Win24 1C SEBI Sharemarket UPSC Mrunal

Mrunal's Win24 Free Updates Pillar#1C: Shares / SENSEX / Mutual Fund/ etc.
Table of Contents
10 🐮📈🐻Pillar#1C: Sharemarket in UPSC....................................................................................... .64
10.11.1 🚩👶🏻
Boycott Notice for PHD in Sharemarket handout......................................................................................65
💰
10.11.2 Capital / Funding Arrangement: Types............................................................................................................ 65
💰
10.11.3 Capital (पूंजी)- types Fixed vs Working............................................................................................................... 65
💰
10.11.4 Capital Arrange → Trade Credit (Short Term)............................................................................................. .66
💰
10.11.5 Account Receivable / Payable........................................................................................................................... . 66
💰
10.11.6 Capital Arrange → Lease Financing (Medium Term).................................................................................. .66
10.11.7 → Capital Arrange → Retained Earnings (Long Term) ......................................................................................... .66
10.12 🗃 🛒Financial / Securities market: meaning and types.......................................................................67

10.13 🔪🗃 Debt Instruments (ऋण उपकरण).........................................................................................................67
10.13.1 →Debt → Short Term → ...............................................................................................................
Tri-party Repo . 67
10.14 🔪🗃🗓 Long Term Debt Instruments (दीर्ध-अवधि ऋण- उपकरण)................................................................ .67
10.14.1 📈🔎 Global Bond Indices & inclusion of Indian G-Sec......................................................................................67
10.15 🥇🗃🗓 Bonds issued by Companies?...................................................................................................68
10.15.1 🐸 Hybrid financing / Mezzanine Financing....................................................................................................... .68
10.15.2 🐸 Hybrid: OFCD: Sahara Refund portal (2023)................................................................................................. .68
10.15.3 🐸 Hybrid: Foreign Currency Convertible Bonds (FCCBs):.............................................................................. .69
10.15.4 🐸 Hybrid: Contingent convertible bond (CoCo)/ enhanced capital note (ECN).......................................... .69
10.16 🔪🗃🗓 Bonds Types : Based on Issuer.................................................................................................69
10.16.1 🔪🗃🗓 Bonds Types : Based on Issuer → ULB (Urban Local Bodies).............................................................69
10.17 🔪Long Term Debt Instruments: Special purpose Bonds- Misc..........................................................70
10.17.1 💦🔪
Long Term Debt → Special → 💦🔪
NABARD Social Bonds (2023).................................................. .70
10.17.2 → → Long Term Debt → Special → Zero coupon zero principal instrument ................................................70
10.18 🗳(🔪🗃)⏳Electoral bonds (चुनावी बांड, 2017 ).........................................................................................71

10.18.1 🗳🚨👨🏻‍⚖️ SC bans electoral bonds (2024-Feb)....................................................................................................... .72
10.18.2 🗳 Electoral Bond & Companies Act - SC bans amendments.............................................................................72
10.18.3 🗳👨🏻‍⚖️ Electoral Trusts (ET) Scheme (2013).......................................................................................................... . 72
10.19 🔪 🔖 Bonds: Misc. Types.......................................................................................................................73
10.19.1 🔪 🔖 Bonds: Misc. Types → Market Linked Debentures/Bonds..................................................................... .73
10.19.2 🔪🔖 Bonds: Misc. Types → Strip bond / Stripped bond....................................................................................73
10.20 🪣🔪 Buffer Funds for Bond Repayment............................................................................................. .73
10.20.1 🪣🐯🔪👨‍🦲 Consolidated Sinking Fund (CSF) for State Govts’ repayment...................................................... .73
10.20.2 🪣🤵‍♂️🔪 Debenture Redemption Reserve (DRR) Fund of Companies issuing Bonds......................................73
11 🐮📈🐻Equity Instruments ( इक्विटी)................................................................................................... .74
11.11.1 👩🏻‍💼📦 Private equity (PE) funds and Venture Capital Funds...............................................................................74
11.11.2 🐲 Share Types: Preference Shares vs ordinary shares.........................................................................................75
11.11.3 🐲 Shares for Employees / VIPs / Special investors : ESOP, Equity Warrents ................................................. .76
11.11.4 ⚖️🗃 Share types: Floating vs Restricted Stocks.................................................................................................. .76
11.11.5 🐲 Share types depending on risk / quality............................................................................................................ 76
11.12 🧮 Account types................................................................................................................................... .77

11.12.1 🐾 Goodwill –while buying another company/brand..........................................................................................77
11.13 🐾 Valuation of companies....................................................................................................................77
🦄
11.13.1 Valuation →Startups → Unicorn Startup ..................................................................................................... .78
11.13.2 Valuation → Listed Companies (Small Cap/Mid Cap/Large Cap)................................................................... .78
Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 62

11.13.3 Reliance - first company to hit 20 lakh cr Market Cap (2024-Feb).....................................................................78
11.13.4 🍺🫧Market Froth & Asset bubble in Small-cap & Mid-cap ( बाजारू झाग और सं पत्ति गुब्बारा)........................................ .78
🌷
11.13.5 Tulip Mania (किसी निवेश के पीछे सामूहिक पागलपन)............................................................................................................ . 78
11.13.6 📈📉Volatility / ViX (कीमतों में अस्थिरता)....................................................................................................................... . 79
🐾
11.13.7 Price-to-Earnings (P/E) Ratio and EPS (Earnings per Share)...................................................................... .79
🐾
11.13.8 Leverage Ratio, Debt to Equity Ratio, ROCE, etc............................................................................................80
🐾
11.13.9 Net Worth = Total Assets −(minus) Total Liabilities.................................................................................... .80
11.13.10 🔩
EBITDA, Depreciation, Amortization........................................................................................................... 80
11.14 ⚖️🗃 Methods of Issuing Shares...........................................................................................................80

11.14.1 Share price................................................................................................................................................................ . 80
11.14.2 Sharemarket- company related documents........................................................................................................... 81
11.14.3 IPO vs FPO............................................................................................................................................................... . 81
11.14.4 Underwriter / Lead managers................................................................................................................................ . 81
11.14.5 Share-selling: Offer for sale (OFS) and share pledging.........................................................................................82
11.14.6 Share-selling: Open Offer......................................................................................................................................... 82
🍃
11.14.7 Share Selling: Equity dilution.............................................................................................................................. 82
🍃
11.14.8 Share Swaping and De-listing........................................................................................................................... . 82
🍃
11.14.9 Bonus Shares........................................................................................................................................................ 83
🍃
11.14.10 Share Splitting..................................................................................................................................................... 83
🍃
11.14.11 Share buyback by the Company...................................................................................................................... . 84
11.14.12 ⚖️🗃 🤵 IPO → Special Purpose Acquisition Company (SPAC)................................................................... .84
11.14.13 ⚖️🗃 🌐 ADR/GDR: DESHI Shares in Videshi soil............................................................................................84
11.14.14 🗃🌐 Direct listing of Indian Companies in foreign stock exchanges (2023) ............................................... .85
🛒💻👨‍💼
11.14.15 (: ) DEMAT → ASBA Reforms in IPO/Primary Market.............................................................................. .85
11.14.16 UPI-ASBA in Secondary Market 2024-Jan Reform by SEBI............................................................................ .85
11.15 🤝 Central Counterparties (CCPs), Novation & ESMA controversy ..................................................86

11.15.1 🤝CCP Examples in India........................................................................................................................................ 87
11.15.2 🤝🐅CCP Regulation in India: Who regulates CCP in India?........................................................................... .87
11.16 🙋🏻‍♂️🛒 Investors ke Types.........................................................................................................................87
11.16.1 Style of Trading / Investing based on duration and risk..................................................................................... .87
📞
11.16.2 Bid-Ask Spread................................................................................................................................................... . 87
📞
11.16.3 Arbitrage: Making profit due to difference in to markets/location. ............................................................ .88
11.16.4 🐂📈 India becomes 4th-largest equity (Share) market (2024-Jan)................................................................. .88
11.17 👟 Market Theories.................................................................................................................................88

11.18 👟👠 Efficient Market Hypothesis /theory (EMH)..................................................................................................88
11.18.1 👟👠 Random walk theory..................................................................................................................................... . 88
11.19 🐆Alpha and Beta Values......................................................................................................................88
🐆
11.19.1 Beta Value to monitor price volatility or risk of an asset.................................................................................88
11.19.2 Alpha value to compare performance of Mutual Funds..................................................................................... .89
11.19.3 🚩👶🏻
FAQ: Alpha vs Beta similarity / correlation / difference .......................................................................... .89
⚱️
11.19.4 Types of Analysis – fundamental vs Technical.................................................................................................89
⚱️
11.19.5 DEMAT Portfolio: Meaning, Types, Portfolio Diversification.......................................................................90
11.20 SEBI Reforms to protect investors........................................................................................................90

11.20.1 🤝⏰T+1 day Settlement instead of T+2 day....................................................................................................... .90
11.20.2 🤝⏰⏰ T+1 hour & T+0 hour (instantaneous) settlement.............................................................................. .91
11.21 🆘📡 Server Crash Protection................................................................................................................91
11.21.1 🆘 📡 SEBI’s BCP Plan & DRS Sites...................................................................................................................... . 91

