provides services for stock brokers
and traders to trade stocks, bonds, and other securities. Stock exchanges also
provide facililities for issue and redemption of securities and other financial
instrument, and capital events including the payment of securities and other
financial instrument, and capital events including the payment of income and
dividends. Securities traded on a stock exchange include stock issued by
companies, unit trusts, derivatives, pooled instrument products and bonds. Stock
exchanges often function as continuous auction markets, with buyers and sellers
consummating transactions at a central location, such as the floor of the exchange
To be able to trade a security on a certain stock exchanges, it must be listed there.
Usually, there is a central location at least for record keeping, but trade is
increasingly less linked to such a physical place, as modern markets are electronic
networks, which gives those advantages of increased speed and reduced cost of
transaction. Trade on an exchange is by member only.
The initial offering of stocks and bonds to investors is by definition done in the
primary market and subsequent trading is done in the secondary market. A stock
exchange is often the most important component of a stock market. Supply and
demand in stock markets are driven by various factors that, as in all free markets,
affect the price of stocks
There is usually no compulsion to issue stock via the stock exchange itself, nor
must stock be subsequently traded on the exchange. Such trading is said to be off
exchange or over- the- counter. This is the usual way that derivatives and bonds are
traded. Increasingly, stock exchanges are part of global market for securities.
In recent years, various other trading venues, such as electronic communications
networks, alternative trading system and dark pools have taken much of the
trading activity away from traditional stock exchanges.
Stock exchange market in India
A stock exchange is the place where investors go to buy/sell their shares. Once a
companys public offering is complete, it gets listed in a stock exchange. After
listing it would be available for trading to all investors in the stock exchanges
where they are listed. In India we have two major stock exchanges they are;



National stock exchange Bombay stock exchange
(N S E) (B S E)

1.National stock exchange = The NSE is Indias largest and the worlds
third largest stock exchange in terms of transaction volumes & amounts. The NSE
is based out of Bombay. The NSE has set up its trading platform as a nation wide,
fully automated screen based system. This enables anyone in any part of the
country to trade on shares listed in the NSE.
National stock exchange of India (NSE) assimilated in November 1992; the NSE
was a tariff forfeiting association.
Some figures and facts of NSE
NSE covers around 300 Indian cities for equity trading of 305 cities for
derivatives.
NSE uses satellite communication expertise to bind trading of over 400
Indian cities.
The exchange regulates transactions of around 1 million on a daily basis.
It is one of the biggest VSAT incorporated stock exchange across the world.
About 8500 customers are involved with online trading business in NSE.


NSE index = The NSE index or the nifty index as it is popularly known, is the
index of the performance of the 50 largest & most profitable, popular companies
listed in the index. Each company that is part of the index has its own weight age
in the value of the index. The value of the nifty index is the weighted average of
the price of their 50 companies.
2. Bombay stock exchange = The BSE is the oldest stock exchange in
Asia .it is situated in Dalal street in Mumbai. It is the third largest stock exchange
in South Asia and the tenth largest in the world.BSE has over 5000 companies that
are listed in it. The objectives of the BSE are similar to that of the NSE.
BSE is well as the oldest as the oldest stock market in Asia and was initially
known ` The native share & stock brokers association. ` Incorporated in 1875, BSE
became the first certified exchange in India. The exchange is an investors hub
with over 5000 listed companies.
Some BSE figure & facts
BSE exchange was the first in India to launch equity derivatives, USD
adaptation of BSE Sensex and online stock trading policies.
It was first to acquire the ISO consent for regulation, clearance &
settlement

BSE also uses the latest technologies in the IT field to provide a single place where
traders from across the world can buy/sell shares in the Indian share market.
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
weight age in the value of the index. Since the number of companies is lesser, the
index variations are higher when compared to the nifty index.
Founder: Prem chand Roy chand
Founded: 1875
Headquarters: Mumbai, India


Hours of operation

Session Timing
Pre-open trading session 09:00- 09:15
Trading session 09:15-15:30
Position Transfer session 15:30-15:55
Closing session 15:50-16:05
Option Exercise session 16:05


