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A PROJECT ON

BOMBAY STOCK EXCHANGE- AN OVERVIEW

SUBMITTED TO:

Dr. Deepak Das

(Faculty of Corporate Law)

SUBMITTED BY:

Anchal Kumar Matre

Roll no. 22

Semester-VI

(POLITICAL SCIENCE MAJOR)

SECTION – A

DATE OF SUBMISSION:

07TH APRIL, 2015


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Table of Contents

1. Objectives and Research Methodology………………….4

2. Introduction……………………………………………...6

3. Chapters

 History of BSE………………….……………7
 Vision of BSE………...………………………8
 Brand Identity…………………………………8
 Heritage & Significance…….…………………8
 Corporate Social Responsibility (CSR)………..9
 Awards & Recognitions………………………..10
 Achievements…………………………………..10
 Working of Stock Exchanges In India………….12

4. Conclusion……………………………………………….....13

5. Bibliography………………………………………………..14
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Acknowledgements
On the completion of this project I find that there are many persons to whom I would like to
express my gratitude, since without their help and co-operation the success of this educative
endeavour would not have been possible. I welcome this opportunity to express my sincere
gratitude to my teacher Dr. Deepak Das who has been a constant source of encouragement and
guidance throughout the course of this work. I am grateful to the IT Staff for providing all
necessary facilities for carrying out this work. Thanks are also due to all members of the Library
staff for their help and assistance at all times. I am also grateful to all my friends and colleagues
for being helpful in their differences and for their constant support.

Anchal Kumar Matre


(Researcher)
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OBJECTIVES
1. To understand the concept of stock exchange.
2. To study about different stock exchange.
3. To focus on working of Bombay stock exchange.
4. To analyze the corporate structure of Bombay stock exchange.
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Research Methodology
The present research work is a Doctrinal work and a detailed study of the topic – Bombay
Stock Exchange- an overview. The methodology adopted in this research work is doctrinal
and based on PRIMARY sources like bare acts, statues etc and SECONDARY sources of
information like books, journals, articles etc. This research work contains elabourated
theoretical research, an overall study of the topic and in depth and in depth web browsing.
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INTRODUCTION
"With daily trade volumes rising, it was not enough to just add more production environments,
which was just reducing the efficiency. The need of the hour was a streamlined and consolidated
IT infrastructure."
-Mr. S.B. Patankar
Chief Technology Officer, BSE

Established in 1875, BSE Ltd. (formerly known as Bombay Stock Exchange Ltd.), is Asia’s first
Stock Exchange and one of India’s leading exchange groups. Over the past 137 years, BSE has
facilitated the growth of the Indian corporate sector by providing it an efficient capital-raising
platform. Popularly known as BSE, the bourse was established as "The Native Share & Stock
Brokers' Association" in 1875. BSE is a corporatized and demutualised entity, with a broad
shareholder-base which includes two leading global exchanges, Deutsche Bourse and Singapore
Exchange as strategic partners. BSE provides an efficient and transparent market for trading in
equity, debt instruments, derivatives, mutual funds. It also has a platform for trading in equities
of small-and-medium enterprises (SME).
More than 5000 companies are listed on BSE making it world's No. 1 exchange in terms of listed
members. The companies listed on BSE Ltd command a total market capitalization of USD 1.32
Trillion as of January 2013. It is also one of the world’s leading exchanges (3rd largest in
December 2012) for Index options trading (Source: World Federation of Exchanges).
BSE also provides a host of other services to capital market participants including risk
management, clearing, settlement, market data services and education. It has a global reach with
customers around the world and a nation-wide presence. BSE systems and processes are
designed to safeguard market integrity, drive the growth of the Indian capital market and
stimulate innovation and competition across all market segments. BSE is the first exchange in
India and second in the world to obtain an ISO 9001:2000 certification. It is also the first
Exchange in the country and second in the world to receive Information Security Management
System Standard BS 7799-2-2002 certification for its On-Line trading System (BOLT). It
operates one of the most respected capital market educational institutes in the country (the BSE
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Institute Ltd.). BSE also provides depository services through its Central Depository Services
Ltd. (CDSL) arm.
BSE’s popular equity index - the S&P BSE SENSEX - is India's most widely tracked stock
market benchmark index. It is traded internationally on the EUREX as well as leading exchanges
of the BRCS nations (Brazil, Russia, China and South Africa).
BSE has won several awards and recognitions that acknowledge the work done and progress
made like The Golden Peacock Global CSR Award for its initiatives in Corporate Social
Responsibility, NASSCOM - CNBC-TV18’s IT User Awards, 2010 in Financial Services
category, Skoch Virtual Corporation 2010 Award in the BSE StAR MF category and
Responsibility Award (CSR) by the World Council of Corporate Governance. Its recent
milestones include the launching of BRICSMART indices derivatives, BSE-SME Exchange
platform, S&P BSE GREENEX to promote investments in Green India.

