Comparative Study NSE - BSE

A SUMMER TRAINING PROJECT

ON

LISTING PROCEDURE & ITS ANALYSIS:A COMPARATIVE STUDY BETWEEN

NSE & BSESubmitted in Partial Fulfillment of

MASTER OF BUSINESS ADMINISTRATION (MBA) PROGRAMME ( U.P. Technical University, Lucknow)

(2007-2009)

Submitted To: Submitted By Mr. Satish Matta Bhawesh MishraFaculty Guide MBA (3rd Sem)LIMT, Gr. Noida Roll No. 0717270022

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INDEX

CONTENTS PAGE NO.

ACKNOWLEDGEMENT 4

OBJECTIVE 5

PREFACE 7

METHODOLOGY 8

NATIONAL STOCK EXCHANGE 9

ABOUT NSE 10

NSE MILESTONES 11

CORPORATE STRUCTURE 17

NSE GROUP 31

NSE TECHNOLOGY 36

EQUITIES 39

LISTING 40

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LLOYD INSTITUTE OF MANAGEMENT & TECHNOLOGY

Plot no.11, Knowledge Park-2, Greater Noida.UP-201306

LISTING PROCEDURE ON NSE 41

ELIGIBILITY CRITERIA FOR LISTING ON NSE 55

BOMBAY STOCK EXCHANGE 72

ABOUT BSE 73

LISTING OF SECURITIES ON BSE 86

ANALYSIS AND INTERPRETATION 103

LISTING BENEFITS 112

CONCLUSION 117

FINDINGS 118

LIMITATIONS 119

BIBLIOGRAPHY 120

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ACKNOWLEDGEMENT

A work without the blessing and the guidance of experienced is always half done

and unsatisfactory. The task of completing this project needs knowledge,

experience & guidance of the prominent person as mentioned in the subject line.

My abundant and most 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

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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 project would help a company to make familiar with listing

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

analysis this report also based on descriptive research because it

provide the detailed knowledge about the BSE and NSE and its listing

procedure.

Secondary data is to be used in the research, have 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

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ABOUT NSE

The National Stock Exchange (NSE) is India's leading stock exchange covering

various cities and towns across the country. NSE was set up by leading

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 model for the securities industry in terms of systems, practices and

procedures.

NSE has played a catalytic role in reforming the Indian securities market in terms

of microstructure, market practices and 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 & services viz. demutualisation of stock exchange governance, screen

based trading, compression of settlement cycles, dematerialisation and electronic

transfer of securities, securities lending and borrowing, professionalisation of

trading members, fine-tuned risk management systems, emergence of clearing

corporations to assume counterparty risks, market of debt and derivative

instruments and intensive use of information technology.

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NSE MILESTONES

November 1992 Incorporation

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 1995 Establishment of Investor Grievance Cell

April 1995 Establishment of NSCCL, the first Clearing Corporation

June 1995Introduction of centralised insurance cover for all trading

members

July 1995 Establishment of Investor Protection Fund

October 1995 Became largest stock exchange in the country

April 1996 Commencement of clearing and settlement by NSCCL

April 1996 Launch of S&P CNX Nifty

June 1996 Establishment of Settlement Guarantee Fund

November 1996Setting up of National Securities Depository Limited, first

depository in India, co-promoted by NSE

November 1996 Best IT Usage award by Computer Society of India

December 1996 Commencement of trading/settlement in dematerialised

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http://www.nseindia.com/content/indices/ind_nifty.htm

http://www.nseindia.com/content/us/us_nsccl.htm

http://www.nseindia.com/content/equities/eq_introduction.htm

http://www.nseindia.com/content/debt/debt_introduction.htm

securities

December 1996 Dataquest award for Top IT User

December 1996 Launch of CNX Nifty Junior

February 1997 Regional clearing facility goes live

November 1997 Best IT Usage award by Computer Society of India

May 1998Promotion of joint venture, India Index Services & Products

Limited (IISL)

May 1998 Launch of NSE's Web-site: www.nse.co.in

July 1998 Launch of NSE's Certification Programme in Financial Market

August 1998 CYBER CORPORATE OF THE YEAR 1998 award

February 1999 Launch of Automated Lending and Borrowing Mechanism

April 1999 CHIP Web Award by CHIP magazine

October 1999 Setting up of NSE.IT

January 2000 Launch of NSE Research Initiative

February 2000 Commencement of Internet Trading

June 2000 Commencement of Derivatives Trading (Index Futures)

September

2000Launch of 'Zero Coupon Yield Curve'

November 2000 Launch of Broker Plaza by Dotex International, a joint venture

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http://www.dotexplaza.com/

http://www.nseindia.com/content/debt/debt_zcyc.htm

http://www.nseindia.com/content/fo/fo_niftyfutures.htm

http://www.nseindia.com/content/equities/eq_internet.htm

http://www.nseindia.com/content/research/res_introduction.htm

http://www.nseindia.com/content/us/us_nseit.htm

http://www.nseindia.com/content/ncfm/ncfm_introduction.htm

http://www.nseindia.com/content/indices/ind_iisl.htm

http://www.nseindia.com/content/indices/ind_iisl.htm

http://www.nseindia.com/content/indices/ind_jrnifty.htm

between NSE.IT Ltd. and i-flex Solutions Ltd.