11.21.2 🆘 📡 IRRA Portal: Investor Risk Reduction Access (IRRA)..............................................................................91
11.22 📦 🤹🏻‍♂️ 👴🏻 Investment Funds → Mutual fund (MF) Types....................................................................92
11.22.1 📦 🤹🏻‍♂️ 👴🏻 MF → Hybrid mutual funds................................................................................................................... 92
11.22.2 🚎✋ MF: Open ended vs Close ended................................................................................................................. . 92
11.22.3 ↩️ ↩️ MF: Lumpsum (One-off) vs SIP................................................................................................................. . 92
11.22.4 📦 🤹🏻‍♂️ 👴🏻 Mutual fund → ESG, Shariya Mutual Funds........................................................................................92
11.22.5 📦 🤹🏻‍♂️ 👴🏻 Mutual fund → SIP, ELSS, ULIP.......................................................................................................... . 93
11.23 😴 Index-ETF: a type of Passive Fund...................................................................................................93
11.24 🌸🐂 Bitcoin ETF approved in USA (2024)......................................................................................... .94
11.24.1 🌸🐂
Bitcoin ETF: Pros............................................................................................................................................ 94
11.24.2 🌸🐂
Bitcoin ETF: Cons........................................................................................................................................... 94
11.24.3 Gold-ETF.................................................................................................................................................................. . 94
12 🍋 Tax on Investment / financial assets.......................................................................................... .95

12.0 🍋😍 Tax relief given on (निम्न चीजो पे टैक्स में रियायत/छू ट दी जाती है)........................................................................ .95
12.1 🍋🥵 Tax relief NOT given on ............................................................................................................... .96
13 Pillar 1C3: Corporate Governance.................................................................................................. .96
13.0 👊🐤 Takeover related terms...................................................................................................................96
13.1 👊🐤 Leverage Buy-Out (LBO)................................................................................................................96
13.2 👊🐤🐍 Poison Pill against Takeover by Twitter....................................................................................97
13.3 🤞 De-Merger When a company subdivided into multiple companies.................................................97
14 What is covered in past in Win## Pill1C?....................................................................................... .97
14.0 Win20: already covered Following in 1C12.............................................................................................97
14.3 Win23: Already covered this....................................................................................................................99
14.4 👨‍🏫📡MRUNAL’S ECONOMY COURSE FOR UPSC..............................................................................99
🧑‍🏫📡MRUNAL’S ECONOMY COURSE FOR UPSC EXAM
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10 🐮📈🐻P ILLAR#1C: SHAREMARKET IN UPSC

MCQs from SEBI/ Share market /Financial Market / Companies Act Topic in UPSC Prelims
Year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
MCQs 1 MCQ 0 2 0 1 1 3 1 2 3

10.11.1 🚩👶🏻 Boycott Notice for PHD in Sharemarket handout
Since UPSC has recently started asking special types of MCQs from Sharemarket related so I’ve
increased the topic coverage in this handout = number of pages increased without any SHAME.
- We will only grab low hanging fruits / 1-liner-GK and move. If I have not covered something =
that means I do not find it important for exam or I find it to have poor cost:benefit.
- I boycott unnecessary translation into Hindi for every term: because sharemarket-topic does not
have much utility in the mains written exam, and it is easier to explain/understand it in English.
10.11.2 💰 Capital / Funding Arrangement: Types
Source: NCERT Class12 Business Studies Ch.8

Wait till we finish entire handout, then these terms will make sense to you.
💰
10.11.3 Capital (पूंजी)- types Fixed vs Working
Capital required to meet financial needs of a company.

Fixed Capital (स्थायी) Working Capital (कार्यकारी)
Money needed for purchase of land, Money needed for purchase raw materials, salaries to
plant and machinery, furniture, and employees, rent of the office, advertising / marketing,
other fixed assets. other day-to-day operations, etc.
10.11.4 💰 Capital Arrange → Trade Credit (Short Term)
10.11.5 💰 Account Receivable / Payable
10.11.6 💰 Capital Arrange → Lease Financing (Medium Term)
10.11.7 🗃Capital Arrange → Retained Earnings (Long Term)

• Company makes profit → ₹₹ goes into two channels.
• Some of the money given to shareholders as dividend.
• Remaining money is re-invested in the business = this is called “Retained Earnings”
• 🙋🏼‍♀️
FAQ: who will decide how much money will be given as dividend/retained earning? Ans.
Company’s board of directors.

10.12 🗃 🛒F INANCIAL / SECURITIES MARKET: MEANING AND TYPES
10.13 🔪🗃 D EBT INSTRUMENTS (ऋण उपकरण)

Bond holders are creditors to company. First claim during liquidation. Assured interest irrespective
of profit of company. These debt instruments can be classified into short-term vs long term.
10.13.1 🔪⏰👨‍👦‍👦 🔪🗃⏰ Debt → Short Term → Tri-party Repo
Type (Normal) Bi-Party Repo Tri-Party Repo
1) borrowers
No. of (1) borrower (bank)
2) lenders
Parties (2) lender (RBI).
3) Tri-Party Agent (e.g. NSE or BSE)^^
• ^^
The Tri-Party Agent (e.g. NSE or BSE) acts as an intermediary between the two parties to
facilitate collateral custody, & repayment. Agent will earn commission from this deal.
• Tri-party Repo is not a tool of RBI monetary policy.
10.14 🔪🗃🗓 L ONG TERM DEBT INSTRUMENTS (दीर्ध-अवधि ऋण- उपकरण)

Tenure = 1 year/>. Further sub-division based on who is the Borrower? e.g. Govt, Company etc.
10.14.1 📈🔎 Global Bond Indices & inclusion of Indian G-Sec

bond market index is a measurement/reporting tool to show the performance of the bond market.
Indian G-Sec
Name Description
included?
JPMorgan Govt Bond Index-Emerging Markets (GBI-EM)
JPMorgan GBI-EM yes, from 2024
tracks prices of more than 15 emerging countries’ G-Secs.
Bloomberg Bloomberg Emerging Market (EM) Local Currency yes, from 2025

EM Index Government Index.
🥰 What are the benefits when Indian G-Sec included in global Indices?
• 🥰 It improves the confidence of foreign investors in park their money into Indian
government security.
• 🥰 Increased number investors = Easier liquidity to the existing investors in the secondary
market.
10.15 🥇🗃🗓 B ONDS ISSUED BY COMPANIES?
🐸
10.15.1 Hybrid financing / Mezzanine Financing
• It has elements of both debt (loan) and equity (partnership).
• Lender gets a right to convert the debt (bond) to an equity (share).
• it is done via instruments such as Optionally fully convertible debentures (OFCD).
• Venture Capitalists usually do it in the start-up companies.
Traditional Bonds / Non-convertible
Instrument OFCD Share (Equity)
debenture (NCD)
Interest/ Return on Investment 12% 8% uncertain
Rights/ Claim during last/residual
first right middle
liquidation of company claim
^^ Numbers only for illustration that OFCD normally pay less interest than traditional
bonds(NCD).
10.15.2 🐸 Hybrid: OFCD: Sahara Refund portal (2023)
Basic story explained in above chart: then

- Ministry of Coop. → Central Registrar of Cooperative Societies (CRCS, a statutory body under
Multi-State Co-operative Societies Act 2002) → CRCS - SAHARA REFUND PORTAL setup.

- 2023: Each investors given ₹10,000 refund from this portal.
10.15.3 🐸 Hybrid: Foreign Currency Convertible Bonds (FCCBs):

- FCCB investor has option to convert his bond Into shares at pre-determined exchange rate.
- The FCCB’s are issued in a foreign currency and carry a fixed interest rate
- e.g. 2010: Data Motors issued FCCB worth $1 billion. (Investors gave dollar currency)
Terms Matter
Face Value $1000 for one bond
Tenure 5 years
Interest 5% on face value in dollars = 50 dollars.
Conversion if INVESTOR wanted he could convert 1 Bond (of $1000 value) -into 2 shares of
option ₹500 face value each.
Usually, FCCB’s interest rate lower than non-convertible debentures (NCD). (because company is
giving you the lollipop of conversion. So you cannot eat Laddu both ways ke I want high interest rate
and also I want conversion option.)
🐸
10.15.4 Hybrid: Contingent convertible bond (CoCo)/ enhanced capital note (ECN)
Its features are hybrid Mix of i) AT1 Bonds (Ref 1B2) and iii) OFCD.
we’ll pay u “A%” interest rate But
- If Condition “B” happens, we’ll convert it into Shares
- If Condition “C” happens, we’ll write-off principal + Interest and will not even convert it into
share.
10.16 🔪🗃🗓 B ONDS TYPES : BASED ON ISSUER
10.16.1 🔪🗃🗓 Bonds Types : Based on Issuer → ULB (Urban Local Bodies)
Year Event
Ahmedabad Municipal Corporation was the first urban local body to raise funds through
1996#
municipal bonds (₹100 cr); without state govt guarantee.
Bangaluru Mahanagar Pallike (BMP) was to issue municipal bonds for ₹ 125 crore. (=
1997#
Matlab ki this much large size ₹ 125 cr krne walla first ULB was Bangaluru.)
Lucknow Municipal Corporation (LMC) issued bonds worth ₹ 100 cr. it is the first
2020
municipal bond from North India.
- Ghaziabad Municipal Corporation (Uttar Pradesh), issued first-ever Green Municipal

bond in India. (भारत का सर्वप्रथम हरित नगर निगम बॉन्ड)
2021
- however, it was 'private placement' i.e. only selected big players allowed to invest.
normal retail investors couldn't apply for it.