HISTORY OF BOMBAY STOCK EXCHANGE (BSE)

The Bombay Stock Exchange is the oldest exchange in Asia. It traces its history to the 1850s,
when four Gujarati and one Parsi stockbroker would gather under banyan trees in front of
Mumbai's Town Hall. The location of these meetings changed many times, as the number of
brokers constantly increased. The group eventually moved to Dalal Street in 1874 and in 1875
became an official organization known as 'The Native Share & Stock Brokers Association'. In
1956, the BSE became the first stock exchange to be recognized by the Indian Government under
the Securities Contracts Regulation Act. The Bombay Stock Exchange developed the BSE
SENSEX in 1986, giving the BSE a means to measure overall performance of the exchange. In
2000 the BSE used this index to open its derivatives market, trading SENSEX futures contracts.
The development of SENSEX options along with equity derivatives followed in 2001 and 2002,
expanding the BSE's trading platform. Historically an open outcry floor trading exchange, the
Bombay Stock Exchange switched to an electronic trading system in 1995. It took the exchange
only fifty days to make this transition. This automated, screen-based trading platform called BSE
On-line trading (BOLT) currently has a capacity of 8 million orders per day. The BSE has also
introduced the world's first centralized exchange-based internet trading system, BSEWEBx.co.in
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to enable investors anywhere in the world to trade on the BSE platform. The BSE is currently
housed in Phiroze Jeejeebhoy Towers at Dalal Street, Fort area.1

VISION OF BSE

"Emerge as the premier Indian stock exchange with best-in-class global practice in technology,
products innovation and customer service."

BRAND IDENTITY

Bombay Stock Exchange has now adopted only its initials as the new name (BSE), positioning
itself better position as a national multi-asset financial infrastructure institution. BSE’s strategic
shift in approach, attitude and business focus is reflected in its new tag line - Experience the
New. With renewed zeal and focus on new business opportunities, product and service
innovation, upgrades in technology, increased investor and member focus, BSE is always
pushing the envelope on all fronts. The ambition is to continually improve and adopt new and
better ways of conducting our business.

As the first stock exchange in Asia and the pioneer of securities transaction business, BSE prides
itself on being at the forefront of bringing innovations to the Indian capital markets while
creating diverse investment opportunities for the investor community in India throughout its long
history.BSE continues to undertake several initiatives to build on its strong brand, legacy and
market position to create value for its stakeholders and the financial system.

HERITAGE AND SIGNIFICANCE

BSE Ltd, the first ever stock exchange in Asia established in 1875 and the first in the country to
be granted permanent recognition under the Securities Contract Regulation Act, 1956, has had an
interesting rise to prominence over the past 137 years. While BSE Ltd is now synonymous with
Dalal Street, it was not always so. The first venue of the earliest stock broker meetings in the

1
http://en.wikipedia.org/wiki/Bombay_Stock_Exchange
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1850s was in 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 what is now called
Mahatma Gandhi Road. As the number of brokers increased, they had to shift from place to
place, but they always overflowed to the streets. At last, in 1874, the brokers found a permanent
place, and one that they could, quite literally, call their own. The new place was, aptly, called
Dalal Street (Brokers' Street). The journey of BSE Ltd. is as eventful and interesting as the
history of India's securities market. In fact, as India's biggest bourse in terms of listed companies
and market capitalisation, almost every leading corporate in India has sourced BSE Ltd. services
in raising capital and is listed with BSE Ltd. Even in terms of an orderly growth, much before the
actual legislations were enacted, BSE Ltd. had formulated a comprehensive set of Rules and
Regulations for the securities market. It had also laid down best practices which were adopted
subsequently by 23 stock exchanges which were set up after India gained its independence.
BSE Ltd., as a institutional brand, has been and is synonymous with the capital market in India.2
Its S&P BSE SENSEX is the benchmark equity index that reflects the health of the Indian
economy.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Corporate Social Responsibility (CSR) in BSE is aligned with its tradition of creating wealth in
the community with a three pronged focus on Education, Health and the Environment. Besides
funding charitable causes for the elderly and the physically challenged, BSE has been supporting
the rehabilitation and restoration efforts in earthquake-hit communities of Gujarat. BSE has been
awarded the Golden Peacock Global - CSR Award for its initiatives in Corporate Social
Responsibility (CSR) by the World Council of Corporate Governance.3