December 2000 Commencement of WAP trading

June 2001 Commencement of trading in Index Options

July 2001 Commencement of trading in Options on Individual Securities

November 2001 Commencement of trading in Futures on Individual Securities

December 2001 Launch of NSE VaR for Government Securities

January 2002 Launch of Exchange Traded Funds (ETFs)

May 2002NSE wins the Wharton-Infosys Business Transformation

Award in the Organization-wide Transformation category

October 2002 Launch of NSE Government Securities Index

January 2003 Commencement of trading in Retail Debt Market

June 2003 Launch of Interest Rate Futures

August 2003 Launch of Futures & options 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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http://www.nseindia.com/content/press/prs_attn_eii.htm

http://www.nseindia.com/content/press/prs_whatsnew.htm#stp

http://www.nseindia.com/content/fo/fo_products.htm

http://www.nseindia.com/content/fo/fo_interestrate.htm

http://www.nseindia.com/content/rdm/rdm_introduction.htm

http://www.nseindia.com/content/debt/debt_gsecindex.htm

http://www.nseindia.com/content/products/prod_etfs.htm

http://www.nseindia.com/content/debt/debt_var.htm

http://www.nseindia.com/content/fo/fo_stockfutures.htm

http://www.nseindia.com/content/fo/fo_stockoptions.htm

http://www.nseindia.com/content/fo/fo_niftyoptions.htm

http://www.nseindia.com/content/equities/eq_wap.htm

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 recognition as a stock exchange under the Securities Contracts

(Regulation) Act, 1956 in April 1993, NSE commenced operations in the

Wholesale Debt Market (WDM) segment in June 1994. The Capital Market

(Equities) segment commenced 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,

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ensuring equal access to investors all over the country through an

appropriate communication network,

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

become industry benchmarks and are being emulated by other market

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 vibrancy and unleashing of creative

energy to constantly bring about change through innovation

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PROMOTERS

NSE has been promoted by leading financial institutions, banks, insurance

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

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CORPORATE STRUCTURE

NSE is one of the first de-mutualised stock exchanges in the 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 and other financial intermediaries and is managed by professionals,

who do not directly or indirectly trade on the Exchange. This has completely

eliminated any conflict of interest and helped NSE in aggressively pursuing

policies and practices within a public interest framework.

The NSE model however, does not preclude, but in fact accommodates

involvement, support and contribution of trading members in a variety of ways. Its

Board comprises of senior executives from promoter institutions, eminent

professionals in the fields of law, economics, accountancy, finance, taxation, etc,

public representatives, nominees of SEBI and one full time executive of the

Exchange.

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http://www.nseindia.com/content/us/us_promoters.htm

http://www.nseindia.com/content/us/us_promoters.htm

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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http://www.nseindia.com/content/us/us_mgmtteam.htm

http://www.nseindia.com/content/us/us_committees.htm

BOARD OF DIRECTORS

Chairman Mr. S. B. Mathur

Administrator of the Specified

Undertaking of

Unit Trust of India

Managing Director Mr. Ravi Narain

National Stock Exchange of India

Ltd.

Deputy Managing Director Ms. Chitra Ramkrishna

National Stock Exchange of India

Ltd.

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Directors

Mr. S. P. Chhajed

Partner

M/s. Chhajed & Doshi

Chartered Accountants

Mr. R. P. Chitale

Managing Partner

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

Chartered Accountants

Mr. S. H. Khan

Chairman

Feedback First Urban Infrastructure

Development Comp. Ltd.

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

Professor and Former Director

Indian Institute of Management,

Bangalore

Mr. Anand G. Mahindra

Vice Chairman & Managing Director

Mahindra & Mahindra Ltd

Mr. N.S. Kannan

Chief Financial Officer & Treasurer

ICICI Bank Ltd

Mr. Indrajit Gupta

Managing Director & CEO

SBI Capital Markets Ltd.

Mr. A. P. Kurian

Chairman

Association of Mutual Funds in India

Mr. Justice M.L. Pendse (Retd.)

Former Chief Justice of Karnataka

High Court

and Judge of Bombay High Court

Mr. Ravi Parthasarathy

Chairman & Managing Director

Infrastructure Leasing & Financial

Services Ltd

Mr. R. N. Bhardwaj

Chairman

Life Insurance Corporation of India

Mr. M. Raghavendra

Ex-General Manager

General Insurance Corporation of India

Dr. R. H. Patil

Chairman

The Clearing Corporation of India Ltd.

Mr. S.Venkiteswaran

Sr. Advocate &

Mr. Y. H. Malegam

Chartered Accountant

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COMMITTEES

The Exchange has constituted various committees to advise it on areas such as

good market practices, settlement procedures, risk containment systems etc.

These committees are manned by industry professionals, trading 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

Managing Director

National Stock Exchange of India Ltd.

Chairman

2. Mr. Mukesh Kansal

Managing Director

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

Trading Member

3. Mr. Hemang Raja Trading Member

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http://www.nseindia.com/content/us/us_coti.htm

http://www.nseindia.com/content/us/us_ec.htm

Managing Director

M/s IL&FS Investsmart Ltd.

4. Mr. Shailesh Saraf

Wholetime Director

M/s. Dynamic Equities Pvt. Ltd.

Trading Member

5. Mr. C.Parthasarathy

Director

M/s. Karvy Stock Broking Ltd.

Trading Member

6. Mr. R. P. Chitale

Managing Partner

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

Accountants

Public

Representative

7. Mr. Y. H. Malegam

Chartered Accountant

Public

Representative

8. Mr. S. Venkiteswaran

Sr. Advocate

Public

Representative

9. Ms. Chitra Ramkrishna

Deputy Managing Director


Other Nominee

10. Mr. P. M. Venkatasubramanian

Ex-Managing Director, GIC

Other Nominee

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11. Mr. N.S.Kannan

Chief Financial Officer & Treasurer

ICICI Bank Limited

Other Nominee

For Futures & Options Segment

1. Mr. Ravi Narain

Managing Director


Chairman

2. Mr. Shitin D Desai

Executive Vice Chairman

M/s. DSP Merrill Lynch Ltd.