Indore becomes first civic body to launch municipal green bonds in India for retail
2023
investors (aam aadmi). This money was used for solar plant
2024 Ahmedabad becomes 2nd to issue municipal green bonds after Indore.
🚩👶🏻 Note: Various books/websites are giving different facts about “who was the first to issue
#
Muni.Bonds?” Ans. I've copy pasted from Prof. Bharati Pathak’s book on financial market & PIB.
10.17 🔪L ONG TERM DEBT INSTRUMENTS: SPECIAL PURPOSE BONDS- MISC.
10.17.1 💦🔪 Long Term Debt → Special → 💦🔪

NABARD Social Bonds (2023)
• NABARD listed ‘Social Bonds’ on the Bombay Stock Exchange (BSE). - Interest 7.##%,
Tenure: 5 Years.
• India’s first AAA-rated Rupee currency social bond in the country.
• Money will be used for Jeevan Mission (= Union govt’s drinking water project)
10.17.2 🌈 🔪 Long Term Debt → Special → Zero coupon zero principal instrument
• issued by Not for Profit Organization (NPO), Non-governmental organization (NGO) for
social service.
• They repay NEITHER principal NOR interest.
• Zero Coupon Zero Principal (ZCZP) Bonds do not give any interest or principal to the
investor.
• They can't be re-sold in the secondary market.
• They can be transferred to legal heirs. (E.g. Amitabh Bacchan to his son Abhishek)
• ZCZP is akin to a donation made to a charity. But it gives greater
transparency/accountability because the issuer will have to disclose all the financial details to
SEBI & investors.
• The minimum issue size for the issue of ZCZP instruments is set at ₹50 lakh, and the
minimum subscription/application size is ₹10,000.
• 2023-Nov: Unnati is a not-for-profit organization formed in issued bonds at NSE-social
stock exchange for the skill development of youth.

10.18 🗳(🔪🗃)⏳E LECTORAL BONDS (चुनावी बांड, 2017 )
 Announce in Budget 2017 → Notified by Dept. of Economic Affairs, Finance Ministry (आर्थिक
मामलों का विभाग). Only SBI can issue at present, and in multiples of Rs.1,000, Rs.10,000,
Rs.1,00,000, Rs.10,00,000 and Rs.1,00,00,000.
 Controversy about the SBI’s commission, printing cost and GST on sale of electoral bonds. But
not much imp for exam. Enough to know Government pays [Commission + GST] to SBI for
selling these bonds.
 When to buy? For ten days at the start of each quarter. (January, April, July and October).
However, during Lok Sabha election year, can sell for another 30 days.
 Who can buy? Only an Indian Citizen or Company registered in India → deposit money in
their bank account → use that ₹₹to buy Electoral Bond, after giving certain KYC-documents. So,
Electoral Bond can’t be bought anonymously or directly with cash.
 Electoral Bonds can be donated only to a political party registered under Representation of the
People Act 1951 (RPA: लोक-प्रतिनिधित्व अधिनियम) and which has secured 1% /> votes polled in last
Lok Sabha or Vidhan Sabha elections.
 🗓Validity (वैधता अवधि)? Only 15 days from date of purchase. Within that time, buyer must
donate, and political party must deposit in its SBI (current) bank account. No interest payable.
 Characteristics of electoral bonds? (विशेषताएँ)
○ Paper / Physical format (not DEMAT / electronic format).
○ Bearer instrument (Donor or Recipient’s name not mentioned),
○ Promissory Note (promises to transfer money in bank account)
○ Interest Free banking instrument (zero interest payable to anyone).
○ Can’t sell it to third party, can’t pledge it for loans. (गिरवी नहीं रख सकते)
 🤩Benefits of electoral bonds?
○ Transparency in political funding. (राजनीतिक चंदे में पारदर्शिता)
○ Reducing influence of cash and black money in election, (काले धन का प्रभाव)

○ Confidentiality to donor- he can give to any political party without his wife, staff, CA,
Lawyers, journalists, local goons etc. knowing the name of recipient political party. (दाता
को गोपनीयता)
10.18.1 🗳🚨👨🏻‍⚖️ SC bans electoral bonds (2024-Feb)

Note: I am not going into polity aspects/mains analysis. I’m giving basic facts for MCQ.
Supreme Court ruled that:
• Electoral bonds can promote corruption & quid pro quo (e.g. businessman giving the fund
and minister passing his contract for highway/mining etc) (चुनावी बांड भ्रष्टाचार को मदद करते हैं)
• Electoral bond violates the provisions of (1) Representation of the People Act, (2)
Companies Act, and (3) Income Tax Act, (4) Voters’ right to information about political
funding under Article 19(1)(a) of the Constitution. (जन प्रतिनिधित्व कानून, आयकर कानून, मतदाता का
चुनावी पक्षकी फं डिंग के बारे में जानने का बुनियादी अधिकार, आदि का उल्लंघन होता है)
• Donors’ right to privacy is not bigger than voters’ right to know. (फं ड-दाता का अपने दान को गुप्त
रखने का अधिकार, मतदाता के जानकारी पाने के अधिकार से बड़ा नहीं है)
• SBI must disclose the list of all donors & recipient political parties from 2019–24 to election
commission → election commission must disclose this database to public, by 2024-March.
(किस दाता ने किस पक्ष को कितना चंदा दिया? उसकी सारी जानकारी एसबीआई ने चुनाव आयोग को देनी होगी. और चुनाव
आयोग ने वह जानकारी सार्वजनिक रूप से प्रकाशित करनी होगी.)
• 2024-March: SBI says it needs more time till June-2024 to compile such large data.
• Then court hearing / ball by ball commentary going on.
10.18.2 🗳 Electoral Bond & Companies Act - SC bans amendments

Matter Companies Act 2013 Amendment in 2017
How much money can a
not more than 7.5% of 3- Unlimited. कं पनी मन चाहे उतनी मात्रा में
company donate to a political
years’ average net profits चंदा दे सकती है
party?
Does the company need to yes Company to disclose
no need to mention exact name.
disclose the name of the name of the political party to
(किस पक्ष को चंदा दिया? कं पनी ने वित्तीय
recipient political party in its whom company gave the
दस्तावेजों में उसे स्पष्ट रूप से बताना ज़रूरी नहीं।)
financial statements? donation.
2024: SC declared above amendments in the company act as unconstitutional because they (1) can
promote corruption (2) Violate the voters right to know about the political party’s funding sources.
(सर्वोच्च न्यायालय ने कं पनी कानून में किए गए इन सुधारो को गैर-सं वैधानिक घोषित किया है)
10.18.3 🗳👨🏻‍⚖️
Electoral Trusts (ET) Scheme (2013)
• 2013: UPA/Congress govt launched it. It allows a company to create an electoral trust.
• Such Electoral Trusts (ET) can receive donations from other (persons/companies) → ET
donates it to various political parties. e.g.
Donors → Electoral Trust → Recipient Parties
DLF, GMR, Bharti Airtel, etc. Prudent Electoral
Congress, BJP, regional parties
companies Trust
• Here, it is difficult to trace how much of Bharti Airtel’s donation went to BJP. Thus, it
provides anonymity to the donors. This scheme is not yet banned by courts (2024).

10.19 🔪🔖 B ONDS: MISC. TYPES
10.19.1 🔪🔖 Bonds: Misc. Types → Market Linked Debentures/Bonds
Their interest is not fixed. It is linked to an underlying market index e.g. SENSEX, G-Sec-Yield, gold
price index, etc.
10.19.2 🔪🔖
Bonds: Misc. Types → Strip bond / Stripped bond
• When the bond has principal and interest repayment stripped into separate compartments.
• Suppose a 3 year bond (₹100) with 10% annual simple interest.
Normal Bonds Strip Bond
Year Principal Interest Principal Interest repaid
Year1 33.33 10 0 15
Year2 33.33 10 0 15
Year3 33.33 10 100 0
Total 100 30 100 30
• Lucknow Municipal Corporation had issued this type of municipal bond.
• Benefits? Helps the players to create new type of short-term securities out of such long-term
instrument. How? Not imp.
10.20 🪣🔪 B UFFER FUNDS FOR BOND REPAYMENT

10.20.1 🪣🐯🔪👨‍🦲 Consolidated Sinking Fund (CSF) for State Govts’ repayment
10.20.2 🪣🤵‍♂️🔪 Debenture Redemption Reserve (DRR) Fund of Companies issuing Bonds
• Whenever a company issues bonds/debentures (=long term instruments) → company needs

to create a buffer fund from its profits.
• This DRR fund is used later on for paying the principal and interest to the investors.

• This is legally required under the Companies act.
• 2019: Govt relaxed the rules to help companies in ease of doing business.
DRR Fund requirement Before After 2019 Reform

Bank N/A N/A
NBFCs 25% Buffer N/A
Public listed Companies (e.g Reliance)^^ 25% Buffer N/A
Other companies not in above list
25% Buffer 10%
(e.g. Byjus)
• ^^ public listed companies = companies whose shares are traded at BSE/NSE.
• Numbers not important. Sufficient to know some type of companies are exempted from it.
11 🐮📈🐻E QUITY INSTRUMENTS (इक्विटी)

 Equity holders are called owners / proprietors of the company.
 If company makes profit → they get dividend. They’ve last claim during liquidation.
11.11.1 👩🏻‍💼📦
Private equity (PE) funds and Venture Capital Funds
• Private equity is a type of investment fund where wealthy individuals park their money into
private unlisted companies.
• Unlisted companies = whose shares are not traded in the stock exchange like BSE/NSE) e.g.
Byjus, Parle (1929).
• Venture capital fund (VCF) is a subtype of PE fund - which invests in startup companies.