LIST OF VARIOUS STOCK EXCHANGES
IN INDIA

SR.
No
Name of stock Exchanges Valid up to
1 Ahmadabad Stock Exchange
Limited
PERMANENT
2 BSE Limited PERMANENT
3 Bangalore Stock Exchange Limited PERMANENT
4 Bhubaneswar Stock Exchange Limited 04-JUN-2014
5 Calcutta Stock Exchange Limited PERMANENT
6 Cochin Stock Exchange Limited 07-NOV-2013
7 Delhi Stock Exchange Limited PERMANENT
8 Gauhati Stock Exchange Limited 30-APR-2013
9 Inter-connected Stock Exchange of India
Limited
17-NOV-2013

10 Jaipur Stock Exchange Limited 08-JAN-2014
11 Ludhiana Stock Exchange Limited 27- APR-2014
12 MCX SX Exchange Limited 15- SEP-2013
13 Madhya Pradesh Stock Exchange Limited PERMANENT
14 Madras stock Exchange Limited PERMANENT
15 Magadh Stock Exchange Limited
SEBI vide order dated sep.3,2007 refused
To renew the recognition granted to Magadh
stock exchange

16 Mangalore Stock Exchange
As per securities Appellate Tribunal order
dated October 4,2006,the Mangalore Stock
Exchange is a de-recognized Stock Exchange
under Section 4(4)of SCRA

17 National Stock Exchange of India Limited PERMANENT
18 OTC Exchange of India 22-AUG-2013
19 Pune Stock Exchange Limited 01-SEP-2013
20 The Vadodara Stock Exchange Limited 03-JAN-2014
21 U.P Stock Exchange Limited 02-JUN-2014
22 United Stock Exchange of India Limited 21-MAR-2014

Note: The Hyderabad securities and enterprises ltd.(erstwhile Hyderabad
stock exchange),Coimbatore stock exchange ltd and Saurashtra Kutch stock
exchange ltd. Have been granted exit by SEBI wide order dated January 25, 2013,
April 04, 2013 and April 05, 2013 respectively.










Introduction of LSE
.
Ludhiana Stock Exchange is one of the leading Regional Stock Exchange and has
been in the forefront of other stock exchange in every spheres, whether it is
formation of subsidiary for providing the platform The Ludhiana Stock Exchange
Limited (LSE was established in 1981, by Sh. S.P. Oswal of Vardhman Group and
Sh. B.M. Munjal of Hero Group, leading industrial luminaries, to fulfill a vital
need of having a Stock Exchange in the region of Punjab Himachal Pradesh
Jammu & Kashmir and Union territory of Chandigarh. Since its inception, the
stock exchange has grown phenomenally. The stock Exchange has played an
important role in channelizing savings into capital for the various industrial and
commercial units of the state of Punjab and other parts of the company. The
Exchange has facilitated the mobilization of funds by entrepreneurs from the
public and thereby contributed in the overall, economic, industrial and social
development of the state under its jurisdictionof trading to investors, for brokers
etc. in the era of Screen based trading introduced by national Stock exchange and
Bombay stock Exchange, entering into the filed of Commodities trading or
imparting education to the Public at large by way of starting Certificate
Programmes in Capital Market.
The vision and mission of stock Exchange is:
Reaching small investors by providing services relating to Capital market
including Trading Depository operations etc and creating Mass Awareness by
way of education and training in the field of Capital market.
To create educated investors and fulfilling the gap of skilled work force in the
domain in Capital Market.
Further, the exchange has 295 members out of which 171 are registered with
national Stock exchange as Sub- broker and 124 with Bombay Stock exchange as
sub- brokers through our subsidiary.