Trading Member

3. Mr. Vineet Bhatnagar

Managing Director

M/s Refco-Sify Securities India (Pvt.) Ltd.

Trading Member

4. Mr. D.C.Anjaria

Director

International Finance Solutions Pvt. Ltd.

Public

Representative

5. Mr. Shailesh Haribhakti

Partner

M/s. Haribhakti & Co.

Public

Representative

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6. Prof. V. Ravi Anshuman

Indian Institute of Management

Bangalore

Public

Representative

7. Mr. M. Raghavendra

Ex-General Manager

General Insurance Corporation of India

Other Nominee

8. Ms. Chitra Ramkrishna

Deputy Managing Director


Other Nominee

9. Mr. M. L. Soneji

Director (Operations & Surveillance)


Other Nominee

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COMMITTEE ON TRADE ISSUES (COTI)

Objective: To provide guidance on trade related issues which crop up during the

day-to-day functioning of the Exchange Composition:

Mr. Atul Kumar

Managing Director

Practical Financial Services Pvt. Ltd.

(Chairman of the committee)

Mr. S.Ramasubramanian

Partner

M/s. Venkatraman & Co

. Mr. Dhiraj Single

Head of Market Operations

ASK Raymond James Financial

Services (I) Ltd.

Mr. Dikul Patel

Executive Director

JK Securities Pvt. Limited

Mr. Shreekant Phumbhra

Proprietor

Shreekant Phumbhra

Mr. G V Nageswara Rao

Managing Director

IDBI Capital Market Services Ltd.

Mr. Ashok Kakkar

Wholetime Director

Vivek Financial Focus Ltd.

Mr. Ketan H. Marwadi

Managing Director

Marwadi Shares & Finance Pvt.

Ltd.

Mr.K. Ravindra Babu

Managing Director

Zen Securities Ltd.

Mr. Ravindra Kumar Agrawal

Wholetime Director

Shri Parashram Holdings P. Ltd.

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ADVISORY COMMITTEE - LISTING OF SECURITIES

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 out in the listing agreement as well as other formalities, 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

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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

8 Mr. Pradip P. Shah

Chairman, Indasia Fund Advisors Pvt. Ltd.

9 Mr. Vimal Bhandari

Executive Director, Infrastructure Leasing & Financial Services

Ltd.

10 Mr. J. Ravichandran

Company Secretary & Sr.Vice President


11. Mrs. Chitra Ramkrishna

Deputy Managing Director, Head of Listing


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Management Team (Personal Staff)

Mr. Ravi Narain MANAGING DIRECTOR & CHIEF EXECUTIVE

OFFICER

Ms. Chitra Ramkrishna Deputy Managing Director

Mr. J Ravichandran Director

Legal & Secretarial , Inspection, Finance &

Accounts

Mr. M L Soneji Director

Capital Market (Trade & Surveillance), F&O

(Trade & Surveillance), WDM (Trade &

Surveillance), IPO and Investigation

Mr. R Sundararaman Vice President

NSCCL - F&O Clearing, Risk Management &

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

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Mr. C. N. Upadhyay Asst. Vice President

Inspection

Mr. D Satish Kumar Asst. Vice President

Legal

Mr. Dhruvkumar Patil Asst. Vice President

Arbitration, Defaulters Section & Investor

Grievances

Mr. Mahesh Haldipur Asst. Vice President

Premises

Mr. Narendra Kumar

Ahlawat

Asst. Vice President

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

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Investigation & Surveillance

Ms. T S Jagadharini Asst. Vice President

Listing & Membership

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NSE Group

NSCCL

IISL NSE.IT

NSE

DotEx Intl. Ltd. NSDL

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http://www.nseindia.com/content/us/us_iisl.htm


http://www.nseindia.com/content/us/us_dotex.htm


National Securities Clearing Corporation Ltd. (NSCCL)

The National Securities Clearing Corporation Ltd. (NSCCL), a wholly owned

subsidiary of NSE, was incorporated in August 1995. It was set up to bring and

sustain confidence in clearing and settlement of securities; to promote 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

Equities and Derivatives segments and operates Subsidiary General Ledger

(SGL) for settlement of trades in government securities. It assumes the counter-

party risk of each member and guarantees financial settlement. It 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

settlement procedures and has brought Indian financial markets in line with

international markets.

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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

country. NSE.IT is uniquely positioned to provide products, services and

solutions for the securities industry. There has been a long felt need for top-of-

the-line products, services and solutions in the area of trading, broker front-end

and back-office, clearing and settlement, web-based trading, risk management,

treasury management, asset liability management, banking, insurance etc.

NSE.IT's expertise in these areas is the primary focus. The company also plans

to provide consultancy and implementation services in the areas of Data

Warehousing, Business Continuity Plans, Stratus Mainframe Facility

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.

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India Index Services & Products Ltd. (IISL)

India Index Services and Products Limited (IISL), a joint venture between NSE

and CRISIL Ltd. (formerly the Credit Rating Information Services of India

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 provides a broad range of services, products and professional index

services. It maintains over 80 equity indices comprising broad-based benchmark

indices, sectoral indices and customised indices. Many investment and 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 to solve the myriad problems associated with trading in physical

securities, NSE joined hands with the Industrial Development Bank of India

(IDBI) and the Unit Trust of India (UTI) to promote dematerialisation of securities.

