BSE Overview

Oldest stock exchange in Asia

Established as "The Native Share &

Stock Brokers Association" in 1875.

The Exchange has a nation-wide reach

with a presence in 417 cities and towns of
India
 Groups Listed In BSE
A
B1
B2
F
Z
G
 Recent

Total Market Capitalisation

– Rs.3022190 Cr. / $ 6520bn

Total Scrips Listed

– 7466
 BSE Products
Equities

Derivatives

Debt Market Securities

 Board Of Directors
Non-Executive Chairman:
Mr. Jagdish Capoor, Chairman, HDFC Bank

MD & CEO: Mr. Rajnikant Patel

Directors
Mr. P. K. Banerji IAS (Retd.)

Mr. Shekhar Datta Former Managing Director &

President
Greaves Cotton Limited
Mr.S.Jambunathan IAS (Retd.)

Mr. Jitesh Khosla Joint Secretary, Ministry of

Company Affairs, Govt. of India

Mr. Vijay Mukhi Managing Director, Vijay Mukhi's

Computer Institute

Mr. Pradip P. Shah Chairman, IndAsia Fund Advisors

Private Limited
Mr. P. P. Vora Ex-Chairman, Industrial
Development Bank of India and
National Stock Exchange of India
Limited
 BSE SENSEX?
It consists of the 30 largest and most
actively traded stocks, representative of
various sectors, on the BSE

Free Float capitalisation method

The base value of the Sensex is 100 on

April 1, 1979 and the base year of BSE-
SENSEX is 1978-79.
 Calculation of SENSEX

Aggregate Mkt Capitalisation * Base Index Value

Aggregate base Mkt capitalisation
 Which 30 Stocks?
1. Associated Cement Companys Ltd.
2. Bajaj Auto Ltd.
3. Bharat Heavy Electricals Ltd.
4. Bharti Airtel Ltd.
5. Cipla Ltd.
6. Dr Reddy's Laboratories Ltd.
7. Grasim Industries Ltd.
8. Gujarat Ambuja Cements Ltd.
9. HDFC
10.HDFC Bank Ltd.
11.Hero Honda Motors Ltd.
12.Hindalco Industries Ltd.
13.Hindustan Lever Ltd.
14.ICICI Bank Ltd.
15.Infosys Technologies Ltd.
• ITC Ltd.
• Larsen & Toubro Limited
• Maruti Udyog Ltd.
• NTPC Ltd.
• ONGC Ltd.
• Ranbaxy Laboratories Ltd.
• Reliance Communications Limited
• Reliance Energy Ltd.
• Reliance Industries Ltd.
• Satyam Computer Services Ltd.
• State Bank of India
• Tata Consultancy Services Limited
• Tata Motors Ltd.
• Tata Steel Ltd.
• Wipro Ltd.
 How 30 companies selected?
Market Capitalization
Industry Representation
Trading Frequency
No. of Trades
Value Traded
 0
10000
12000
14000

2000
4000
6000
8000
7/1/1997
1/1/1998
7/1/1998
1/1/1999
7/1/1999
1/1/2000
7/1/2000
1/1/2001
7/1/2001
1/1/2002
SENSEX

7/1/2002
1/1/2003
7/1/2003
1/1/2004
7/1/2004
SENSEX Movement

1/1/2005
7/1/2005
1/1/2006
7/1/2006
 Notable Indexes
BSE launched the country’s first free float based
index ‘ BSE Teck Index’ in 2001.
It launched the Dollar version of Sensex “
DOLLEX- 30” on July 25,2001
BSE –PSU Index 2002
BANKEK June 2003
BSE 100
BSE 200
BSE 500
Contd….
BSE MIDCAP & BSE SMALLCAP
BSE HEALTH CARE
BSE CONSUME DURABLE
BSE CAPITAL GOODS
 Index Maintenance

Index committee : It comprises of

academicians, fund managers, journalist
and broker members. They have been
formed to give advice on all aspects
related to indices.
Index Cell : It looks after the daily index
maintenance
 SPIcE
SENSEX Prudential ICICI Exchange
Traded Fund
Features of both an open-ended mutual
fund and an exchange listed security
The price of one SPIcE unit will be equal
to approximately 1/100th of SENSEX
value
 BOLT - BSE On-Line Trading

Need for Bolt

Poor transparency
15 days + settlement cycle
Poor liquidity
Computer & Network Evolution
Faster spread of equity
 Type of Orders
Limit orders
Market orders
Hit/Take orders
Stop loss orders
 BOLT Screen
Market view
– Best five quotes
– Total depth – buy and sell
– Last traded rate & quantities
– Trades / values / volumes
– Lower / upper circuit limit rate & weighted avg.
rate
– Open / High / Low / Close
 BOLT Screen
Scrip Help
– Ex-dates
– Book Closure
– No Delivery period
– Standard Rate
– ISIN No.
– Dividend
 Daily Trading Sessions on BOLT
Opening Session 08.46 a.m. To 09.00 a.m.