DETAILS OF PRESIDENTS AND VICE PRESIDENTS

PRESIDENTS/ CHAIRMEN
Sr.
No.
Name of the
person
Tenure

1 Sh. S.P. Oswal
16.08.1983 to
27.07.1986

2
Sh. B.M. Lal
Munjal
28.07.1986 to
15.10.1989

3 Sh. V.N. Dhiri
16.10.1989 to
30.10.1992
30.09.1998 to
04.10.2000

4 Sh. G.S. Dhodi
31.10.1992 to
22.12.1993

5 Sh. Jaspal Singh
23.12.1993 to
05.10.1995
01.10.1996 to
29.09.1998
06.10.2001 to
01.07.2002

6 Sh. M.S. Gandhi
06.10.1995 to
30.09.1996

7 Sh. R.C. Singal
05.10.2000 to
05.10.2001

8
Dr. B. B. Tandon,
Chairman
25.06.2007 to
10.12.2007

9
Sh. S.P. Sharma,
Chairman
15.07.2007 to
23.09.2008

10
Sh. Jagmohan
Krishan
23.09.2008 to
29.09.2009

11
Prof Padam
Parkash Kansal
30.09.2009 to
18.08.2012

12 Sh. Joginder Kumar
19.08.2012 to
18.09.2012

13 Ved Parkash Gaur
18.02.2013 to till
date



VICE PRESIDENTS/ VICE CHAIRMEN
Sr.
No.
Name of the
person
Tenure

1 Sh. Rajinder Verma
14.07.1984 to
08.08.1987

2 Sh. B.K. Arora
09.08.1987 to
15.10.1989
31.10.1992 to
22.12.1993

3 Sh. G.S. Dhodi
28.10.1991 to
30.10.1992

4 Sh. B.S. Sidhu
16.10.1989 to
27.10.1991
23.12.1993 to
05.10.1995

5 Sh. D.P. Gandhi
06.10.1995 to
26.09.1997

6 Sh. M. S. Sarna
27.09.1997 to
29.09.1998

7 Sh. T.S. Thapar
30.09.1998 to
04.10.2000

8
Sh. Tarvinder
Dhingra
05.10.2000 to
05.10.2001

9 Dr. Rajiv Kalra
06.10.2001 to
01.07.2002

10
Sh. D.K. Malhotra,
Vice Chairman
025.06.2007 to
10.12.2007

11
Sh. Jagmohan
Krishan, Vice
15.07.2007 to
23.09.2008

Chairman
12
Sh. Ravinder Nath
Sethi
23.09.2008 to
08.10.2008

13
Prof Padam
Parkash Kansal
09.10.2008 to
29.09.2009

14 Sh. Joginder Kumar
30.09.2009 to
18.09.2012


MANDATORY COMMITTEES OF LUDHIANA STOCK
EXCHANGE

Operational Committees
Sr. No. Name of Committee

1
Membership Selection
Committee
2
Disciplinary Action
Committee
3
Investor Grievance
Redressal Committee
4 Defaulters Committee

5
Compensation
Committee
6 Selection Committee

7
Standing Committee
On Technology
8
Sub-committee For
Compliance Of SEBI
Inspection Report

9
Investor Services
Committee
10
Public Interest
Directors Committee
11 Arbitration Committee

12 Ethics Committee

13
Independent Oversight
Committee For
Member Regulations

14
Independent Oversight
Committee For Listing
Function

15
Independent Oversight
Committee For Trading
and Surveillance
Function

16 Advisory Committee


Additional Committee
Sr. No. Name of Committee

1 Share Transfer Committee

2 Management Sub-committee

3
FMC CUM ROOM Transfer
Committee








DETAILS OF PRESIDENTS AND VICE PRESIDENTS
LSE SALUTES ITS PRESIDENT/ CHAIRMEN VICE PRESIDENT/ VICE
CHAIRMEN
PRESIDENTS/ CHAIRMEN
Sr.
No.
Name of the
person
Tenure

1 Sh. S.P. Oswal
16.08.1983 to
27.07.1986
2
Sh. B.M. Lal
Munjal
28.07.1986 to
15.10.1989
3 Sh. V.N. Dhiri
16.10.1989 to
30.10.1992
30.09.1998 to
04.10.2000

4 Sh. G.S. Dhodi
31.10.1992 to
22.12.1993
5 Sh. Jaspal Singh
23.12.1993 to
05.10.1995
01.10.1996 to
29.09.1998
06.10.2001 to
01.07.2002

6 Sh. M.S. Gandhi
06.10.1995 to
30.09.1996
7 Sh. R.C. Singal
05.10.2000 to
05.10.2001
8
Dr. B. B. Tandon,
Chairman
25.06.2007 to
10.12.2007
9
Sh. S.P. Sharma,
Chairman
15.07.2007 to
23.09.2008
10
Sh. Jagmohan
Krishan
23.09.2008 to
29.09.2009
11
Prof Padam
Parkash Kansal
30.09.2009 to
18.08.2012
12 Sh. Joginder Kumar
19.08.2012 to
18.09.2012
13 Ved Parkash Gaur
18.02.2013 to till
date


