CHAPTER 2 STOCK MARKET: AN OVERVIEW - …shodhganga.inflibnet.ac.in/bitstream/10603/42567/11/11_chapter 2.pdf · CHAPTER 2 STOCK MARKET: AN OVERVIEW ... the Amex expanded it niche

17

CHAPTER 2 STOCK MARKET AN OVERVIEW

21 INTRODUCTIONhelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphellip18

22 HISTORY OF WORLD STOCK MARKEThelliphelliphelliphelliphelliphelliphelliphellip18

23 THE ROLE OF STOCK EXCHANGEShelliphelliphelliphelliphelliphelliphelliphelliphelliphellip22

24 MAJOR STOCK EXCHANGEShelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphellip27

25 REQUIREMENTS BY STOCK EXCHANGEhelliphelliphelliphelliphelliphelliphellip29

26 OWNERSHIPhelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphellip30

27 HISTORY OF INDIAN STOCK MARKEThelliphelliphelliphelliphelliphelliphelliphellip30

28 THE BOMBAY STOCK EXCHANGEhelliphelliphelliphelliphelliphelliphelliphelliphelliphellip38

29 STOCK MARKET INDEXhelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphellip45

210 STOCK MARKET VOLATILITYhelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphelliphellip54

18

21 INTRODUCTION

Stock exchange is a mutual organization which provides trading facilities for stock

brokers and traders to trade stocks and other securities In common mens language

Stock markets refer to a market place where investors can buy and sell stocks The

price at which each buying and selling transaction takes place is determined by the

market forces (ie demand and supply for a particular stock)

Stock exchanges also provide facilities for the issue and redemption of securities as

well as other financial instruments and capital events including the payment of

income and dividends The securities traded on a stock exchange

include shares issued by companies unit trusts derivatives pooled investment

products and bonds To trade a security on a certain stock exchange it has to

be listed there Usually there is a central location at least for recordkeeping but trade

is less and less linked to such a physical place as modern markets are equipped with

electronic networks which gives them advantages of speed and cost efficiency of

transactions Only members are entitling to Trade on an exchange The initial offering

of stocks and bonds to investors is by definition done in the primary market and

subsequent trading is done in the secondary market A stock exchange is often the

most important component of a stock market Supply and demand in stock markets is

driven by various factors which as in all free markets affect the price of stocks

Usually there is no compulsion to issue stock via the stock exchange itself nor must

stock be subsequently traded on the exchange Such trading is said to be off

exchange or over-the-counter This is the usual way that derivatives and bonds are

traded Increasingly stock exchanges are part of a global market for securities

22 HISTORY OF WORLD STOCK MARKET

221 The First Stock Exchanges

It is believed that the first stock was established in 11th century France where

the courtiers de change were concerned with managing and regulating the debts of

Agricultural communities on behalf of the Banks Some stories suggest that the

origins of the term bourse come from the Latin bursa meaning a bag because in

19

13th century Bruges the sign of a purse (or perhaps three purses) hung on the front of

the house where merchants met

There were people in Pisa Verona Genoa and Florence who also began trading in

government securities during the 14th century This was only possible because these

were independent city states ruled by a council of influential citizens not by a duke

The Dutch later started joint stock companies which let shareholders invest in

business ventures and get a share of their profitsmdashor losses In 1602 the Dutch East

India Company issued the first shares on the Amsterdam Stock Exchange It was the

first company to issue stock and bonds In 1688 the trading of stocks began on a

stock exchange in London

On May 17 1792 twenty-four supply brokers signed the Buttonwood Agreement

outside 68 Wall Street in New York underneath a buttonwood tree On March 8

1817 properties got renamed to New York Stock amp Exchange Board In the 19th

century exchanges got substantiated to trade futures contracts and then choices

contracts generally famous as futures exchanges

222 London Stock Exchange - 1698

London Stock Exchange is arguably the oldest of the worlds major stock exchanges

The London Exchange can trace its history back to 1698 when its founder - John

Casting - began to organize the market in Jonathans Coffee-house via a simple list of

stock and commodity prices Today this exchange lists 3500 companies representing

84 countries

223 New York Stock Exchange - 1792

The New York Stock Exchange or NYSE is arguably the oldest and most well known

of all the American stock markets The NYSE was formed in 1792 when two dozen

stockbrokers from New York City had the idea to organize what was then a

disorganized and chaotic method of stock trading From those humble beginnings the

NYSE has continued to grow and today lists 2800 companies with a total

capitalization of nearly $20 trillion In 2007 a historic merger of equals created the

NYSE Euro next

20

224 Bombay Stock Exchange ndash 1875

The Bombay Exchange also known as Mumbai claims to be the oldest stock

exchange in Asia tracing its history back to 1875 In 2008 nearly 2000000 shares

of stock traded daily on the Bombay Exchange

225 American Stock Exchange - 1849

The American Stock Exchange or Amex is a relatively recent addition to the worlds

stock markets The history of this stock market begins with the Curb Exchange and

the California Gold Rush of 1849 The Amex played an important part in the

financial and business transactions associated with the mining industry in the 19th

century In 1921 the Amex expanded it niche role to include companies that did not

meet the strict standards of the NYSE In 1998 the NASDAQ purchased Amex and it

continues its history of being a niche market player and today specializes in

derivatives and stock options In late 2003 the American Stock Exchange regained

its independence After only six years under the control of NASDAQ The Amex

Membership Corporation completed an agreement to transfer control of the exchange

back to its membership

226 NASDAQ - 1971

Yes weve even included a relatively recent addition in this article on stock market

history And thats because we recognize the importance of this particular exchange

At one time most companies aspired to be traded on the NYSE That changed about

10 years ago and many large companies now trade on the NASDAQ Founded in

1971 the National Association of Securities Dealers Automated Quotation or

NASDAQ was the first stock exchange to recognize the role of electronics in stock

trading

Today stock exchanges operate around the world and they have become highly

regulated institutions Investors wanting to buy and sell shares must do so through a

share broker who pays to own a seat on the exchange Companies with shares traded

on an exchange are said to be listed and they must meet specific criteria which

varies across exchanges Most stock exchanges began as floor exchanges where

21

traders made deals face-to-face The largest stock exchange in the world the New

York Stock Exchange continues to operate this way but most of the worlds

exchanges have now become fully electronic The graphs below show (Chart 21 amp

22) world markets in both 1900 and 2000 and the anomalous growth of

the US market during this time While having 10 market share in 1900 India is

leading stock market but in 2000 market share of India is reduced drastically

Chart 21 Stock Market In 1900


Source Triumph of the optimists

22

12

254

2

11

10

43

7USA

UK

EUROLAND

JAPAN

SOUTH AFRICA

RASSIA

INDIA

AUSTRIA HUNGARY

LATIN AMERICA

47

8

13

13

211

6USA

UK

EUROLAND

JAPAN

CANADA

OTHER FORM 1900

NEW MARKET

22

23 THE ROLE OF STOCK EXCHANGES

The role of a stock exchange for any country appears to be vitally important For any

countries moving toward economic assimilation of enlistment and proficient

allocation of savings to productive investments stock market play imperative role

This is largely proficient through a sound financial architecture Quite a lot of the

most flourishing evolution economies have achieved stupendous increases in the

savings rate with lends a hand of stock exchanges Stock exchanges are indispensable

to support savings and investment in successful conversion countries Companies

often face Liquidation problems that the banking system is powerless or reluctant to

address With a functioning stock market it becomes easier for these firms to find

sources of capital in both domestic and international capital markets A properly

functioning stock exchange will not only help companies raise capital but also help

individuals and organizations to diversify their holdings With thinly traded markets

liquidity problems discourage participation by these investors in the financial system

