Comparative Study NSE - BSE

A SUMMER TRAINING PROJECT ON

LISTING PROCEDURE & ITS ANALYSIS: A COMPARATIVE STUDY BETWEEN

NSE & BSE  Submitted in Partial Fulfillment of   MASTER OF BUSINESS ADMINISTRATION (MBA) PROGRAMME  ( U.P. Technical University, Lucknow)

(2007-2009)

Submitted To:

Submitted By

Mr. Satish Matta Faculty Guide LIMT, Gr. Noida

Bhawesh Mishra MBA (3rd Sem) Roll No. 0717270022

LLOYD INSTITUTE OF MANAGEMENT & TECHNOLOGY  Plot no.11, Knowledge Park-2, Greater Noida.UP-

1

INDEX CONTENTS

PAGE NO.

 ACKNOWLEDGEMENT

4

 OBJECTIVE

5

 PREFACE

7

 METHODOLOGY

8

 NATIONAL

 ABOUT

 NSE

STOCK EXCHANGE

NSE

10

MILESTONES

 CORPORATE

9

11

STRUCTURE

 NSE

GROUP

 NSE

TECHNOLOGY

17

31

36

 EQUITIES

39

 LISTING

40

 LISTING

PROCEDURE ON NSE

 ELIGIBILITY

41

CRITERIA FOR LISTING ON NSE

2

55

 BOMBAY

 ABOUT

STOCK EXCHANGE

72

BSE

 LISTING

OF SECURITIES ON BSE

 ANALYSIS

 LISTING

73

AND INTERPRETATION

86

103

BENEFITS

112

 CONCLUSION

117

 FINDINGS

118

 LIMITATIONS

119

 BIBLIOGRAPHY

120

3

ACKNOWLEDGEMENT

A work without the blessing and the guidance of experienced is always half done and unsat unsatis isfa fact ctory ory.. The The task task of comp comple leti ting ng this this projec projectt needs needs knowl knowled edge ge,, experience & guidance of the prominent person as mentioned in the subject line. My abundant and most sincere sincere thanks goes to the honorable guide for providing me with the necessary facilities to carry out the project successfully. I would also like to thank Mr. Satish Matta, Faculty Guide, LIMT, Gr. Noida for  familiarizing me with the concepts of management, which were of great help to complete this project.

BHAWESH MISHRA MBA (3RD SEM)

Roll No.: 0717270022

4

OBJECTIVE

The main objective of this project is to gain an insight of National Stock Exchange & Bombay Stock Exchange towards the listing procedure and to explore the benefits of listing on the stock exchanges with a comparative study.

SCOPE

•

The The proj projec ectt woul would d help help a comp compan any y to make make fami famililiar ar with with list listin ing g procedure on NSE & BSE.

•

The project would also tell the benefits of listing on the stock exchanges for raising funds through equity share capital.

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METHODOLOGY The methodology used for the implementation of the assigned project is based on secondary data & with the help of custom type pie explosion chart.

LIMITATIONS

The limitations of this project arise from the time period assigned to me in this project. Since I had to work only for two months. This project merely tells about the listing procedure of equities on NSE & BSE.

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PREFACE

“Learning Categories You, and practicing on that learning specialize you “ .

The importance of any academic courses would gain advantage and the acceptance of the true form, only through practical experiences. Hence it is quite necessary to put theories as into task. This is made possible with the summer training at any of  the companies under the expert guidance of a competent person.

The students are required to submit a report on the work done and knowledge gained during this period. The report is evaluated and marks awarded as per the contents in the report.

I was asked to work on project “Comparison of listing procedure between NSE & BSE.”

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METHODOLOGY

The methodology used for the implementation of the assigned project is based on secondary data and with the help of custom type pie explosion chart. Research design for the descriptive study is of exploratory type and the forms is given to discover the possible measure by detailed analy analysi sis s this this repo report rt also also base based d on descr descrip ipti tive ve rese resear arch ch becau because se it provide the the detailed detailed knowledge knowledge about the the BSE and NSE and its listing listing procedure. Seco Se cond ndar ary y data data is to be use sed d in the rese resear arch ch,, have have bee been collected from various magazines, news paper, web sites and other source. Research design:

descriptive type and analytical type

Data collection method

: secondary data collect method.

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NATIONAL STOCK EXCHANGE

9

ABOUT NSE The National Stock Exchange (NSE) is India's leading stock exchange covering vari variou ous s citi cities es and and town towns s acro across ss the the coun countr try. y. NSE NSE was was set set up by lead leadin ing g institutions to provide a modern, fully automated screen-based trading system with national reach. The Exchange has brought about unparalleled transparency, speed & efficiency, safety and market integrity. It has set up facilities that serve as a mode modell for for the the securi securiti ties es indu indust stry ry in terms terms of syst system ems, s, pract practic ices es and and procedures. NSE has played a catalytic role in reforming the Indian securities market in terms of microstructure, microstructure, market practices and trading trading volumes. The market today uses state-of-art information technology to provide an efficient and transparent trading, clearing and settlement mechanism, and has witnessed several innovations in products products & services services viz. demutualisati demutualisation on of stock exchange exchange governance, governance, screen based trading, compression of settlement cycles, dematerialisation and electronic transfer transfer of securities, securities, securities lending and borrowing, borrowing, professional professionalisati isation on of  trading members, fine-tuned risk management systems, emergence of clearing corpor corporat ation ions s to assu assume me count counterp erpart arty y risk risks, s, mark market et of debt debt and deri deriva vati tive ve instruments and intensive use of information technology.

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NSE MILESTONES Nove Novemb mber er 199 1992 2

Inco Incorp rpor orat atio ion n

April 1993

Recognition as a stock exchange

May 1993

Formulation of business plan

June 1994

Wholesale Debt Market segment goes live

November 1994 Capital Market (Equities) segment goes live March rch 19 1995

Establ ablishmen hmentt of of In Investo stor Gr Grievanc vance e Ce Cell

April 1995

Establishment of  NSCCL  NSCCL,, the first Clearing Corporation Intr Introdu oduct ctio ion n of cent centra ralilise sed d insu insura rance nce cover cover for for all all trad trading ing

June 1995 members July 1995

Establishment of Investor Pr Protection Fu Fund

Octo Octobe berr 199 1995 5

Beca Became me larg larges estt sto stock ck exc excha hang nge e in in the the cou count ntry ry

Apri pril 1996

Commencem cement of cleari aring and and settlement ent by NSCCL

April 1996

Launch of  S&P S&P CNX Nifty

June 19 1996

Establishment of of Se Settlement Gu Guarantee Fu Fund Sett Settin ing g up of  Nation National al Securit Securities ies Deposi Depositor tory y Limite Limited d, firs firstt

November 1996 depository in India, co-promoted by NSE Novemb November er 1996 1996

Best Best IT Usage Usage award award by by Comput Computer er Societ Society y of India India Comm Commen encem cemen entt

of

trad tradin ing/ g/se sett ttle leme ment nt

in

dema demate teri rial alis ised ed

December 1996 securities Decemb December er 1996 1996 Dataque Dataquest st award award for Top IT User  User  Dec Decembe emberr 199 1996 6

Laun Launch ch of CNX of CNX Nifty Junior 

Febru February ary 1997 1997

Regio Regiona nall clear clearin ing g faci facilility ty goes goes live live

Novemb November er 1997 1997

Best Best IT Usage Usage award award by by Comput Computer er Societ Society y of India India Promotion of joint venture, India Index Services & Products

May 1998 Limited (IISL) May 1998

Launch of NSE's Web-site: www.nse.co.in

July 1998

Launch of NSE's N   SE's Certification Programme in Financial Market

Augu August st 1998 1998

CYBE CYBER R CORP CORPO ORAT RATE OF THE THE YEA YEAR 1998 1998 awar award d 11

Febru February ary 1999 1999

Laun Launch ch of Aut Autom omat ated ed Lend Lendin ing g and Bor Borrow rowin ing g Mecha Mechani nism sm

April 1999

CHIP Web Award by CHIP magazine

October 1999

Setting up of  NSE.IT  NSE.IT

January 2000

Launch of  NSE  NSE Research Initiative

Febru bruary ary 200 2000 0

Commencem cement of Internet f Internet Trading

June 20 2000

Commencement of De Derivatives Tr Trading (Index (Index Futures) Futures)

Septe Septemb mber er 2000 2000 Laun Launch ch of 'Zero of 'Zero Coupon Yield Curve' Launch of Broker of  Broker Plaza by Dotex International, a joint venture November 2000 between NSE.IT Ltd. and i-flex Solutions Ltd. Dece Decemb mber er 200 2000 0

Comm Commen ence ceme ment nt of  of WAP WAP trading

June 2001

Commencement of trading in Index Options

July 2001

Commencement of trading in Options on Individual Securities

Novem November ber 200 2001 1

Comm Commen encem cemen entt of tra tradi ding ng in Futures on Individual Securities

Dec Decembe emberr 200 2001 1

Laun Launch ch of NSE of NSE VaR for Government Securities

January 2002

Launch of  Exchange  Exchange Traded Funds (ETFs) NSE NSE wins wins the the Whar Wharto ton-I n-Inf nfos osys ys Busin Business ess Transf Transform ormat ation ion

May 2002 Award in the Organization-wide Transformation category October 2002

Launch of  NSE  NSE Government Securities Index

Janu anuary 2003 003

Commencem cement of tr trading in Retail Debt Market

June 2003

Launch of Interest  Interest Rate Futures

August 20 2003

Launch of of Fu Futures & options in in CNXIT Index

June 2004

Launch of STP Interoperability

August 2004

Launch of NSE’s electronic interface for listed companies

June 2005

Launch of Futures & options in BANK Nifty Index

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THE ORGANISATION The National Stock Exchange of India Limited has genesis in the report of the High Powered Study Group on Establishment of New Stock Exchanges, which recommended promotion of a National Stock Exchange by financial institutions (FIs) to provide access to investors from all across the country on an equal footing. Based on the recommendations, NSE was promoted by leading Financial Institutions at the behest of the Government of India and was incorporated in November 1992 as a tax-paying company unlike other stock exchanges in the country. On its its reco recogn gnit itio ion n as a stoc stock k exch exchan ange ge unde underr the the Secu Securi riti ties es Cont Contra ract cts s (Regul (Regulat atio ion) n) Act, Act, 1956 1956 in April April 1993 1993,, NSE NSE comm commenc enced ed opera operati tion ons s in the the Wholes Wholesale ale Debt Debt Market Market (WDM) (WDM) segment segment in June June 1994. 1994. The Capita Capitall Market Market (Equities) (Equities) segment commenced operations operations in November 1994 and operations in Derivatives segment commenced in June 2000.

Mission NSE's mission is setting the agenda for change in the securities markets in India. The NSE was set-up with the main objectives of:

•

establishing a nation-wide trading facility for equities, debt instruments and hybrids,

•

ensur ensuring ing equal equal acces access s to inve invest stors ors all all over over the the count country ry throu through gh an appropriate communication network, 13

•

providing a fair, efficient and transparent securities market to investors using electronic trading systems,

•

enabling shorter settlement cycles and book entry settlements systems, and

•

meeting the current international standards of securities markets.

The standards set by NSE in terms of market practices and technology have beco become me indu indust stry ry benc benchm hmar arks ks and and are are bein being g emul emulat ated ed by othe otherr mark market et participants. NSE is more than a mere market facilitator. It's that force which is guiding the industry towards new horizons and greater opportunities.

Logo The logo of the NSE symbolises a single nationwide securities trading facility ensuring equal and fair access to investors, trading members and issuers all over  the country. The initials of the Exchange viz., N, S and E have been etched on the logo and are distinctly visible. The logo symbolises use of state of the art information technology and satellite connectivity to bring about the change within the securities industry. The logo symbolises symbolises vibrancy and unleashing unleashing of creative creative energy to constantly bring about change through innovation

PROMOTERS

14

NSE has been promot promoted ed by leading leading financ financial ial instit instituti utions, ons, banks, banks, insuran insurance ce companies and other financial intermediaries: 1. Industrial Development Bank of India Limited 2. Industrial Finance Corporation of India Limited 3. Life Insurance Corporation of India 4. State Bank of India 5. ICICI Bank Limited 6. IL & FS Trust Company Limited 7. Stock Holding Corporation of India Limited 8. SBI Capital Markets Limited 9. The Administrator of the Specified Undertaking of Unit Trust of India 10. Bank of Baroda 11. Canara Bank 12. General Insurance Corporation of India 13. National Insurance Company Limited 14. The New India Assurance Company Limited 15. The Oriental Insurance Company Limited 16. United India Insurance Company Limited 17. Punjab National Bank 18. Oriental Bank of Commerce 19. Corporation Bank 20. Indian Bank 21. Union Bank of India

15

CORPORATE STRUCTURE NSE is one of the first de-mutualised de-mutualised stock exchanges in the country, country, where the ownership and management of the Exchange is completely divorced from the right to trade on it. Though the impetus for its establishment came from policy makers in the country, it has been set up as a public limited company, owned by the leading institutional investors in the country. From day one, NSE has adopted the form of a demutualised exchange - the ownership, management and trading is in the hands of three different sets of  people. NSE is owned by a set of  leading financial institutions, banks, insurance companies companies and other financial intermediaries intermediaries and is managed by professionals, who do not directly or indirectly trade on the Exchange. This has completely elimin eliminate ated d any confli conflict ct of interes interestt and helped helped NSE in aggress aggressive ively ly pursuin pursuing g policies and practices within a public interest framework. The The NSE NSE mode modell howe howeve ver, r, does does not not prec preclu lude de,, but but in fact fact acco accomm mmod odat ates es involvement, support and contribution of trading members in a variety of ways. Its Board comp compri rises ses of seni senior or exec execut utiv ives es from from prom promot oter er inst instit itut utio ions, ns, emin eminent ent professionals in the fields of law, economics, accountancy, finance, taxation, etc, public representatives, nominees of SEBI and one full time executive of the Exchange.