11.11.2 🐲 Share Types: Preference Shares vs ordinary shares
e.g. Jio 10% fixed dividend Preference Share on face value of ₹100. That means person is entitled to a
FIXED ₹10 dividend (if company makes profit.)
Preference Share Ordinary Share
Parameter
अधिमान्य शेयर: साधारण शेयर:
Dividend payout’s rate fluctuates
Dividend payout’s rate
depending on how much money LEFT
Rate of dividend is fixed e.g. NIRMA
AFTER giving dividend to pref.share
10%.
holders
if company makes ZERO No. जब मुनाफा हुआ ही नहीं तो
profit, does this investor have तंबुरे का डिविडेंड मिलेगा!!? कु छ No.
a right to get dividend? नहीं मिलेगा
they’ll get money
Rights upon liquidation of the they’ll get money AFTER
BEFORE ordinary
company pref.shareholders
shareholders
Do not enjoy voting Yes have voting rights in company
Voting rights
rights. decisions.
Preferred stocks can be
Convertibility converted into ordinary Equity stocks cannot be converted.
shares
It is not mandatory for A registered companies must issue equity
Issuance company to issue shares. (More Refer to Pillar1C2:
preference shares. Company Types)
Risk to investor? lower higher

💡NOTE: preference shares have many sub-types e.g. (cumulative vs non cumulative), (redeemable
vs non-redeemable) but we will not PHD.
11.11.3 🐲 Shares for Employees / VIPs / Special investors : ESOP, Equity Warrents
Note: In above chart- there are many finer aspects/differences between ESOP and Equity warrants.
But we’re doing only 1 liner GK.
Shares sold @discount to directors & employees for their value addition to company
Sweet [Amount is regulated under Companies Act]
Equity 🙋🏼‍♀️FAQ: How is Sweet Equity similar / different than ESOP/Equity Warrant
Ans. NOTIMP. 1 liner GK. थोड़ा-पढ़ो-आगे-बढ़ो.
🎓✋ - 1)What is this? NOT IMPORTANT.
- 2) How different from Sweet Equity? NOT IMPORTANT.
Sweat
Equity 🚩👶🏻FAQ: I’m a commerce graduate / hot-shot MBA-walla and I’ve 500 jaat ke
इसका कु छ Counter arguments. Ans. Good. Plz Keep it with yourself. This course for teaching
काम नहीं some basic one liners for MCQ. We are not preparing for your semester exams.
परीक्षा में
11.11.4 ⚖️🗃 Share types: Floating vs Restricted Stocks

Q. are the shares available for buying/selling in secondary market?
11.11.5 🐲 Share types depending on risk / quality

Shares whose market price remain excessively low compared to its face value. Such
Penny stocks pathetic companies give zero or little dividend.
फालतू कं पनी का 🚩👶🏻FAQ: I’m a commerce graduate / sharemarket ka hot-shot trader and I’ve
500 jaat ke Counter arguments. Ans. Good. Plz Keep it with yourself.
Blue Chip Shares of a nationally recognized, well-established and financially sound company
stocks with a history of generating good return for the investor. E.g. Reliance, TCS,
दमदार कं पनी का
Multi- When company’s share price climbs rapidly of time. e.g. IRCTC (2021) from ₹300

bagger Share to ₹1000 = 233% return on investment (ROI) within January to October 2021
Cyclical / When price of a company’s shares depend on the particular business cycle. e.g.
Seasonal automobile shares will generally rise during Navratri till Diwali shopping season.
Shares
🚩👶🏻FAQ: tell me Similarity and difference between Blue chip vs Multibagger? ANS. Notimp.
🚩👶🏻FAQ: Share vs stock- what is the difference? This academic-pedantry NOTIMP4EXAM.
11.12 🧮A CCOUNT TYPES
Account Meaning/subtypes
Personal - 1) Natural person account e.g. Mark Zuckerberg
Account - 2) Artificial legal person’s account (=company’s account) e.g. Meta (Facebook).
- 1) Tangible Real Accounts e.g. buildings, vehicles, machines
Real Account
- 2) Intangible Real Accounts e.g. Goodwill, Patent, Copyright, Trademark, etc.
- 1) Gain/Income account e.g. revenue from goods sold, income earned from
Nominal
investments,
Account
- 2) Loss/Expense account e.g. salaries, rent, cost of raw material.
11.12.1 🐾 Goodwill –while buying another company/brand

Item Price in Million $ (Not real. Just e.g.)
Company Whitehat’s assets (building, machine, software
250
copyrights etc.
Byjus buys Whitehat at price 300
Difference = Goodwill acquired by Byjus = 50
- Goodwill is an ‘intangible asset’ for the buyer company (Byjus in above example.)
- Goodwill represents Whitehat's reputation, customer base, brand, or other intangible factors- for
which Byjus paid 50 million extra, BEYOND the fair-market value of Whitehat’s assets.
MCQ. Goodwill Account is a/an _ _ _ (UPSC EPFO-2023) (a) Personal Account (b) Real Account c)
Nominal Account (d) Expense Account
11.13 🐾V ALUATION OF COMPANIES

Term Valuation of Listed Company Valuation of (unlisted) Startup company
It is the total value of a listed It is the process of estimating the total value of a
Meaning
company’s shares. Startup company.
Current share price (X Complex formula involving company’s financial
Formula multiply with) total number of performance, its assets and liabilities, and its future
shares. growth potential.

See Apple Company in Byjus @ $22 Billion (2022-Oct)
Example
previous section @$12 Billion (2023-Aug)
11.13.1 Valuation →Startups → 🦄

Unicorn Startup
Means the startup has valuation of 1 billion U.S. dollars or more. e.g. Unacademy, Byjus, etc.
11.13.2 Valuation → Listed Companies (Small Cap/Mid Cap/Large Cap)

Market capitalisation = {Total number of share multiplied with current price of every share.}
Market cap can change every day, depending on the price movement in sharemarket.
Apple Company (A) Total No. Of Shares (B) Price of 1 share Market Cap = A x B
2023-Jan 15.63 billion units $125 $1.9 trillion
2023-Sept 15.63 billion units $171 $2.6 trillion
In India, shares are classified based on market capitalization as follows:
Type Small Cap Mid Cap Large Cap
between 5000-
Market Capitalisation^^ less than ₹5000 cr more than 20,000 cr
20,000 cr
(General understanding) (=₹50 billion) (=₹200 billion)
(=50-200 billion)
Market Capitalisation top-100 companies based
below 250 rank 101–250 rank
(exact SEBI Rule) on Market cap
Reliance, Infosys, TCS etc
Examples VIP Suitcase Castrol
giants
Risk to shareholder High Medium Low
Liquidity of shares (how Low. Difficult to find high. Easily u can re-sell to
medium
easy to re-sell & Exit) buyer exit.
^^ Note: This crores rupee number varies from year to year depending on how much share prices
changed. We’ll not waste time memorising EXACT number.
11.13.3 Reliance - first company to hit 20 lakh cr Market Cap (2024-Feb)

self-explanatory from the topic heading itself.
11.13.4 🍺🫧 Market Froth & Asset bubble in Small-cap & Mid-cap (बाजारू झाग और सं पत्ति गुब्बारा)
• During market froth, investors begin to ignore fundamentals (e.g. a company’s profit-loss
balance sheet) and buy its shares rapidly → demand rise → share price increases in a rapid-
unsustainable manner.
• This ultimately results in an asset bubble that can lead to a collapse, e.g. Dotcom bubble in
the USA (2001) and the Subprime crisis (2007–08).
• 2024: SEBI felt that small-cap and mid-cap companies were experiencing market froth →
SEBI issued some technical directives on mutual funds to reduce their investments/exposure
in small cap and cap.
🌷
11.13.5 Tulip Mania (किसी निवेश के पीछे सामूहिक पागलपन)
 mid-1600s: Tulip flower was introduced in Holland/Netherlands.
 some people started buying Tulips in high quantity, with the hopes of re-selling it to customers at

much higher price. But ultimately this bubble collapsed.
 Today, if price of an asset (share, real-estate, Bitcoin) start climbing unreasonably high →
Columnist describe it as ‘Tulip Mania’.
11.13.6 📈 📉Volatility / ViX (कीमतों में अस्थिरता)
 If the prices of a share changes rapidly in a short time span → we say it has “high volatility”. e.g.
Adani after Hindenburg report.
 Mathematically expressed thru an indicator called “ViX”
🐾
11.13.7 Price-to-Earnings (P/E) Ratio and EPS (Earnings per Share)
Note: If I’ve not covered a particular ratio e.g. Price to Book Ratio (PB) = means I feel it is poor cost
benefit for the exam.
Note: real formulas/ real interpretations are more complex. this is for basic understanding for MCQ.