VICE PRESIDENTS/ VICE CHAIRMEN
Sr.
No.
Name of the person Tenure

1 Sh. Rajinder Verma
14.07.1984 to
08.08.1987
2 Sh. B.K. Arora
09.08.1987 to
15.10.1989
31.10.1992 to
22.12.1993

3 Sh. G.S. Dhodi
28.10.1991 to
30.10.1992
4 Sh. B.S. Sidhu
16.10.1989 to
27.10.1991
23.12.1993 to
05.10.1995

5 Sh. D.P. Gandhi
06.10.1995 to
26.09.1997
6 Sh. M. S. Sarna
27.09.1997 to
29.09.1998
7 Sh. T.S. Thapar
30.09.1998 to
04.10.2000
8 Sh. Tarvinder Dhingra
05.10.2000 to
05.10.2001
9 Dr. Rajiv Kalra 06.10.2001 to

01.07.2002
10
Sh. D.K. Malhotra, Vice
Chairman
025.06.2007 to
10.12.2007
11
Sh. Jagmohan Krishan,
Vice Chairman
15.07.2007 to
23.09.2008
12 Sh. Ravinder Nath Sethi
23.09.2008 to
08.10.2008
13
Prof Padam Parkash
Kansal
09.10.2008 to
29.09.2009
14 Sh. Joginder Kumar
30.09.2009 to
18.09.2012

MANDATORY COMMITTEES OF LUDHIANA STOCK EXCHANGE

Operational Committees
Sr. No. Name of Committee

1
Membership Selection
Committee
2
Disciplinary Action
Committee
3
Investor Grievance
Redressal Committee
4 Defaulters Committee

5
Compensation
Committee
6 Selection Committee

7
Standing Committee
On Technology
8
Sub-committee For
Compliance Of SEBI
Inspection Report

9
Investor Services
Committee
10 Public Interest

Directors Committee
11 Arbitration Committee

12 Ethics Committee

13
Independent Oversight
Committee For
Member Regulations

14
Independent Oversight
Committee For Listing
Function

15
Independent Oversight
Committee For Trading
and Surveillance
Function

16 Advisory Committee


Additional Committee
Sr. No. Name of Committee

1 Share Transfer Committee

2 Management Sub-committee

3
FMC CUM ROOM Transfer
Committee








Work profile of LSE










LEVELS OF MANAGEMENT

TOP LEVEL MANAGEMENT

MIDDLE LEVEL MANAGEMENT

LOWER LEVEL MANAGEMENT
Board of director
6. Shareholder director

6. Public Interest director
3. Trading member director

1. Executive director
Organizational chart of LSE















Board of directors
Chairman
C E O
Departments
Legal department
Secretarial department
Tech & Maintance department
Listing department
Membership department
Account department
Training & education
Department


DEPARTMENTS OF LSE




Depository Department Mr. Viney Mahajan
KYC Department Ms. Sonia Makkar
Clearing Department Mr. Vipun Goyal
Margin Department Mr. Rajinder Pal Singh
Account 1 Department Mr. Ram Ji
Account 2 Department Mr. Ravinder Saini
Surveillance Department Ms. Paramjeet Kaur
IT Department Mr. Madhur Gupta
Personnel Department Ms. Pooja Sharma
Strength of LSE group
1. LSE brand is popular among masses. The brand image of LSE can be
capitalized.
2. We have requisite infrastructure for the Capital Market activities which includes a
multi-storeyed, centrally air conditioned building situated in the financial hub of the
city i.e. Feroze Gandhi Market.
3. We have well experienced staff handling operations of Stock Exchange.
4. We have competent Board and professional management.
5. We have much needed networking of sub brokers in the entire region, who are
having rich experience in Stock Market operations for the last 31 years.
6. We have more than 46,000 clients spread across Punjab, Himachal Pardesh,
Jammu & Kashmir and adjoining areas of Haryana and Rajasthan.
7. The turnover of our subsidiary is the highest amongst all subsidiaries of Regional
Stock Exchanges in India.

