BOMBAY STOCK EXCHANGE (BSE)

MCOM PART II SEM 4

PRESENTATION BY:
YASH THAKKAR; ROLL NO: 51
SHRUTI MITTAL; ROLL NO:40
MEGHNA VALIYAVEETIL; ROLL NO: 53
HEENA SHAIKH; ROLL NO: 31
PRANALI NAIK; ROLL NO: 43
YOHAN PRADHAN; ROLL NO: 46

GUIDED BY: DR. ASHA JADHAV

INTRODUCTION TO STOCK EXCHANGE MARKET

 A stock market, equity market, or share market is the

aggregation of buyers and sellers of stocks (also called
shares), which represent ownership claims on businesses;
these may include securities listed on a public 
stock exchange, as well as stock that is only traded privately,
such as shares of private companies which are sold to 
investors through equity crowdfunding platforms.
Investment in the stock market is most often done via 
stockbrokerages and electronic trading platforms. Investment
is usually made with an investment strategy in mind.
 FUNCTIONS AND PURPOSE OF THE STOCK
EXCHANGE

 The stock market is one of the most important ways for 

companies to raise money, along with debt markets which are
generally more imposing but do not trade publicly. This
allows businesses to be publicly traded, and raise additional
financial capital for expansion by selling shares of ownership
of the company in a public market.
 The liquidity that an exchange affords the investors enables
their holders to quickly and easily sell securities. This is an
attractive feature of investing in stocks, compared to other
less liquid investments such as property and other
immoveable assets.
THE PRIDE OF FINANCIAL MARKET IN INDIA (THE BSE )

 BSE Limited, formerly known as the Bombay

Stock Exchange is an Indian stock exchange
 located on Dalal Street in Mumbai. Established
in 1875, it is Asia's oldest stock exchange.[6] The
BSE is the world's 7th largest stock exchange
with an overall market capitalization of more
than US$2.8 trillion on as of February 2021
.

MEGHN
TIMINGS FOR TRADING
 1.Pre-opening session9.00 a.m. – 9.15a.m
 2.Normal session9.15 a.m. – 3.30 p.m
 3.Closing session3.30 p.m. – 4.00 p.m.

RELIGIOUS ETHICS
Muhurat’ Trading 
 Indian stock market is generally closed for any transactions

on Diwali, as it is a religious festival celebrated all across the

country. However, a one-hour trading session is conducted
from 5.30 p.m. to 6.40 pm as it is considered to be auspicious.
HISTORY OF BSE
 While Bombay Stock Exchange Limited is now synonymous with
Dalal Street, it was not always so. In the 1850s, five stock brokers
gathered together under Banyan tree in front of Mumbai Town
Hall, where Horniman Circle is now situated. A decade later, the
brokers moved their location to another leafy setting, this time
under banyan trees at the junction of Meadows Street and what was
then called Esplanade Road, now Mahatma Gandhi Road. With a
rapid increase in the number of brokers, they had to shift places
repeatedly. At last, in 1874, the brokers found a permanent
location, the one that they could call their own. The brokers group
became an official organization known as "The Native Share &
Stock Brokers Association" in 1875.
THE TRADING OF BSE IN 1873
THE FIRST EVER STOCK EXCHANGE OF INDIA

 On 31 August 1957, the BSE became the first stock

exchange to be recognized by the Indian Government
 under the Securities Contracts Regulation Act.
Construction of the present building, the Phiroze
Jeejeebhoy Towers at Dalal Street, Fort area, began in
the late 1970s and was completed and occupied by the
BSE in 1980. Initially named the BSE Towers, the name
of the building was changed soon after occupation, in
memory of Sir Phiroze Jamshedji Jeejeebhoy, chairman
of the BSE since 1966, following his death.
MODERNISING
 Historically an open outcry floor trading exchange, the Bombay Stock Exchange
switched to an electronic trading system developed by CMC Ltd. in 1995. It took
the exchange only 50 days to make this transition. This automated, 
screen-based trading platform called BSE On-Line Trading (BOLT) had a
capacity of 8 million orders per day. Now BSE has raised capital by issuing shares
and as on 3 May 2017 the BSE share which is traded in NSE only closed with
₹999 .The BSE is also a Partner Exchange of the 
United Nations Sustainable Stock Exchange initiative, joining in September 2012.

 BSE established India INX on 30 December 2016. India INX is the first
international exchange of India.

 BSE launches commodity derivatives contract in gold, silver.