11.13.8 🐾 Leverage Ratio, Debt to Equity Ratio, ROCE, etc
Year 2022 Tata Motors Maruti

Debt:Equity 2 (means Tata borrowed 2x times more money than the 0 (debt-free
ratio amount of share capital it has) company)
Note: real formulas/ real interpretations are more complex. this is for basic understanding for MCQ.
11.13.9 🐾Net Worth = Total Assets −(minus) Total Liabilities

Amount Mukesh Reliance Anil Ambani’s Reliance Capital Ltd. Company
Total Assets (A) ₹16 Trillion ₹63,000 crore
Total Liabilities (L) ₹ 6 Trillion ₹83,000 crore
NET Worth = A - L 16-6=10 POSITIVE NEGATIVE 20,000 cr. Case going on in IBC
code
🙋🏼‍♀️FAQ: can we say NET-worth represents profit/loss of the company? Ans. It is more refined than
that. Because company may be profitable for present year. But IF its liabilities are too big then it may
have NEGATIVE net-worth. But we’ll not do PHD. थोड़ा-पढ़ो-आगे-बढ़ो.
11.13.10 🔩 EBITDA, Depreciation, Amortization

EBITDA It shows Company’s Earnings Before loan Interest repayment, Taxes payment,
Depreciation, and Amortization. Higher number is better.
Depreciation Represents wear and tear, repairs, or decrease in the value of physical assets like
machinery and buildings. भौतिक सं पत्तियों का घिसाव / मूल्यह्रास
Amortisation Represents decrease in the value of intangible assets like patents and copyrights.
अमूर्त सं पत्तियों का घिसाव / मूल्यह्रास
11.14 ⚖️🗃 M ETHODS OF ISSUING SHARES
11.14.1 Share price

• Share have printed price on the certificate called Face Value or Par Value (सममूल्य).
• If they’re sold at higher price than face value, it’s called “trading at a Premium Value”
• if sold lower than face value, it's called "trading at a discount".

11.14.2 Sharemarket- company related documents
Guidance Guidance report contains company’s estimate of its future growth.
Company releases this report for investors/shareholders/analysts.
Prospectus it is the document containing all the info about the IPO-wali company.
11.14.3 IPO vs FPO
🙋🏼‍♀️FAQ: When FPO is issued, is it primary market or secondary market? Ans. It is ultimately a
Petipack/brand new share = primary market. However, this pedantry NOTIMP4EXAM.
11.14.4 Underwriter / Lead managers

• Underwriter is a merchant banker/investment banker (ref Pillar-1B1)
• He undertakes the responsibility of issuing IPO/FPOs on behalf of the company promoters.
• If IPO not fully subscribed, then underwriter will buy unsold shares.
• Lead Manager = synonym for underwriter. (there is internal difference, but boycott PHD).

11.14.5 Share-selling: Offer for sale (OFS) and share pledging
🙋🏼‍♀️FAQ: How is OFS different than IPO/FPO? Ans. Motives are different. IPO/FPO is when owner
wants money for the company by selling fresh shares. OFS is when owner wants money for himself
by selling his own shares. But this pedantry is NOTIMP.
11.14.6 Share-selling: Open Offer
🙋🏼‍♀️FAQ: now I'm confused between OFS vs Open offer? Ans. Khichdi mtt karo. Their objectives are
different. Observe the photos carefully.
11.14.7 🍃Share Selling: Equity dilution
11.14.8 🍃Share Swaping and De-listing

Terms in news after HDFC (NBFC) got merged into HDFC (Bank), in 2023.

11.14.9 🍃 Bonus Shares
Total Qty Price Total Value in ur DEMAT account

Before 1 Share ₹3000 x 1 No. ₹ 3000.00
After Bonus Share 2 Shares ₹3000 x 2 No. ₹ 6000.00
11.14.10 🍃Share Splitting
Qty Price Total Value in ur DEMAT

Before 1 Share ₹3000 x 1 No. ₹ 3000.00

Qty Price Total Value in ur DEMAT
₹ 3000.00 (Total Value of Asset
After Share split (1:2) 2 share ₹1500 x 2 No.
NOT increased. It’s unchanged.)
Note: Share splitting depends on marzi/ discretion of company’s board of directors. It is not done on
1-1 investor’s complaint/request. I have given an example only for illustration.
11.14.11 🍃Share buyback by the Company
Total Share liabilities of TCS BEFORE AFTER Share buyback

Amount ₹ 12 lakh crores 12,00,000 - 18,000 = ₹11.82 lakh cr
11.14.12 ⚖️🗃 🤵 IPO → Special Purpose Acquisition Company (SPAC)

Faded topic. Removing from handout.
11.14.13 ⚖️🗃 🌐 ADR/GDR: DESHI Shares in Videshi soil

Figure 1: बिना अमरीकी SEBI मे पंजीकरण किए, उनके शेयरबाजार से पैसा उठाऊँ , तो कै से?
- A non-American company wants to mobilize money from American share market but does not
want to go through the lengthy & complex process of registration with the American
sharemarket regulator.
- Then such non-American company gives its shares to an American bank.
- Based on those (non-American) shares, the American bank will issue American Depositary
Receipts (ADR: अमरीकी निपेक्षागार रसीद) & sell them to American investors. Denomination: USD.
- Global Depositary Receipt (GDR): Same as above, but when single bank issues receipts for
investors in multiple countries. Denomination: usually USD or Euro.
Share issuing company → Deposits his company’s shares in That bank issues -- in local
a bank of → market in – currency
Issues ADR (in $) in American

Non-American company → American Bank →
Sharemarket
Non-Indian company → Indian Bank → Issues Bharat / Indian depositary

receipt (IDR) (in ₹) in Indian
Sharemarket
11.14.14 🗃 🌐 Direct listing of Indian Companies in foreign stock exchanges (2023)
Note: This topic is still developing. It is allowed via Gift-City (Gujarat). (Ref: Pillar#3A)
11.14.15 🛒 (💻:👨‍💼) DEMAT → ASBA Reforms in IPO/Primary Market
 Scamster Rupal Panchal (2005) opened multiple fake DEMAT accounts to increase the chances
of getting share allocations in IPO. Then she’d sell such shares in stock-exchange for higher
prices.
 Subsequently, SEBI made PAN Card (issued by Income Tax Dept) compulsory for opening
DEMAT Accounts. SEBI also introduced ASBA (Application Supported by Blocked Amount)- it
allows the underwriter to block the amount in IPO-investor-applicant’s bank account, but only
IF shares allotted to the applicant, his bank money will be deducted. ASBA-Benefits:
o only serious investors with sufficient bank balance can apply.
o investor continues to earn bank interest on his blocked amount until the process of IPO-
share allotment is over.

11.14.16 UPI-ASBA in Secondary Market 2024-Jan Reform by SEBI
What does above chart mean? Ans. watch lecture video.
11.15 🤝 CENTRAL COUNTERPARTIES (CCPS), NOVATION & ESMA CONTROVERSY

Problem
Solution
- CENTRAL COUNTERPARTIES (CCPS) act as intermediary between the buyers and sellers in
financial market. E.g. G-Sec, T-bill, shares, bonds, derivatives, forex, commodities
- They act as a central counter-party to every trade i.e. CCP becomes seller to the buyer, and
simultaneously CCP becomes buyer to the seller. This process is called “novation”. (HOW? Ans.
Observe the chart carefully.)
- so, if one of the party does not honour the agreement → CCP will take care of it. Thus, CCP
prevents system failure.
- 😭Controversy? Indian CCPs also deal with international financial trades e.g. in Europe. But,
European Securities and Markets Authority (ESMA) is planning to cancel their license/
registration/ entry. What exactly is the matter? NOTIMP4Exam. Enough to know in 1 line ke
Indian CCPs facing some problem in Europe.

🤝
11.15.1 CCP Examples in India
The Clearing Corporation of India (CCIL), Indian Clearing Corporation Ltd (ICCL), NSE Clearing
Ltd (NSCCL), Multi Commodity Exchange Clearing (MCXCCL), India International Clearing
Corporation (IFSC) and NSE IFSC Clearing Corporation Ltd (NICCL).
11.15.2 🤝🐅CCP Regulation in India: Who regulates CCP in India?

Matter Regulator
Money transfer between buyer
RBI using powers of Payment and Settlement Systems Act, 2007
and seller
Foreign currency transactions RBI using powers of Foreign Exchange Management Act, 1999
SEBI using powers of SEBI Act, 1992 and Securities Contract
Shares, Bonds, Commodities
(Regulation) Act, 1956 (SCRA)
11.16 🙋🏻‍♂️🛒 I NVESTORS KE TYPES
11.16.1 Style of Trading / Investing based on duration and risk

Margin Trading when a person is buying more shares, than he can afford to. usually done by
borrowing money from the broker. Risky because is the investment fails
then person will get into huge debt.
Day trading / Individuals buy and sell shares over the Internet over a period of a single
Intra-day trading day's trading, with the speculative intention of profiting from small price
fluctuations.
Swing Trader He’s buying a share for just few days or weeks then sells it for profit.
Long term investor He’s buying for himself and he holds the share for more than 1 year.
Block Deal When large value order placed e.g. ₹5cr or more. This is usually done by
institutional investors such as Mutual Fund, Insurance companies etc.
Contra Trading / - investor will do opposite of what everyone else is going. - e.g. in Corona-
investing lockdown, if everyone is buying Pharma shares and ignoring PVR-cinema
shares → then contra trader will begin investing in PVR-cinema shares
(with the hope that after Corona unlock down → cinema industry will
boom and contra-investor will make great profit)
Further subtypes with various animal / bird names can be found on Investopedia but with poor cost :
benefit in exam. # 🕰थोड़ा-पढ़ो-आगे-बढ़ो
11.16.2 📞 Bid-Ask Spread
Jetha wants to buy at Bhide wants to sell at
Player Spread / Gap
(Bidding price) (Asking price)
WIPRO Share 600 800 ₹200

In above situation, the deal can’t happen because the Bid-Ask Spread is high.
- Either buyer or the seller will have to make price-compromise, only then deal can happen.
- If bid-ask spread is HIGH = liquidity of the asset decreases. Because it becomes difficult to sell
such asset. (खरीददार की बोली/कीमत और बेचने के भाव में जितना अंतर ज्यादा होता है तो उस सं पत्ति की तरलता कम होने
लगती है क्योंकि उसको बेचना मुश्किल हो जाता है)
11.16.3 📞 Arbitrage: Making profit due to difference in to markets/location.