2
http://www.bseindia.com/static/about/heritage.aspx?expandable=0
3
http://www.bseindia.com/static/about/csr.aspx?expandable=0
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AWARDS AND RECOGNITIONS

As a pioneering financial institution in the Indian capital market, BSE has won several awards
and recognitions that acknowledge the work done and progress made.

 The Golden Peacock Global CSR Award for its initiatives in Corporate Social
Responsibility
 BSE has won NASSCOM - CNBC-TV18’s IT User Awards, 2010 in Financial Services
category
 BSE has won Skoch Virtual Corporation 2010 Award in the BSE StAR MF category
 Responsibility Award (CSR), by the World Council of Corporate Governance
 Annual Reports and Accounts of BSE have been awarded the ICAI awards for excellence
in financial reporting for four consecutive years from 2006 onwards
 Human Resource Management at BSE has won the Asia - Pacific HRM awards for its
efforts in employer branding through talent management at work, health management at
work and excellence in HR through technology4

ACHIEVEMENTS

At par with international standards, BSE Ltd. has been a pioneer in several areas over the
decades and has many firsts and key achievements to its credit. BSE is the first exchange in India
to

 Launch a special platform for trading in SME securities


 Introduce Equity Derivatives
 Launch a Free Float Index - S&P BSE SENSEX
 Launch Exchange Enabled Internet Trading Platform

4
http://www.bseindia.com/static/about/awards.aspx?expandable=0
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 Obtain ISO certification for a stock exchange


 Exclusive facility for financial training – BSE Institute Ltd.
 Launch its website in Hindi and regional languages
 Host the popular opening-bell ceremony in Indian capital markets
 Launch mobile-based trading in India in Sept 2010
 Become securities market infrastructure member of SWIFT in India and provide
corporate actions to custodians in ISO 15022 format
 Launched S&P BSE SENSEX Realized S&P BSE Volatility (REALVOL) Index in Nov
2010

Besides the above, BSE has taken large strides in product and service innovation for the benefit
of its members and investors, notable ones being

 Launch of a reporting platform for corporate bonds


 Launch of the S&P BSE IPO index and S&P BSE PSU website
 Revamp of its website with wide range of new investor-friendly features
 No. of stock exchanges were increases and national stock exchange was also established
in Mumbai in 1993.
 Launch of trading in S&P BSE SENSEX futures on EUREX and leading exchanges of
the BRICS nation bloc
 Launched Smart Order Routing for members and investors
 Introduced SACT (SMS alert & Complaint Tracking system)
 Launched co-location facility at BSE premises in November 2010
 Reduction in membership fees to Rs. 10 lakh for new memberships to promote financial
access and inclusion
 Launch of web-based mutual fund trading platform for investors5

5
http://www.bseindia.com/static/about/achivements.aspx?expandable=0
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WORKING OF STOCK EXCHANGES IN INDIA