As such investors will demand higher risk premiums to compensate for lack of

liquidity Thus the company in need of capital is placed at a disadvantage because

only relatively more expensive credit is available Solving this problem has helped

companies to raise more capital in the most successful transition economies while

failure to do so has constrained growth in some of the more backward states Role of

stock exchanges include the following29

231 Raising capital for businesses

The stock market is one of the most important sources for companies to raise money

This allows businesses to be publicly traded or raise additional capital for expansion

by selling shares of ownership of the company in a public market They encourage

investment by providing places for buyers and sellers to trade securities This

investment in turn enables corporations to obtain funds to expand their businesses30

29 Diamond Peter A (1967) The Role of a Stock Market in a General Equilibrium Model with

Technological Uncertainty American Economic Review 57 (4) 759ndash776

30 Gilson Ronald J Black Bernard S (1998) Venture Capital and the Structure of Capital Markets

Banks Versus Stock Markets Journal of Financial Economics 47 243ndash277

23

Corporations issue new securities in the primary market usually with the help of

investment bankers Company negotiates price and then makes the securities available

for its clients and other investors This is called an initial public offering (IPO)

In this primary market corporations receive the proceeds of stock sales After this

initial offering the securities are bought and sold in the secondary market The

corporation is not usually involved in the trading of its stock in the secondary market

therefore stock exchanges will essentially function as a secondary market By

providing investors the opportunity to trade financial instruments the stock exchanges

support the performance of the primary markets This arrangement makes it easier for

a corporation to raise the funds that they need to build and expand their businesses

Although corporations do not directly benefit from secondary market transactions the

managers of a corporation closely monitor the price of the corporationlsquos stock in

secondary markets Reasons for this concern involves the cost of raising new funds

for further business expansion the perceived strength of a company (and whether it

is vulnerable to a takeover) and of course their options and bonus packages

There are benefits and new obligations that come from raising capital through a public

offering

Benefits

Companylsquos access to capital will increase since you can contact more

potential investors

Company may become more widely known

Company may obtain financing more easily in the future if investor interest in

your company grows enough to sustain a secondary trading market in your

securities

Controlling shareholders such as the companys officers or directors may

have a ready market for their shares which means that they can more easily

sell their interests at retirement for diversification or for some other reason

24

Company may be able to attract and retain more highly qualified personnel if

it can offer stock options bonuses or other incentives with a known market

value

The image of company may be improved

Obligations

Company must continue to keep shareholders informed about the companys

business operations financial condition and management incurring additional

costs and new legal obligations

Company may be liable if you do not fulfill these new legal obligations

Company may lose some flexibility in managing your companys affairs

particularly when shareholders must approve your actions

Company public offering will take time and money to accomplish

232 Mobilizing savings for investment

When people draw their savings and invest in shares it leads to a

more rational allocation of resources because funds which could have been

consumed or kept in idle deposits banks are mobilized and redirected to

promote business activity with benefits for several economic sectors such

as agriculture commerce and industry resulting in stronger economic growth and

higher productivity levels of firms

233 Facilitating company growth

The smooth functioning of all these activities facilitates economic growth in that

lower costs and enterprise risks promote the production of goods and services as well

as employment In this way the financial system contributes to increased prosperity

An important aspect of modern financial markets however including the stock

markets is absolute discretion For example American stock markets see more

unrestrained acceptance of any firm than in smaller markets attention must be given to

25

the foreign Companies view acquisitions as an opportunity to expand product lines

increase distribution channels hedge against volatility increase its market share or

acquire other necessary business assets A takeover bid or a merger agreement

through the stock market is one of the simplest and most common ways for a

company to grow by acquisition or fusion

234 Profit sharing

Both casual and professional stock investors through dividends and stock

price increases that may result in capital gains will share in the wealth of profitable

businesses

235 Corporate governance

By having a wide and varied scope of owners companies generally tend to improve

on their management standards and efficiency in order to satisfy the demands of these

shareholders and the more stringent rules for public corporations imposed by public

stock exchanges and the government Consequently it is alleged that public

companies (companies that are owned by shareholders who are members of the

general public and trade shares on public exchanges) tend to have better management

records than privately-held companies (those companies where shares are not publicly

traded often owned by the company founders andor their families and heirs or

otherwise by a small group of investors) However some well-documented cases are

known where it is alleged that there has been considerable slippage in corporate

governance on the part of some public companies The dot-com bubbles in the early

2000s and the subprime mortgage crisis in 2007-08 are classical examples of

corporate mismanagement Companies like Petscom (2000) Enron

Corporation (2001) OneTel (2001) Sunbeam(2001) Webyan (2001) Adelphia

(2002) MCI World Com (2002) Parmalat (2003) American International Group

(2008) Lehman Brothers (2008) and Satyam Computer Service(2009) were among

the most widely scrutinized by the media

26

236 Creating investment opportunities for small investors

As opposed to other businesses that require huge capital outlay investing in shares is

open to both the large and small stock investors because a person buys the number of

shares they can afford Therefore the Stock Exchange provides the opportunity for

small investors to own shares of the same companies as large investors

The liquidity that an exchange provides affords investors the ability to quickly and

easily sell securities This is an attractive feature of investing in stocks compared to

other less liquid investments such as real estate

237 Government capital-raising for development projects

Governments at various levels may decide to borrow money in order to finance

infrastructure projects such as sewage and water treatment works or housing estates

by selling another category of securities known as bonds These bonds can be raised

through the Stock Exchange whereby members of the public buy them thus loaning

money to the government The issuance of such bonds can obviate the need to directly

tax the citizens in order to finance development although by securing such bonds

with the full faith and credit of the government instead of with collateral the result is

that the government must tax the citizens or otherwise raise additional funds to make

any regular coupon payments and refund the principal when the bonds mature

238 Barometer of the economy

Form the history of many countries it has shown that the price of share and other

assets is an important part of the dynamics of economic activity The price of these

assets can influence or be an up and coming economy Many times the stock market is

considered the primary indicator of a countrylsquos economic development and strength

If the stock market is rising it tends to be associated with increased business and

investments and if the stock market if falling associated with deceased business and

investments It can also be observed that share prices also affect the wealth of

households and their consumption At the stock exchange share price rise or fall may

depending largely on market forces and sentiments When the economy is stable or

growing the share prices tense to raise or remain stable but when economic face

recession depression or financial crisis result in stock market crash Therefore the

27

movement of share prices and in general of the stock indexes can be an indicator of

the general trend in the economy

24 MAJOR STOCK EXCHANGES

Twenty Major Stock Exchanges Of The World Market Capitalization amp Year-to-date

Total Turnover at the end of August 2009

Table 21 Major Stock Exchanges of World

(August 2009 Figure in Million USD) Region Stock Exchange Market Value

Total Share

Turnovers

America Satildeo Paulo Stock Exchange 103251840 36195900

America Toronto Stock Exchange 143287700 79819310

America New York Stock Exchange 1084200190 1215862060

Asia-Pacific Australian Securities Exchange 106651320 56091280

Asia-Pacific Bombay Stock Exchange 108257200 17117620

Asia-Pacific Hong Kong Stock Exchange 194551770 97022760

Asia-Pacific Korea Exchange 72712530 105047380

Asia-Pacific National Stock Exchange of India 101910900 50665230

Asia-Pacific Shanghai Stock Exchange 214275680 331576850

Asia-Pacific Shenzhen Stock Exchange 59632020 170125680

Asia-Pacific Tokyo Stock Exchange 347860250 267598330

Europe Euro next 260509760 119596220

Europe Frankfurt Stock Exchange (Deutsche Boumlrse) 120429200 158973670

Europe London Stock Exchange 256049110 232151850

Europe Madrid Stock Exchange (Bolsas y Mercados

Espantildeoles)