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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 infrastructure of international standard to handle trading and 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 to their 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

offer web-based services to their customers. As a neutral aggregator 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

F&O Trading Module.

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NSE Technology

Across the globe, developments in information, communication and network

technologies have created paradigm shifts in the securities market operations.

Technology has enabled organisations to build new sources of competitive

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 organisation to retain its competitive edge and ensure timeliness and

satisfaction in customer service. In recognition of the fact that technology will

continue to redefine the shape of the securities industry, NSE stresses on

innovation and sustained investment in technology to remain ahead 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 (NSE's Internet Based Information System) for

on-line real-time dissemination of trading information over the internet. In order to

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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, optical-

fibre 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 the back office processing. The latest software platforms 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 centre operations, system and database administration, design

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and development of in-house systems and design and implementation of

telecommunication solutions.

NSE is one of the largest 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 wide area

network in the country and the first extended C- Band VSAT network in the world.

Currently more than 9000 users are trading on the real time-online NSE

application. There are over 15 large computer systems which include non-stop

fault-tolerant computers and high end UNIX servers, 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. This corporate network enables speedy inter-office 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 started trading in the equities segment (Capital Market segment) on

November 3, 1994 and within a short span of 1 year became the largest

exchange in India in terms of volumes transacted.

Trading volumes in the equity segment have grown rapidly with average daily

turnover increasing from Rs.17 crores during 1994-95 to Rs.4,328 crores during

2003-04. During the year 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 quotes and statistics of the equities market. In-

depth information regarding listing of securities, trading systems & processes,

clearing and settlement, risk management, trading statistics etc are available

here.

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http://www.nseindia.com/content/equities/eq_businessgrowth.htm

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.

Listing on NSE provides qualifying companies with the broadest access to

investors, the greatest market depth and liquidity, cost-effective access to capital,

the highest visibility, the fairest pricing, and investor benefits. NSE trading

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.

NSE plays an important role in helping an Indian companies access 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 units, infrastructure, and financial services. Listing on NSE 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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http://www.nseindia.com/content/equities/eq_serieslist.htm

http://www.nseindia.com/content/equities/eq_securities.htm

http://www.nseindia.com/content/equities/eq_vsats.htm

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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http://www.nseindia.com/content/equities/eq_listproc5.htm





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 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 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 there shall be no forfeiture of unclaimed dividends before the claim

becomes barred by law;

b. that a common form of transfer shall be used;

c. that fully paid shares shall be free from all lien and that in the 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 registration of transfer shall not be refused on the ground 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 any amount paid up in advance of calls on any share may carry

interest but shall not in respect thereof confer a right to dividend or to

participate in profits;

f. that option or right to call of shares shall not be given to any person except

with the sanction of the Issuer in general meetings.

g. permission for Sub-Division/Consolidation of Share Certificate.

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 the Articles

of Association.

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Listing Procedure

Approval of draft prospectus

The Issuer shall file the draft prospectus and application forms with NSE. In case

NSE is not the Regional Stock Exchange then the draft prospectus 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 prospectus only from the point of view of checking whether the draft

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 Regional

Stock Exchange with NSE. The Issuer should also submit the 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

For Issuers listing on NSE for the first time

Listing of further Issues by Issuers already listed on NSE

Listing Fees

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

Stock Exchange)

Supporting documents

Listing Procedure

Submission of Application (For Issuers listing on NSE for the

first time)

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http://www.nseindia.com/content/equities/eq_listfees.htm

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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

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 for admission shall be made in the forms 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.

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Appendix 'E' - Schedule of Distribution

Appendix 'G'- Application Letter for Listing of further issues.

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.50 crores 70,000

Companies which have a paid up capital of more than Rs. 50 crores will pay

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additional listing fees of Rs. 1400 for every increase of Rs. 5 crores or part

thereof in the paid up share/debenture capital.

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:

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1. The Issuer shall comply with all prevailing requirements of law including all

requirements of and under any notifications, directives and guidelines

issued by the Central Government, SEBI or any statutory body or local

authority or any body or authority acting under the authority or direction of

the Central Government and all prevailing listing requirements and

conditions of the NSE and of each recognized Stock Exchange where the

Issuer has applied for permission for admission to dealings of the

securities, within the prescribed or stipulated period;

2. If the Issuer has complied with all the aforesaid requirements and

conditions including, wherever applicable, its obligation under Section 73

(or any statutory modification or re-enactment thereof) of the Companies

Act, 1956 and obligations arising therefrom, within the prescribed 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 of the prescribed or stipulated period or the extended 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 unable to complete compliance of the aforesaid

requirements and conditions within the prescribed or stipulated period, the

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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

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 has at least ten days prior to expiry of the prescribed or

stipulated period applied in writing for extension of time to the NSE

stating the reasons for non-compliance, and

2. the Issuer, having been allowed further time by the NSE, has

before expiry of the prescribed or stipulated period, published in a

manner required by the NSE, the fact of such extension having

been allowed; provided further that where the NSE has not allowed

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.

%2%. 50% of the above mentioned security deposit should be paid 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:

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

security in the form prescribed in Appendix E (Table I, II & III) to 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 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 Initial Public Offerings (IPOs)

B. For Securities of Existing Companies

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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IPOs by Companies

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

1. Paid up Capital

The paid up equity capital of the applicant shall not be less than Rs. 10 crores

* and the capitalisation of the 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

issue price and the post issue number of shares) requirement of 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. Conditions Precedent to Listing:

The Issuer shall have adhered to conditions precedent to listing as emerging

from inter-alia from Securities Contracts (Regulations) Act 1956, Companies

Act 1956, 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.