The Exchange building is situated at Feroze Gandhi Market, Ferozepur Road,
Ludhiana. It is a six storeyed building, which is centrally air-conditioned. The
building has 262 rooms, which are located on various floors ranging from second to
fifth. The first floor of the building houses the administrative office and rooms from
second to fifth floors have been leased out to brokers. The first floor also has canteen
facility. Investor Service Centre is also located at first floor which houses a well-
equipped library and view-terminals to provide live rates of NSE and BSE to
investors. Investors are also provided with Cable TV for the purpose of viewing the
latest happenings in the Capital Market and around. Basement of the building has
air-conditioning plant and Generators to provide air-conditioned environment and
twenty-four hours power back up.
The Exchange has also an additional plot of land measuring 2333 sq. yards in the
prime location of city, to enhance its infrastructure and source of income.
Due to Nationwide reach of bigger Stock Exchanges, the trading volumes at
Ludhiana Stock Exchange declined and ultimately, the trading stopped in February,
2002, but the Stock Exchange converted the threat of bigger Exchanges into
opportunities and acquired the corporate membership of these exchanges through its
subsidiary company i.e. LSE Securities Limited. We have now been providing
Trading Platforms of Bigger Stock Exchanges to the Investors of the region. The
vast network of Brokers of the Exchange is servicing millions of Investors. The
subsidiary company is also providing depository services in the State of Punjab and
Himachal Pradesh. The turnover of subsidiary is highest amongst all the subsidiaries
of Regional Stock Exchanges. The growth of subsidiary is swift and it has been
providing a range of services to the public at large such as Trading, Depository, IPO
bidding collection Centre.
The Company in its continuous endevour to provide qualitative services to its valued
clients, has started e-broking trading services for its clients, thereby increasing the
geographical reach of the company


The Exchange has been providing a variety of services for the benefit of investing
public. The services include Investor Service Centres, Investor Protection fund and
Investor Educational Seminars.
(I).INVESTOR SERVICE CENTRES :-
The Exchange has set-up Investor Service Centre at LSE Building for providing
information relating to Capital Market to the general public. The Centres subscribe
to leading economic, financial dailies and periodicals. They also store the Annual
Reports of the companies listed at the Stock Exchange. The Investor Service
Centres are also equipped with a Terminal for providing live rates of trading at
NSE and BSE. A large number of the investors visit the centre to utilize the services
being provided by the Exchange.
(II).INVESTOR AWARENESS SEMINARS:-
The Exchange has been organizing Investor Awareness Seminars for the benefit of
Investors of the region comprising State of Punjab, Himachal Pradesh, Jammu &
Kashmir, Chandigarh and adjoining areas of Haryana and Rajasthan. This massive
exercise of organizing Investor Awareness Seminars has been launched as a part of
Securities Market Awareness Campaign launched by SEBI in January, 2003. The
Exchange apprises the investors about Dos and Donts to be observed while
dealing in Securities Market. During 2011-2012, till date, Exchange has organized
more than 83 workshops in the region mentioned above.
(III).WEBSITE OF THE EXCHANGE:-
www.lse.co.in The Exchange has its own website with the domain name
www.lse.co.in. The website provides valuable information about the latest market
commentary, research reports about companies, daily status of International
markets, a separate module for Internet trading, information about listed companies
and brokers and sub-brokers of the Exchange and its subsidiary. The website also
contains many useful links on portfolio management, investor education, frequently
asked questions about various topics relating to Primary and Secondary Market,
information about Mutual Funds, Financials of the Company including Quarterly
Results, Share Prices, Profit and Loss Accounts, Balance Sheet and Many More.
The website also contains daily Technical Charts of various scrips being traded in
BSE and NSE.


LSE has carved out its unique position among the Stock Exchanges of the country
for the Knowledge Management. It has set up an Education and Training Cell and
the same has emerged as a leading facility in various Financial Services in India.
The Exchange has been conducting a unique certification programme in Capital
Market in association with Centre for Industry Institute Partnership Programme
Punjab University, Chandigarh for the last three year. This programme has widened
the horizons of participants vis--vis Capital Market Operations as practical skill
based knowledge is provided by Stock Brokers, Stock Exchange Officials,
Professors of Finance and Business Management and above all Professionals
working in different areas of Capital Market. We have completed series of batches
of this programme and we now want to scale up this programme and are planning to
launch various other programmes on areas relating to Securities Market.