117852560 104075110

Europe Milan Stock Exchange (Borsa Italiana) 63667480 56575930

Europe Nordic Stock Exchange Group OMX1 78114630 50304990

Europe Swiss Exchange 99235640 52086750

Note includes the Copenhagen Helsinki Iceland Stockholm Tallinn Riga and

Vilnius Stock Exchanges

Sources World Federation of Exchanges - Statistics Monthly

Remarks There are 2 pending major mergers NASDAQ with OMX and London

Stock Exchange with Milan Stock Exchange

28

Chart 23 Market Value

Chart 24 Total Share Turnovers

Source From the table 21

000 400000000 800000000 1200000000

Satildeo Paulo Stock Exchange

Toronto Stock ExchangeNew York Stock Exchange

Australian Securities ExchangeBombay Stock Exchange

Hong Kong Stock ExchangeKorea Exchange

National Stock Exchange of India

Shanghai Stock ExchangeShenzhen Stock Exchange

Tokyo Stock ExchangeEuro next

Frankfurt Stock Exchange (Deutsche Boumlrse)

London Stock ExchangeMadrid Stock Exchange (Bolsas y hellip

Milan Stock Exchange (Borsa Italiana)Nordic Stock Exchange Group OMX1

Swiss Exchange Market hellip

000 500000000 1000000000 1500000000

Satildeo Paulo Stock ExchangeToronto Stock Exchange

New York Stock ExchangeAustralian Securities Exchange

Bombay Stock ExchangeHong Kong Stock Exchange

Korea ExchangeNational Stock Exchange of India



Frankfurt Stock Exchange (Deutsche hellipLondon Stock Exchange

Madrid Stock Exchange (Bolsas y hellipMilan Stock Exchange (Borsa Italiana)Nordic Stock Exchange Group OMX1

Swiss Exchange Total Share hellip

29

25 REQUIREMENTS BY STOCK EXCHANGE

Companies have to meet the requirements of the exchange in order to have their

stocks and shares listed and traded there but requirements vary by stock exchanges

251 Bombay Stock Exchange

Bombay Stock Exchange (BSE) has requirements for a minimum market

capitalization of Rs250 Million and minimum public float equivalent to Rs100

Million31

252 London Stock Exchange

The main market of the London Stock Exchange has requirements for a minimum

market capitalization (pound700000) three years of audited financial statements

minimum public float (25 per cent) and sufficient working capital for at least 12

months from the date of listing

253 NASDAQ Stock Exchange

To be listed on the NASDAQ a company must have issued at least 125 million shares

of stock worth at least $70 million and must have earned more than $11 million over

the last three years 32

254 New York Stock Exchange

To be listed on the New York Stock Exchange (NYSE) a company must have issued

at least a million shares of stock worth $100 million and must have earned more than

$10 million over the last three years 33

255 Other types of exchanges

In the 19th century exchanges were opened to trade forward

contracts on commodities Exchange traded forward contracts are called futures

contracts These commodity exchanges later started offering future contracts on other

31 wwwbseindiacomaboutabintrobselistsecasp 32 NASDAQ Corporate -NASDAQ Listing Information wwnasdaqcomaboutlisting_informationstm 33 wwwnysecomFramesethtmldisplayPage=listed

30

products such as interest rates and shares as well as Options contracts They are now

generally known as futures exchanges

26 OWNERSHIP

Stock exchanges originated as mutual organizations owned by its member stock

brokers There has been a recent trend for stock exchanges to demutualize where the

members sell their shares in an initial public offering In this way the mutual

organization becomes a corporation with shares that are listed on a stock exchange

Examples are

Australian Securities Exchange (1998) Euro next (merged with New York Stock

Exchange) NASDAQ (2002) The New York Stock Exchange (2005) Bolsas

Mercados Espanoles and the Sao Paulo Stock Exchange (2007) The Shenzhen and

Shanghai stock exchanges can be characterized as quasi-state institutions insofar as

they were created by government bodies in China and their leading personnel are

directly appointed by the China Securities Regulatory Commission

27 HISTORY OF INDIAN STOCK MARKET

The stock exchange in Mumbai is more than 100 years old The origin of the stock

market in India dates back to the end of the eighteenth century when long term

negotiable securities were first issued The real beginning however occurred in the

middle of the nine teeth century after the enactment of the Companies Act in 1850

which introduced the feature of limited liability and generated investor interest in

corporate securities

The Native Share and Stock Brokerslsquo Association now known as the Bombay Stock

Exchange (BSE) was formed in Bombay (now Mumbai) in 1875 This was followed

by the formation of association in Ahmadabad in 1894 Calcutta (now Kolkata) in

1908 and Madras (now Chennai) in 1937 In order to promote the orderly

development of the stock market the central government introduced a comprehensive

legislation called the Securities Contracts (Regulation) Act 1956

31

The Calcutta Stock Exchange (CSE) was the largest stock exchange in India till the

1960s In 1961 there were 1203 listed companies across the various stock exchanges

of the country Of these 576 were listed on the CSE and 297 on the BSE However

during the later half of the 1960s the relative importance of the CSE declined while

that of the BSE increased sharply

One of the oldest stock markets in Asia the Indian Stock Markets have a 200 years

old history

Table 22 Origin of Indian Stock Market

Year Events

18th

Century

East India Company was the dominant institution and by end of the century business in its loan

securities gained full momentum

1830s Business on corporate stocks and shares in Bank and Cotton presses started in Bombay Trading list

by the end of 1839 got broader

1840s Recognition from banks and merchants to about half a dozen brokers

1850s Rapid development of commercial enterprise saw brokerage business attracting more people into

the business

1860s The number of brokers increased to 60

1860-61 The American Civil War broke out which caused a stoppage of cotton supply from United States of

America marking the beginning of the Share Mania in India

1862-63 The number of brokers increased to about 200 to 250

1865 A disastrous slump began at the end of the American Civil War (as an example Bank of Bombay

Share which had touched Rs 2850 could only be sold at Rs 87)

1874 With the rapidly developing share trading business brokers used to gather at a street (now well

known as Dalal Street) for the purpose of transacting business

1875 The Native Share and Stock Brokers Association (also known as The Bombay Stock

Exchange) was established in Bombay

1880s Development of cotton mills industry and set up of many others

1894 Establishment of The Ahmadabad Share and Stock Brokers Association

1880 -

90s

Sharp increase in share prices of jute industries in 1870s was followed by a boom in tea stocks and

coal

1908 The Calcutta Stock Exchange Association was formed

1920 Madras witnessed boom and business at The Madras Stock Exchange was transacted with 100

brokers

1923 When recession followed number of brokers came down to 3 and the Exchange was closed down

32

1934 Establishment of the Lahore Stock Exchange

1936 Merger of the Lahore Stock Exchange with the Punjab Stock Exchange

1937 Re-organization and set up of the Madras Stock Exchange Limited (Pvt) Limited led by

improvement in stock market activities in South India with establishment of new textile mills and

plantation companies

1940 Uttar Pradesh Stock Exchange Limited and Nagpur Stock Exchange Limited was established

1944 Establishment of The Hyderabad Stock Exchange Limited

1947 Delhi Stock and Share Brokers Association Limited and The Delhi Stocks and Shares Exchange

Limited were established and later on merged into The Delhi Stock Exchange Association

Limited

Sources wwwsurfindiacom wwwappuonlinecom

271 Post Independence Scenario

The depression witnessed after the Independence led to closure of a lot of exchanges

in the country Lahore Stock Exchange was closed down after the partition of India

and later on merged with the Delhi Stock Exchange Bangalore Stock Exchange

Limited was registered in 1957 and got recognition only by 1963 Most of the other