16

While the Board deals with broad policy issues, decisions relating to market operations are delegated by the Board to various committees constituted by it. Such committees include representatives from trading members, professionals, the public and the management. The day-to-day management of the Exchange is delegated to the Managing Director who is supported by a team of  professional staff .

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BOARD OF DIRECTORS

Mr. S. B. Mathur 

Chairman

Administrator of the Specified Undertaking of  Unit Trust of India

Mr. Ravi Narain

Managing Director 

National Stock Exchange of India Ltd.

Ms. Chitra Ramkrishna

Deputy Managing Director 

National Stock Exchange of India Ltd.

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Directors Mr. S. P. Chhajed

Mr. R. P. Chitale

Partner 

Managing Partner 

M/s. Chhajed & Doshi

M/s. M.P.Chitale & Co.

Chartered Accountants Mr. S. H. Khan

Chartered Accountants Prof. (Dr.) K.R.S.Murthy

Chairman

Professor and Former Director 

Feedback First Urban Infrastructure

Indian Institute of Management,

Development Comp. Ltd. Mr. Anand G. Mahindra

Bangalore Mr. N.S. Kannan

Vice Chairman & Managing Director 

Chief Financial Officer & Treasurer 

Mahindra & Mahindra Ltd Mr. Indrajit Gupta

ICICI Bank Ltd Mr. A. P. Kurian

Managing Director & CEO

Chairman

SBI Capital Markets Ltd. Mr. Justice M.L. Pendse (Retd.)

Association of Mutual Funds in India Mr. Ravi Parthasarathy

Former Chief Justice of Karnataka

Chairman & Managing Director 

High Court

Infrastructure Leasing & Financial

and Judge of Bombay High Court Mr. R. N. Bhardwaj

Services Ltd Mr. M. Raghavendra

Chairman

Ex-General Manager 

Life Insurance Corporation of India

General Insurance Corporation of India Mr. S.Venkiteswaran

Dr. R. H. Patil

Sr. Advocate &

Chairman

Mr. Y. H. Malegam

The Clearing Corporation of India Ltd.

Chartered Accountant

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COMMITTEES The Exchange has constituted constituted various committees committees to advise it on areas such as good market practices, settlement settlement procedures, procedures, risk containment containment systems etc. These These commit committee tees s are manned manned by indust industry ry profes professio sional nals, s, tradin trading g members members,, Exchange staff as also representatives from the market regulator.

•

Executive Committee

•

Committee On Trade Related Issues (COTI)

•

Advisory Committee - Listing of Securities

Executive Committee Objective: To manage the day-to-day operations of the Exchange Composition:

1.

Mr. Ravi Narain

Chairman

Managing Director  National Stock Exchange of India Ltd. 2.

Mr. Mukesh Kansal

Trading Member 

Managing Director  M/s. K & A Securities (P) Ltd. 3.

Mr. Hemang Raja

Trading Member 

Managing Director 

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M/s IL&FS Investsmart Ltd. 4.

Mr. Shailesh Saraf 

Trading Member 

Wholetime Director  M/s. Dynamic Equities Pvt. Ltd. 5.

Mr. C. C.Parthasarathy

Trading Member 

Director  M/s. Karvy Stock Broking Ltd. 6.

Mr. R. P. Chitale

Public

Managing Partner 

Representative

M/s. M. P. Chitale & Co. Chartered Accountants 7.

8.

9.

Mr. Y. H. Malegam

Public

Chartered Accountant

Representative

Mr. S. S. Ve Venkiteswaran

Public

Sr. Advocate

Representative

Ms. Chit hitra Ramkris rishna

Other Nominee

Deputy Managing Director  National Stock Exchange of India Ltd. 10. Mr. Mr. P. M. Ven Venkat katas asubr ubram aman ania ian n

Other Nominee

Ex-Managing Director, GIC 11. 11. Mr. N.S N.S.Kan .Kanna nan n

Other Nominee

Chief Financial Officer & Treasurer  ICICI Bank Limited

For Futures & Options Segment 21

1. Mr. Ravi avi Narain ain

Chairman

Managing Director  National Stock Exchange of India Ltd. 2. Mr. Shit hitin D Des Desa ai

Trading Member 

Executive Vice Chairman M/s. DSP Merrill Lynch Ltd. 3. Mr. Vine Vineet et Bhat Bhatn nagar  agar 

Trading Member 

Managing Director  M/s Refco-Sify Securities India (Pvt.) Ltd. 4. Mr. D.C.Anjari aria

Public

Director 

Representative

International Finance Solutions Pvt. Ltd. 5. Mr. Mr. Sha Shaililes esh h Har Harib ibha hakt ktii

Public

Partner 

Representative

M/s. Haribhakti & Co. 6. Prof Prof.. V. Ravi Ravi Ansh Anshum uman an

Public

Indian Institute of Management

Representative

Bangalore 7. Mr. M. Ragh Raghav aven endr dra a

Other Nominee

Ex-General Manager  General Insurance Corporation of India 8. Ms. Ms. Chit Chitra ra Ramk Ramkri rish shna na

Other Nominee

Deputy Managing Director  National Stock Exchange of India Ltd. 9. Mr. M. L. Soneji

Other Nominee 22

Director (Operations & Surveillance) National Stock Exchange of India Ltd.

23

COMMITTEE ON TRADE ISSUES (COTI) Objective: Objective: To provide guidance on trade related issues which crop up during the day-to-day functioning of the Exchange Composition:

Mr. Atul Kumar 

Mr. S.Ramasubramanian

Managing Director 

Partner 

Practical Financial Services Pvt. Ltd.

M/s. Venkatraman & Co

(Chairman of the committee) . Mr. Dhiraj Single

Mr. Dikul Patel

Head of Market Operations

Executive Director 

ASK Raymond James Financial

JK Securities Pvt. Limited

Services (I) Ltd. Mr. Shreekant Phumbhra

Mr. G V Nageswara Rao

Proprietor 

Managing Director 

Shreekant Phumbhra

IDBI Capital Market Services Ltd.

Mr. Ashok Kakkar 

Mr. Ketan H. Marwadi

Wholetime Director 

Managing Director 

Vivek Financial Focus Ltd.

Marwadi Shares & Finance Pvt. Ltd.

Mr.K. Ravindra Babu

Mr. Ravindra Kumar Agrawal

Managing Director 

Wholetime Director 

Zen Securities Ltd.

Shri Parashram Holdings P. Ltd.

ADVISORY COMMITTEE - LISTING OF SECURITIES 24

Objective: To advise NSE on

•

The suitability of the Companies for listing on the Exchange within the parameters set out by the listing agreement

•

To ensure that the applicant company has complied with all the conditions set set out out in the the list listin ing g agre agreem emen entt as well well as othe otherr form formal alit itie ies, s, SEBI SEBI regulations, etc.

•

Systems and procedures to be adopted for listing of securities

Composition:

1

Mr. N Ganga Ram Former Executive Director, Industrial Development Bank of India

2

Mr. Uday Kotak Executive Vice Chairman and Managing Director, Kotak Mahindra Bank Ltd.

3

Mr. M R Mondkar   Chairman, Mondkar Computers Pvt. Ltd.

4

Mr. S Ramadorai Chief Executive Officer, Tata Consultancy Services

5

Mr. Prithvi Haldea Managing Director, Prime Database Praxis Cons. & Information Services Pvt. Ltd.

6

Mr. Prakash Karnik Director-Asia, Electrapartners Asia Pvt. Ltd.

7

Mr. S.V. Prasad Chief Executive Officer, Birla Sunlife Mutual Fund 25

8

Mr. Pradip P. Shah Chairman, Indasia Fund Advisors Pvt. Ltd.

9

Mr. Vimal Bhandari Executive Director, Infrastructure Leasing & Financial Services Ltd.

10 Mr. Mr. J. Ravi Ravich chan andr dran an Company Secretary & Sr.Vice President National Stock Stock Exchange of India Ltd. Ltd. 11. Mrs. Mrs. Chit Chitra ra Ramkri Ramkrish shna na Deputy Managing Director, Head of Listing National Stock Stock Exchange of India Ltd. Ltd.

26

Management Team (Personal Staff)

Mr. Ravi Narain

MANAGING DI DIRECTOR & CH CHIEF EX EXECUTIVE OFFICER

Ms. Chitra Ramkrishna

Deputy Managing Director 

Mr. J Ravichandran

Director   Lega Legall & Secre Secreta tari rial al , Insp Inspect ectio ion, n,

Fina Finance nce &

Accounts Mr. M L Soneji

Director   Capi Capita tall Mark Market et (Tra (Trade de & Surv Survei eillllan ance ce), ), F&O F&O (Trade

&

Surveillance),

WDM

(Trade

&

Surveillance), IPO and Investigation Mr. R Sundararaman

Vice President NSCC NSCCL L - F&O F&O Clear Clearin ing, g, Risk Risk Mana Manage geme ment nt & Collaterals

Mr. Yatrik R Vin

Vice President Finance & Accounts

Mr. A Sebastin

Asst. Vice President Risk Management

Mr. Arup Mukherjee

Asst. Vice President NCFM & Economic Analysis & policy

Mr. C. N. Upadhyay

Asst. Vice President Inspection

Mr. D Satish Kumar

Asst. Vice President Legal

27

Mr. Dhruvkumar Patil

Asst. Vice President Arbi Arbittrat ration, ion,

Defau efault lter ers s

Sect Sectiion

Grievances Mr. Mahesh Haldipur

Asst. Vice President Premises

Mr. Narendra Kumar 

Asst. Vice President

Ahlawat

NSCCL - Development

Mr. Nayan Mehta

Asst. Vice President Finance & Accounts

Mr. Suresh Narayan

Asst. Vice President India Index Services & Products Ltd.

Mr. R Jayakumar

Asst. Vice President Secretarial

Mr. R Nanda Kumar

Asst. Vice President Development

Mr. Ravi Varanasi

Asst. Vice President Investigation & Surveillance

Ms. T S Jagadharini

Asst. Vice President Listing & Membership

28

&

Inves nvesto tor  r 

29

NSE Group

NSCCL

IISL

NSE.IT

NSE

DotEx Intl. Ltd.

NSDL

30

National Securities Clearing Corporation Ltd. (NSCCL)

The Nation National al Securit Securities ies Cleari Clearing ng Corpor Corporati ation on Ltd. Ltd. (NSCCL (NSCCL), ), a wholly wholly owned owned subsidiary of NSE, was incorporated in August 1995. It was set up to bring and sustain sustain confide confidence nce in cleari clearing ng and settle settlemen mentt of securit securities; ies; to promot promote e and maintain, short and consistent settlement cycles; to provide counter-party risk guarantee, and to operate a tight risk containment system. NSCCL commenced clearing operations in April 1996. NSCCL carries out the clearing and settlement of the trades executed in the Equiti Equities es and Derivat Derivatives ives segment segments s and operat operates es Subsid Subsidiary iary General General Ledger  Ledger  (SGL) for settlement settlement of trades in government securities. securities. It assumes assumes the counterpart party y risk risk of each each memb member er and and guar guaran ante tees es fina financ ncia iall sett settle leme ment nt.. It also also undertakes settlement of transactions on other stock exchanges like, the Over  the Counter Exchange of India. NSCCL has successfully brought about an up-gradation of the clearing and settle settlemen mentt procedu procedures res and has brought brought Indian Indian financ financial ial markets markets in line line with with international markets.

31

NSE.IT Ltd. NSE.IT, a 100% subsidiary of National Stock Exchange of India Limited (NSE), is the information technology arm of the largest stock exchange of the country. A leading edge technology user, NSE houses state-of-the-art infrastructure and skills. NSE.IT possesses the wealth of expertise acquired in the last six years by running the trading and clearing infrastructure of largest stock exchange of the count country ry.. NSE. NSE.IT IT is uniq uniquel uely y posit positio ione ned d to provi provide de produ product cts, s, servi service ces s and solutions for the securities industry. There has been a long felt need for top-ofthe-line products, services and solutions in the area of trading, broker front-end and back-office, clearing and settlement, web-based trading, risk management, treasur treasury y managem management ent,, asset asset liabil liability ity managem management ent,, banking banking,, insuran insurance ce etc. etc. NSE.IT's expertise in these areas is the primary focus. The company also plans to provi provide de consu consult ltan ancy cy and impl implem ement entat atio ion n servi service ces s in the the areas areas of Data Data Ware Wareho hous usin ing, g,

Busi Busine ness ss

Cont Contin inui uity ty

Plan Plans, s,

Stra Stratu tus s

Main Mainfr fram ame e

Faci Facilility ty

Management, Site Maintenance and Backups, Real Time Market Analysis & Financial News over NSE-Net, etc. NSE.IT is an Export Oriented Unit with STP and plans to go global for various IT services in due course. In the near future the company plans to release new products for Broker Back-office Operations and enhance NeatXS / Neat iXS to support Straight Through Processing on the net.