Log-in Session 09.00 a.m. To 09.55 a.m.

Continuous 09.55 a.m. To 3.30 p.m.

Session
Closing Session 3.30 p.m. To 03.50 p.m.

Post Closing 03.50 p.m. To 04.15 p.m.

Session
6A / 7A / Member 04.15 p.m. To 05.30 p.m.
Query Session
 Advantages of BOLT
Transparency of trades
Faster settlement T + 2
Improved access to sensitive information
Simplicity in broker back office operations
Increases geographical spread
 Milestones
Landmark Date
1000 25-Jul-90
2000 15-Jan-92
3000 29-Feb-92
4000 30-Mar-92
5000 11-Oct-99
6000 11-Feb-00
7000 21-Jun-05
8000 08-Sep-05
9000 09-Dec-05
10000 07-Feb-06
11000 27-Mar-06
12000 20-Apr-06
Debt Markets
Or
Bond Markets
 Brief Overview of Bond Markets

Fixed income securities

Wide Variety of Instruments
Growing Retail Interest in India
Safer and secure vis-à-vis other financial
instruments
Continuing innovations and developments
Issued by any legal entity
Lower average volatility
 Composition of
Indian Debt Markets
Composition of Indian Bond Mkt
6%
6%

8%

7%

73%

Government Securities Money Market Instru.

Corporate Debt FI Bonds
PSU Bonds
Investment Opportunities in Debt

Government Securities
Treasury Bills
Money Market Instruments
Certificates of Deposits
Commercial Paper
PSU & Institutional Bonds
Corporate Bonds
Participants in Indian Debt Markets
Traditional Investors
– Public Sector Banks
– Private Sector & Foreign Banks
– Primary Dealers
– Financial Institutions
– LIC / GIC

New Class of Investors

– FIIs & Mutual Funds
– Co-operative Banks
– Private Insurance Companies
– Private Trusts & Pension Funds
– Corporate & Retail Investors
 Debt Market

Wholesale Debt Retail Debt

Market Segment Segment
 Retail Debt Market
Why ?
– Greater investment opportunities for
retail investors
– Efficient Diversification and balancing
for investor portfolios
– Enhance liquidity and trading options in
debt instruments
 GILT System
BSE Debt Segment: trading mechanism
Accrued Interest and Delivery Value:
available in the system
T + 1 & T + 2
 Z Group Rules
Three out of the following seven criteria
– Required notice of Book Closure & Record Dates
– Yearly submission of Annual Reports
– Quarterly submission of shareholding pattern
– Payment of Annual Listing Fees
– Publication of Audited / Unaudited results on a
quarterly basis
– Redressal of Investors' Complaints (regarding share
transfers etc.)
– Implementation of corporate governance, if
applicable.
 Investor Protection Fund
The members contribute

The Stock Exchange contributes

The maximum amount presently payable

to an investor
 Listing
The company should have minimum issued and
paid up equity capital of Rs. 3Cr.
The Company should have profit making
track record for last three years.
Minimum networth of Rs. 20 Crs
The company should have a dividend
paying track record
 Delisted Companies

Clause 38 of the listing agreement.

Delisted due to amalgamation, merger,

winding-up, etc.
Surveillance
 Regulatory Framework

Security Contract Regulation Act 1956

Security Contract Regulation Rules 1957
SEBI Act 1992 and rules and Regulations there
under
SEBI Stock Brokers and Sub Brokers Rules
1992.
Rules Regulation and Bye laws, of the Exchange
SEBI, Prohibition of Fraudulent and Unethical
Trade Practices Regulations 2003
 Types of Risk for an
Exchange
Reg. Compliance Default Risk
Mkt Abuse Risk
risk

Surv. & Member Capital

Monitoring Inspection Management

Risk Mgt. Tools

 Objectives : Surveillance
Detect unusual price/vol. Mvts. at a nascent
stage & impose corrective measures.

Reduce the ability of Market Participants to

influence price and volume of securities

Minimize Default Risk through Position

Monitoring

Strengthen the Self Regulatory Mechanism

 Surveillance Activities
1. Price Monitoring
On-Line Surveillance
Off-Line Surveillance
Rumour Verifications

2. Position Monitoring
Top Purchasers and Sellers
Concentrated Purchases/ Sales
Purchase/ Sales of scrips having thin trading
Trading in B1, B2, T & Z Groups
Pay in liabilities above a threshold limit
Verification of Institutional Trades
Weak Member Portfolio profile & MTM loss monitoring

3. Investigation
 Companies Suspended
BPL Ltd
Singer India Limited
Starlite Components Ltd.
Kinetic Trust Ltd.
Jaybharat Fabrics Mills Ltd.
Vision Organics Ltd
THANK YOU !!!