Exchanges were in a miserable state till 1957 when they applied for recognition under

Securities Contracts (Regulations) Act 1956 The Exchanges that were recognized

under the Act were

Bombay Calcutta Madras Ahmadabad Delhi Hyderabad Bangalore Indore

272 Many more stock exchanges were established during 1980s

namely

Cochin Stock Exchange (1980)

Uttar Pradesh Stock Exchange Association Limited (at Kanpur 1982)

Pune Stock Exchange Limited (1982)

Ludhiana Stock Exchange Association Limited (1983)

Gauhati Stock Exchange Limited (1984)

Kanara Stock Exchange Limited (at Mangalore 1985)

33

Magadh Stock Exchange Association (at Patna 1986)

Jaipur Stock Exchange Limited (1989)

Bhubaneswar Stock Exchange Association Limited (1989)

Saurashtra Kutch Stock Exchange Limited (at Rajkot 1989)

Vadodara Stock Exchange Limited (at Baroda 1990)

Coimbatore Stock Exchange

Meerut Stock Exchange

At present there are twenty one recognized stock exchanges in India which does not

include the Over The Counter Exchange of India Limited (OTCEI) and the National

Stock Exchange of India Limited (NSEIL)

Government policies during 1980s also played a vital role in the development of the

Indian Stock Markets There was a sharp increase in number of Exchanges listed

companies as well as their capital which is visible from the following table

Table 23 Pattern of Growth of Stock Exchanges

Source SEBI annual report

273 Trading Pattern of the Indian Stock Market

Indian Stock Exchanges allow trading of securities of only those public limited

companies that are listed on the Exchange(s) They are divided into two categories

S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005

1 No of Stock Exchanges 7 7 8 9 20 22 23 23

2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731

5 Market value of Capital

of Listed Cos (Cr Rs)

971 1292 2675 6750 110279 478121 6319212 478121

34

Chart 25 Trading Pattern of the Indian Stock Market

Source wwwbseindiacom

274 Types of Transactions

The flowchart below describes the types of transactions that can be carried out on the

Indian stock exchanges

Chart 26 Types of Transactions


Listed Securities of Public limited companies

Specified securities (forward List)

Equity shares of company that are

- Dividend paying

- growth orinted companies

- paid up capital of atleast Rs50 million

- Market capitalisation of atleast Rs100 million

- has more than 20000 shareholders

Non specicied Securities (Cash List)

equity shares of companies not covered in specified securities

Transactions on Indian Stock Exchanges

Spot Delivery Transactions

Forward Transactions

35


Includes transactions that require delivery and payment within stipulated time

period at the time of entering into the contract

This period shall not be more than 14 days following the date of the contract


Transactions in which delivery and payment can be extended by further period

of 14 days each

The overall period should not exceed 90 days from the date of contract

Transactions permitted only in case of specified shares

275 Indian stock exchange allows a member broker to perform

following activities

Act as an agent

Buy and sell securities for clients and charge commission for the same

Act as a trader or dealer as a principal

Buy and sell securities on their account and risk

276 Over The Counter Exchange of India (OTCEI)

Traditionally trading in Stock Exchanges in India followed a conventional style

where people used to gather at the Exchange and bids and offers were made by open

outcry This age-old trading mechanism in the Indian stock markets used to create

much functional inefficiency Lack of liquidity and transparency long settlement

periods and benami transactions are a few examples that adversely affected investors

In order to overcome these inefficiencies OTCEI was incorporated in 1990 under the

Companies Act 1956 OTCEI is the first screen based nationwide stock exchange in

India created by Unit Trust of India Industrial Credit and Investment Corporation of

India Industrial Development Bank of India SBI Capital Markets Industrial Finance

Corporation of India General Insurance Corporation and its subsidiaries and Can

Bank Financial Services

36

Chart 27 Securities traded on the OTCEI


Listed Securities

Securities of the companies listed on the OTC

Can be bought or sold at any OTC counter across India

Should not be listed anywhere else

Permitted Securities

Certain securities (Shares and debentures listed on other exchanges)

Unites of Mutual funds can be traded

Initiated Debentures

An equity holding a minimum of one lakh debentures of a particular scrip can

offer them for trading on the OTC

Advantages of OTCEI

Greater liquidity and lesser risk of intermediary charges due to widely spread trading

mechanism across India The screen-based scrip less trading ensures transparency and

accuracy of prices Faster settlement and transfer process as compared to other

exchanges Shorter allotment procedure (in case of a new issue) than other exchanges

277 National Stock Exchange

In order to lift the Indian stock market trading system at par with the international

standards On the basis of the recommendations of high powered Pherwani

Securities teaded on the

OTCEI

Listed Securities



37

Committee the National Stock Exchange was incorporated in 1992 by Industrial

Development Bank of India Industrial Credit and Investment Corporation of India

Industrial Finance Corporation of India all Insurance Corporations selected

commercial banks and others

2771 NSE provides exposure to investors in two types of markets

namely

Wholesale debt market

Capital market

Wholesale Debt Market - Similar to money market operations debt market

operations involve institutional investors and corporate bodies entering into

transactions of high value in financial instruments like treasury bills government

securities commercial papers etc

Capital market- A capital market is a market for securities (debt or equity) where

business enterprises and governments can raise long term funds It is defined as a

market in which money is defined as a market in which money is provided for periods

longer than a year34 as the raising of short term funds takes place on other markets

Capital markets may be classified as primary markets and secondary markets In

primary markets new stock or bond issues are sold to investors via a mechanism

known as underwriting In the secondary markets existing securities are sold and

bought among investors or traders usually on a securities exchange over the counter

or elsewhere

278 Trading at NSE amp BSE

Fully automated screen-based trading mechanism

Strictly follows the principle of an order-driven market

Trading members are linked through a communication network

34 Steven M Sheffrin (2003) Economics Principles in action Upper Saddle River Pearson Prentice

Hall

38

This network allows them to execute trade from their offices

The prices at which the buyer and seller are willing to transact will appear on

the screen

When the prices match the transaction will be completed

A confirmation slip will be printed at the office of the trading member

2781 Advantages of trading at NSE amp BSE

Integrated network for trading in stock market of India

Fully automated screen based system that provides higher degree of

transparency

Investors can transact from any part of the country at uniform prices

Greater functional efficiency supported by totally computerized network

28 THE BOMBAY STOCK EXCHANGE

Formerly the Stock Exchange Mumbai popularly called Bombay Stock Exchange

or BSE is the oldest stock exchange in Asia and has the greatest number of listed

companies in the world with 4700 listed as of August 2007 35

It is located at Dalal Street Mumbai India On 31 December 2007 the equity market

capitalization of the BSE was US $ 179 trillion making it the largest stock exchange

in South Asia and the 12th largest in the world

With over 4700 Indian companies list on the stock exchange [10]

and it has a

significant trading volume The BSE SENSEX (SENSITIVE INDEX) also called the

―BSE 30 is a widely used market index in India and Asia Though many other

exchanges exist BSE and the National Stock Exchange of India account for most of

the trading in shares in India

35 World Federation of Exchanges (2007) wwwworld-exchangesorg

39

281 History of the Bombay Stock exchange

Trading in securities has been in vogue in India for a little over 200 years Trading in

securities dates back 1793 most of them being transactions in loan securities of the

East India Company The broking community prospered as there was a rise in prices

which led to a share mania during 1861-65 This bubble burst in 1865 when the

American Civil War ended The brokers realized that investor confidence in the

securities market could be sustained only by organizing themselves into a regulated

body with defined rules and regulations The realization resulted in formation of ―The