32

India Index Services & Products Ltd. (IISL) India Index Services and Products Limited (IISL), a joint venture between NSE and CRISIL CRISIL Ltd. Ltd. (form (formerl erly y the the Credi Creditt Rati Rating ng Info Inform rmat atio ion n Servi Service ces s of Indi India a Limited), was set up in May 1998 to provide a variety of indices and index related services and products for the Indian capital markets. It has a consulting and licensing agreement with Standard and Poor's (S&P), the world's leading provider  of investible equity indices, for co-branding equity indices. IISL IISL prov provid ides es a broad broad range range of servi service ces, s, produ product cts s and and prof profes essi sion onal al inde index x services. It maintains over 80 equity indices comprising broad-based benchmark indices indices,, sector sectoral al indices indices and custom customise ised d indices indices.. Many invest investmen mentt and risk risk management products based on IISL indices have been developed in the recent past, within India and abroad. These include index based derivatives traded on NSE and Singapore Exchange (SIMEX) and a number of index funds

National Securities Depository Ltd. (NSDL) In order order to solv solve e the the myri myriad ad prob problem lems s associ associat ated ed with with trad tradin ing g in physi physica call securities, NSE joined hands with the Industrial Development Bank of India (IDBI) and the Unit Unit Trust Trust of India India (UTI) (UTI) to promote promote demater dematerial ialisa isatio tion n of securit securities ies..

33

Together they set up National Securities Depository Limited (NSDL), the first depository in India. NSDL commenced operations in November 1996 and has since established a national national infrastructu infrastructure re of internationa internationall standard to handle trading and settlement settlement in dematerialised form and thus completely eliminated the risks to investors associated with fake/bad/stolen paper.

DotEx International Limited DotEx was formed to provide world-class internet trading platforms which allows members of NSE to offer online trading facilities facilities to their customers. customers. Members of  NSE can service a larger clientele by using the automated risk management features and thus increase volumes. Investors get comprehensive and updated information necessary to trade, along with a single-click convenience to fulfil their  obligations. The initial offering of DotEx is DotEx Plaza where multiple market participants such as members of NSE, depository participants and banks can offe offerr web-b web-base ased d servi service ces s to thei theirr cust custom omers ers.. As a neut neutral ral aggre aggregat gator or and and infrastructure provider, DotEx offers choice and convenience to investors. DotEx was a joint venture between i-flex Solutions Ltd. and NSE.IT Ltd. Recently NSE has taken over the shareholding and management of DotEx. DotEx products may be classified under the following broad categories:

•

Equity Trading Module

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F&O Trading Module. 34

NSE Technology Across Across the globe, globe, develo developmen pments ts in inform informati ation, on, commun communica icatio tion n and network network technologies have created paradigm shifts in the securities market operations. Technol Technology ogy has enable enabled d organis organisati ations ons to build build new sources sources of compet competiti itive ve advantage, bring about innovations in products and services, and to provide for  new business opportunities. Stock exchanges all over the world have realised the potential of IT and have moved over to electronic trading systems, which are cheaper, have wider reach and provide a better mechanism for trade and post trade execution. NSE believes that technology will continue to provide the necessary impetus for  the the organ organis isat atio ion n to reta retain in its its comp compet etit itiv ive e edge edge and and ensur ensure e time timelilines ness s and and satisfaction in customer service. In recognition of the fact that technology will conti continu nue e to rede redefi fine ne the the shap shape e of the the secur securit itie ies s indus industr try, y, NSE NSE stres stresses ses on inno innova vati tion on and and sust sustai aine ned d inve invest stme ment nt in tech techno nolo logy gy to rema remain in ahea ahead d of  competition. NSE's IT set-up is the largest by any company in India. It uses satellite communication technology to energise participation from around 400 cities spread all over the country. In the recent past, capacity enhancement measures were taken up in regard to the trading systems so as to effectively meet the requirements of increased users and associated trading loads. With upgradation of trading hardware, NSE can handle up to 1 million trades per day. NSE has also put in place NIBIS NIBIS (NSE's Internet Internet Based Information Information System) for  on-line real-time dissemination of trading information over the internet. In order to 35

capitalise on in-house expertise in technology, NSE set up a separate company, NSE.IT, in October 1999. This is expected to provide a platform for taking up new IT assignments both within and outside India and attaining global exposure. NEAT is a state-of-the-art client server based application. At the server end, all trading information is stored in an in-memory database to achieve minimum response time and maximum system availability for users. The trading server  software runs on a fault tolerant STRATUS main frame computer while the client software runs under Windows on PCs. The telecommunications network uses X.25 protocol and is the backbone of the automated trading system. Each trading member trades on the NSE with other  members through a PC located in the trading member's office, anywhere in India. The trading members on the Wholesale Debt Market segment are linked to the central computer at the NSE through dedicated 64Kbps leased lines and VSAT terminals. These leased lines are multiplexed using dedicated 2 Mbps, opticalfibre links. The WDM participants connect to the trading system through dial-up links.

The Exchange uses powerful RISC -based UNIX servers, procured from Digital and HP for for the the back back offi office ce proce process ssin ing. g. The The late latest st softw software are plat platfo forms rms like like ORACLE 7 RDBMS, GUPTA - SQL/ORACLE FORMS 4.5 Front - Ends, etc. have been used for the Exchange applications. The Exchange currently manages its data data cent centre re opera operati tions ons,, syst system em and and data databa base se admin adminis istr trat ation ion,, desi design gn and and

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deve develo lopm pmen entt

of in-h in-hou ouse se syst system ems s

and and

desi design gn and and

impl mplemen ementtatio ation n

of 

telecommunication solutions. NSE is one of the largest interactive interactive VSAT based stock exchanges in the world. Today it supports more than 3000 VSATs and is expected to grow to more than 4000 VSATs in the next year. The NSE- network is the largest private private wide area network in the country and the first extended C- Band VSAT network in the world. Curre Current ntly ly more more than than 9000 9000 users users are tradi trading ng on the the real real time time-o -onl nlin ine e NSE NSE application. There are over 15 large computer systems which include non-stop fault-toler fault-tolerant ant computers and high end UNIX servers, operational operational under one roof  to support the NSE applications. This coupled with the nation wide VSAT network makes

NSE

the

country's

largest

Information

Technology

user.

In an ongoing effort to improve NSE's infrastructure, a corporate network has been implemented, connecting all the offices at Mumbai, Delhi, Calcutta and Chennai. Chennai. This corporate corporate network network enables speedy inter-office inter-office communications communications and data and voice connectivity between offices. In keeping with the current trend, NSE has gone online on the Internet. Apart from having a 2mbps link to VSNL and our own domain for internal browsing and e-mail purposes, we have also set up our own Web site. Currently, NSE is displaying its live stock quotes on the web site (www.nseindia.com) which are updated online.

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Equities NSE NSE star starte ted d trad tradin ing g in the the equi equiti ties es segm segment ent (Capi (Capita tall Mark Market et segme segment nt)) on Novem November ber 3, 1994 1994 and and with within in a shor shortt span span of 1 year year becam became e the the large largest st exchange in India in terms of volumes transacted. Trading volumes in the equity segment have grown rapidly with average daily turnover increasing increasing from Rs.17 crores during 1994-95 to Rs.4,328 crores during 2003-04. During the year  2003-04, 2003-04, NSE reported a turnover of Rs.1,099,535 crores in the equities segment accounting for 68.60% of the total Indian securities market. The Equities section provides you with an insight into the equities segment of  NSE and also provides real-time real-time quotes and statistics statistics of the equities market. Indepth information regarding listing of securities, trading systems & processes, clearing and settlement, risk management, trading statistics etc are available here.

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LISTING Listing means admission of securities of an issuer to trading privileges on a stock exchange through a formal agreement. The prime objective of admission to dealings on the Exchange is to provide liquidity and marketability to securities, as also to provide a mechanism for effective management of trading. List Listin ing g on NSE NSE provi provides des qual qualif ifyi ying ng comp compan anies ies with with the the broad broadest est access access to investors, the greatest market depth and liquidity, cost-effective access to capital, the highest highest visibi visibilit lity, y, the fairest fairest pricin pricing, g, and invest investor or benefi benefits. ts. NSE tradin trading g terminals are now situated in various cities and towns across the length and breath of India.

Securities listed on the Exchange are required to fulfill the eligibility criteria for  listing. Various types of  securities of a company are traded under a unique symbol and different series. series. NSE plays an importa important nt role role in helping helping an Indian Indian companies companies access access equity equity capital, by providing a liquid and well-regulated market. NSE has about 800 companies listed representing the length, breadth and diversity of the Indian economy which includes from hi-tech to heavy industry, software, refinery, public sector sector units, units, infrast infrastruct ructure, ure, and financi financial al service services. s. Listin Listing g on NSE raises raises a company’s profile among investors in India and abroad. Trade data is distributed worldwide through various news-vending agencies.

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More importantly, each and every NSE listed company is required to satisfy stringent financial, public distribution and management requirements. High listing standards foster investor confidence and also bring credibility into the markets.

NSE lists securities in its Capital Market (Equities) segment and its Wholesale Debt Market segment

LISTING PROCEDURE An Issuer has to take various steps prior to making an application for listing its securities on the NSE. These steps are essential to ensure the compliance of  certain requirements by the Issuer before listing its securities on the NSE. The various steps to be taken include:

1. Initial Discussions 2. Approval of Memorandum and Articles of Association 3. Approval of draft prospectus 4. Submission of Application 5. Listing conditions and requirements

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LISTING PROCEDURE

Initial Discussions Authorised persons of the concerned Issuer should hold discussions with NSE personnel regarding various requirements to be fulfilled by the Issuer for listing its securities. The discussions should particularly cover the qualifications of the Issuer which are required for an Issuer to be admitted admitted for listing on the NSE and to understand all the conditions that are precedent to listing on the NSE. The proposed Memorandum & Articles of Association and the draft prospectus may be presented to the NSE for examination before finalising them.

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LISTING PROCEDURE

Approval of Memorandum and Articles of Association Rule 19(2) (a) of the Securities Securities Contracts Contracts (Regulation) Rules, 1957 requires that the Articles of Association of the Issuer wanting to list its securities must contain provisions as given hereunder.

The Articles of Association of an Issuer shall contain the following provisions namely: a. that that there shall be no forfei forfeitur ture e of unclai unclaimed med divide dividends nds before before the claim becomes barred by law; b. that that a common common form form of transf transfer er shall shall be used; used; c. that that fully fully paid paid share shares s shall shall be free free from all lien lien and that that in the the case case of  partly paid shares the Issuer's lien shall be restricted to moneys called or  payable at a fixed time in respect of such shares; d. that that regist registrat ratio ion n of transf transfer er shall shall not not be refuse refused d on the grou ground nd of the transferor being either alone or jointly with any other person or persons indebted to the Issuer on any account whatsoever;

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e. that that any amou amount nt paid paid up in adva advanc nce e of calls calls on any any shar share e may may carr carry y interest but shall not in respect thereof confer a right to dividend or to participate in profits; f. that option option or right right to call of of shares shares shall shall not be given given to any person person except except with the sanction of the Issuer in general meetings. g. permission permission for Sub-Divi Sub-Division/ sion/Consoli Consolidation dation of of Share Certif Certificate. icate. Note: The Relevant Authority may take exception to any provision contained in the Articles of Association of an Issuer which may be deemed undesirable or  unreasonable in the case of a public company and may require inclusion of  specific provisions deemed to be desirable and necessary.

If the Issuer's Articles of Association is not in conformity with the provisions as stated above, the Issuer has to make amendments to the Articles of Association. However, the securities of an Issuer may be admitted for listing on the NSE on an undertaking by the Issuer that the amendments necessary in the Articles of  Association to bring Articles of Association in conformity with Rule 19(2)(a) of the Securities Contract (Regulation) Rules, 1957 shall be made in the next annual general meeting and in the meantime the Issuer shall act strictly in accordance with prevalent provisions of Securities Contract (Regulation) Act, 1957 and other  statutes.

It is to be noted that any provision in the Articles of Association, which is not in tune with sound corporate practice, has to be removed by amending amending the Articles Articles of Association. 43

Listing Procedure

Approval of draft prospectus The Issuer shall file the draft prospectus and application forms with NSE. In case NSE NSE is not not the the Regi Region onal al Stoc Stock k Exch Exchan ange ge then then the the draf draftt pros prospe pect ctus us and and application forms have to be filed simultaneously with the NSE when the same is filed with the Regional Stock Exchange pertaining to the issue, for the perusal of  NSE. The draft prospectus should have been prepared in accordance with the statutes, notifications, circulars, guidelines, etc. governing preparation and issue of prospectus prevailing at the relevant time. The Issuers may particularly bear in mind the provisions of Companies Act, Securities Contracts (Regulation) Act, the SEBI Act and the relevant subordinate legislations thereto. NSE will peruse the draft draft prosp prospect ectus us only only from from the the poin pointt of view view of chec checki king ng whet whethe herr the the draf draftt prospectus is in accordance with the listing requirements, and therefore any approval given by NSE in respect of the draft prospectus should not be construed as approval under any laws, rules, notifications, circulars, guidelines etc. The Issuers shall file a copy of the draft prospectus given by the respective respective Regional Stoc Stock k Exch Exchan ange ge with ith NSE. NSE. The The Issu ssuer sho should uld also also subm submit it the the SEBI SEBI

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acknowledgment card or letter indicating observations on draft prospectus or  letter of offer by SEBI

Listing Procedure

Submission of Application

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For Issuers listing on NSE for the first time

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Listing of further Issues by Issuers already listed on NSE

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Listing Fees

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Security deposit (for new & fresh issues and when NSE is the Regional Stock Exchange)

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Supporting documents

Listing Procedure

Submission of Application (For Issuers listing on NSE for the first time) Issuers desiring to list existing/new securities on the NSE shall make application for admission of their securities to dealings on the NSE in the forms prescribed in

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this regard as per details given hereunder or in such other form or forms as the Relevant Authority may from time to time prescribe in addition thereto or in modification or substitution thereof. Appendix 'A' - Clauses of Articles of Association. Appendix 'B'- Application Letter for Listing. Appendix 'C-1' - Listing Application providing pre-issue details of securities. Appendix 'C-2' - Listing Application providing post-issue details of securities. Appendix 'D'- Checklist for supporting documents ( as applicable to the issuer) Appendix 'E' - Schedule of Distribution Appendix 'F'- Listing Agreement

Listing Procedure

Submission of Application (Listing of further Issues by Issuers already listed on NSE) Issuers whose securities are already listed on the NSE shall apply for admission to listing on the NSE of any further issue of securities made by them. The application application for admission shall be made in the forms prescribed prescribed in this regard or  in such other form or forms as the Relevant Authority may from time to time prescribe in addition thereto or in modification or substitution thereof. Appendix 'E' - Schedule of Distribution Appendix 'G'- Application Letter for Listing of further issues. 46

Appendix 'H' - Listing Application providing details of securities. Appendix 'I' - Checklist for supporting documents submitted (as applicable)

Listing Fees The listing fees depend on the paid up share capital of your Company:

Particulars

Amount (Rs.)