3. At least three years track record of 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

reports of three preceding financial years to NSE and also provide 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 line of business and shall be holding at least 20%

of the post issue equity share capital individually or severally

4. The Project/ Activity plan of the applicant must have been appraised by a

financial institution u/s 4 A 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 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 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 which has received license from the

Reserve Bank of India or

2. a corresponding new bank set up under the Banking Companies

(Acquisition and Transfer of Undertakings) Act, 1970, Banking

Companies (Acquisition and Transfer of Undertakings) Act, 1980,

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State Bank of India Act, 1955 and the State Bank of India

(Subsidiary Banks) Act, 1959 (i.e. Public Sector Banks) or

3. an infrastructure company – (a) whose project has been appraised

by a Public Financial Institution or Infrastructure Development

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

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 at a later date issued by Government Companies, Public Sector

Undertakings, Financial Institutions, Nationalised Banks, Statutory

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 disciplinary action by other stock exchanges and

regulatory authorities in past three years

The applicant, promoters’/promoting company(ies), group

companies, companies promoted by the promoters/promoting

company(ies) have not been in default in payment of listing fees to

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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 or other regulatory authorities in connection with investor

related issues or otherwise.

Redressal mechanism of Investor grievance

The points of consideration are:


companies, companies promoted by the promoters’/promoting

company(ies) track record in redressal of investor grievances

The applicant’s arrangements envisaged are in place for servicing

its investor.



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

debenture/bond/fixed deposit holders by the applicant,

promoters’/promoting company(ies), group companies,

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 in such payments the securities of the

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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

March 31 of last three calendar years separately showing

promoters and other groups’ shareholding pattern should be as

per the regulatory requirements.

Details of Litigation



company(ies) litigation record, the nature of litigation, status of

litigation during the preceding three years period need to be

clarified to the exchange.

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 criminal cases filed or nature of the investigation being

undertaken with regard to alleged commission of any offence by

any of its directors and its effect on the business of the company,

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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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Securities of Existing Companies

Existing Companies listed on other stock exchanges

1. Paid up Capital & Market Capitalisation

1. The paid-up equity capital of the applicant shall not be less 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

issued by Government Companies, Public Sector Undertakings,

Financial Institutions, Nationalised Banks, Statutory 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 equity capital of the applicant shall not be less 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

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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 capitalisation of the applicant’s 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

purpose of calculating the market capitalisation over a 12 month

period, the average of the weekly high and low of the 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

Exchange such average price on any of the recognised Stock

Exchanges where those shares are frequently traded shall be taken

into account while determining market capitalisation after making

necessary adjustments for Corporate Action such as Rights / Bonus

Issue.

63

%2%. Conditions precedent to Listing:

The applicant shall have adhered to conditions precedent to listing as

emerging from inter-alia, Securities Contracts (Regulations) Act 1956,

Companies Act 1956, 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.

%2%. Atleast three years track record of 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

reports of three preceding financial years to NSE and also provide a

certificate to the Exchange in respect of the following:

1. The company has not been referred to the Board for Industrial and

Financial Reconstruction (BIFR).

2. The networth of the company has not been wiped out by the

accumulated losses resulting in a negative networth.

3. 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 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).

65

or

The networth of the applicant is atleast Rs. 50 crores***

While considering the profitability / ability to distribute dividend, the non

recurring income/extraordinary income shall be excluded from the 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).

*** Networth means: Paid up equity capital plus Reserves excluding

revaluation reserve minus Miscellaneous Expenses not written off 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) Equity shares and securities convertible into equity issued 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 which has received license from the Reserve Bank of India or

ii. a corresponding new bank set up under the Banking Companies

(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)

66

Or

iii. an infrastructure company – (a) whose project has been appraised by a

Public Financial Institution or Infrastructure Development 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 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 at a later date issued by Government Companies, Public Sector

Undertakings, Financial Institutions, Nationalised Banks, Statutory

Corporations, Banking Companies and subsidiaries of Scheduled Commercial

Banks."

67

THE APPLICANT DESIROUS OF LISTING ITS SECURITIES SHOULD

ALSO SATISFY THE EXCHANGE ON THE FOLLOWING:

1. No Disciplinary action has been taken by other stock exchanges and

regulatory authorities in the past three years

The applicant, promoters/promoting company(ies), group companies,

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 proceeded against by SEBI or other regulatory authorities in

connection with investor related issues or otherwise.

2. Redressal mechanism of Investor grievance

The points of consideration are:

The applicant, promoters/promoting company(ies), group


company(ies) track record in redressal of investor grievances

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

investor



68

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

debenture/bond/fixed deposit holders by the applicant,

promoters/promoting company(ies), group companies, 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 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. Distribution of shareholding

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. Details of Litigation

The applicant, promoters/promoting company(ies), group companies,

companies promoted by the promoters/promoting company(ies)

litigation record, the nature of litigation, status of litigation during the

preceding three years need to be clarified to the exchange.

69

5. 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 criminal

cases filed or nature of the investigation being 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. Change in Control of a Company/Utilisation of funds raised

from public

In the event of new promoters taking over listed companies which

results in change in management and/or companies utilising the funds

raised through public issue for the purposes other than those

mentioned in the offer document, such companies shall make

additional disclosures (as required by the Exchange) with regard to

change in control of a company and utilisation of funds raised from

public.

70

NOTE:

Where an unlisted company merges with a company listed on other stock

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.

71

BOMBAY STOCK EXCH ANGE

72

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

Securities Contracts (Regulation) Act, 1956.The Exchange's pivotal and pre-

eminent 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

under the provisions of the Companies Act, 1956, pursuant to the

BSE(Corporatisation and Demutualisation) Scheme, 2005 notified by the

Securities and Exchange Board of India (SEBI).