Native Share and Stock Brokerslsquo Association which later came to be known as the

Bombay Stock Exchange In 1875 these brokers assembled at a place now called

Dalal Street

The Bombay Stock Exchange is a voluntary nonprofit making association of broker

members It emerged as a premier stock exchange after the 1960 The increased pace

of industrialization caused by the two world wars protection to the domestic industry

and the governmentlsquos fiscal policies aided the growth of new issues which in turn

helped the BSE to prosper The BSE dominated the Indian Capital Market by

accounting for more than 60 per cent of the all Indian turn over

Until 1992 the BSE operated like a closed club of selected members With the

securities scam outburst in 1992 and the SEBI taking over the rains of the Stock

Market the BSE had to bring about changes in its operational policies Until March

1995 the BSE had an open outcry system of trading However when faced with stiff

competition from NSE the countrylsquos first modern computerized and professionally

managed stock exchange set up in 1994 the BSE had to change its system of trading

and operation

On 14 March 1995 the BSE turned to electronic trading whereby brokers trade using

computers This system is known as the BSE On-line Trading System (BOLT)

The introduction of BOLT helped in improving trading volumes significantly

reducing the spread between buy and sell orders better trading in odd lot shares fixed

income instruments and dealings in the renunciation of rights shares

40

In 1995 BOLT was limited to Mumbai whereas the NSE was operating at the

national level As a result the BSE submitted a proposal for allowing installation of

terminals connected to BOLT in centers outside Mumbai After rejecting the proposal

four times on 29 october 1996 the SEBI finally allowed the BSE to use its BOLT

system nationwide Later the BSE set up a central depository system to dematerialize

shares and promote demate Account (trading)

282 Hours of Operation

Beginning of the Day Session 800 to 900

Trading Session 900 to 1530

Position Transfer Session 1530 to 1550

Closing Session 1550 to 1605

Option Exercise Session 1605 to 1635

Margin Session 1635 to 1650

Query Session 1650 to1735

End of Day Session 1735

The hours of operation for the BSE quoted above are stated in terms of the local time

(ie GMT+530) in Mumbai India

BSElsquos normal trading sessions are on all days of the week except Saturdays Sundays

and Holidays declared by the Exchange in advance 36

283 Services of BSE

BSE also had a wide range of services to empower investors and facilitate smooth

transactions These services are as follows

2831 Investor Services

The Dept of investor services redresses grievances of investors BSE was the first

exchange in the country to provide an amount of Rs 1 million towards the investor

36 Asia Technical Analysis with Phil Smith wwwreutersindianet

41

protection fund it is an amount higher than that of any exchange in the country BSE

launched a nationwide investor awareness program ―Safe Investing in the Stock

Market under which 264 programmers were held in more than 200 cities

2832 The BSE Online Trading (BOLT)

BSE on line Trading (BOLT) facilities on-line screen based trading in securities

BOLT is currently operating in 25000 trader work stations located across over 399

cities in India

2833 BSEWEBXcom

In February 2001 BSE introduced the worldlsquos first centralized exchange based

Internet trading system BSEWEBXcom This initiative enables investors anywhere

in the world to trade on BSE platform

2834 Surveillance

BSElsquos Online Surveillance System (BOSS) monitors on a real time basis the price

movements volume position and real time measurements of the default risk market

reconstruct and generation of cross market alerts

2835 BSE Training Institute

BTI imparts capital market training and certification in collaboration with reputed

management institutes and universities It offers over 40 courses on various aspects of

the capital mark and financial sector More than 20000 people have attended the BTI

program

284 Awards

Fowling awards were given to BSE

The world council of Corporate Governance has awarded the Golden Peacock

Global CSR Award for BSElsquos initiatives in corporate social responsibility

The Annual Reports and Accounts of BSE for the year ended March 312006 and

42

March 312007 have been awarded the ICAI awards for excellence in financial

reporting

The 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 technology

Drawing from its rich past and its equally robust performance in the recent times

BSE will continue to remain an icon in the Indian Capital Market

285 Index Closure Algorithm

The closing SENSEX on any trading day is computed taking the weighted average of

all the trades on SENSEX constituents in the last 30 minutes of trading session If a

SENSEX constituent has not traded in the last 30 minutes the last traded price is

taken for computation of the Index closure If a SENSEX constituent has not traded at

all in a day then its last days closing price is taken for computation of Index closure

The use of Index Closure Algorithm prevents any intentional manipulation of the

closing index value

286 Maintenance of SENSEX

One of the important aspects of maintaining continuity with the past is to update the

base year average The base year value adjustment ensures that replacement of stocks

in Index additional issue of capital and other corporate announcements like rights

issue etc do not destroy the historical value of the index The beauty of maintenance

lies in the fact that adjustments for corporate actions in the Index should not affect the

index values The BSE Index Cell does the day-to-day maintenance of the index

within the broad index policy framework set by the BSE Index Committee The BSE

Index Cell ensures that SENSEX and all the other BSE indices maintain their

benchmark properties by striking a delicate balance between frequent replacements in

index and maintaining its historical continuity The BSE Index Committee comprises

of capital market expert fund managers market participants and members of the BSE

Governing Board

43

287 On-Line Computation of the Index

During trading hours value of the Index is calculated and disseminated on real time

basis This is done automatically on the basis of prices at which trades in Index

constituents are executed

288 Adjustment for Bonus Rights and Newly Issued Capital

SENSEX calculation needs to be adjusted for issue of Bonus or Rights shares If no

adjustments were made a discontinuity would arise between the current value of the

index and its previous value despite the non-occurrence of any economic activity of

substance At the BSE Index Cell the base value is adjusted which is used to alter

market capitalization of the component stocks to arrive at the SENSEX value The

BSE Index Cell keeps a close watch on the events that might affect the index on a

regular basis and carries out daily maintenance of all the 19 Indices

2881 Adjustments for Rights Issues

When a company included in the compilation of the index issues right shares the

free-float market capitalization of that company is increased by the number of

additional shares issued based on the theoretical (ex-right) price An offsetting or

proportionate adjustment is then made to the Base Market capitalization

2882 Adjustments for Bonus Issue

When a company included in the compilation of the index issues bonus shares the

market capitalization of that company does not undergo any change Therefore there

is no change in the Base Market capitalization only the number of shares in the

formula is updated

2883 Other Issues Base

Market capitalization adjustment is required when new shares are issued by way of

conversion of debentures mergers spin-offs etc or when equity is reduced by way of

buy-back of shares corporate restructuring etc

44

289 Listing Categories

Before badla was resumed in 1996 there were only two categories of securities listed

on the BSE the specified group of shares comprising The securities in which carry

forward deals were allowed and the cash group shares in which no carry forward deals

were permitted Later it was observed that the facility of carry forward was not being

used in all the 94 scrips in the specified group Hence after badla was resumed the

size of the specified group was reduced to 32 scrips on 3 April 1996 The BSE later

decided to regroup the existing A and B group shares into three categories The BSE

delisted 637 companies for a period of 3 years during 2004-05 for non-compliance of

listing agreements

A Group This group consists of large stock with turnover and high floating stock

with large market capitalization In other words scrips with more liquidity and high

networth are included in this group At present there are 150 scrips in this group

B1 Group This group includes scrips of quality companies with equity above Rs 3

crore with high growth potential and trading frequency No carry forward facility was

allowed in this group in June 2000 there were 1803 scrips in this group

B2 Group Scrips in this group were just like those of B1 but with fortnightly

settlement However in September 1996 the BSE introduced weekly settlement for all

scrips listed on the exchange thus doing away with the distinction between the B1 and