Initial Listing Fees

7,500 Annual Listing Fees

Companies with paid up share and/or debenture capital: Of Rs.1 crore

4,200

Above Rs.1 crore and up to Rs.5 crores

8,400

Above Rs.5 crores and up to Rs.10 crores

14,000

Above Rs.10 crores and up to Rs.20 crores

28,000

Above Rs.20 crores and up to Rs.50 crores

42,000

Above Rs.50 crores

70,000

Companies which have a paid up capital of more than Rs. 50 crores will pay additional listing fees of Rs. 1400 for every increase of Rs. 5 crores or part thereof in the paid up share/debenture capital.

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Kindly draw your Cheques/Demand Drafts favouring National Stock Exchange of  India Limited, payable in Mumbai.

Listing Procedure

Submission of Application (Security Deposit) (Payable only for new and fresh issues and only when NSE is the Regional Stock Exchange)

The Relevant Authority shall not grant admission to dealings of securities of an Issuer which is not listed or of any new (original or further) issue of securities of  an Issuer excepting Mutual Funds, which is listed on the NSE unless the Issuer  deposits and keeps deposited with the NSE (in cases where the securities are offered for subscription, whether through the issue of a prospectus, letter of offer  or otherwise, and NSE is the Regional Stock Exchange for the Issuer) an amount calculated at 1% of the amount of securities offered for subscription to the public and or to the holders of existing securities of the Issuer, as the case may be for  ensuring compliance by the Issuer within the prescribed or stipulated period of all requirements and conditions hereinafter mentioned and shall be refundable or  forfeitable in the manner hereinafter stated: 1. The Issuer shall shall comply comply with all prevaili prevailing ng requirements requirements of law includi including ng all requirements of and under any notifications, directives and guidelines issued by the Central Government, SEBI or any statutory body or local

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authority or any body or authority acting under the authority or direction of  the the Cent Centra rall Gove Govern rnme ment nt and and all all preva prevaililin ing g list listin ing g requir requirem emen ents ts and and conditions of the NSE and of each recognized Stock Exchange where the Issue Issuerr has appli applied ed for for permi permiss ssio ion n for for admis admissi sion on to deali dealing ngs s of the the securities, within the prescribed or stipulated period; 2. If the the Issu Issuer er has has comp complilied ed with with all all the the afor afores esai aid d requ requir irem emen ents ts and and conditions including, wherever applicable, its obligation under Section 73 (or any statutory modification or re-enactment thereof) of the Companies Act, Act, 1956 and obligat obligation ions s arisin arising g theref therefrom rom,, within within the prescrib prescribed ed or  stipulated period, and on obtaining a No Objection Certificate from SEBI and submitting it to NSE , NSE shall refund to the Issuer the said deposit without interest within fifteen days from the expiry of the prescribed or  stipulated period; 3. If on expiry expiry of the prescribe prescribed d or stipul stipulate ated d period period or the extend extended ed period period referred to hereafter, the Issuer has not complied with all the aforesaid requirements and conditions, the said deposit shall be forfeited by the NSE, at its discretion, and thereupon the same shall vest in the NSE. Provided the forfeiture shall not release the Issuer of its obligation to comply with the aforesaid requirements and conditions; 4. If the Issuer is unabl able to com complete ete compliance nce of the afore oresaid requirements and conditions within the prescribed or stipulated period, the NSE, at its discretion and if the Issuer has shown sufficient cause, but without prejudice to the obligations of the Issuer under the laws in force to 49

comply with any such requirements and conditions within the prescribed or  stipulated period, may not forfeit the said deposit but may allow such further time to the Issuer as the NSE may deem fit; provided that 1. the Issuer Issuer has has at least ten ten days prior prior to expiry expiry of the the prescrib prescribed ed or  stipulated period applied in writing for extension of time to the NSE stating the reasons for non-compliance, and 2. the Issuer, Issuer, having having been been allowed allowed further further time by the NSE, NSE, has before expiry of the prescribed or stipulated period, published in a manner  requi required red by the the NSE, NSE, the the fact fact of such such exten extensi sion on havi having ng been been allow allowed ed;; prov provide ided d furt further her that that wher where e the the NSE NSE has has not not allo allowe wed d extension in writing before expiry of the prescribed or stipulated period, the request for extension shall be deemed to have been refused; provided also that any such extension shall not release the Issuer of its obligations to comply with the aforesaid requirements and conditions. b. 50% of the the above mention mentioned ed security security deposit deposit should should be paid to to the NSE in cash. The balance amount can be provided by way of a bank guarantee, in the format prescribed by or acceptable to NSE. The amount to be paid in cash is limited to Rs.3 crores.

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LISTING PROCEDURE

Submission of Application (Supporting Documents) Issuers applying for admission of their securities to dealings on the NSE shall submit to the NSE the following:

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Documents and Information

The documents and information prescribed in Appendix D or Appendix I (as the case may be) to this Regulation or such other documents and information as the Relevant Authority may from time to time prescribe, in addition thereto or in modification or substitution thereof together with any other documents and information which the Relevant Authority may require in any particular  case;

•

Distribution Schedules

Distribution Schedules duly completed in respect of each class and kind of  secur securit ity y in the the form form presc prescri ribed bed in Appen Appendi dix x E (Tabl (Table e I, II & III) III) to this this Regulation or in such other form or forms as the Relevant Authority may from time to time prescribe in addition thereto or in modification or substitution thereof.

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Listing Procedure

Listing conditions and requirements All Issuers whose securities are listed on the NSE shall comply with the listing conditions and requirements contained in the Listing Agreement Form appearing in Appendix F to this Regulation or such other conditions and requirements as the Relevant Authority may from time to time prescribe in addition thereto or in modification or substitution thereof. After fulfilling these criteria, a company has to send the following information for  further processing:

1. A brief note on the promoters and an d management. 2. Company profile. 3. Copies of the Annual Report for last 3 years. 4. Copies of the Draft Offer Document. 5. Memorandum & Articles of Association.

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ELIGIBILITY CRITERIA FOR LISTING

An applicant who desires listing of its securities with NSE must fulfill the following pre-requisites:

A. For Initia Initiall Public Public Offerings Offerings (IPOs) (IPOs) B. For Securiti Securities es of of Existi Existing ng Compani Companies es

NSE staff welcome the opportunity to discuss a company’s eligibility to list before a formal application is made. On fulfillment of the eligibility criteria, the company is required to fill in the listing application form.

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ELIGIBILITY CRITERIA FOR LISTING

IPOs by Companies Qualifications for listing Initial Public Offerings (IPO) are as below:

1. Paid Paid up Capi Capita tall

The paid up equity capital of the applicant shall not be less than Rs. 10 crores * and the capitalisatio capitalisation n of the applicant’s applicant’s equity shall not be less than Rs. 25 crores** 

In respect of the requirement of paid-up capital and market capitalisation, the issuers shall be required to include, in the disclaimer clause forming a part of  the offer document that in the event of the market capitalisation (Product of  issu issue e pric price e and and the the post post issu issue e numb number er of shar shares es)) requ requir irem emen entt of the the Exchange not being met, the securities of the issuer would not be listed on the Exchange. * For this purpose, the post issue paid up equity capital for which listing is sought shall be taken into account. **For this purpose, capitalisation will be the product of the issue price and the post issue number of equity shares.

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2. Condit Condition ions s Preceden Precedentt to Listing: Listing: The Issuer shall have adhered to conditions conditions precedent to listing as emerging emerging from inter-alia from Securities Securities Contracts (Regulations) (Regulations) Act 1956, Companies Act 1956, Securities and Exchange Board of India Act 1992, any rules and/or  regu regullatio ations ns fram framed ed unde underr

foreg oregoi oing ng stat statut utes es,,

as also lso

any any circ circul ular ar,,

clarifications, guidelines issued by the appropriate authority under foregoing statutes.

3. At least least three three years years track track record record of of either: either: a. The applicant seeking listing; or  b. The promoters*/promoting company, incorporated in or outside India For this purpose, the applicant or the promoting company shall submit annual repo report rts s of thre three e prec preced edin ing g fina financ ncia iall year years s to NSE NSE and and also also prov provid ide e a certificate to the Exchange in respect of the following: • The Company has not been referred to the Board for Industrial and Financial Reconstruction (BIFR). • The networth of the company has not been wiped out by the accumulated losses resulting in a negative networth. • The company has not received any winding up petition accepted by a court.

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* Promoters’ mean one or more persons with minimum 3 years of experience of each of them in the same sa me line of business and shall be holding at least 20% of the post issue equity share capital individually or severally 4. The Project Project// Activity Activity plan plan of the applica applicant nt must have have been appraised appraised by a financial institution u/s 4 A of the Companies Act, 1956 or a state finance corpor corporat atio ion n or a sched schedul uled ed comme commerc rcia iall bank bank with with a paid paid up capit capital al exceeding exceeding Rs.50 crores or a category I Merchant Banker with a net worth of atleast Rs.10 crores or a venture capital fund with a net worth of atleast Rs. 50 crores. or  The applicant should have working capital arrangements with a bank having a Networth of not less than Rs.50 crores. “Provided that this Clause 4 shall not be applicable for listing of: a) Equity shares and securities convertible into equity issued by 1. a banking banking company company includ including ing a local area area bank (i.e. (i.e. Private Private Sector  Sector  Banks) set up under sub-clause (c) of Section 5 of the Banking Regula Regulatio tion n Act, Act, 1949 1949 and which has received received license license from the Reserve Bank of India or  2. a corre corresp spon ondi ding ng new bank bank set up under under the the Bank Banking ing Compan Companie ies s (Acqui (Acquisit sition ion and Transf Transfer er of Undert Undertakin akings) gs) Act, Act, 1970, 1970, Bankin Banking g Companies (Acquisition and Transfer of Undertakings) Act, 1980,

56

Stat State e Bank Bank of Indi India a Act Act, 1955 955 and and the Stat State e Bank Bank of Indi India a (Subsidiary Banks) Act, 1959 (i.e. Public Sector Banks) or  3. an infrast infrastruct ructure ure company company – (a) whose whose project project has been apprais appraised ed by a Public Public Financ Financial ial Instit Instituti ution on or Infrast Infrastruct ructure ure Develo Developme pment nt Finance Corporation (IDFC) or Infrastructure Leasing and Financial Services Limited (IL&FS) and (b) not less than 5% of the project cost is financed by any of the institutions referred to in clause (a) above, jointly or severally, irrespective of whether they appraise the proj projec ectt or not, not, by way way of loan loan or subs subscr crip ipti tion on to equi equity ty or a combination of both. b) Securities other than equity shares or securities convertible into equity shares shares at a later later date date issued issued by Governm Government ent Companies Companies,, Public Public Sector  Unde Undert rtak akin ings gs,,

Fina Financ ncia iall

Inst Instit itut utio ions ns,,

Nati Nation onal alis ised ed

Bank Banks, s,

Stat Statut utor ory y

Corporations, Banking Companies and subsidiaries of Scheduled Commercial Banks.” 5) The applicant desirous of listing its securities should satisfy the exchange on the following:



No disci discipl plin inary ary actio action n by other other stoc stock k exch exchan ange ges s and and

regulatory authorities in past three years

The The

appl applic ican ant, t,

prom promot oter ers’ s’/p /pro romo moti ting ng

comp compan any( y(ie ies) s),,

grou group p

comp compan anies ies,, compan companie ies s promo promote ted d by the the promo promote ters rs/p /pro romo moti ting ng company(ies) company(ies) have not been in default in payment of listing fees to 57

any stock exchange in the last three years or has not been delisted or suspended in the past, and has not been proceeded against by SEBI SEBI or other other regulat regulatory ory authori authoritie ties s in connect connection ion with with invest investor  or  related issues or otherwise.



Redressal mechanism of Investor grievance

The points of consideration are:



The The

appl applic ican ant, t,

prom promot oter ers’ s’/p /pro romo moti ting ng

comp compan any( y(ie ies) s),,

grou group p

compani companies, es, compani companies es promote promoted d by the promote promoters’ rs’/pr /promot omoting ing company(ies) track record in redressal of investor grievances 

The applicant’s arrangements envisaged are in place for servicing its investor.