Indian stock exchanges are working before independence of Indian after revaluation of
industry in west, English investors started to deal in shares in Indian stock exchanges
since 1875. They started to deal first in India’s economic and business center Bombay.
For this they had established Bombay stock exchange in India in 1875 with the name of
“The native share and stock brokers association”. There were just 318 persons who
became members of this association. Slowly the no. of members and trading in this stock
market was increasing and in 1956, BSE became reputed market after providing powers
of capital market by passing securities contract(Regulation) act1956 and also after
making of new economic policies in 1991 by Dr. Manmohan Singh( slogan of
liberalisation , privatisation and globalisation). From 1875 to 1995 working of stock
exchanges in India was fully dependent on paper shares, debentures and bond. It means
for completing dealing physical delivery of shares was necessary. But from 1995, online
dealing in shares, created online stock markets in India. One side, we are seeing the
developments and progress in stock exchanges in India but other side of Harshad Mehta
scam, we watched downfall in the progress of stock exchanges in India. Harshad Mehta
was a player who rendered fraud in Indian stock market by including private bank in
fraud scheme. Govt. of India had taken good action for prohibiting such scams by
establishing SEBI in 1992. This board played a great role to develop and to secure the
investors of India. After this India stock exchange again because attraction point of
international investors. SEBI made rules in which all transactions will be settled on daily
basis and there will be zero level fraud and scam in stock exchanges in India. Main
benefit of e-stock exchanges that now NRI can sell and purchase without physical
transferring of shares , all dealing are taken place online and sale and purchase price of
shares are transferred by cheque or by e-banking facility . This new form of stock
exchanges in India opens new business in each and every home which is connected with
Internet. Indian stock exchange trends are showing upward sensex from last 2008 when
USA market fell due to financial crisis but India saved easily from this crisis and a very
small effect was on Indian stock market.
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CONCLUSION

Over the past 137 years, BSE has facilitated the growth of the Indian corporate sector by
providing it an efficient capital-raising platform. Popularly known as BSE, the bourse
was established as "The Native Share & Stock Brokers' Association" in 1875. BSE is a
corporatized and demutualised entity, with a broad shareholder-base which includes two
leading global exchanges, Deutsche Bourse and Singapore Exchange as strategic
partners. BSE provides an efficient and transparent market for trading in equity, debt
instruments, derivatives, mutual funds. Around 5000 companies are listed on BSE
making it world's No. 1 exchange in terms of listed members. The companies listed on
BSE Ltd command a total market capitalization of USD Trillion 1.2 as of October 31,
2012. BSE Ltd is world's fifth most active exchange in terms of number of transactions
handled through its electronic trading system. It is also one of the world’s leading
exchanges (3rd largest in July 2012) for Index options trading (Source: World Federation
of Exchanges). BSE also provides a host of other services to capital market participants
including risk management, clearing, settlement, market data services and education. It
has a global reach with customers around the world and a nation-wide presence. BSE
systems and processes are designed to safeguard market integrity, drive the growth of the
Indian capital market and stimulate innovation and competition across all market
segments. BSE is the first exchange in India and second in the world to obtain an ISO
9001:2000 certification. It is also the first Exchange in the country and second in the
world to receive Information Security Management System Standard BS 7799-2-2002
certification for its On-Line trading System (BOLT). It operates one of the most
respected capital market educational institutes in the country (the BSE Institute Ltd.).
BSE also provides depository services through its Central Depository Services Ltd.
(CDSL) arm. BSE’s popular equity index - the S&P BSE SENSEX [Formerly SENSEX ]
- is India's most widely tracked stock market benchmark index. It is traded internationally
on the EUREX as well as leading exchanges of the BRCS nations (Brazil, Russia, China
and South Africa). On Tuesday, 19 February 2013 BSE has entered into Strategic
Partnership with S&P DOW JONES INDICES and the SENSEX has been renamed as
"S&P BSE SENSEX".
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BIBLIOGRAPHY

Acts

1. Indian Companies Act, 2013.


2. Securities exchange Board of India Act, 1992.
Websites
http://www.bseindia.com/static/about/csr.aspx?expandable=0

http://www.bseindia.com/static/about/awards.aspx?expandable=0

http://www.bseindia.com/static/about/achivements.aspx?expandable=0

http://www.bseindia.com/static/about/milestones.aspx?expandable=0

http://www.bseindia.com/static/about/logo.aspx?expandable=0

http://www.bseindia.com/static/about/heritage.aspx?expandable=0

http://www.bseindia.com/static/about/vision.aspx?expandable=0

http://www.bseindia.com/static/about/introduction.aspx?expandable=0

http://www.bseindia.com/#about

http://www.bseindia.com/downloads/Code_of_Conduct_for_Directors.pdf

http://en.wikipedia.org/wiki/Bombay_Stock_Exchange

http://www.svtuition.org/2009/06/working-of-stock-exchanges-in-india.html

http://h71028.www7.hp.com/enterprise/downloads/Bombay%20Stock%20Exchange-IN.pdf

all sites accessed at 04-04-2015 at 4 pm.