B2 groups On June 2000 there were 3219 scrips in this group

Z Group Subsequently a Z group was introduced in 1999 with scrips of companies

that do not meet the rules regulations and stipulations laid down by the exchange It

is a buyer beware company These are some 300 scrips in the group All Z category

stocks result in delivers

F Group A new Flsquo group pertaining to debt market segment was started with effect

from 9 September 1996

S Group The BSE reduced post-public issue capital base requirement from Rs10

crore to Rs3 crore to attract listing by companies with a smaller capital base It also

45

started a new trading segment small cap stock segment known as the Slsquo segment

Corporate with minimum turnover of an equal amount would be eligible to list scrips

on this segment In addition stocks listed on the regional exchanges would also be

able to list on the lsquoSlsquo segment subject to meeting certain criteria

2810 Base Market capitalization Adjustment

The formula for adjusting the Base Market capitalization is as follows

New Base Market Capitalization (NBMC)

New Market capitalization

NBMC = Old Base Market capitalization x mdashmdashmdashmdashmdashmdashmdashmdashmdashmdashmdash

Old Market capitalization

To illustrate suppose a company issues right shares which increases the market

capitalization of the shares of that company by say Rs100 crores The existing Base

Market capitalization (Old Base Market capitalization) say is Rs2450 crores and the

aggregate market capitalization of all the shares included in the index before the right

issue is made is say Rs4781 crore The New Base Market capitalization will then

be

2450x (4781+100)

_____________________ = Rs250124 crores

4781

This figure of Rs 250124 crore will be used as the Base Market capitalization for

calculating the index number from then onwards till the next base change becomes

necessary

Index Review Frequency

The BSE Index Committee meets every quarter to discuss index related issues In case

of a revision in the Index constituents the announcement of the incoming and

outgoing scrips is made six weeks in advance of the actual implementation of the

revision of the Index

29 STOCK MARKET INDEX

The stock market index is the most important indices of all as it measures overall

market sentiment through a set of stocks that representative of the market The stock

46

market index is a barometer of the market behavior It reflects direction and indicates

day-to-day fluctuations in stock prices The market index reflects expectations about

the behavior of the economy as a whole It is a precursor of economic cycles The

function of a stock index is to provide investors with information regarding the

average share price in the market An ideal index must represent changes in the prices

of the scrips and reflect price movements of typical shares for better market

representation Stock index is a barometer of a nationlsquos economic health as market

prices reflect expectations about the economylsquos performance Stock indices termed as

leading economic as they indicate what is going to happen in the economy in the

future The returns generated in the stock market are based on future expectations A

good market index incorporates a set of scrips which have high market capitalization

and high liquidity Market capitalization is the sum of the market value of all the

stocks included in the index The market value is derived by multiplying the price of

the share outstanding In other words the bid-ask spread is minimum The index on a

day is calculated as the percentage of the aggregate market value of the set of scrips

incorporated in the index on that day to the average market value of the same scrips

during the base period

291 Definition of an Index

A price index is such as the stock market price of the individual securities in the

market It reflects the overall price or return movements of a group of securities

Movements in an index are determined by sample weighting and computational

procedure Sample is normally generated by random selection or try a non random

selection technique designed to incorporate desired characteristics are used to select

sample shares rather than by completely random selection Major criteria for selection

are market activity due representation to various industrial groups and to major stock

exchanges

292 Global Stock Market Indices

2921 The Dow Jones Industrial averagersquos

It is the most widely watched and quoted index because of its long existence The

Dow has 30 constituents and it follows the methodology of price based weighted

47

Changes to stocks included in the Dow are infrequent three stocks were

addeddropped in 1991 four in 1997 and four in 1999 The addition of Microsoft and

Intel in 1999 was the first inclusion of Nasdaq market stocks to the Dow 30

2922 The Nasdaq composite index

The index is the market capitalization weighted of prices for all the stocks listed in the

Nasdaq stock market The Nasdaq composite began on 8 February 1971 with a base

of 100

2923 The Nasdaq 100 index

Nasdaq 100 comprises the largest computer software and telecom stocks by market

capitalization on the Nasdaq For a company to be included in the Nasdaq 100 it must

have a minimum average trading volume of 100000 shares per day and must have

been trading on a major exchange for at least a year or two

2924 The S amp P 500 index

This index comprises 500 biggest publicly traded companies in the US by market

capitalization Most money managers treat the S amp P 500 as a proxy for the US stock

market The S amp P 500 tries to cover all major areas of US economy To be included a

company must be profitable the prospective company must not be closely hold and

must have a large trading volume for its shares

2925 The FTSE 100

The FTSE 100 consists of the largest 100 companies by full market Value listed on

the London Stock Exchange The FTSE 100 is the benchmark index to indicate the

performance of the European market It is a market capitalization weighted index that

also considers the free float weighted of individual stocks before including them in

the index

2926 The MSCI Indices

Include the MSCIEAFE (Europe Australia and Far East) MSCI Europe MSCI

world MSCI (EMF) and MSCI Pacific Basin Indices

48

The MSCI world Index is a free float adjusted market capitalization index that is

designed to measure global developed market equity performance As of April 2002

the MSCI world Index consisted of the MSCI world Index consisted of the following

23 developed market country indices

Australia Austria Belgium Canada Denmark Finland France Germany Greece

Hong Kong Ireland Italy Japan Netherlands New Zealand Norway Singapore

Portugal Spain Sweden Switzerland United Kingdom and the United States of

America

293 Methodology for Calculating The Index

2931 Price Weighted Index

In this method the price of each stock in the index is summed up which is then

equated to an index starting value An arbitrary date is set as the base and the

Laspeyerlsquos Price Index which measures price changes against a fixed base period

quantity weight is used In case of a stock split the market price of the stock falls and

these results in less weighted in the index The Dow Jones Industrial Average and

Nikkie 225 are price-weighted indices

2932 Equal Weighting

In this method each stocklsquos percentage weight in the index is equal and hence all

stocks have an equal influence on the index movement The value line index at

Kansas City Board of Trade (KCBT) is an equal weighted index

2933 Market Capitalization Weighted

29331 Full Market Capitalization Method

In this method the number of shares outstanding multiplied by the market price of a

companylsquos share determines the scriplsquos weighted in the index The shares with the

highest market capitalization would have a higher weighted and would be most

influential in this type of index Eg S amp P 500 Index in USA and S amp P CNX Nify in

India

49

29332 Modified Capitalization Weighted

This method seeks to limit the influence of the largest stocks in the index which

otherwise would dominate the entire index This method sets a limit on the largest

stock or a group of stocks The NASDAQ 100 Index is calculated by using this

method

294 Free Float Market Capitalization Method

2941 Concept

Free float methodology refers to an index construction methodology that takes in to

consideration only the free-float market capitalization of a company for the purpose of

index calculation and assigning weight to stocks in the index Free float market

capitalization takes into consideration only those shares issued by the company that

are readily available for trading in the market It generally excludes promoters

holding Strategic holding government holding and other locked-in-shares that will

not come to the market for trading in the normal course In other words the market

capitalization of each company in a free-float index is reduced to the extent of its

readily available shares in the market

All BSE indices with exception of BSE-PSU index have adopted the free-float

methodology

2942 Definition of Free Float

Share holding of investor that would not in the normal course come into the

open market for trading are treated as ―Controlling Strategic Holding and

hence not included in free float specifically the following categories of

holding are generally excluded from the definition of free float

Shares hold by foundersdirectorsacquires which has control element

Shares held by person with ―Controlling Interestlsquo

Shares held by Govt as promoters

50

Holding through the FDI Route

Strategic Stakes by private corporate bodiesindividuals

Equity held by employee welfare trusts

Locked-in-shares and shares which not be sold in the open market in normal

course

2943 Major Advantages of Free Float Methodology

A Free float index reflects the market trends more rationally as it takes into

consideration only those shares that are available for trading in the market Free float

methodology makes the index more broad based by reducing the concentration of top

few companies in index

A free-float index aids both active and passive investing styles It aids active

managers by enabling them to benchmark their fund returns Vis-agrave-Vis an investible

index This enables an apple-to-apple comparison thereby facilitating better

evaluation of performance of active managers

Free float methodology improves index flexibility in terms of including any stock

from the Universe of listed stocks This improves market coverage and sector

coverage of the index However under the Free-float Methodology since only the free

float market capitalization of each company is considered for index calculation it

becomes possible to include such closely held companies in the index while at the

same time preventing their undue influence on the index movement

The free float methodology of index construction is considered to be an industry best

practice and all major index providers like MSCI FTSE SampP have adopted the same