The The

appl applic ican ant, t,

prom promot oter ers’ s’/p /pro romo moti ting ng

comp compan any( y(ie ies) s),,

grou group p

compani companies, es, compani companies es promote promoted d by the promote promoters/ rs/pro promot moting ing company(ies) general approach and philosophy to the issue of  investor service and protection 

defaults in respect of payment of interest and/or principal to the deb debent enture/ ure/bo bond nd//fixed ixed prom promot oter ers’ s’//prom promot otiing

dep deposit osit

hold olders ers

comp compan any( y(iies), es),

by grou group p

the the

appl applic ican ant, t, comp compan anie ies, s,

companies promoted by the promoters’/promoting company(ies) shall also be considered while evaluating a company’s application for listing. The auditor’s certificate shall also be obtained in this regard. In case of defaults defaults in such payments the securities securities of the 58

applicant company may not be listed till such time it has cleared all pending obligations relating to the payment of interest and/or  principal.



Distribution of shareholding

The applicant’s/promoting company(ies) shareholding pattern on Marc March h 31 of last last thre three e cale calend ndar ar year years s sepa separa rate tely ly show showin ing g promoters and other groups’ shareholding pattern should be as per the regulatory requirements.



The The

Details of Litigation

appl applic ican ant, t,

prom promot oter ers’ s’/p /pro romo moti ting ng

comp compan any( y(ie ies) s),,

grou group p

compani companies, es, compani companies es promote promoted d by the promote promoters/ rs/pro promot moting ing company(ies) litigation record, the nature of litigation, status of  liti litigat gation ion durin during g the the prec preced eding ing thre three e years years perio period d need need to be clarified to the exchange.

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Track Record of Director(s) of the Company

In respect of the track record of the directors, relevant disclosures may be insisted upon in the offer document regarding the status of crim crimin inal al case cases s file filed d or natu nature re of the the inve invest stig igat atio ion n bein being g undertaken with regard to alleged commission of any offence by any of its directors and its effect on the business of the company, 59

where all or any of the directors of issuer have or has been charge-sheeted with serious crimes.

Note:

In case a company approaches the Exchange for listing within six months of an IPO, the securities may be considered as eligible for  listing if they were otherwise eligible for listing at the time of the IPO. If  the company approaches the Exchange for listing after six months of  an IPO, the norms for existing listed companies may be applied and market capitalisation be computed based on the period from the IPO to the time of listing.

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ELIGIBILITY CRITERIA FOR LISTING

Securities of Existing Companies Existing Companies listed on other stock exchanges

1. Paid up up Capital Capital & Mark Market et Capital Capitalisat isation ion

1. The paid-up paid-up equity equity capital capital of the the applicant applicant shall shall not be be less than than Rs. 10 crores * and the market capitalisation of the applicant’s equity shall not be less than Rs. 25 crores** Provided that the requirement of Rs. 25 crores market capitalisation under this clause 1(a) shall not be applicable to listing of securities issu issued ed by Gove Governm rnment ent Comp Compan anie ies, s, Publ Public ic Secto Sectorr Unde Undert rtaki aking ngs, s, Financial Financial Institution Institutions, s, Nationalised Nationalised Banks, Statutory Corporations Corporations and Banking Companies who are otherwise bound to adhere to all the relevant statutes, guidelines, circulars, clarifications etc. that may be issued by various regulatory authorities from time to time. or  2. The paid-up paid-up equity equity capital capital of the the applicant applicant shall shall not be be less than than Rs. 25 crores * (In case the market capitalisation is less than Rs. 25 crores, the securities of the company should be traded for at least 25% of the trading days during the last twelve months preceding

61

the date of submission of application by the company on at least one of the stock exchanges where it is traded.) or  3. The market market capital capitalisat isation ion of the applica applicant’ nt’s s equity equity shall not be less than Rs. 50 crores. ** * Explanation 1 For this purpose the existing paid up equity capital as well as the paid up equity capital after the proposed issue for which listing is sought shall be taken into account. ** Explanation 2 The market capitalisation shall be calculated by using a 12 month moving average of the market capitalisation over a period of six months immediately preceding the date of application. For the purpo purpose se of calc calcul ulat atin ing g the the mark market et capi capita talilisa sati tion on over over a 12 mont month h period, the average of the weekly high and low of the closing closing prices of  the shares as quoted on the National Stock Exchange during the last twelve months and if the shares are not traded on the National Stock Exch Exchan ange ge such such aver averag age e pric price e on any any of the the reco recogn gnis ised ed Stoc Stock k Exchanges where those shares are frequently traded shall be taken into into account account while while determ determini ining ng market market capita capitalis lisati ation on after after making making necessary adjustments for Corporate Action such as Rights / Bonus Issue.

62

b. Conditions Conditions precedent precedent to to Listing: Listing: The The appli applican cantt shal shalll have have adhe adhered red to condit conditio ions ns prec precede edent nt to list listin ing g as emerg emergin ing g from from interinter-al alia ia,, Secu Securi riti ties es Cont Contra ract cts s (Regu (Regula lati tions ons)) Act Act 1956, 1956, Companies Companies Act 1956, Securities Securities and Exchange Board of India Act 1992, any rules and/or regulations framed under foregoing statutes, as also any circular, clarifications, guidelines issued by the appropriate authority under foregoing statutes.

c. Atleast three years track track record record of of either: either: a. the appl applica icant nt seeki seeking ng listi listing; ng; or  or  b. the promoters’*/promoting company, incorporated in or o r outside India For this purpose, the applicant or the promoting company shall submit annual repo report rts s of thre three e prec preced edin ing g fina financ ncia iall year years s to NSE NSE and and also also prov provid ide e a certificate to the Exchange in respect of the following: 1. The company company has has not been referre referred d to the Board for Indust Industria riall and Financial Reconstruction (BIFR). 2. The The netw networ orth th of the the compa ompany ny has has not been been wipe wiped d out out by the accumulated losses resulting in a negative networth. 3. The company company has not received received any any winding winding up petitio petition n accepted accepted by a court

63

* Prom Promot oter ers’ s’ mean mean one one or more more pers person ons s with with mini minimu mum m 3 year years s of  experience of each of them in the same line of business and shall be holding at least 20% of the post issue equity share capital individually or  severally.

o

The applicant should have been listed on any other recognised

stock exchange for atleast last three years or  The project/activity plan must have been appraised by a financial institution u/s 4A of the Companies Act, 1956, or a state finance corporation, or a scheduled commercial bank with a paid up capital exceeding Rs. 50 crores, or  a category I Merchant Banker with a net worth of atleast Rs.10 crores or a venture capital fund with a net worth of atleast Rs. 50 crores or  The applicant should have working capital arrangements with a bank having a networth of at least Rs.50 crores.

o

The applicant has paid dividend in atleast 2 out of the last 3

financial years immediately preceding the year in which listing application has

been

made

or  The applicant has distributable profits in at least two out of the last three financial years (an auditors certificate must be provided in this regard). 64

or  The networth of the applicant is atleast Rs. 50 crores*** While While consider considering ing the profit profitabi abilit lity y / abilit ability y to distri distribut bute e divide dividend, nd, the non recurri recurring ng income income/ex /extra traord ordinar inary y income income shall shall be excluded excluded from from the total total income. Further in case of companies where networth criteria is satisfied on account of shares being issued at a premium for consideration other than cash, such cases be referred to the Listing Advisory Committee (LAC). *** *** Netw Networ orth th mean means: s: Paid Paid up equi equity ty capi capita tall plus plus Rese Reserv rves es excl exclud udin ing g revaluat revaluation ion reserve reserve minus minus Miscel Miscellan laneou eous s Expense Expenses s not writte written n off minus minus balance in profit and loss account to the extent not set off  "Provided that Clause 4 and Clause 5 shall not be applicable for listing of:

a) Equi Equity ty shar shares es and and secu securi ritties conv conver erttible ible int into equi equitty issu issued ed by

i. a banking company including a local area bank (i.e. Private Sector Banks) set up under sub-clause (c) of Section 5 of the Banking Regulation Act, 1949 and and whic which h has has rece receiv ived ed lice licens nse e from from the the Rese Reserv rve e Bank Bank of Indi India a or 

ii. ii. a corr corres espo pond ndin ing g new new bank bank set set up unde underr the the Bank Bankin ing g Comp Compan anie ies s (Acquisition and Transfer of Undertakings) Act, 1970, Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980, State Bank of India Act, 1955 and the State Bank of India (Subsidiary Banks) Act, 1959 (i.e. Public Sector Banks) 65

Or  iii. an infrastructure company – (a) whose project has been appraised by a Public Financial Institution or Infrastructure Development Finance Corporation (IDFC) or Infrastruct Infrastructure ure Leasing Leasing and Financial Financial Services Limited (IL&FS) and (b) not less than 5% of the project cost is financed by any of the institutions referred to in clause (a) above, jointly or severally, irrespective of whether  they appraise the project or not, by way of loan or subscription to equity or a combination of both. b) Securities other than equity shares or securities convertible into equity shares shares at a later later date date issued issued by Governm Government ent Companies Companies,, Public Public Sector  Unde Undert rtak akin ings gs,,

Fina Financ ncia iall

Inst Instit itut utio ions ns,,

Nati Nation onal alis ised ed

Bank Banks, s,

Stat Statut utor ory y

Corporations, Banking Companies and subsidiaries of Scheduled Commercial Banks."

66

THE APPLIC APPLICANT ANT DESIRO DESIROUS US OF LISTIN LISTING G ITS SECURI SECURITIE TIES S SHOULD SHOULD ALSO SATISFY THE EXCHANGE ON THE FOLLOWING:

No Disc Discip ipli lina nary ry acti actio on has has been been take taken n by othe otherr stock tock

1.

exch exchan ange ges s and and regu regula lato tory ry auth author orit itie ies s in the the past past thre three e year years s

The applica applicant, nt, promot promoters/ ers/prom promoti oting ng company company(ie (ies), s), group group compan companies, ies, companies promoted by the promoters/promoting company(ies) have not been in default in payment of listing fees to any stock exchange in the last three years or has not been delisted or suspended in the past and has not been been proc procee eede ded d agai agains nstt by SEBI SEBI or othe otherr regu regula lato tory ry auth author orit itie ies s in connection with investor related issues or otherwise. 2. Redress Redressal al mechan mechanism ism of Invest Investor or grievan grievance ce

The points of consideration are:



The applic applicant ant,, promot promoters/ ers/prom promoti oting ng company company(ie (ies), s), group group

compa compani nies es,, compan companie ies s promo promote ted d

by the the promo promote ters rs/p /pro romo moti ting ng

company(ies) track record in redressal of investor grievances 

The applic applicant ant’s ’s arrangem arrangement ents s envisa envisaged ged are in place place for 

servicing its investor  

The applic applicant ant,, promot promoters’ ers’/pr /promo omotin ting g company company(ies (ies), ), group group

compa compani nies es,, compan companie ies s promo promote ted d

67

by the the promo promote ters rs/p /pro romo moti ting ng

compa company ny(ie (ies) s) gener general al appro approac ach h and and phil philoso osophy phy to the the issue issue of  investor service and protection 

the the

defaults in respect of payment of interest and/or principal to debe debent ntur ure/ e/bo bond nd/f /fix ixed ed

depo deposi sitt

hold holder ers s

by

the the

appl applic ican ant, t,

promoters/prom promoters/promoting oting company(ies), company(ies), group companies, companies, companies companies promote promoted d by the promote promoters/ rs/prom promoti oting ng company company(ie (ies) s) shall shall also also be considered while evaluating a company’s application for listing. The auditor’s certificate shall also be obtained in this regard. In case of  defaults in such payments, the securities of the applicant company may not be listed till such time it has cleared all pending obligations relating to the payment of interest and/or principal.

3. Distribu Distribution tion of shareh sharehold olding ing

The applicant company/promoting company(ies) shareholding pattern on March 31 of preceding three years separately showing promoters and other groups’ shareholding pattern should be as per the regulatory requirements.

4. Deta Details ils of Litig Litigati ation on

The applicant, promoters/promoting company(ies), group companies, compa companie nies s prom promot oted ed by the the promo promote ters rs/p /prom romot otin ing g compan company(i y(ies es))

68

litigation record, the nature of litigation, status of litigation during the preceding three years need to be clarified to the exchange.

5. Track Track Record Record of of Directo Director(s) r(s) of of the Compan Company y

In respect of the track record of the directors, relevant disclosures may be insisted upon in the offer document regarding the status of criminal cases filed or nature of the investigati investigation on being undertaken undertaken with regard to alleged commission of any offence by any of its directors and its effect on the business of the company, where all or any of the directors of issuer have or has been charge-sheeted with serious crimes.

6. Chan Change ge in Cont Contro roll of a Compa Company ny/U /Util tilis isati ation on of fund funds s raise raised d from public

In the event of new promoters taking over listed companies which results in change in management and/or companies utilising the funds rais raised ed thro throug ugh h publ public ic issu issue e for for the the purp purpos oses es othe otherr than than thos those e ment mentio ione ned d in the the offe offerr docu docume ment nt,, such such comp compan anie ies s shal shalll make make additional disclosures (as required by the Exchange) with regard to change in control of a company and utilisation of funds raised from public.