With demutualisation, the trading rights and ownership rights have been de-

linked effectively addressing concerns regarding perceived and real conflicts of

interest. The Exchange is professionally managed under the overall direction of

the Board of Directors.The Board comprises eminent professionals,

representatives of Trading Members and the Managing Director of the Exchange.

The Board is inclusive and is designed to benefit from theparticipation of market

intermediaries.

73

In terms of organisation structure, the Board formulates larger policy issues and

exercises over-all control. The committees constituted by the Board are broad-

based.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 2004-

2005, the trading volumes on the Exchange showed robust growth.

The Exchange provides an efficient and transparent market for trading in equity,

debt instruments and derivatives. The BSE's On Line Trading System (BOLT) is

a proprietory system of the Exchange and is BS 7799-2-2002 certified. The

surveillance and clearing & settlement functions of the Exchange are ISO

9001:2000 certified.

74

HERITAGE

The oldest exchange in Asia and the first exchange in the country to be granted

permanent recognition under the Securities Contract Regulation Act, 1956,

Bombay Stock Exchange Limited (BSE) has had an interesting 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

market capitalisation, BSE has played a pioneering role in the Indian

75

Securities Market - one of the oldest in the world. Much before actual

legislations were enacted, BSE had formulated comprehensive set of Rules

and Regulations for the Indian Capital Markets. It also laid down best

practices adopted by the Indian Capital Markets after India gained 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

76

'BSE On-Line Trading System’ (BOLT) has been awarded the globally

recognised the Information Security Management System standard

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 nationwide awareness campaigns and dissemination of information

through print and electronic medium was undertaken. BSE also actively

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 expanded, nationwide, in 1997. It was at the BSE's International

Convention Hall that India’s 1st Bell ringing ceremony in the history Capital

77

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"

index of 30 component stocks representing a sample of large, well-

established and financially sound companies. The base year of BSE-SENSEX

78

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 witnessed a similar frenzy in the 'TMT' sectors. The BSE-SENSEX

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, 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.

79

With a view to provide a better representation of the increased number of

companies listed, increased market capitalisation and the new industry

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 BSE-

200 Index in 1994 was followed by the launch of BSE-500 Index and 5

sectoral indices in 1999. In 2001, BSE launched the BSE-PSU 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 values of all BSE indices (except the Dollar version of indices) are

updated every 15 seconds during the market hours and displayed through the

BOLT system, BSE website and news wire agencies.

80

All BSE-Indices are reviewed periodically by the "Index Committee" of the

Exchange. The committee frames the broad policy guidelines for 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.

81

BOARD OF DIRECTORS

Non-Executive Chairman Mr. Jagdish Capoor

Chairman, HDFC Bank

MD & CEO Mr. Rajnikant Patel

Directors

Mr. P. K. Banerji

IAS (Retd.)

Mr.S.Jambunathan

IAS (Retd.)

Ex-Chairman-cum-Managing Director

Export Credit and Gurantee

Corporation, Govt. of India

Prof. N. Ravichandran

Professor, IIM Ahmedabad

Mr. Jitesh Khosla

Joint Secretary, Dept. of Company

Affairs, Govt. of India

Mr. Vijay Mukhi

Managing Director, Vijay Mukhi's

Computer Institute

82

Mr. Pradip P. Shah

Chairman, IndAsia Fund Advisors Private

Limited

Mr. P. P. Vora

Ex-Chairman, Industrial Development

Bank of India and National Stock

Exchange of India Limited

Trading Member Representatives Mr. Prakash R. Kacholia

Mr. Balkishan Mohta

Mr. Siddharth J. Shah

83

MANAGEMENT TEAM

Sr. No. Name Designation Department

1 Mr. Rajnikant

Patel

MD & CEO

2 Mr. A. A.

Tirodkar

Chief - Investor

Services

Department of Investor

Services

3 Mr. S.B.

Patankar

Chief Technology

Officer

Dept. of Information

Technology

4 Mr. Kevin

Desouza

Chief General

Manager

Dept. of Administration &

Personnel Mgt.

5 Mr. P.S.

Reddy

Chief General

Manager

HR (Policies &

Procedures), DCS and

DOSS

6 Mr. S. S. Vyas Chief - Internal Control Internal Control Functions

7 Dr. Bandi Ram

Prasad

Chief Knowledge

Officer

Knowledge Management

8 Mr. Suniel

Vichare

Senior General

Manager

Member Services &

Development

9 Mr. P. P. Senior General Dept. of Operations &

84

Kaladharan Manager Trading (DOT)

10 Mr. T. V.

Rangaswami

Senior General

Manager

Strategy, Planning &

Policies

11 Mr. V. G.

Bhagat

Company Secretary Secretarial & Compliance

12 Mr. Sanjiv

Kapur

General Manager Dept. of Surveillance &

Supervision (DOSS)

13 Mrs. Devika S.

Shah

General Manager Clearing & Settlement,

Derivatives & Debt

14 Mr. S. S. Bolar General Manager Investments & Accounts

15 Mr. Sanjay M.

Golecha

General Manager Dept. of Corporate Services

(DCS)

16 Mr. Lalit

Ranpuria

General Manager Dept. of Information

Technology (DIT)

17 Mr. C.

Vasudevan

General Manager Knowledge Management

18 Mr. Rahul

Sharma

General Manager Dept. of Operations &

Trading (DOT)

19 Mr. Saji

Cherian

General Manager Strategy, Planning &

Policies

85

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, quasi-governmental and other financial institutions/corporations,

municipalities, etc.