MSCI a leading global index provider shifted all its indices to the free-float

methodology in 2002 the MSCI India Standard Index which is followed by foreign

institutional investors (FIIs) to track Indian equities is also based on the free float

methodology NASDAQ 100 the underlying index to the famous exchange traded

fund (ETF)-QQQ is based on the free float methodology

51

29441 Determining Free-float Factors of Companies

BSE has designed a Free-float format which is filled and submitted by all index

companies on a quarterly basis BSE determines the Free-float factor for each

company based on the detailed information submitted by the companies in the

prescribed format Free-float factor is a multiple with which the total market

capitalization of a company is adjusted to arrive at the Free-float market

capitalization Once the Free-float of a company is determined it is rounded-off to the

higher multiple of 5 and each company is categorized into one of the 20 bands given

below A Free-float factor of say 055 means that only 55 of the market

capitalization of the company will be considered for index calculation

Table 24 Free-float Bands

Free-Float Free-Float Factor Free-Float Free-Float Factor

gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices

For the premier stock exchange that pioneered the securities transaction business

in India over a century of experience is a proud achievement A lot has changed since

1875 when 318 persons by paying a then princely amount of Re 1 became members

of what today is called Bombay Stock Exchange Limited (BSE) Over the decades

the stock market in the country has passed through good and bad periods The journey

52

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 BSE in 1986 came out with a Stock Index-SENSEX- that subsequently

became the barometer of the Indian stock market

The launch of SENSEX in 1986 was later followed up in January 1989 by

introduction of BSE National Index (Base 1983-84 = 100) It comprised 100 stocks

listed at five major stock exchanges in India - Mumbai Calcutta Delhi Ahmadabad

and Madras The BSE National Index was renamed BSE-100 Index from October 14

1996 and since then it is being calculated taking into consideration only the prices of

stocks listed at BSE BSE launched the dollar-linked version of BSE-100 index on

May 22 2006

With a view to provide a better representation of the increasing number of listed

companies larger market capitalization and the new industry sectors BSE launched

on 27th May 1994 two new index series viz the BSE-200 and the DOLLEX-200

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 for still broader

segment-specific and sector-specific indices BSE has continuously been increasing

the range of its indices BSE-500 Index and 5 sectorial indices were launched in 1999

In 2001 BSE launched BSE-PSU Index DOLLEX-30 and the countrys first free-

float based index - the BSE TEC Index Over the years BSE shifted all its indices to

the free-float methodology

BSE disseminates information on 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 are updated on real time basis during market hours and

displayed through the BOLT system BSE website and news wire agencies

All BSE Indices are reviewed periodically by the BSE Index Committee This

Committee which comprises eminent independent finance professionals frames the

broad policy guidelines for the development and maintenance of all BSE indices The

BSE Index Cell carries out the day-to-day maintenance of all indices and conducts

research on development of new indices

53

2951 BSE-100 Index

A broad-based index the BSE-100 was formerly known as the BSE National index

This Index has 1983-84 as the base year and was launched in 1989 In line with the

shift of the BSE Indices to the globally accepted Free-Float methodology BSE-100

was shifted to Free-Float methodology effective from April 5 2004 The method of

computation of Free-Float index and determination of free-float factors is similar to

the methodology for SENSEX

Table 25 Index Specification

Base Year 1983-84

Base Index Value 100

Date of Launch 3-Jan-89

Method of calculation Launched on full market capitalization

method and effective April 05 2004

calculation method shifted to free-float

market capitalization

Number of scrips 100

Index calculation frequency Real Time


2952 Base Year

The financial year 1983-84 has been chosen as the base year The price stability

during that year and proximity to the index series were the main consideration for

choice of 1983-84 as the base year The base value was fixed at 100 points

2953 Dollex-100

BSE also calculates a dollar-linked version of SENSEX and historical values of this

index are available since its inception

2954 BSE-100 index - Scrip Selection Criteria

The general guidelines for selection of constituents in BSE-100 are as follows

Trading Frequency The scrip should have been traded on 95 of the trading days

54

in the last three months Exceptions can be made for extreme reasons like scrip

suspension etc

Final Rank The scrip should figure in the top 200 companies listed by final rank

The final rank is arrived at by assigning 75 weighted to the rank on the basis of

three-month average full market capitalization and 25 weighted to the liquidity rank

based on three-month average daily turnover amp three-month average impact cost

IndustrySector Representation Scrip selection would generally take into account a

balanced sectorial representation of the listed companies in the universe of BSE

Track Record In the opinion of the BSE Index Committee the company should

have an acceptable track record

210 STOCK MARKET VOLATILITY

2101 Meaning

Volatility is a measure for variation of price of a financial instrument over time

Historic volatility is derived from time series of past market prices An implied

volatility is derived from the market price of a market traded derivative (in particular

an option) Volatility does not measure the direction of price changes merely their

dispersion This is because when calculating standard deviation (or variance) all

differences are squared so that negative and positive differences are combined into

one quantity Two instruments with different volatilities may have the same expected

return but the instrument with higher volatility will have larger swings in values over

a given period of time

For example a lower volatility stock may have an expected (average) return of 7

with annual volatility of 5 This would indicate returns from approximately negative

3 to positive 17 most of the time (19 times out of 20 or 95 via a two standard

deviation rule) A higher volatility stock with the same expected return of 7 but

with annual volatility of 20 would indicate returns from approximately negative

33 to positive 47 most of the time (19 times out of 20 or 95) These estimates

assume a normal distribution in reality stocks are found to be leptokurtotic

55

2102 Terminology used in volatility

Volatility as described here refers to the actual current volatility of a financial

instrument for a specified period (for example 30 days or 90 days) It is the volatility

of a financial instrument based on historical prices over the specified period with the

last observation the most recent price This phrase is used particularly when it is

wished to distinguish between the actual current volatility of an instrument and

actual historical volatility which refers to the volatility of a financial instrument

over a specified period but with the last observation on a date in the past

actual future volatility which refers to the volatility of a financial instrument

over a specified period starting at the current time and ending at a future date

(normally the expiry date of an options)

historical implied volatility which refers to the implied volatility observed from

historical prices of the financial instrument (normally options)

current implied volatility which refers to the implied volatility observed from

current prices of the financial instrument

future implied volatility which refers to the implied volatility observed from

future prices of the financial instrument

For a financial instrument whose price follows a random walk or wiener process the

width of the distribution increases as time increases This is because there is an

increasing profitability that the instruments price will be farther away from the initial

price as time increases However rather than increase linearly the volatility increases

with the square-root of time as time increases because some fluctuations are expected

to cancel each other out so the most likely deviation after twice the time will not be

twice the distance from zero

2103 Usefulness of volatility for Investors

Investors care about volatility for five reasons

1 The wider the swings in an investments price the harder emotionally it is to

not worry

2 Price volatility of a trading instrument can define position sizing in a portfolio

56

3 When certain cash flows from selling a security are needed at a specific future

date higher volatility means a greater chance of a shortfall

4 Higher volatility of returns while saving for retirement results in a wider

distribution of possible final portfolio values

5 Higher volatility of return when retired gives withdrawals a larger permanent

impact on the portfolios value

6 Price volatility presents opportunities to buy assets cheaply and sell when

overpriced

18

21 INTRODUCTION

Stock exchange is a mutual organization which provides trading facilities for stock

brokers and traders to trade stocks and other securities In common mens language

Stock markets refer to a market place where investors can buy and sell stocks The

price at which each buying and selling transaction takes place is determined by the

market forces (ie demand and supply for a particular stock)