69

NOTE:

Where Where an unli unlist sted ed comp compan any y merge merges s with with a comp compan any y list listed ed on other other stoc stock k exchanges and the merged entity seeks listing on the NSE, the Exchange may grant listing to the merged entity only if the listed company (prior to the merger  with the unlisted company) meets all the criteria for listing on its own account or  the unlisted company meets the requirements for listing on the Exchange, except for the market capitalisation condition, on its own account. In case either of the above conditions are not met then such company may be considered for listing after a minimum period of 18 months or more or after the publication of two annual reports whichever is later, provided it satisfies the criteria at that point of  time.

70

BOMBAY STOCK EXCHANGE

71

ABOUT BSE

Bombay Stock Exchange Limited is the oldest stock exchange in Asia with a rich heritage. Popularly known as "BSE", it was established as "The Native Share & Stock Brokers Association" in 1875. It is the first stock exchange in the country to obtain permanent recognition in 1956 from the Government of India under the Securit Securities ies Contra Contracts cts (Regulat (Regulation ion)) Act, Act, 1956.Th 1956.The e Exchang Exchange's e's pivota pivotall and preeminent role in the development of the Indian capital market is widely recognized and its index, SENSEX , is tracked worldwide. Earlier an Association of Persons (AOP), the Exchange is now a demutualised and corporatised entity incorporated und under the

prov proviisions ons

of the

Compani anies Act, 1956, pursua rsuan nt to

the

BSE(C BSE(Cor orpo porat ratis isat atio ion n and and Demut Demutual ualis isat atio ion) n) Schem Scheme, e, 2005 2005 notif notifie ied d by the the Securities and Exchange Board of India (SEBI). With demutualisation, the trading rights and ownership rights have been delinked effectively addressing concerns regarding perceived and real conflicts of  interest. The Exchange is professionally managed under the overall direction of  the

Boar Board d

of

Dire Direct ctor ors. s.Th The e

Boar Board d

comp compri rise ses s

emin eminen entt

prof profes essi sion onal als, s,

representatives of Trading Members and the Managing Director of the Exchange. The Board is inclusive and is designed designed to benefit benefit from theparticipat theparticipation ion of market intermediaries.

72

In terms of organisation organisation structure, structure, the Board formulates formulates larger policy issues and exercises over-all control. The committees constituted by the Board are broadbased.The day-to-dayoperations of the Exchange are managed by the Managing Director and a management team of professionals. The Exchange has a nation-wide reach with a presence in 417 cities and towns of India. The systems and processes of the Exchange are designed to safeguard market integrity and enhance transparency in operations. During the year 20042005, the trading volumes on the Exchange showed robust growth. The Exchange provides an efficient efficient and transparent transparent market for trading trading in equity, equity, debt instruments instruments and derivatives. derivatives. The BSE's On Line Trading System (BOLT) is a proprietory system of the Exchange and is BS 7799-2-2002 certified. The surve surveililla lance nce and and clear clearin ing g & settl settlem emen entt func functi tion ons s of the the Excha Exchange nge are are ISO ISO 9001:2000 certified.

73

HERITAGE

The oldest exchange in Asia and the first exchange in the country to be granted permane permanent nt recogni recognitio tion n under under the Securit Securities ies Contract ntract Regula Regulatio tion n Act, Act, 1956, 1956,

Bomb Bombay ay Stoc Stock k Excha Exchange nge Limi Limite ted d (BSE (BSE)) has has had had an inter interes esti ting ng rise rise to prominence over the past 130 years.

While the BSE is now synonymous with Dalal Street, it wasn’t always so. In fact the first venues of the earliest stock broker meetings in the 1850s were amidst rather natural environs - under banyan trees - in front of the Town Hall, where Horniman Circle is now situated. A decade later, the brokers moved their venue to another set of foliage, this time under banyan trees at the  junction of Meadows Street and Mahatma Gandhi Road. As the number of  brokers increased, they had to shift from place to place, and wherever they went, through sheer habit, they overflowed in to the streets. At last, in 1874, found a permanent place, and one that they could, quite literally, call their  own. The new place was, aptly, called Dalal Street.

The journey of BSE is as eventful and interesting as the history of India’s securitiesmarkets. India’s biggest bourse, in terms of listed companies and mark market et capi capita talilisa sati tion on,, BSE BSE has play played ed a pione pioneer erin ing g role role in the the Indi Indian an

74

Secu Securi riti ties es Mark Market et - one one of the the olde oldest st in the the worl world. d. Much Much befor before e actu actual al legislations were enacted, BSE had formulated comprehensive set of Rules and Regu Regula lati tions ons for for the the Indi Indian an Capi Capita tall Mark Market ets. s. It also also laid laid down down best best prac practi tice ces s adopt adopted ed by the the Indi Indian an Capi Capital tal Mark Market ets s afte afterr Indi India a gain gained ed its its Independence.

Perhaps, there would not be any leading corporate in India, which has not sourced BSE’s services in resource mobilization.

BSE as a brand is synonymous with capital markets in India. The BSE SENSEX is the benchmark equity index that reflects the robustness of the economy and finance. At par with international standards, BSE has been a pioneer in several areas. It has several firsts to its credit even in an intensely competitive environment.



First in India to introduce Equity Derivatives



First in India to launch a Free Float Index



First in India to launch US$ version of BSE Sensex



First in India to launch Exchange Enabled Internet Trading Platform



First in India to obtain ISO certification for Surveillance, Clearing & Settlement

75



'BSE On-Line Trading Trading System’ System’ (BOLT) has been awarded the globally globally recogni recognised sed the Inform Informati ation on Securi Security ty Managem Management ent System System standa standard rd BS7799-2: 2002.



First to have an exclusive facility for financial training



Moved from Open Outcry to Electronic Trading within just 50 days

An equally important accomplishment of BSE is the launch of a nationwide investor awareness campaign - Safe Investing in the Stock Market - under  which which nation nationwid wide e awaren awareness ess campai campaigns gns and dissemi disseminat nation ion of inform informati ation on throug through h print print and electr electroni onic c medium medium was underta undertaken ken.. BSE BSE also also active actively ly promoted the securities market awareness campaign of the Securities and Exchange Board of India.

In 2002, the name The Stock Exchange, Mumbai, was changed to BSE. BSE, which had introduced securities trading in India, replaced its open outcry system of trading in 1995, when the totally automated trading through the BSE Online trading (BOLT) system was put into practice. The BOLT network was was expand expanded, ed, nati nation onwi wide, de, in 1997. 1997. It was was at the the BSE' BSE's s Inte Intern rnati ation onal al Convention Hall that India’s 1st Bell ringing ceremony in the history Capital

76

Markets was held on February 18th, 2002. It was the listing ceremony of  Bharti Tele ventures Ltd.

BSE with its long history of capital market development is fully geared to continue its contributions to further the growth of the securities markets of the country, thus helping India increase its sphere of influence in international financial markets.

For the premier Stock Exchange that pioneered the stock broking activity in India, 125 years of experience seem to be a proud milestone. A lot has changed since 1875 when 318 persons became members of what today is called "Bombay Stock Exchange Limited" by paying a princely amount of Re1.

Since then, the stock market in the country has passed through both good and bad periods. The journey in the 20th century has not been an easy one. Till the decade of eighties, there was no measure or scale that could precisely measure the various ups and downs in the Indian stock market. Bombay Stock Exchange Limited (BSE) in 1986 came out with a Stock Index that subsequently became the barometer of the Indian Stock Market.

BSE-SENSEX, first compiled in 1986 is a "Market Capitalization-Weighted"

inde index x of 30 comp compon onen entt stoc stocks ks repr repres esen enti ting ng a samp sample le of larg large, e, well well-established and financially sound companies. The base year of BSE-SENSEX 77

is 1978-79. The index is widely reported in both domestic and international markets through print as well as electronic media. BSE-SENSEX  is not only scientifically designed but also based on globally accepted construction and review methodology. The "Market Capitalization-Weighted"  methodology is a widely followed index construction methodology on which majority of global equity benchmarks are based.

The growth of equity markets in India has been phenomenal in the decade gone by. Right from early nineties the stock market witnessed heightened activity in terms of various bull and bear runs. More recently, the bourses in India India witnes witnessed sed a simila similarr frenzy frenzy in the 'TMT' 'TMT' sector sectors. s. The BSE-S BSE-SENS ENSEX EX captured all these happenings in the most judicial manner. One can identify the booms and bust of the Indian equity market through BSE-SENSEX.

The launch of BSE-SENSEX in 1986 was later followed up in January 1989 by introduction of BSE National Index (Base: 1983-84 = 100). It comprised of  100 stocks listed at five major stock exchanges in India at Mumbai, Mumbai, Calcutta, Delhi, Ahmedabad and Madras. The BSE National Index was renamed as BSE-100 Index from October 14, 1996 and since then it is calculated taking into consideration only the prices of stocks listed at BSE.

78

With a view to provide a better representation of the increased number of  comp compani anies es list listed ed,, incr increas eased ed marke markett capi capita talilisat satio ion n and and the the new new indu indust stry ry groups, the Exchange constructed and launched on 27th May, 1994, two new index series viz., the 'BSE-200' and the 'DOLLEX-200' indices. Since then, BSE has come a long way in attuning itself to the varied needs of investors and market participants. In order to fulfill the need of the market participants for still broader, segment-specific and sector-specific indices, the Exchange has continuously been increasing the range of its indices. The launch of BSE200 Index in 1994 was followed by the launch of BSE-500 Index and 5 sect sector oral al indi indice ces s in 1999. 1999. In 2001, 2001, BSE BSE laun launch ched ed the the BSEBSE-PS PSU U Index Index,, DOLLEX-30 and the country's first free-float based index - the BSE TECk Index taking the family of BSE Indices to 13.

The Exchange also disseminates the Price-Earnings Ratio, the Price to Book Value Ratio and the Dividend Yield Percentage on day-to-day basis of all its major indices.

The The valu values es of all all BSE BSE indi indice ces s (exc (except ept the the Doll Dollar ar vers versio ion n of indi indice ces) s) are are updated every 15 seconds during the market hours and displayed through the BOLT system, BSE website and news wire agencies.

79

All BSE-Indices are reviewed periodically by the "Index Committee" of the Exch Exchan ange ge.. The The comm commit itte tee e fram frames es the the broa broad d pol policy icy guid guidel elin ines es for for the the development and maintenance of all BSE indices. The Index Cell of the Exchange carries out the day to day maintenance of all indices and conducts research on development of new indices.

80

BOARD OF DIRECTORS

Non-Executive Chairman

Mr. Jagdish Capoor 

Chairman, HDFC Bank

MD & CEO

Mr. Rajnikant Patel

Directors

Mr. P. K. Banerji

Mr.S.Jambunathan

IAS (Retd.)

IAS (Retd.) Ex-Chairman-cum-Managing Director 

Prof. N. Ravichandran

Export Credit and Gurantee

Professor, IIM Ahmedabad

Corporation, Govt. of India

Mr. Jitesh Khosla

Mr. Vijay Mukhi

Joint Secretary, Dept. of Company

Managing Director, Vijay Mukhi's

Affairs, Govt. of India

Computer Institute

Mr. Pradip P. Shah

Mr. P. P. Vora

Chairman, IndAsia Fund Advisors Private

Ex-Chairman, Industrial Development

Limited

Bank of India and National Stock Exchange of India Limited

81

Trading Member Representatives

Mr. Prakash R. Kacholia Mr. Balkishan Mohta Mr. Siddharth J. Shah

82

MANAGEMENT TEAM

Sr. No.

Name

1

Mr.

Designation

Department

Rajnikant MD & CEO

Patel 2

3

4

Mr. A. A.

Chief

-

Investor   Depart artment

Tirodkar 

Services

Inve nvestor 

Mr. S.B.

Chief

Patankar 

Officer 

Mr. Kevin

Chie Chieff Gene Genera rall Manag anager er Dept Dept.. of Admi Admini nist stra rati tion on &

Services Technology Dept.

of

Information

Technology

Desouza 5

of

Personnel Mgt.

Mr. P.S. Reddy Chief General Manager HR (Policies & Pr Procedures), DCS and DOSS

6

Mr. S. S. Vyas

7

Dr. Bandi Ram Chief

8

9

10

11

Chief - Internal Control

Internal Control Functions

Knowledge Knowledge Management

Prasad

Officer 

Mr. Suniel

Senior

Vichare

Manager 

Mr. P. P.

Senior

Kaladharan

Manager 

Mr. T. V.

Senior

Rangaswami

Manager 

Policies

Mr. V. G.

Company Secr ecretary ary

Secr ecreta etaria rial & Complianc ance

General Manager

Dept.

General Member

Services

&

Operations

&

Development General Dept.

of

Trading (DOT) General Strategy,

Planning

&

Bhagat 12

13

Mr. Sanjiv

of

Surveillance

Kapur 

Supervision (DOSS)

Mrs. Devika S. Ge General Manager

Clearing

83

&

&

Settlement,

Shah

Derivatives & Debt

14

Mr. S. S. Bolar

15

Mr. Sanjay M. General Manager

Dept. of of Co Corporate Se Services

Golecha

(DCS)

16

Mr. Lalit

General Manager

General Manager

Ranpuria 17

Mr. C.

Investments & Accounts

Dept.

of

Information

Technology (DIT) General Manager

Knowledge Management

General Manager

Dept.