Location Delhi Mumbai Arbitrage
Gold Price (10gm) 60,900 60,800 ₹100
- In above example, a dealer can buy the gold from Mumbai and sell to Delhi and he will make a
profit (arbitrage) of ₹100.
- nowadays the arbitrage in financial assets (share/bond etc) is very low because of the online
trading.
11.16.4 🐂📈 India becomes 4th-largest equity (Share) market (2024-Jan)

• 2024-Jan: Ranking of Combined value of shares listed on a country’s stock exchanges: 1)
U.S., 2) China, 3) Japan, 4) India ($4.33 trillion) 5) HongKong ($4.29 trillion)
• Reason for India climbing to 4th place? 1) Chinese regulators getting strict, so foreign
investors shifting money out of China towards Indian Sharemarket. 2) Stable political
environment in India 3) Strong GDP growth.
11.17 👟 MARKET THEORIES
11.18 👟👠 Efficient Market Hypothesis /theory (EMH)
- financial markets are efficient in processing information and pricing securities. So one investor
CANNOT always KEEP earning more profits than the average trend in market.
- However, some experts disagree with it. We’ll not debate. थोड़ा-पढ़ो-आगे-बढ़ो.
- Gist: शेयर बाजार में जो होना है, वह होकर रहना है. तुम कम्पनी का चार्ट/बेलेंश-शीट पढ़कर तंबूरा कु छ नहीं उखाड़ सकते। भले
आपका एक दाव सही लग जाए, लेकिन दो-तीन गलत भी लग जाएं गे तो. फिर नफा मोटा नहीं नफा सामान्य(एवरेज) ही हो जाएगा.
11.18.1 👟👠 Random walk theory
• Share prices move unpredictably.
• Therefore, company’s past shares prices/charts shouldn’t be used to predict future prices.
• So, it is impossible to beat/defeat the share-market.
11.19 🐆A LPHA AND BETA VALUES

🐆
11.19.1 Beta Value to monitor price volatility or risk of an asset
Indicator to monitor price-volatility/risk of an asset.

Value Meaning
This company’s share moves faster than sharemarket in both directions.
High Reward: if SENSEX moves upward at 1x speed, this company will move at may be
β>1 1.5x speed.
High Risk: If SENSEX falling at 1x speed, this company will fall at 1.5x speed.
Usually Tech/Startup/small-cap companies show this behaviour.
β<1 This company moves slower than SENSEX. Low risk, Low return.
β=1 This company’s share moves parallel to SENSEX.

uncorrelated to the market. Mona-Lisa Painting: its value changes independently of
β=0
SENSEX movement.
negatively correlated to the market. This asset moves in the opposite direction of the
β less
SENSEX. e.g. Bond/Gold. If SENSEX goes up, people will shift money from gold/bonds
than 0
to shares so gold/bond will fall. (However, this is not always true in real life.)
MCQ. In the context of finance, the term ‘beta’ refers to _ _ (Prelims 23-SET-A-Q073]
(a) the process of simultaneous buying and selling of an asset from different platforms
(b) an investment strategy of a portfolio manager to balance risk versus reward
(c) a type of systemic risk that arises where perfect hedging is not possible
(d) a numeric value that measures the fluctuations of a stock to changes in the overall stock market
11.19.2 Alpha value to compare performance of Mutual Funds

This indicator used mainly to compare a Mutual Fund / Hedge Fund manager’s performance against
a benchmark e.g. SENSEX
Value Meaning
This MF gives better profit than SENSEX.e.g. if HDFC-MF has 2% Alpha. Means when
Alpha > 0
SENSEX claimed 10%, then HDFC-MF gave 12% return.
Alpha = 0 This MF performing same as SENSEX
Alpha < 0 This MF gives less return than SENSEX
11.19.3 🚩👶🏻 FAQ: Alpha vs Beta similarity / correlation / difference

Term Alpha Beta
Mainly to compare performance of Mutual
Usage Mainly to find volatility/risk of a share.
Funds.
Beyond that we’ll NOT PHD. UPSC is only asking one liner from here. We’ll not spend more time.
11.19.4 ⚱️Types of Analysis – fundamental vs Technical

Fundamental Analysis Technical Analysis
Investor Company’s profit, loss, Share price related charts-graphs & mathematical-

Fundamental Analysis Technical Analysis
indicators e.g. Simple-moving-average of the share
price for last 200 days (200-day SMA).
balance sheet, new
studies what? More examples of indicators (listNOTIMP): Relative
products-launch etc.
Strength Index (RSI), Stochastic Oscillator, Moving
average convergence divergence (MACD) etc.
Long term Investor (longer Intraday Trader (buy/sell within a single day)
Suitable for
than 1 year) Swing Trader (buy/sell for few days or weeks)
⚱️
11.19.5 DEMAT Portfolio: Meaning, Types, Portfolio Diversification
Portfolio means the collection of assets held by an investor.
In financial market, “Portfolio” means the list of shares/bonds/ETF you’re keeping in your DEMAT
account.
11.20 SEBI REFORMS TO PROTECT INVESTORS
11.20.1 🤝⏰T+1 day Settlement instead of T+2 day

 Badla System/Carry forward system: Buying of shares using borrowed money & making
promises to carry forward the settlement for upto 72 days. scamsters misused (इसकी टोपी उसके सर पे:
सौदा आज करते लेकिन पैसों का भुगतान/शेयर की डिलीवरी ७२ दिनो बाद होती- और इस समय के दौरान वही घपलेबाज उन्ही शेयर
बेचने की टोपी दूसरों को पहेनाते रहेता)
 so SEBI discontinued Badla System (in 2001) & introduced (T+2) rolling settlement system i.e.
after trade is conducted, the parties must settle it within two working days (= buyer pays money,
seller deliver shares/bonds/securities). -> 2022: T+1 settlement started.
11.20.2 🤝⏰ ⏰ T+1 hour & T+0 hour (instantaneous) settlement

Term Meaning SEBI aims to launch from
T+1 hour Within 1 hour, Payment-delivery concluded. March 2024
T+0 hour also called instant/instantaneous settlement. October 2024
11.21 🆘📡 S ERVER CRASH PROTECTION
11.21.1 🆘 📡 SEBI’s BCP Plan & DRS Sites
• SEBI has designed business continuity plan (BCP) for market infrastructure institutions
(MIIs) — i.e. (1) stock exchanges, (2) depositories, (3) clearing corporations.
• MII need to have a disaster recovery site (DRS). So when there is disruption in their server at
the primary site (PR) → they’ll move data/operations to the server at DRS site.
• 2024-March: Bombay Stock Exchanges (BSE) and the National Stock Exchanges (NSE)
carried out mock drill / special trading sessions for this.
11.21.2 🆘📡 IRRA Portal: Investor Risk Reduction Access (IRRA)

• is a platform that will act as a ‘safety net’ for investors during technical glitches/server errors.
• Helps Investor to cancel/close the trade to protect his money during server errors.
• Boss? jointly developed by all the stock exchanges – BSE, NSE, NCDEX, MCX and
Metropolitan Stock Exchange of India (MSE)

11.22 📦 🤹🏻‍♂️👴🏻 I NVESTMENT FUNDS → MUTUAL FUND (MF) TYPES
Figure 2: swag से करेंगे 'middle-class' का 'स्वागत'। Observe colors in logo, meant for attracting ordinary crowd
 Mutual Fund is an Asset Management Company (AMC-NBFC) that pools savings of (retail)
investors and gives them “Units”.
 MF Manager parks this money in securities & builds his ‘portfolio’.
 Whatever dividend/ interest is generated from the portfolio, it is distribute among investors in
the proportion of their units.
 Investor pays Entry Load (= fees for joining), Exit Load (= fees while quitting). SEBI regulates
these fees.
11.22.1 📦 🤹🏻‍♂️ 👴🏻 MF → Hybrid mutual funds

Type of MF Invests money in
Equity-MF Shares.
Debt-MF Bonds, G-Sec, T-Bill etc. Short-term and long-term Bonds instruments
Hybrid-MF Shares and Bonds both types.
Multi-asset Shares, Bond & Gold.
11.22.2 🚎✋ MF: Open ended vs Close ended

Type Open ended Close ended
unlimited, everyone fixed e.g. 50 cr fund. Manager will not accept more
size of the fund
welcome. money once it is filled.
client can there is closing date, after which MF- manager will not
whenever he wants
subscribe accept money.
maturity none. Fixed maturity period e.g. 5 years
11.22.3 ↩️ ↩️ MF: Lumpsum (One-off) vs SIP

Type One-time / one-off /lump-sump Systematic Investment Plan (SIP)
client contributes only 1 time . (बस एक ही बार पैसा जमा regular basis e.g. Monthly (नियमित रूप से बार बार
₹→ करता है) पैसा जमा करता है )
11.22.4 📦 🤹🏻 👴🏻
‍♂️ Mutual fund → ESG, Shariya Mutual Funds
 ESG Mutual Funds= These mutual funds will invest clients’ money in companies that have good
performance on Environmental, Social, And Governance (ESG) aspects.
 Shariya Mutual Fund= These mutual funds will invest clients’ money in companies that are
compliant with Islamic Shariya law. E.g. They will not invest in alcohol, pork, gambling etc
related companies.