We have edge over others as far as Education and Training in Financial Services is
concerned due to following factors:
a. Directly connected with the Industry as Regional Stock Exchange.
b. Connected with large base of Investors as they use the Stock Exchange as a
Trading Platform for their liquidity needs
c. Presence in the region of Punjab, Himachal Pradesh, Jammu & Kashmir and
Chandigarh through our branches Network and the area being under the jurisdiction
of our Exchange.
d. Already running Certification programmes in Capital Market successfully.
e. Continuously holding Investor Awareness Programmes for Investors & Investor
Groups through association with Brokers, Sub-brokers, Colleges, Universities and
Consumer Groups.



Subsidiary of LSE

LSE Securities Limited is a subsidiary of the Ludhiana Stock Exchange, which was
formed with an objective to enhance business and investment opportunities for the
investors and members of Ludhiana Stock Exchange at large, through innovative
products by encompassing a variety of activities related to the capital market. The
company has a paid-up capital of Rs 6.52 crores.

Introduction Of The LSE SECURITIES LTD.
LSE Securities Ltd., was incorporated in January, 2000 with a view to revive the
capital market in the region and for taking full advantage of the emerging
opportunities being provided by expansion of bigger stock exchanges like NSE and
BSE. The company since its inception has marched forward rapidly and achieved
many milestone in a short span of existence


Governing Council

The Council of the management of the Company comprises of 10 directors of which
3are broker members and 7non-brokers. Five non broker members are Independent
Directors of eminent status from the field of finance, law and management and
remaining two are Chief Executive Officer of LSE Securities. And Executive
Director of the holding company (Ludhiana Stock Exchange), who are on the Board
of the company as ex-officio Directors. Thus the council of management has
representation of sub-brokers as well as professionals and subject specialists
representing various fields of business activities. Operations of the company are run
in a professional, transparent and fair manner keeping in view of the interest of
investors as well as other stake-holders.

Corporate Membership Of NSE & BSE

SEBI, at the initiative of LSE, permitted smaller Stock Exchanges, to trade on bigger
Stock Exchanges through their subsidiary companies. The Ludhiana Stock Exchange
floated its subsidiary company, the LSE Securities Limited, with the objective of
obtaining trading rights on bigger Stock Exchanges. It has obtained corporate
membership of both NSE and BSE in the first half of year 2000.

Trading At NSE & BSE

The LSE Securities Ltd. commenced trading operations in Capital Market Segments
of BSE and NSE in September, 2000 and December 2000 respectively. The turnover
of the Company at NSE and BSE is growing by leaps and bounds ever since in
incorporation. There was encouraging response from the sub-brokers specially at
NSE counters. During the financial year 2005-06, the Company recorded a turnover
of Rs. 7975 crores and Rs.3834 crores in "Capital Market" segments of NSE and
BSE respectively. For the year ended 2005-2006, there were 128 sub-brokers
registered for NSE and 68 for BSE.

F&O Segment Of NSE

The LSE Securities Ltd. commenced trading operations in Future and Options
Segment of NSE in February 2002. The Company became the first subsidiary of any
Regional Stock Exchange which commenced trading in F&O Segment of NSE.
Response to trading facilities in the F&O segment of NSE has been very
encouraging and volumes generated in this segment soon exceeded those in Capital
Market segment.

Trading Through V-Sats

The LSE Securities Limited has provided facility to its sub-brokers for trading on
NSE and BSE through VSAT counters which are located outside Stock Exchange
Building. During 2005-2006, 27 sub-brokers of the company have been trading
through VSAT on NSE and 13 on BSE.

Certification In Financial Market

In order to provide professional services to the investors of LSE Securities Limited
through its sub-brokers, the company motivated its sub-brokers and its staff to
qualify the certification in financial markets conducted by NSE. All trading
terminals for Capital Market Segment and F&O segment are being operated by the
persons after having qualified the said certification.






Depository Participant Services National Securities
Depository Limited (NSDL)

The LSE Securities Ltd. commenced its operations as Depository Participant of
NSDL in August 2000. The DP services provided by the Company have technology
edge over other DPs, as DP of the company is the only On-line Real-Time DP in the
region. As a result of efficient services and competitive rates, the Company has been
able to increase its market share in the DP business at the cost of other DPs in the
region. As on date DP of NSDL and CDSL of the Company at Ludhiana is servicing
over 35000 beneficiary accounts.