Vasudevan 18

Mr. Rahul Sharma

19

Mr. Saji

of

Operations

&

Trading (DOT) General Manager

Cherian

Strategy,

Planning

&

Policies

LISTING OF SECURITIES Listing means admission of the securities to dealings on a recognised stock exchange. The securities may be of any public limited company, Central or State Government, Government, quasi-governme quasi-governmental ntal and other financial financial institution institutions/corpo s/corporation rations, s, municipalities, etc. The objectives of listing are mainly to :

•

provide liquidity to securities;

•

mobilize savings for economic development; 84

•

protect interest of investors by ensuring full disclosures.

The Exchange has a separate Listing Department Department to grant approval for listing of  securit securities ies of compani companies es in accordan accordance ce with with the provis provision ions s of the Securit Securities ies Contracts (Regulation) Act, 1956, Securities Contracts (Regulation) Rules, 1957, Companies Act, 1956, Guidelines issued by SEBI and Rules, Bye-laws and Regulations of the Exchange. A company intending to have its securities listed on the Exchange has to comply with with the the list listin ing g requ requir irem emen ents ts pres prescr crib ibed ed by the the Exch Exchan ange ge.. Some Some of the the requirements are as under: -

85

1. Minimum Minimum Listin Listing g Requireme Requirements nts for new new companie companies s 2. Minim Minimum um Requ Require iremen ments ts for for compa compani nies es delis delisted ted by this this Exch Exchan ange ge seeking relisting of this Exchange 3. Minim Minimum um Requ Require iremen ments ts for for compa compani nies es delis delisted ted by this this Exch Exchan ange ge seeking relisting of this Exchange 4. Permissi Permission on to use the name name of the Exchang Exchange e in an Issuer Compan Company's y's prospectus 5. Submiss Submission ion of of Letter Letter of Appli Applicati cation on 6. Allot Allotmen mentt of Secu Securit rities ies 7. Trad Tradin ing g Perm Permis issi sion on 8. Requi Requirem remen entt of 1% Sec Securi urity ty 9. Paymen Paymentt of Listi Listing ng Fees Fees 10.Complian 10. Compliance ce with Listing Agreement Agreement 11."Z" Group 12. Cash Management Services (CMS) - Collection of Listing Fees

86

[I] MINIMUM LISTING REQUIREMENTS FOR NEW COMPANIES (A) Minimum Capital: 1. New New comp compan anie ies s can can be list isted on the the Exc Exchang hange, e, if thei theirr issu issued ed & subscribed equity capital after the public issue is Rs.10 crores. In addition to this the issuer company should have a post issue networth (equity capital + free reserves excluding revaluation reserve) of Rs.20 crores. 2. For new new compa compani nies es in high high techn technol olog ogy y ( i.e. i.e. info inform rmat atio ion n tech technol nolog ogy, y, internet, e-commerce, telecommunication, media including advertisement, enterta entertainm inment ent etc.) etc.) the follow following ing criter criteria ia will will be applica applicable ble regardi regarding ng threshold limit: i.

The The tota totall inco income me/s /sal ales es from from the the main main acti activi vity ty,, whic which h shou should ld be in the the

fiel field d

of

info inform rmat atio ion n

tech techno nolo logy gy,,

inte intern rnet et,,

e-co e-comm mmer erce ce,,

telecommunication, media including advertisement, entertainment etc. should not be less than 75% of the total income during the two immediately preceding years as certified by the Auditors of the company. ii. ii.

The The mini minimu mum m post post-i -iss ssue ue paidpaid-up up equit equity y capi capita tall shou should ld be Rs.5 Rs.5 Crores.

87

iii. iii.

The The minim minimum um marke markett capit capital alis isat ation ion shou should ld be Rs.5 Rs.50 0 Crores Crores.. (The (The capi capita talilisat satio ion n will will be calcu calcula late ted d by mult multip iply lyin ing g the the post post issu issue e subscribed number of equity shares with the Issue price).

iv. iv.

Post Post issu issue e net networt worth h ( equi equitty capi capita tall + free ree rese reserv rves es excl exclud udin ing g revaluation reserve) of Rs.20 Crores.

(B) MINIMUM PUBLIC OFFER:

As per Rule 19(2) (b) of the Securities Contracts (Regulation) Rules, 1957, securities of a company can be listed on a Stock Exchange only when at least 25% of each class or kind of securities is offered to the public for subscription. In case of IPOs by unlisted companies in the IT & entertainment sector, at least 10% of the securities issued by the company may be offered to the public subject to the following:

•

Minimum 20 lac securities are offered to the public (excluding reservation, firm allotment and promoters contribution)

•

The size of the offer to the public is minimum 50 crores.

88

For this purpose, the term "offered to the public" means only the portion offered to the the publ public ic and and does does not not incl includ ude e rese reserv rvat atio ions ns of secu securi riti ties es on firm firm or  competitive basis. SEBI may, however, relax this condition on the basis of recommendations of  stock exchange(s), only in respect of a Government company defined under  Section 617 of the Companies Act, 1956.

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[II] [II]

MINI MINIMU MUM M

LIST LISTIN ING G

REQU REQUIR IREM EMEN ENTS TS

FOR FOR

COMP COMPAN ANIE IES S

LISTED ON OTHER STOCK EXCHANGES The Governing Board of the Exchange at its meeting held on 6th August, 2002 amen amende ded d the the dire direct ct list listin ing g norm norms s for for comp compan anie ies s list listed ed on othe otherr Stoc Stock k Excha Exchang nge(s e(s)) and and seek seekin ing g list listing ing at BSE. BSE. Thes These e norm norms s are are appl applic icabl able e with with immediate effect. 1. The company company should should have have minimum minimum issued issued and paid paid up equity equity capita capitall of  Rs. 3 crores. 2. The Company Company should should have profit profit making making track record record for last three three years. years. The revenues/profits arising out of extra ordinary items or income from any source source of non-recu non-recurri rring ng nature nature should should be excluded excluded while while calcul calculati ating ng distributable profits. 3. Minimu Minimum m networth networth of Rs. 20 crores crores (networt (networth h includ includes es Equity Equity capita capitall and free reserves excluding revaluation reserves). 4. Minimu Minimum m market capital capitalisa isatio tion n of the listed listed capital capital should be at least least two times of the paid up capital. 5. The compa company ny should should have have a divi divide dend nd paying paying track track record record for the last last 3 consecutive years and the minimum dividend should be at least 10%. 6. Mini Minimu mum m 25% 25% of the the comp compan any' y's s issu issued ed capi capita tall shou should ld be with with NonNonPromoters shareholders as per Clause 35 of the Listing Agreement. Out of  above Non Promoter holding no single shareholder should hold more than 0.5% of the paid-up capital of the company individually or jointly with

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others except in case of Banks/Financial Institutions/Foreign Institutional Investors/Overseas Corporate Bodies and Non-Resident Indians. 7. The company company should should have at least least two years years listing listing record record with any any of the Regional Stock Exchange. 8. The compa company ny should should sign sign an agreem agreement ent with with CDSL CDSL & NSDL NSDL for demat demat trading.

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[III] [III] Minim Minimum um Requ Requir irem ement ents s for compa companie nies s deli delist sted ed by this this Exchange seeking relisting of this Exchange The companies delisted by this Exchange and seeking relisting are required to make a fresh public offer and comply with the prevailing SEBI's and BSE's guidelines regarding initial public offerings.

[IV] Permission to use the name of the Exchange in an Issuer Company's prospectus The Exchange follows a procedure in terms of which companies desiring to list their their securi securitie ties s offered offered throug through h public public issues issues are require required d to obtain obtain its prior  prior  permission permission to use the name of the Exchange Exchange in their prospectus prospectus or offer for sale documents before filing the same with the concerned office of the Registrar of  Comp Compan anie ies. s. The The Exch Exchan ange ge has has sinc since e last last thre three e year years s form formed ed a "Lis "Listi ting ng Committee" to analyse draft prospectus/offer documents of the companies in respect of their forthcoming public issues of securities and decide upon the matter of granting them permission to use the name of "Bombay Stock Exchange Limite Limited" d" in their their prospect prospectus/ us/off offer er docume documents nts.. The commit committee tee evaluat evaluates es the promoters, company, project and several other factors before taking decision in this regard.

92

[V] SUBMISSION OF LETTER OF APPLICATION As per Section 73 of the Companies Act, 1956, a company seeking listing of its securities on the Exchange is required to submit a Letter of Application to all the Stock Exchanges where it proposes to have its securities listed before filing the prospectus with the Registrar of Companies.

[VI] ALLOTMENT OF SECURITIES As per List Listin ing g Agre Agreem ement ent,, a compa company ny is requi required red to comp comple lete te allo allotm tment ent of  securities offered to the public within 30 days of the date of closure of the subscription list and approach the Regional Stock Exchange, i.e. Stock Exchange nearest to its Registered Office for approval of the basis of allotment. In case of Book Building issue, Allotment shall be made not later than 15 days from the closure of the issue failing which interest at the rate of 15% shall be paid to the investors.

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[VII] TRADING PERMISSION As per Securities and Exchange Board of India Guidelines, the issuer company should complete the formalities for trading at all the Stock Exchanges where the secur securit itie ies s are are to be list listed ed with within in 7 worki working ng days days of final finalis isat atio ion n of Basi Basis s of  Allotment. A company should scrupulously adhere to the time limit for allotment of all securit securities ies and dispat dispatch ch of Allotm Allotment ent Letters Letters/Sh /Share are Certifi Certificat cates es and Refund Refund Orders and for obtaining the listing permissions of all the Exchanges whose names are stated in its prospectus or offer documents. In the event of listing permission to a company being denied by any Stock Exchange where it had applied for listing of its securities, it cannot proceed with the allotment of shares. However, the company may file an appeal before the Securities and Exchange Board of India under Section 22 of the Securities Contracts (Regulation) Act, 1956.

[VIII] REQUIREMENT OF 1% SECURITY The companies making public/rights issues are required to deposit 1% of issue amount with the Regional Stock Exchange before the issue opens. This amount is liable to be forfeited in the event of the company not resolving the complaints of investors regarding delay in sending refund orders/share certificates, nonpayment of commission to underwriters, brokers, etc. 94

[IX] PAYMENT OF LISTING FEES All companies listed on the Exchange have to pay Annual Listing Fees by the 30th April of every financial financial year to the Exchange as per the Schedule of Listing Fees prescribed from time to time. The schedule of listing fees for the year 2004-2005, prescribed by the Governing Board of the Exchange and approved by the Securities and Exchange Board of  India is given hereunder:

95

SCHEDULE OF LISTING FEES FOR THE YEAR 2005-2006

Sr.

Amount Particulars

No. 1

(Rs.) Initial Listing Fees

20,000

2 Annual Listing Fees (i) Companies with paid-up capital* upto Rs. 5 crores

(ii) Above Rs. 5 crores and upto Rs. 10 crores

(iii) Above Rs. 10 crores and upto Rs. 20 crores 3

10,000

15,000

30,000

Comp Compan anie ies s whi which ch hav have e a pai paidd-up up cap capit ital al** of more more tha than n Rs. Rs. 20 crores will pay additional fee of Rs. 750/- for every increase of  Rs. 1 crores or part thereof.

4

In case case of of deb deben entu ture re capi capita tall (not (not conve convert rtib ible le int into o equi equity ty share shares) s) of  of  companies, the fees will be charged @ 25% of the fees payable as per the above mentioned scales.

Includ udes es equi equity ty shar shares es,, prefe prefere renc nce e shar shares es,, full fully y conv conver erti tibl ble e debe debent nture ures, s, part partly ly *Incl convertibl convertible e debenture debenture capital and any other security security which will be converted converted into equity shares.

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[X] COMPLIANCE WITH LISTING AGREEMENT The companies desirous of getting their securities listed are required to enter into an agreement with the Exchange called the Listing Agreement and they are required to make certain disclosures and perform certain acts. As such, the agreement is of great importance and is executed under the common seal of a company. Under the Listing Agreement, a company undertakes, amongst other  things, things, to provide provide facili facilitie ties s for prompt prompt transf transfer, er, regist registrat ration, ion, sub-div sub-divisi ision on and consolidation of securities; to give proper notice of closure of transfer books and record record dates, dates, to forward forward copies copies of unabri unabridged dged Annual Annual Report Reports s and Balance Balance Sheets Sheets to the shareho shareholde lders, rs, to file file Distri Distribut bution ion Schedul Schedule e with with the Exchange Exchange annually; to furnish financial results on a quarterly basis; intimate promptly to the Exchang Exchange e the happeni happenings ngs which which are likely likely to materi materiall ally y affect affect the financi financial al performance of the Company and its stock prices, to comply with the conditions of Corporate Governance, etc. The The List Listin ing g Depa Depart rtme ment nt of the the Exch Exchang ange e moni monito tors rs the the comp complilianc ance e of the the companies with the provisions of the Listing Agreement, especially with regard to time timely ly paym paymen entt of annu annual al list listin ing g fees fees,, subm submis issi sion on of quar quarte terl rly y resu result lts, s, requirement of minimum number of shareholders, etc. and takes penal action against the defaulting companies.

97

[XI] "Z" Group The Exchange has introduced a new category called "Z Group" from July 1999 for companies who have not complied with and are in breach of provisions of the Listing Agreement. The number of companies placed under this group as at the end of May, 2001 was 1,475 . The number of companies listed at the Exchange as at the end of May 2001 was 5,874. This is the highest number among the Stock Exchanges in the country and

in the world.