11.22.5 📦 🤹🏻 👴🏻
‍♂️ Mutual fund → SIP, ELSS, ULIP
 Traditional Mutual Fund = client invests entire amount at once. एक साथ पूरी रकम जमा करानी होती है
 Systematic Investment Plan (SIP)= Mutual fund wherein client deposits small-small fixed
amounts at fixed interval e.g. month basis etc. ग्राहक छोटी-छोटी किस्तों में रकम जमा करवाता है
 Equity Linked Savings Scheme (ELSS)= It is a sub-type of mutual fund where money is locked in
for 3 years and invested in equities (shares). It’s eligible for certain benefits in Income Tax.
 Unit linked insurance policy (ULIP)= client invest money in a scheme wherein → (1) some ₹₹
goes into Mutual Fund (2) some ₹₹ goes into insurance policy
11.23 😴I NDEX-ETF: A TYPE OF PASSIVE FUND
They collect client money and invests in the companies in a proportion to the stock-exchange weight
assigned to those companies.
Fund Index-ETF Mutual Fund
Passively. Manager will Actively. Manager will apply the brain before
mechanically invest money into an investing clients money. e.g. a mutual fund
Managed external indicator/index/asset manager will decide whether to invest in
without applying Brain. e.g. Index- Adani or reliance after checking their balance
ETF (see next section). sheet and future expected profits.
Fees charged
less more
by Manager
Liquidity higher/easier lower/slower
Can be resold
difficult for close-ended MF with fixed
in secondary Yes
maturity period e.g. 3 years.
market?
MCQ. Find wrong about Exchange Traded Fund (ETF) (CDS-2018-I)
(a) It is a marketable security. (b) It experiences price changes throughout the day.
(c) It typically has lower liquidity and higher fees than mutual fund shares.
(d) An ETF does not have its net asset value calculated once at the end of every

🚩👶🏻 FAQ explain me terms mentioned in all of the above options in above MCQ!? Ans. Poor cost-
benefit / self-study from google.
11.24 🌸🐂 B ITCOIN ETF APPROVED IN USA (2024)

• How does it work? Ans. Explained in video lecture. I am not typing the entire movie script
here, otherwise handout will become very long.
• 2024: USA’s share market regulator i.e. Securities and Exchange Commission (SEC)
approved Bitcoin ETF. (India has not yet approved.)
11.24.1 🌸🐂 Bitcoin ETF: Pros

• Bitcoin ETF provide no anonymity to investor = easier for the Government to demand tax
from his profits/income.
• Bitcoin-ETF helps bypassing the dangers/complexities of buying Bitcoin directly from
unknown websites/apps.
• Normal bitcoin wallet = If password is forgotten then difficult to recover.
• Whereas the Bitcoin-ETF = easier to retrieve lost passwords.
• They reduce volatility In prices. (because when mutual fund, insurance companies and other
institutional investors invest put money in it, they will not randomly run away for smallest
negative news. So the prices will remain stable.)
11.24.2 🌸🐂 Bitcoin ETF: Cons

• investor will have to pay the fees to the stock exchange for every buying and selling.
🚩👶🏻 FAQ: (1) can we say Bitcoin-ETF is an example of passive funds? Ans. Yes but waste of time
preparing a Mendeleev’s periodic chemistry table ki kaunsa fund is example of active/passive.
🚩👶🏻 FAQ:(2) can we also say XYZ is also a pros/cons of Bitcoin-ETF? Ans. AskChatGPT, my
syllabus-finisher-bus can’t wait for you. थोड़ा-पढ़ो-आगे-बढ़ो.
11.24.3 Gold-ETF
• Investors give money → manager buys gold for safekeeping and trades it depending on
price movements → returns are divided among the unit-holders.

• In between, the investor may sell his Gold-ETF to third party via Stock Exchange therefore
they’re also Exchange Traded Funds.
• WATCH VIDEO FOR MORE. IF I GIVE charts for it, handout will become very long.
12 🍋T AX ON INVESTMENT / FINANCIAL ASSETS

 Normally, whenever we make investment, it is subjected to variety of taxes such as income tax,
capital gains tax, securities transaction tax, commodities transaction tax, stamp duty etc.
depending on the type of investment/transaction. (Ref: Pillar#2A-Taxation for more)
 However, in following investments, government provide some relief in the taxes. How
much/when? NOTIMP.
Rajiv Gandhi Equity Savings Scheme= Govt gives income tax benefit to
RGESS people who invest in the share market for the first time. Discontinued by
Started in 2012 Budget-2017
मध्यमवर्ग का नया निवेशक पहली बार शेयर बाजार में निवेश करें तो आयकर में राहत
12.0 🍋😍 T AX RELIEF GIVEN ON (निम्न चीजो पे टैक्स में रियायत/छू ट दी जाती है)
CATEGORY Examples
Bank FD (sp.type) - - 5-Year Tax Saving Fixed Deposit (FD) with Banks
- Public Provident Fund (PPF)

- Employee Provident Fund (EPF)
Small Savings /
- Sukanya Samriddhi Yojana (SSY)- Fixed bank deposit in the name of
social security
daughter
More in Pillar1D
- National Savings Certificate (NSC)
- Senior Citizen Savings Scheme (SCSS)
Pension/Insurance Unit Linked Insurance Plans (ULIPs), National Pension System (NPS),
Pillar1D EPFO
Share market Equity-Linked Savings Scheme (ELSS)
Tax-Free bonds by some (NOT ALL, only Some) of the Govt
companies/statutory bodies such as
- National Highways Authority of India (NHAI),
Bonds - Indian Railway Finance Corp (IRFC),
- Power Finance Corporation (PFC),
- Housing and Urban Development Corporation (HUDCO),
- India Infrastructure Finance Company Limited (IIFCL) etc.
Donations Election donation, PM-CARES fund (ref Pillar2), Army Welfare Fund etc.

CATEGORY Examples
Location based Investments made from GIFT City (Gujarat). (Ref: Pillar#3A: Intl. Trade)
Above list is NOT exhaustive/complete. There could be some more tax-free instruments also. But we
are not here for Chartered Accountant exam.
12.1 🍋🥵 T AX RELIEF NOT GIVEN ON

Now, if the name of an instrument is not mentioned in above list → then good chance, it is
subjected to some tax for example
 Bank Savings Account pe interest income.
 Sovereign Green Bond (Yes government has NOT given any tax benefit on it, YET)
 Municipal Bonds, G-Sec, T-Bill;
 Shares, Company Bonds;
 Futures, Options, P-Notes
 Mutual Fund, REITS, InVITS, ETF
 Bitcoins and Cryptocurrency (30% Tax)
 Property, Mona-Lisa Painting, Gold-Silver etc precious metals, Diamonds, Racehorses etc.
MCQ. [CSP23-SET-A-Q021] Consider the following statements :

- Statement-I : Interest income from the deposits in Infrastructure Investment Trusts (InvITs)
distributed to their investors is exempted from tax, but the dividend is taxable.
- Statement-II : InvITs are recognized as borrowers under the 'Securitization and Reconstruction
of Financial Assets and Enforcement of Security Interest Act, 2002'.
Which one of the following is correct in respect of the above statements?
(a) Both -I and Statement-II are correct and Statement-II is the correct explanation for Statement-I
(b) Both -I and Statement-II are correct and -II is not the correct explanation for Statement-I
(c) Statement-I is correct but Statement-II is incorrect (d) Statement-I is incorrect but St-II is correct
13 PILLAR 1C3: CORPORATE GOVERNANCE
13.0 👊🐤 T AKEOVER RELATED TERMS

- Sometimes in news because of the Elon musk purchase of Twitter (“X”). - We will not DO to the
actual B.Com/MBA aspect of it. - We will get a very vague only, with some examples.
Friendly Takeover Hostile Takeover
When board of director approve where a person takes control of another company (the target
selling the company to another company) without the consent of the target company’s
company. board of directors.
e.g. Ranbaxy sold to Sunpharma e.g. How Elon Musk acquired Twitter (“X”)
13.1 👊🐤 L EVERAGE BUY-OUT (LBO)

- e.g. Elon Musk borrows money to takeover/acquire majority shareholding in Twitter (“X”).

- Note: in real life, it is more complex, but we will not prepare MBA/B.Com here.
13.2 👊🐤🐍 P OISON PILL AGAINST TAKEOVER BY TWITTER

- it is a strategy adopted by a Company (Twitter) to defend itself against hostile takeover (By Elon
Musk). Generally involves giving extra shares to existing shareholder to make % shareholding
composition unfavorable to new buyer who is trying to take over (Musk). HOW?NOTIMP
13.3 🤞 D -M
E ERGER WHEN A COMPANY SUBDIVIDED INTO MULTIPLE COMPANIES.
BEFORE AFTER De-merger
1) ITC (Hotel, Cigarettes, FMCG^^) 1) ITC ( Cigarettes, FMCG) 2) ITC (Hotel)
1) TATA Motors planning to divide into (1) truck (2) cars & EV
^^ FMCG = Fast Moving Consumer Goods e.g. soap, shampoo, toothpaste, potato-chips etc.
14 WHAT IS COVERED IN PAST IN WIN## PILL1C?