Expansion Projects

To increase its presence in the region further, the company plans to open its
branches of Depository Services in the major cities of the region. To start with, it has
already opened its branches at Jalandhar Amritsar and Chandigarh.























CAPITAL MARKET







Introduction =
An organized capital market is the basic requirement of industrial and commercial
development of a country. There is requirement of two types of credit in the
economic system of a country i.e. short term credit and long term credit. The short
term capital is supplied by money market. On other hand, the long term capital needs
met by the capital market. Capital market is central coordinating and directing
technique help in free and balanced flow of financial resource into the economic
system operating in a country. The capital market in India has substantially changed
after independence.

Meaning and definition =
Capital market is the centre for dealing in
long term funds. In capital market, money is borrowed and lent for a long period. It
refers to the institutional arrangement for facilitating the borrowing and lending of
long term funds. The capital market consists of a series of channels through which
the savings of public are made available for productive use to industrial and
commercial enterprises and public authorities.

Definitions =
According to H.F. Dougal,
The capital market deals in long
term funds both debt and equity.

According to G.H. Penters,
We use the term capital market for markets dealing in
permanent long period of medium term loans

Capital
Market









1.Intial public offer after market & uniform
2.Further public offer platform issued financial
3.Right issue instrument
4.Bonus issue - stock
5.Prefential issue - bonds
- options
-futures


Primary market

The primary market is where securities are created. In this market firms sell new
stocks and bonds to the public for the first time. For our purposes, you can think of
the primary market as being synonymous with an initial public offer. Simply put, an
IPO occurs when a private company sells stocks to the public for the first time.

1.Right issue -
Under a secondary market offering or seasoned equity
offering of shares to raise money, a company can opt for a right issue to
raise capital. The right issue is a special form of shelf offering or shelf
registration. With the issued right .existing shareholders have the privilege
to buy a specified number of new shares from the firm at a specified price
within a specified time.





Primary market Secondary market
Segment of capital market
2. Bonus issue-
Bonus issue means when company issue the new share to
his current shareholder in a company, based upon the number of shares
that the shareholder already owns. Bonus share increase the total number
of share issued or owned.

Secondary market =
The secondary market is what people are talking about when they refer to the "stock
market". This includes the all major exchanges around the world. The defining
characteristic of the secondary market is that investors trade among themselves. In
the secondary market, investors trade previously issued securities without the
issuing companies 'involvement.
The secondary market can be further broken down into two specialized categories;
auction & dealer market.

In the auction market, all individuals and institutions that want to trade securities
congregate in one area and announce the prices at which they are willing to buy and
sell. These are referred to as bid and ask prices. The idea is that an efficient market
should prevail by bringing together all parties and having them publicly declares
their prices. Thus, theoretically, the best price of a good need not be sought out
because the convergence of buyers and sellers will cause mutually-agreeable prices
to emerge. The best example of an auction market is the New York Stock Exchange
(NYSE).
Important terms in secondary market
- STT( Securities transaction tax)
- Rolling settlement
- Day trading
- Span margin
- Mark to market
- Volatility margin
- VAR margin
- Before and after haircut
Initial public offer(IPO)
An IPO is when a company which is presently not listed at any stock exchange
makes either a fresh issue of shares or makes an offer for sale of its existing shares
or both for the first time to the public. Through a public offering, the issuer makes an
offer for new investors to enter its shareholding family.

The shares are made available to the investors at the price determined by the
promoters of the company in consultation with its investment bankers.

The successful completion of an IPO leads to the listing and trading of the
companys shares at the designated stock exchanges.
RULES AND REGULATIONS FOR INTIAIL PUBLIC OFFER (IPO)

1. A company contacts an underwriting firm to determine the legal and financial
details of the public offering.

2. A preliminary registration statement, detailing the company's interests and
prospects and the specifics of the issue, is filed with the appropriate authorities.
Known as a preliminary prospectus, or red herring, this document is neither finalized
nor is it a solicitation by the company issuing the new shares. It is simply an
information pamphlet and a letter describing the company's intent.

3. The appropriate governing bodies must approve the finalized statement as well as
a final prospectus, which details the issue's price, restrictions and benefits, and is
issued to those who purchase the securities. This final prospectus is legally binding
for the company.


