STOCK EXCHANGES

IN INDIA
&
DEMAT OF SHARES
HARSH CHADHA-17BSP0995
AMEYA PRADHAN-17BSP
AISHWARYA JOSHI-17BSP0158
BHAVANA THOTA-16BSP2727
AJAY SAWANE-17BSP
 STOCK EXCHANGES IN INDIA:

 Mark Twain once divided the world into two kinds of people:
those who have seen the famous Indian monument, the Taj
Mahal, and those who haven't. The same could be said about
investors. There are two kinds of investors: those who know
about the investment opportunities in India and those who
don't.
Participants
Stock Exchanges In INDIA.

 Most of the trading in the Indian stock market takes place on its two
stock exchanges:
The BOMBAY STOCK EXCHANGE (BSE)
The NATIONAL STOCK EXCHANGE (NSE)
 The BSE has been in existence since 1875. The NSE, on the other
hand, was founded in 1992 and started trading in 1994.
 However, both exchanges follow the same trading mechanism,
trading hours, settlement process, etc.
 At the last count, the BSE had about 4,700 listed firms, whereas the
rival NSE had about 1,200.
 Out of all the listed firms on the BSE, only about 500 firms
constitute more than 90% of its market capitalization the rest of the
crowd consists of highly illiquid shares.
Indian stock exchanges may refer to the 18 official stock
exchanges located in India, the largest of which are the NSE and
BSE. Few of them are as below:

 CALCUTTA STOCK EXCHANGE

 PUNE STOCK EXCHANGE
 OTC EXCHANGE OF INDIA
 U.P STOCK EXCHANGE
 VADODARA STOCK EXCHANGE
 COIMBATORE STOCK EXCHANGE
 AHMEDABAD STOCK EXCHANGE
 TRIVANDRUM STOCK EXCHANGE
 BHUBHANESHWAR STOCK EXCHANGE etc..,
 DEMAT OF SHARES

 In order to mitigate the risks associated with share trading in paper

format, dematerialisation concept was introduced in Indian Financial
Market. Dematerialisation or Demat in short is the process through which an
investor’s physical share certificate gets converted to electronic format which
is maintained in an account with the Depository Participant.

 India adopted the demat system successfully and there are plans to facilitate
trading of almost all financial assets in demat format in future.
Meaning

 Dematerialisation is the process of converting physical shares into

electronic format.

 An investor who wants to dematerialise his shares needs to open a demat

account with Depository Participant.

 Investor surrenders his physical shares and in turn gets electronic shares in
his demat account.
Documents required
 Advantages of Demat
 Demat format reduces the risk of bad deliveries
 Time and money is saved as you are not dealing in paper now. You
need not go to the notary, broker for taking delivery or submitting the
share certificate
 Liquidity is very high in case of demat format as whole process in
automated.
 All the benefits of corporate action like bonus, stock split, rights etc are
managed through the depository leading to elimination of transit losses
 Interest on loan against demat shares are less as compared to physical
shares
 Investors save stamp duty while transferring shares in demat format.
 One needs to pay less brokerage in case of demat shares
Demat Conversion

 Most of the trading in shares are done in demat format now a

day, but there are few investors who still hold shares in paper
format. You cannot deal in paper shares now, so you need to
dematerialise them first. In order to dematerialise
physical/paper shares, investors need to fill Demat Request
Form (DRF), and submit the same along with physical shares.
DRF is available with the DP and you simply need to raise a
request for demat conversion with the DP.
 Their representative will come and get the DRF form signed. So the
complete process of dematerialisation involves:

1. Investor surrenders the physical certificates for dematerialisation to the

DP along with DRF.

2. DP updates the account of the investor and shares are allocated in

investor demat holding.
Mutual funds to Demat
 The Depository System

•The depository system:

A depository is responsible for holding the securities of a shareholder in

the electronic form. These securities could be in the form of bonds,
government securities and mutual fund units, which are held by a
registered Depository Participant (DP)

Currently, there are two depositories registered with SEBI. They are:
 National Securities Depository Limited (NSDL)
 Depository Services (India) Limited (CDSL)

A DP is the agent of the depository providing depository services to traders

and investors.
THANK
YOU