WHY IS BSE POPULAR AMONG TRADERS ?
BASIC FUNCTIONS
 The BSE has been instrumental in developing India's
capital markets by providing an efficient platform for the
Indian corporate sector to raise investment capital.
 The BSE is known for its electronic trading system that
provides fast and efficient trade execution.
 The BSE enables investors to trade in equities, currencies,
debt instruments, derivatives, and mutual funds.
 The BSE also provides other important capital market
trading services such as risk management, clearing,
settlement, and investor education.
VISION MISSON AND VALUES OF BSE
 VISION :Our vision is to be the most sought after learning provider in the
world in areas of financial and leadership learning, by pioneering the
generation and dissemination of knowledge for the enhancement of skills
and capabilities of professionals and aspiring professionals.
 MISSION :As a company, our mission is to promote an open learning
environment that brings together people, cultures and ideas from around
the world, changing lives and helping transform organizations through
innovative learning programs.
 CORE VALUES : As a company, our mission is to promote an open
learning environment that brings together people, cultures and ideas from
around the world,
 Changing lives and helping transform organizations through innovative
learning programs.
CORPORATE STRUCTURE

CHAIRMAN

MD & CEO

PUBLIC INTEREST
DIRECTORS & SHARE
HOLDER DIRECTOR
BSE INDEX: SENSEX

Stock market performance is quantified by calculating an index using the benchmark scrip’s and
also known to all SENSEX (Sensitive Index) is associate with Bombay Stock Exchange.

Sensex has been calculated since 1986 and initially it was calculated based on the total market
Capitalisation methodology and the methodology was changed in 2003 to Free Float Market
Capitalization.

Hence, these days, the SENSEX is based on the free floating market cap of 30 SENSEX stocks
traded on the BSE relative to the base value which is 100 (1978-79) and it is calculated for every
15 seconds.

It reflects value of 30 component stocks relative to a base period.

The market capitalization of a company is determined by multiplying the price of its stock by the number
of shares issued by the company.
This market capitalization is further multiplied by the free float factor to determine the free float market
capitalization.
HOW IS SENSEX CALULATED
SENSEX = SUM OF FREE FLOW CAP OF 30 BENCHMARK STOCKS * INDEX FACTOR

where,
Index factor = 100/ market cap value in 1978- 79
100 is the index value during 1978-79

Example
Assume SENSEX has only 2 stocks namely SBI and RELIANCE. Total shares in SBI are 500 out of
which 200 are held by the government and only 300 are available for public trading. Reliance has
100 shares out of which 500 are held by promoters and 500 are available for trading. Assume price
of SBI stock is Rs. 100 and reliance is Rs 200. Then,

300*100+500*200 = 30000 100000= Rs. 130000

Assume market cap was 25000
Then SENSEX = 130000*100/25000=520
CURRENT SCENERIO OF BSE
 Pre COVID-19, market capitalisation on each major exchange in India was about $2.16 trillion. The 2019 stock market
rally was limited to 8-10 stocks within the large caps. The Sensex returned around 14% (excluding dividends) for the year
2019 but prominently featured blue-chip companies such as HDFC Bank, HDFC, TCS, Infosys, Reliance, Hindustan
Unilever, ICICI Bank and Kotak Bank, without which Sensex returns would have been negative. However, in the start of
2020, there was overall recovery which led to both NSE and BSE traded at their highest levels ever, hitting peaks of
12,362 and 42,273 respectively. At the beginning of the year, there were close to 30 companies that were expected to file
IPO’s. The market conditions were generally favourable as they witnessed record highs in mid-January.
 A Comparison of Pre and Post COVID View of Indian Stock Markets

BOURSES INDEX-14 JAN 23 MARCH 20 24 APRIL

20 20
NIFTY 50 12,362 7,610 9,154
SENSEX 41,952 25,981 31,327
 Ever since COVID 19 strike, markets loom under fear as uncertainty prevails. lt has sent markets around the world
crashing to levels not witnessed since the Global Financial Crisis of 2008. Following the strong correlation with the
trends and indices of the global market as BSE Sensex and Nifty 50 fell by 38 per cent. The total market cap lost a
staggering 27.31% from the start of the year. The stock market has reflected the sentiments this pandemic unleashed upon
investors, foreign and domestic alike. Companies have scaled back; layoffs have multiplied and employee compensations
have been affected resulting in negligible growth in the last couple of months. Certain sector such as hospitality, tourism
and entertainment have been impacted adversely and stocks of such companies have plummeted by more than 40%.
CONCLUSION
 With the increasing Globalization, the Stock Exchanges have tremendously affected the financial
conditions of India.

 The stock markets of the future will have a redefined pupose and reinvented architecture due to the
advent and widespread  use of technology. Information and stock price quotations are available almost
instantaneously, and, more importantly, investors can act on this data by executing a trade from anywhere
at anytime. This new market will bring benefits to investors, the listed companies, and the economies of
the company. Trading will become cheaper, faster and settlement will be simpler wit reduced risk.
Raising capital for companies will become easier, thereby contributing directly to the Economic Growth.

 Already, BSE has shown its proactive response by increasingly using leading edge to technologies to
effectively compete in the global environment. In the not too distant future, once full capital account
convertibility is permitted in India, one could well witness an expansion of trading volumes and its
resultant economic benefits to the thriving and ever young metropolis of Mumbai.

 Inspite of all these positive predictions, the future of Stock Exchanges is likely to be uncertain and even
their survival is a major question mark.