The objectives of listing are mainly to :

provide liquidity to securities;

mobilize savings for economic development;

protect interest of investors by ensuring full disclosures.

The Exchange has a separate Listing Department to grant approval for listing of

securities of companies in accordance with the provisions of the Securities

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 the listing requirements prescribed by the Exchange. Some of the

requirements are as under: -

86

1. Minimum Listing Requirements for new companies

2. Minimum Requirements for companies delisted by this Exchange

seeking relisting of this Exchange

3. Minimum Requirements for companies delisted by this Exchange

seeking relisting of this Exchange

4. Permission to use the name of the Exchange in an Issuer Company's

prospectus

5. Submission of Letter of Application

6. Allotment of Securities

7. Trading Permission

8. Requirement of 1% Security

9. Payment of Listing Fees

10.Compliance with Listing Agreement

11."Z" Group

12.Cash Management Services (CMS) - Collection of Listing Fees

87

88

[I] MINIMUM LISTING REQUIREMENTS FOR NEW COMPANIES

(A) Minimum Capital:

1. New companies can be listed on the Exchange, if their issued &

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 companies in high technology ( i.e. information technology,

internet, e-commerce, telecommunication, media including advertisement,

entertainment etc.) the following criteria will be applicable regarding

threshold limit:

i. The total income/sales from the main activity, which should be in

the field of information technology, internet, e-commerce,

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. The minimum post-issue paid-up equity capital should be Rs.5

Crores.

89

iii. The minimum market capitalisation should be Rs.50 Crores. (The

capitalisation will be calculated by multiplying the post issue

subscribed number of equity shares with the Issue price).

iv. Post issue networth ( equity capital + free reserves excluding

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.

90

For this purpose, the term "offered to the public" means only the portion offered

to the public and does not include reservations of securities on 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.

91

[II] MINIMUM LISTING REQUIREMENTS FOR COMPANIES

LISTED ON OTHER STOCK EXCHANGES

The Governing Board of the Exchange at its meeting held on 6th August, 2002

amended the direct listing norms for companies listed on other Stock

Exchange(s) and seeking listing at BSE. These norms are applicable with

immediate effect.

1. The company should have minimum issued and paid up equity capital of

Rs. 3 crores.

2. The Company should have profit making track record for last three years.

The revenues/profits arising out of extra ordinary items or income from

any source of non-recurring nature should be excluded while calculating

distributable profits.

3. Minimum networth of Rs. 20 crores (networth includes Equity capital and

free reserves excluding revaluation reserves).

4. Minimum market capitalisation of the listed capital should be at least two

times of the paid up capital.

5. The company should have a dividend paying track record for the last 3

consecutive years and the minimum dividend should be at least 10%.

6. Minimum 25% of the company's issued capital should be with Non-

Promoters 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

92

others except in case of Banks/Financial Institutions/Foreign Institutional

Investors/Overseas Corporate Bodies and Non-Resident Indians.

7. The company should have at least two years listing record with any of the

Regional Stock Exchange.

8. The company should sign an agreement with CDSL & NSDL for demat

trading.

93

[III] Minimum Requirements for companies delisted by 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 securities offered through public issues are required to obtain its prior

permission to use the name of the Exchange in their prospectus or offer for sale

documents before filing the same with the concerned office of the Registrar of

Companies. The Exchange has since last three years formed a "Listing

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

Limited" in their prospectus/offer documents. The committee evaluates the

promoters, company, project and several other factors before taking decision in

this regard.

94

[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 Listing Agreement, a company is required to complete allotment 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.

95

[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

securities are to be listed within 7 working days of finalisation of Basis of

Allotment.

A company should scrupulously adhere to the time limit for allotment of all

securities and dispatch of Allotment Letters/Share Certificates and 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, non-

payment of commission to underwriters, brokers, etc.

96

[IX] PAYMENT OF LISTING FEES

All companies listed on the Exchange have to pay Annual Listing Fees by the

30th April of every 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:

97

SCHEDULE OF LISTING FEES FOR THE YEAR 2005-2006

Sr.

No.Particulars

Amount

(Rs.)

1 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

10,000

15,000

30,000

3 Companies which have a paid-up capital* of more than Rs. 20

crores will pay additional fee of Rs. 750/- for every increase of

Rs. 1 crores or part thereof.

4 In case of debenture capital (not convertible into equity shares) of

companies, the fees will be charged @ 25% of the fees payable

as per the above mentioned scales.

*Includes equity shares, preference shares, fully convertible debentures, partly

convertible debenture capital and any other security which will be converted into equity

shares.

98

[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, to provide facilities for prompt transfer, registration, sub-division and

consolidation of securities; to give proper notice of closure of transfer books and

record dates, to forward copies of unabridged Annual Reports and Balance

Sheets to the shareholders, to file Distribution Schedule with the Exchange

annually; to furnish financial results on a quarterly basis; intimate promptly to the

Exchange the happenings which are likely to materially affect the financial

performance of the Company and its stock prices, to comply with the conditions

of Corporate Governance, etc.

The Listing Department of the Exchange monitors the compliance of the

companies with the provisions of the Listing Agreement, especially with regard to

timely payment of annual listing fees, submission of quarterly results,

requirement of minimum number of shareholders, etc. and takes penal action

against the defaulting companies.

99

[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

amended the direct listing norms for companies listed on other Stock

Exchange(s) and seeking listing at BSE. These norms are applicable with

immediate effect.

1. The company should have minimum issued and paid up equity capital of

Rs. 3 crores.

