SECONDARY

EQUITY MARKET
SUBMITTED BY: SUMBITTED TO:
Nakshi Shah 167133 PROF. NIYATI DAVE
Rahil Solanki 167142
Shloka Sethi 167155
Siddhant Rajurkar 167157
Source: www.livemint.com
 INTRODUCTION
• Market of buying and selling existing securities.
• Platform for the existing and new investors.
• Leads to economic growth.
• Under the control of framework provided by SEBI.
• Indian stock markets show positive growth since two
decades.
• Saving will increase and resources will be properly
allocated.
 History
• Stock markets started in India in later half of 1800s
• Corporate stock and shares came into existence in 1830.
• Dealings took place in Bank and Cotton presses in Bombay.
• Established “Native share and stock brokers’ association”, now
famous by the name of the stock exchange.
• The first stock exchange was organised in Bombay in 1875.
 BOMBAY STOCK EXCHANGE
• Founded on: July 9, 1875
• Founder: Premchand Roychand.
• Index: Sensex.
• In BSE, there are 5749 listed companies.
• Market capital of BSE in 94.65 Lakh crores.
• In 1875, BSE became an official organisation and in 1980, it
got recognised.
 National Stock Exchange
• Founded in:1992
• This is world’s 12th largest stock market
• 1992: Tax paying company
• 1993: Got recognised.
• There are 1696 companies listed in NSE
• Market capitalisation: US$ 1.41 trillion.
• NSE has various key domestic investors:
LIC, SBI, IFCI, IDFC
 FUNCTIONS
• Platform for buying and selling securities
• Evaluation of securities
• Investors’ protection
• Mobilization of savings
• Promote corporate governance
• Good economic barometer
• Control on the companies
• Information dissemination
• Long term investments
STOCK EXCHANGE INDICES
 SENSEX
• Index of Bombay stock exchange and consists of 30
companies listed on it.
• Base year is 1978-79 and Base value is 100.
• It is calculated based on the Free Float Market Capitalization
method.
SENSEX CHART- HISTORIC DATA

Source: The Financial Literates: www.tflguide.com

 NIFTY
• It is the Index of National Stock Exchange and consists of 50
companies.
• The base year is taken as 1995 along with base value of 1000.
• It is owned and managed by India Index Services and Products
(IISL).
NIFTY CHART- HISTORIC DATA

Source: The Financial Literates: www.tflguide.com

 TRADING MECHANISM OF STOCK
EXCHANGES
1. Selection of a broker
2. Opening Demat Account with Depository
3. Placing the Order
4. Executing the Order
5. Settlement
 CIRCUIT SYSTEM IN STOCK
EXCHANGE
• The concept of circuit is two dimensional.
• The lower circuit acts as price floor and the upper circuit acts
as price ceiling.
• Both the upper and lower circuit have a percentage limit to it
i.e., 20%, 15%, 10%, 5%.
CHAIN ROOP BHANSALI SCAM
SATYAM SCAM
 CONCLUSION
• Secondary equity market provides best investment options,
stability and transparency.
• BSE and NSE are best effective and efficient pillars of
secondary equity market.
• Also attract foreign investments.
• The degree of volatility in the stock exchange results in
investors demanding more risk premium therefore creating
high amount of capital cost which slows down investments
and economic development respectively (Mala and Reddy,
2007).
THANK YOU