New Direct Listing norms

The Governing Board of the Exchange at its meeting held on 6th August, 2002 amen amende ded d the the dire direct ct list listin ing g norm norms s for for comp compan anie ies s list listed ed on othe otherr Stoc Stock k Excha Exchang nge(s e(s)) and and seek seekin ing g list listing ing at BSE. BSE. Thes These e norm norms s are are appl applic icabl able e with with immediate effect. 1. The company company should should have have minimum minimum issued issued and paid paid up equity equity capita capitall of  Rs. 3 crores. 2. The Company Company should should have profit profit making making track record record for last three three years. years. The revenues/profits arising out of extra ordinary items or income from any source source of non-recu non-recurri rring ng nature nature should should be excluded excluded while while calcul calculati ating ng distributable profits.

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3. Minimu Minimum m networth networth of Rs. 20 crores crores (networt (networth h includ includes es Equity Equity capita capitall and free reserves excluding revaluation reserves). 4. Minimu Minimum m market capital capitalisa isatio tion n of the listed listed capital capital should be at least least two times of the paid up capital. 5. The compa company ny should should have have a divi divide dend nd paying paying track track record record for the last last 3 consecutive years and the minimum dividend should be at least 10%. 6. Mini Minimu mum m 25% 25% of the the comp compan any' y's s issu issued ed capi capita tall shou should ld be with with NonNonPromoters shareholders as per Clause 35 of the Listing Agreement. Out of  above Non Promoter holding no single shareholder should hold more than 0.5% of the paid-up capital of the company individually or jointly with others except in case of Banks/Financial Institutions/Foreign Institutional Investors/Overseas Corporate Bodies and Non-Resident Indians. 7. The company company should should have at least least two years years listing listing record record with any any of the Regional Stock Exchange. 8. The compa company ny should should sign sign an agreem agreement ent with with CDSL CDSL & NSDL NSDL for demat demat trading.

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[XII] CASH MANAGEMENT SERVICES (CMS) - COLLECTION OF LISTING FEES As a further step towards simplifying the system of payment of listing fees, the Exchange has entered into an arrangement with HDFC Bank for collection of  listing fees, from 141 locations, situated all over India. Details of the HDFC Bank branches, are available on our website site www.bseindia.com as well as on the HDFC Bank website www.hdfcbank.com The above facility is being provided free of cost to the Companies. Companies Companies intending to utilise utilise the above facility facility for payment payment of listing listing fee would be requ requir ired ed to furn furnis ish h the the info inform rmat atio ion, n, (men (menti tion oned ed belo below) w) in the the Cash Manage Management ment Cash Cash Deposit Deposit Slip. Slip. These slips would be available at all the

HDFC Bank centres.

S.No

HEAD Client

1.

INFORMATION TO BE PROVIDED

Bombay Stock Exchange Limited Name Client

2.

BSELIST Code Cheque

3. 4.

mention the cheque No & date No. Date

date on which payment is being deposited with the bank. state the name of the company and the company code No.The last digits mentioned in the Ref. No. on the Bill is the company

5.

Drawer   code No.e.g If the Ref. No in the Bill is mentioned as : Listing/AlfBill/2004-2005/4488, then the code No of that company is 4488 100

Drawee 6.

state the bank on which cheque is drawn Bank Drawn on

7.

Mention the location of the drawee bank. Location Pickup

8.

Not applicable Location No. of 

9.

Not applicable Insts

The Cheque should be drawn in favour of Bombay Stock Exchange Limited , and should be payable, locally .Companies are requested to mention in the deposit slip, the financial year(s) for which listing fee is being paid. Payment made through any other slips would not be considered. The above slips will have to be fill filled ed in quadr quadrup uplilicat cate. e. One One ackno acknowl wledg edged ed copy copy woul would d be prov provide ided d to the the depositor by the HDFC Bank.

101

ANALYSIS

TABLE NO. 1, COMPARATIVE SUMMARY OF CAPITAL REQUIREMENT.

102

Serial Criteria

BSE

NSE

No.

MINIMUM 10

Capital Required

MINIMUM 10 CRORES

1

CRORES

(Paid-Up) Market

MINIMUM 2 TIMES OF PAID-UP

MINIMUM 25

Capitalization

CAPITAL

CRORES

At-least last 3 years

N.A.

2

Profit Making 3 Record

The net worth of the company has not been wiped out by

Net Worth

Minimum 20 cr.

4

the accumulated

Required

losses resulting in a negative net worth

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Comparison when company/ies is/are already listed on other stock exchange/s

MINIMUM 10

Capital Required

MINIMUM 3CRORES

5

CRORES

(Paid-Up) Market

MINIMUM 2 TIMES OF PAID-UP

MINIMUM 25

Capitalization

CAPITAL

CRORES

6

At-least two out of  Profit Making

At-least last 3 years

7

the last three

Record

financial years Net Worth

Minimum 20 cr.

8

Minimum 50 cr.

Required

Minimum 2 out of the last 3 immediately

Dividend paying

Minimum 3 years

9

preceding financial

track record

years At-least three years At-least two years listing record listing record with 10

Listing Record

with any Regional Stock any Regional Stock Exchange. Exchange.

INTERPRETATION 104

As per the Table No.1 (Comparative summary of capital requirement.)

Capital Required: On NSE for new companies minimum paid up capital requirement is 10 crores, while on BSE the requirement is also 10 crores & for new companies in high technology the minimum post-issue paid-up equity capital should be Rs.5 Crores.

Market Capitalization: On NSE the market capitalization should be 25 crores, while on BSE the minimum market capitalisation should be Rs.50 Crores (in case of new companies in high technology).

Profit Making Record: On NSE the company must have distributable profits in at least two out of the last three financial years (an auditors certificate must be provided in this regard), while for listing company on BSE Company should have profit making track record for last three years

Net Worth Required: On NSE the net worth of the company has not been wiped out by the accumulated losses resulting in a negative net worth, while on BSE the issuer  company should have a post issue net worth (equity capital + free reserves excluding revaluation reserve) of Rs.20 crores.

Dividend paying track record: 105

On NSE the applicant has paid dividend in at least 2 out out of the the last last 3 fina financ ncia iall years years imme immedi diat atel ely y prec preced edin ing g the the year year in whic which h list listin ing g application has been made(in case),while on BSE the company should have a dividend paying track record for the last 3 consecutive years and the minimum dividend should be at least 10%. (when company/ies is/are already listed on other stock exchange/s).

Listing Record: On NSE the applicant should have been listed on any other recognised

stock exchange for at least last three years, while on BSE the company should have at least two years listing record with any of the Regional Stock Exchange.

106

COMPARISON OF LISTING FEES

BSE

NSE Initial Listing Fees

Rs.20, 000

Rs.7, 500

Annual Listing Fees Companies with paid up share and/or debenture capital: Of Rs.1 crore

4,200

Up to Rs. 5 crores 10,000 Above Rs.1 crore and 8,400 up to Rs.5 crores Above Rs. 5 Above Rs.5 crores and crores and up to

15,000

14,000 up to Rs.10 crores

Rs. 10 crores Above Rs. 10 Above Rs.10 crores crores and up to

30,000

28,000 and up to Rs.20 crores

Rs. 20 crores Additional fee of Rs.

Above Rs.20 crores 42,000

750/- for every

and up to Rs.50 crores

Above 20 crores increase of Rs. 1 crores or part thereof.

Above Rs.50 crores

The comparison of INITIAL LISTING FEES is shown in the chart:-1

107

70,000

NSE

BSE

NSE

BSE

Initial Listing Fees (In Rs.) NSE

BSE

7,500

20,000

With the help of these charts we can simplify the comparison of listing fees. These charts depict that listing fees on NSE is much lower than on BSE.

108

The FURTHER LISTING FEES on NSE is shown in the chart: -2

NSE 4,200 8,400

14,000

70,000

28,000

42,000 Of Rs.1 cro re

Rs.1 cr to Rs.5 cr

Rs.5 cr to Rs. 10cr  

Rs.10 Rs .10 cr to Rs.20 cr

Rs.20 cr to Rs Rs.50 cr

Abov Ab ove e Rs.5 Rs.50 0 cror crores es

109

The FURTHER LISTING FEES on BSE is shown in the ch art: -3

BSE

750

10,000

30,000

15,000

Up to Rs. 5 cr

Rs.5 cr to Rs. 10cr  

Rs. 10 cr to Rs. 20 cr

Above 20 crore s*

If we take the initial listing fees so we see that NSE charges less amount when BSE charges a huge amount & as we travel further the charges charged by NSE for  listing on it is lower than the on BSE.

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BENEFITS

1. A prem premie ierr mark market et pla place ce 2. Visi Visibi billity ity 3. Larg Larges estt exch exchan ange ge 4. Unpre Unpreced cedent ented ed reach reach 5. Moder Modern n infr infrast astruc ructu ture re 6. Tran Transa sact ctio ion n speed speed 7. Short Short set settl tlem ement ent cycle cycles s 8. Broadca Broadcast st of corpor corporate ate announ announcem cement ents s 9. Trade Trade statist statistics ics for for listed listed compan companies ies 10.Invest 10. Investor or service centers 11.Nomina 11. Nominall listing fees

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1. A prem premie ierr mark marketp etplac lace e

The sheer volume of trading activity ensure that the impact cost is lower on NSE which in turn reduces the cost of trading to the investor. NSE’s automated trading system system ensures ensures consis consisten tency cy and transp transparen arency cy in the trade trade matchi matching ng which which enhances investors confidence and visibility of our market.

2. Visi isibili ility

The trading system in NSE provides unparallel level of trade and post-trade information. The best 5 buy and sell orders are displayed on the trading system and the the tota totall number number of secu securit ritie ies s avai availa labl ble e for for buyi buying ng and and selli selling ng is also also displayed. This helps the investor to know the depth of the market. Further, corporate announcements, results, corporate actions etc are also available on the trading system.

3. Larg Larges estt Exc Excha hang nge e

NSE is the largest exchange in the county in terms of trading volumes. During the year 2003-2004, NSE reported a turnover of Rs. 1,099,535 crores in the equities segment.

112

4. Unpre Unpreced ceden ente ted d reach reach

NSE provides a trading platform that extends across the length and breadth of  the country. Investors Investors from 360 centres can avail of trading facilities facilities on the NSE Trading Network. The Exchange uses the latest in communication technology to give instant access from every location.

5. Mode Modern rn inf infras rastru tructu cture re

NSE introduced for the first time in India, fully automated screen based trading. The Exchange uses a sophisticated telecommunication network with over 9000 trading terminals connected through VSATs (Very Small Aperture Terminals).

6. Tran Transa sact ctio ion n spee speed d

The The speed speed at whic which h NSE NSE proce process sses es order orders, s, resul results ts in liqui liquidi dity ty and and bette better  r  available prices. NSE's trading system on an average processes 8000 orders per  minute. The highest number of trades in a day of 28,49,987 was recorded on January 05, 2005.

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7. Short Short settl settleme ement nt cycl cycles es

NSE has successfully completed more than 1250 settlements without any delays.

8. Broadca Broadcast st facility facility for corpor corporate ate announ announceme cements nts

The

NSE net networ work

is

used

to

dissem seminate

info nforma rmation

and

compa ompany ny

announ announce ceme ment nts s acros across s the the count country. ry. Impor Importa tant nt info inform rmat atio ion n regar regardi ding ng the the company is announced to the market through the Broadcast Mode on the NEAT Syst System em as well well as diss dissem emin inat ated ed thro throug ugh h the the NSE NSE webs websit ite. e. Corp Corpor orat ate e developments such as financial results, book closure, announcements of bonus, right rights, s, takeo takeover ver,, merg mergers ers etc. etc. are are diss dissem emina inate ted d across across the the coun countr try y thus thus minimizing scope for price manipulation or misuse.

9. Trade Trade statist statistics ics for for listed listed companie companies s

Listed companies are provided with monthly trade statistics for all the securities of the company listed on NSE.

10.Investor 10. Investor service service centers

114

Six investor-service centers opened by NSE across the country cater to the needs of investors.

11.Nominal 11. Nominal listing listing fees

The listing fee charged by NSE is much lower compared to the listing fees charged BSE.

115

CONCLUSION

On the basis of above stated study it has been assorted that with respect to techno technology logy,, listin listing g fees, fees, listin listing g procedu procedure, re, eligib eligibili ility ty criteria criteria of listi listing ng & listin listing g requirements the National Stock Exchange has the edge. Despite the fact that Bombay Stock Exchange is older & has high level of trading volume.

However, Many market Players, Brokers, sub-brokers, trading firms etc. deal through the Bombay Stock Exchange.

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FINDINGS

When I complete the assign project research then I finds some important points in this report these are given as follows; •

There are capital require (paid up) must be minimum 10 crore for listing in NSE or BSE for a particular company.

•

Initial listing fees for a particular company in national stock exchange are much lower then on Bombay stock exchange.

•

Market capitalization of the Bombay stock exchange is more then national stock exchange.

The daily turnover of national stock exchange is more then Bombay stock exchange on daily basis.

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LIMITATION

There are many limitations of this research report which are given as follows•

Short period of time.

•

There are some changes in stock market in daily basis. •

This project merely tells about the listing procedure of equities on NSE and BSE.

This project report not tells about the listing procedure of corporate bonds and mutual funds etc

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BIBLIOGRAPHY

AUTHORS 

PRASANNA CHANDRA



PUNITHARVATHY PANDIAN



FISCHER JORDAN

WEBSITES 

google.com



nseindia.com



bse.com



myiris.com



indiabulls.com

MAGAZINES / NEWSPAPERS 

The Business World



The Business Today



The Financial Express



The Global Business

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