WHY INVESTOR WANT TO INVEST IN IPO?
Because they can make big money on it. Compared to the investment in fixed
deposits in banks it makes more profit, but the bad news is that you are also
expected to bear the losses, if any.
SHORT TERM INVESTMENT STRATEGY-
They want to catch the low price & sell it quickly for profit without the buy and
hold strategy, but often they lose their money because they did not conduct careful
research into company & ISSUE.
LONG TERM INVESTMENT STRATEGY-
- Possibility of high return( capital appreciation)
- Easy liquidity
- Income from dividend
- Bonus

An Issuer may make an IPO if:-
- It has net tangible assets of at least RS. 3 crore.
- Issuer has track record of distributable profits in at least 3 years.
- Public issue is offered at two values;-
- Face value
- Nominal value of the share, assigned to it by the company
- It is the original cost shown on the share certificate and the extent to
which the shareholder is liable to the company.
- Premium value
- It is the amount charged over the face value
- Company charges premium if it has accumulated some past profits.

-:TWO TYPE OF ISSUE PRICING:-




FIXED PRICING:-
Fixed price is that price that that is determine by the company.
In that price is known in advance, but the demand is only known at the close issue.

BOOK BULDING:-
In that case the company allows the investor to determine the
price. Book building means a process undertaken to elicit demand and to assess the
price for determination of the quantum or value of securities in accordance with
ICDR regulation 2009.
In a book building issue the issuer company mentions the minimum and maximum
price at which it will sell its shares. Thus the offer document contains only the price
band instead of the price.
Two option to issue capital through book building:-
-75%book building route
-Not more than 50% of net offer to public can be allocated to QIBs
-25% to retail individual investors who have either not participated in book
building or have not received any allocation
-100%book building route
FIXED PRICING
BOOK BULIDING
-Not more than 50% of net offer to public can allocated to QIBs
-Not less than 25% allocation to retail individual investors
-Not less than 25% allocation to non institutional investor
GREENSHOE OPTION:-
-The company can issue addition shares up 15%, over and above the
original proposed issue.
-This is normally done if the demand for share is rises much higher
than expected

-:CATEGORIES OF INVESTORES:-






1.QULIFIED INTUTIONAL INVESTORES:-
Qualified institutional investors/buyers are those institutional investors who
are generally perceived to possess expertise and the financial muscle to evaluate and
invest in the capital market.
-Scheduled commercial banks
-Mutual funds
-Foreign institutional investors registered with SEBI
Qualified intuitional investor
Non institutional investors
Retail investors
-Multilateral and bilateral development financial institutions.
2.NON INSTITUTIONAL INVESTORES;-
These are those investors whose application size is more than Rs. 2 lakh e.g.
individual investors NRIs, societies& trusts. They are also called high net worth
individual under these resident Indian individuals, HUFs, companies.

3.RETAIL INVESTORES:-
Retail investors buy much smaller quantities than larger institutional investors.
These are those investors whose application size is less than Rs.2 lakh e.g. individual
NRIs, HUFs.

INTERMEDIARIES FOR SUCCESSFULLY COMPLETION OF IPO











BOOK RUNING LEAD
MANGER
BANKERS TO ISSUE UNDERITERS
REGISTRAR TO
ISSUE
1.BOOK RUNING LEAD MANAGER
BRLM are appointed by the company for completion of pre &
post formalities of related to public offer with SEBI , stock exchanges and
other regulatory authorities e.g. escrow account, banker appointment<
price deciding, final allotment etc.
2.BANKER TO ISSUE
They are registered with SEBI in term of SEBI (Banker to the
issue) rules & regulation. They carry out all activities of ensuring that the
fund collected is transfer to escrow account.
3. UNDERWRITERS
They are registered with SEBI under SEBI (Underwriters) rules
and regulations. They provide safety net to the company. Underwriters are
institution / individual who agree to buy the shares of the company in case
companies enable to sell them to the public. They charged commission for
providing this service.
4.REGISTRAR TO ISSUE
They are registered with SEBI in term of SEBI (Registrar to issue
and share transfer agent) rules & regulation registrar to the company
finalize the total list of eligible allotees and ensures that share are credited
to accounts of successful allotees and refund order are sent to
unsuccessful applicants.


































TYPES OF IPO
Public issue Right issue Prefential issue
Initial public offer Further public offer
ASBA NON- ASBA