2. The Company should have profit making track record for last three years.

The revenues/profits arising out of extra ordinary items or income from

any source of non-recurring nature should be excluded while calculating

distributable profits.

100

3. Minimum networth of Rs. 20 crores (networth includes Equity capital and

free reserves excluding revaluation reserves).

4. Minimum market capitalisation of the listed capital should be at least two

times of the paid up capital.

5. The company should have a dividend paying track record for the last 3

consecutive years and the minimum dividend should be at least 10%.

6. Minimum 25% of the company's issued capital should be with Non-

Promoters 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 should have at least two years listing record with any of the

Regional Stock Exchange.

8. The company should sign an agreement with CDSL & NSDL for demat

trading.

101

[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 intending to utilise the above facility for payment of listing fee would

be required to furnish the information, (mentioned below) in the Cash

Management Cash Deposit Slip. These slips would be available at all the HDFC

Bank centres.

S.No HEAD INFORMATION TO BE PROVIDED

1.Client

NameBombay Stock Exchange Limited

2.Client

CodeBSELIST

3.Cheque

No.mention the cheque No & date

4. Date date on which payment is being deposited with the bank.

5. Drawer state the name of the company and the company code No.The

102

http://www.hdfcbank.com/

http://www.bseindia.com/

last digits mentioned in the Ref. No. on the Bill is the company

code No.e.g If the Ref. No in the Bill is mentioned as : Listing/Alf-

Bill/2004-2005/4488, then the code No of that company is 4488

6.Drawee

Bankstate the bank on which cheque is drawn

7.Drawn on

LocationMention the location of the drawee bank.

8.Pickup

LocationNot applicable

9.No. of

InstsNot applicable

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

filled in quadruplicate. One acknowledged copy would be provided to the

depositor by the HDFC Bank.

103

ANALYSIS

104

TABLE NO. 1, COMPARATIVE SUMMARY OF CAPITAL

REQUIREMENT.

Serial

No.Criteria BSE NSE

1Capital Required

(Paid-Up)MINIMUM 10 CRORES

MINIMUM 10

CRORES

2Market

Capitalization

MINIMUM 2 TIMES OF PAID-UP

CAPITAL

MINIMUM 25

CRORES

3Profit Making

RecordAt-least last 3 years N.A.

4Net Worth

RequiredMinimum 20 cr.

The net worth of the

company has not

been wiped out by

the accumulated

losses resulting in a

negative net worth

105

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

5Capital Required

(Paid-Up)MINIMUM 3CRORES

MINIMUM 10

CRORES

6Market

Capitalization

MINIMUM 2 TIMES OF PAID-UP

CAPITAL

MINIMUM 25

CRORES

7Profit Making

RecordAt-least last 3 years

At-least two out of

the last three

financial years

8Net Worth

RequiredMinimum 20 cr. Minimum 50 cr.

9Dividend paying

track recordMinimum 3 years

Minimum 2 out of the

last 3 immediately

preceding financial

years

10 Listing Record

At-least two years listing record

with any Regional Stock

Exchange.

At-least three years

listing record with

any Regional Stock

Exchange.

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INTERPRETATION

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.

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Dividend paying track record: -

On NSE the applicant has paid dividend in at least 2

out of the last 3 financial years immediately preceding the year in which listing

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.

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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:

Up to Rs. 5 crores10,000

Of Rs.1 crore 4,200

Above Rs.1 crore and

up to Rs.5 crores8,400

Above Rs. 5

crores and up to

Rs. 10 crores

15,000Above Rs.5 crores and

up to Rs.10 crores14,000

Above Rs. 10

crores and up to

Rs. 20 crores

30,000Above Rs.10 crores

and up to Rs.20 crores28,000

Above 20 crores

Additional fee of Rs.

750/- for every

increase of Rs. 1

crores or part thereof.

Above Rs.20 crores

and up to Rs.50 crores42,000

Above Rs.50 crores 70,000

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

109

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.

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

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

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 premier market place

2. Visibility

3. Largest exchange

4. Unprecedented reach

5. Modern infrastructure

6. Transaction speed

7. Short settlement cycles

8. Broadcast of corporate announcements

9. Trade statistics for listed companies

10. Investor service centers

11.Nominal listing fees

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1. A premier marketplace

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 ensures consistency and transparency in the trade matching which

enhances investors confidence and visibility of our market.

2. Visibility

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 total number of securities available for buying and selling is 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. Largest Exchange

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.

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4. Unprecedented reach

NSE provides a trading platform that extends across the length and breadth of

the country. Investors from 360 centres can avail of trading facilities on the NSE

Trading Network. The Exchange uses the latest in communication technology to

give instant access from every location.

5. Modern infrastructure

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. Transaction speed

The speed at which NSE processes orders, results in liquidity and better

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 settlement cycles

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

8. Broadcast facility for corporate announcements

The NSE network is used to disseminate information and company

announcements across the country. Important information regarding the

company is announced to the market through the Broadcast Mode on the NEAT

System as well as disseminated through the NSE website. Corporate

developments such as financial results, book closure, announcements of bonus,

rights, takeover, mergers etc. are disseminated across the country thus

minimizing scope for price manipulation or misuse.

9. Trade statistics for listed companies

Listed companies are provided with monthly trade statistics for all the securities

of the company listed on NSE.

10. Investor service centers

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Six investor-service centers opened by NSE across the country cater to the

needs of investors.

11.Nominal listing fees

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

charged BSE.

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CONCLUSION

On the basis of above stated study it has been assorted that with respect to

technology, listing fees, listing procedure, eligibility criteria of listing & listing

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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