Missed previous classes / handouts? Visit Mrunal.org/win24
14.0 WIN20: ALREADY COVERED FOLLOWING IN 1C12

1. 🔪🗃⏰ Debt Instruments: Short Term (लघु अवधि ऋण उपकरण )
2. 🔪🗃🗓 Debt Instruments: Long Term (दिर्ध अवधि ऋण उपकरण )
3. ⚖️🗃 Shares / Equity Finance / IPO
4. 🌬🌪:🤷🏾♂️⚖️👨⚖️ Force Majeure (अभेद्य शक्ति)
5. Share market: misc. Terms
6. 🗃🔢 ISIN Number
7. 🗃🕵🏻♀️IOSCO
8. 🔗🥏 Initial Coin Offering (ICO)
9. Investment Instruments/Funds
10. 📦 🤹🏻♂️ 🤴🏻 Sovereign Wealth Fund (SWF: सं प्रभु धन कोष)
11. (🦁🔪)📦: (🏛🛒🤝) Bharat Bond (Debt) ETF (2019-Dec)
12. (🦁📦):(🏗🏠) Govt’s AIF for Real Estate Sector (2019)
13. 🤼♀️👬 Corporate Governance (कॉर्पोरेट शासन)

1. 🔪🗃⏰Debt → Interest Rate Benchmarks: LIBOR, MIBOR, MIFOR, SOFR
2. 🔪🗃⏰: 🐯🔪 🧔👨🦲 Short term debt instruments → by Govt → WMA

3. 🐯🔪👨🦲 Consolidated Sinking Fund (CSF) for State Govts’ repayment
4. 🔪🗃🗓 Long Term Debt Instruments: Other Special purpose Bonds
5. ⚖️🗃 Financial Instruments: Equities / Share Market
6. ⚖️🗃 🤵 IPO → Special Purpose Acquisition Company (SPAC)
7. ⚖️🗃 🌐 ADR/GDR: Shares in Videshi locker
8. 👻⚖️🗃 🌐 ATMANIRBHAR reforms in ADR/GDR/BharatDR
9. 📈 SENSEX & Corona(उल्लेखनीय सं के तक/ सूचकांक)
10. 🐮📈🐻 SENSEX: Impact of Corona
11. 🐮📈🐻 Share Market: Impact of Bond Yield
12. 🐮📈🐻 Bond Vigilantism
13. 🗃😼Securities and Exchange Board of India (SEBI)
14. 🗃⚖️📜Securities Market Code & Investor charter
15. 🛒 (💻⏱:👨💼) Algo Trading & Co-Location
16. 🛒 (🔪🗃) Bond Market Reforms
17. 🛒 (🔪🗃: 🧔👨💼) Unified Bond Market (एकीकृ त बॉन्ड बाजार)
18. 🛒 (🔪🗃: 🧔👨💼) Deepening of G-Sec market- Direct Retail participation @RBI
19. 🛒 (🔪🗃: 🧔👨💼) Bond Buying Institution in 💼Budget-2021
20. 💍🎖🏦🤝Commodity Market: Gold exchanges & 💼Budget-2021
21. 📦 🤹🏻♂️ 👴🏻 Mutual fund → 🎛 Mutual fund risk-o-meter
22. 🗃🔗: 🚛🤝🚚 Bilateral Netting of Qualified Financial Contracts Act 2020
23. 🏙🤵 Corporate Governance: Budget-2021
24. 🏙🤵: Corporate Governance → LLP settlement Scheme 2020
25. 🏙🤵 Corporate Governance → OPC easier to setup & upgrade
26. 🏙🤵 Corporate Governance → Small Companies given compliance relief

1. 🔪🗃⏰Debt → Short Term → Factoring & TREDS
2. 🔪🗃⏰Factoring Regulation (Amendment) Act, 2021
3. 🔪🗃⏰: 📡 TReDS platform to connect factoring-players.
4. 🔪🗃 Bonds in News: 🚦🚗 Surety Bonds
5. 🔪🗃Bonds in News: Misc.
6. 🗃😼Securities and Exchange Board of India (SEBI)
7. T+1 Settlement instead of T+2
8. 🛒 (🔪🗃: 🧔👨💼) G-Sec Trading: RBI's NDS-OM, OTC
9. 🐮🐻Stockmarket IPO Bubble Burst: Case of Paytm (फू ट गया ग़ुब्बारा, निकल गयी हवा)
10. 🐮🐻MSCI Emerging Market (EM) index

14.3 WIN23: ALREADY COVERED THIS
1. Financial Market Types
2. Short term debt: Certificate of Deposit (CD-instrument by Bankers)
3. 🔪🗃🗓 Long Term Debt: Special purpose Bonds- Sovereign green bonds (2023)
4. 🔪 👨‍💼🏦
( ) Credit Default Swap (CDS)
5. 🔪📈 Social Stock Exchange: zero-coupon, zero-principal instrument
6. 📈 Social Stock Exchange (सामाजिक स्टॉक एक्सचेंज)
7. Equity (Shares) related Updates
8. Open Offer - Adani NDTV को खरीदने की खुली ऑफर
9. IPO FPO LIC and Adani
10. Adani Hindenburg controversy (2023)
11. Short selling (make profit from falling share price)
12. 📙
Sharemarket observations of ES23
13. 🛒 💻⏱ 👨‍💼
( : ) Algo Trading & Co-Location
14. DEMAT Account creation slowed down- says ES23 📙
15. 📙
Proportion of money invested by retailers is falling- says ES23
16. Retail investors have decreased participation in the share market
17. India’s first bullion exchange (2022)
18. 👛
NISM- capacity building for financial market professionals - Budget-2023
19. Corporate governance / Companies Act
20. 👛
Companies Act: EoD- Central Data Processing Centre in Budget-2023
21. 👛
Unclaimed shares and dividends of IEPF & Budget-2023
22. 🧛‍♀️
Finfluencers
14.4 👨‍🏫📡MRUNAL’S ECONOMY COURSE FOR UPSC
Subscribe Now for 50% off & 6 Months Extra:

unacademy.com/goal/upsc-optional/KSCGY/subscribe?plan_type=plus&referral_code=mrunal.org
📑Next Handout: Pillar2: Budget Taxation GST FRBM Fiscal Deficit etc.
Missed previous classes / handouts? Visit Mrunal.org/win24

Win24 1C SEBI Sharemarket UPSC Mrunal

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Mrunal's Win24 Free Updates Pillar#1C: Shares / SENSEX / Mutual Fund/ etc.

10.12 🗃 🛒Financial / Securities market: meaning and types.......................................................................67

10.18 🗳(🔪🗃)⏳Electoral bonds (चुनावी बांड, 2017 ).........................................................................................71

11.12 🧮 Account types................................................................................................................................... .77

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 62

11.14 ⚖️🗃 Methods of Issuing Shares...........................................................................................................80

11.15 🤝 Central Counterparties (CCPs), Novation & ESMA controversy ..................................................86

11.17 👟 Market Theories.................................................................................................................................88

11.20 SEBI Reforms to protect investors........................................................................................................90

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 63

12 🍋 Tax on Investment / financial assets.......................................................................................... .95

Subscribe Now for 50% off & 6 Months Extra:

10 🐮📈🐻P ILLAR#1C: SHAREMARKET IN UPSC

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 64

10.11.2 💰 Capital / Funding Arrangement: Types

Source: NCERT Class12 Business Studies Ch.8

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 65

10.11.4 💰 Capital Arrange → Trade Credit (Short Term)

10.11.5 💰 Account Receivable / Payable

10.11.6 💰 Capital Arrange → Lease Financing (Medium Term)

10.11.7 🗃Capital Arrange → Retained Earnings (Long Term)

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 66

10.13 🔪🗃 D EBT INSTRUMENTS (ऋण उपकरण)

10.14 🔪🗃🗓 L ONG TERM DEBT INSTRUMENTS (दीर्ध-अवधि ऋण- उपकरण)

10.14.1 📈🔎 Global Bond Indices & inclusion of Indian G-Sec

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 67

10.15 🥇🗃🗓 B ONDS ISSUED BY COMPANIES?

10.15.2 🐸 Hybrid: OFCD: Sahara Refund portal (2023)

Basic story explained in above chart: then

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 68

10.15.3 🐸 Hybrid: Foreign Currency Convertible Bonds (FCCBs):

- Ghaziabad Municipal Corporation (Uttar Pradesh), issued first-ever Green Municipal

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 69

10.17 🔪L ONG TERM DEBT INSTRUMENTS: SPECIAL PURPOSE BONDS- MISC.

10.17.1 💦🔪 Long Term Debt → Special → 💦🔪

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 70

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 71

10.18.1 🗳🚨👨🏻‍⚖️ SC bans electoral bonds (2024-Feb)

10.18.2 🗳 Electoral Bond & Companies Act - SC bans amendments

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 72

10.20 🪣🔪 B UFFER FUNDS FOR BOND REPAYMENT

• Whenever a company issues bonds/debentures (=long term instruments) → company needs

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 73

DRR Fund requirement Before After 2019 Reform

11 🐮📈🐻E QUITY INSTRUMENTS (इक्विटी)

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 74

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 75

11.11.4 ⚖️🗃 Share types: Floating vs Restricted Stocks

11.11.5 🐲 Share types depending on risk / quality

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 76

11.12.1 🐾 Goodwill –while buying another company/brand

11.13 🐾V ALUATION OF COMPANIES

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 77

11.13.1 Valuation →Startups → 🦄

11.13.2 Valuation → Listed Companies (Small Cap/Mid Cap/Large Cap)

11.13.3 Reliance - first company to hit 20 lakh cr Market Cap (2024-Feb)

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 78

11.13.6 📈 📉Volatility / ViX (कीमतों में अस्थिरता)

Mrunal’s Economy Win24 Series Pillar1C: SEBI Sharemarket → Page 79

Year 2022 Tata Motors Maruti

11.13.9 🐾Net Worth = Total Assets −(minus) Total Liabilities

11.13.10 🔩 EBITDA, Depreciation, Amortization

11.14.1 Share price