Stock exchanges also provide facilities for the issue and redemption of securities as

well as other financial instruments and capital events including the payment of

income and dividends The securities traded on a stock exchange

include shares issued by companies unit trusts derivatives pooled investment

products and bonds To trade a security on a certain stock exchange it has to

be listed there Usually there is a central location at least for recordkeeping but trade

is less and less linked to such a physical place as modern markets are equipped with

electronic networks which gives them advantages of speed and cost efficiency of

transactions Only members are entitling to Trade on an exchange The initial offering

of stocks and bonds to investors is by definition done in the primary market and

subsequent trading is done in the secondary market A stock exchange is often the

most important component of a stock market Supply and demand in stock markets is

driven by various factors which as in all free markets affect the price of stocks

Usually there is no compulsion to issue stock via the stock exchange itself nor must

stock be subsequently traded on the exchange Such trading is said to be off

exchange or over-the-counter This is the usual way that derivatives and bonds are

traded Increasingly stock exchanges are part of a global market for securities

22 HISTORY OF WORLD STOCK MARKET

221 The First Stock Exchanges

It is believed that the first stock was established in 11th century France where

the courtiers de change were concerned with managing and regulating the debts of

Agricultural communities on behalf of the Banks Some stories suggest that the

origins of the term bourse come from the Latin bursa meaning a bag because in

19





















84 countries








NYSE Euro next

20

















226 NASDAQ - 1971







trading






21










22

12

254

2

11

10

43

7USA

UK

EUROLAND

JAPAN

SOUTH AFRICA

RASSIA

INDIA

AUSTRIA HUNGARY

LATIN AMERICA

47

8

13

13

211

6USA

UK

EUROLAND

JAPAN

CANADA

OTHER FORM 1900

NEW MARKET

22































23

















offering

Benefits


potential investors




securities




24



value


Obligations






















25






234 Profit sharing



businesses



















26































27








Total Share

Turnovers












Europe Euro next 260509760 119596220




Espantildeoles)

117852560 104075110









28




000 400000000 800000000 1200000000












000 500000000 1000000000 1500000000










29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

19





















84 countries








NYSE Euro next

20

















226 NASDAQ - 1971







trading






21










22

12

254

2

11

10

43

7USA

UK

EUROLAND

JAPAN

SOUTH AFRICA

RASSIA

INDIA

AUSTRIA HUNGARY

LATIN AMERICA

47

8

13

13

211

6USA

UK

EUROLAND

JAPAN

CANADA

OTHER FORM 1900

NEW MARKET

22































23

















offering

Benefits


potential investors




securities




24



value


Obligations






















25






234 Profit sharing



businesses



















26































27








Total Share

Turnovers












Europe Euro next 260509760 119596220




Espantildeoles)

117852560 104075110









28




000 400000000 800000000 1200000000












000 500000000 1000000000 1500000000










29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

20

















226 NASDAQ - 1971







trading






21










22

12

254

2

11

10

43

7USA

UK

EUROLAND

JAPAN

SOUTH AFRICA

RASSIA

INDIA

AUSTRIA HUNGARY

LATIN AMERICA

47

8

13

13

211

6USA

UK

EUROLAND

JAPAN

CANADA

OTHER FORM 1900

NEW MARKET

22































23

















offering

Benefits


potential investors




securities




24



value


Obligations






















25






234 Profit sharing



businesses



















26































27








Total Share

Turnovers












Europe Euro next 260509760 119596220




Espantildeoles)

117852560 104075110









28




000 400000000 800000000 1200000000












000 500000000 1000000000 1500000000










29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

21










22

12

254

2

11

10

43

7USA

UK

EUROLAND

JAPAN

SOUTH AFRICA

RASSIA

INDIA

AUSTRIA HUNGARY

LATIN AMERICA

47

8

13

13

211

6USA

UK

EUROLAND

JAPAN

CANADA

OTHER FORM 1900

NEW MARKET

22































23

















offering

Benefits


potential investors




securities




24



value


Obligations






















25






234 Profit sharing



businesses



















26































27








Total Share

Turnovers












Europe Euro next 260509760 119596220




Espantildeoles)

117852560 104075110









28




000 400000000 800000000 1200000000












000 500000000 1000000000 1500000000










29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

22































23

















offering

Benefits


potential investors




securities




24



value


Obligations






















25






234 Profit sharing



businesses



















26































27








Total Share

Turnovers












Europe Euro next 260509760 119596220




Espantildeoles)

117852560 104075110









28




000 400000000 800000000 1200000000












000 500000000 1000000000 1500000000










29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

23

















offering

Benefits


potential investors




securities




24



value


Obligations






















25






234 Profit sharing



businesses



















26































27








Total Share

Turnovers












Europe Euro next 260509760 119596220




Espantildeoles)

117852560 104075110









28




000 400000000 800000000 1200000000












000 500000000 1000000000 1500000000










29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

24



value


Obligations






















25






234 Profit sharing



businesses



















26































27








Total Share

Turnovers












Europe Euro next 260509760 119596220




Espantildeoles)

117852560 104075110









28




000 400000000 800000000 1200000000












000 500000000 1000000000 1500000000










29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

25






234 Profit sharing



businesses



















26































27








Total Share

Turnovers












Europe Euro next 260509760 119596220




Espantildeoles)

117852560 104075110









28




000 400000000 800000000 1200000000












000 500000000 1000000000 1500000000










29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

26































27








Total Share

Turnovers












Europe Euro next 260509760 119596220




Espantildeoles)

117852560 104075110









28




000 400000000 800000000 1200000000












000 500000000 1000000000 1500000000










29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

27








Total Share

Turnovers












Europe Euro next 260509760 119596220




Espantildeoles)

117852560 104075110









28




000 400000000 800000000 1200000000












000 500000000 1000000000 1500000000










29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

28




000 400000000 800000000 1200000000












000 500000000 1000000000 1500000000










29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

29







Million31



















30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

30



26 OWNERSHIP





Examples are




















31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

31







old history


Year Events

18th

Century







the business













1880 -

90s


coal



brokers


32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

32










Limited









under the Act were



namely







33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

33



















S

No

As on 31st December 1946 1961 1971 1980 1991 1995 2000 2005


2 No of Listed Cos 1125 1203 1599 2265 6229 8593 9413 4731



971 1292 2675 6750 110279 478121 6319212 478121

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

34











- Dividend paying










35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

35







of 14 days each





Act as an agent
















36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

36



Listed Securities










Advantages of OTCEI









OTCEI

Listed Securities



37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

37






namely


Capital market













or elsewhere






Hall

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

38



the screen






transparency











and it has a






39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

39











Dalal Street













and operation






40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

40




















283 Services of BSE







41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

41







cities in India

2833 BSEWEBXcom




2834 Surveillance








program

284 Awards





42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

42


reporting













closing index value













Governing Board

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

43






















formula is updated





44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

44










listing agreements



















45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

45
















be

2450x (4781+100)

_____________________ = Rs250124 crores

4781



necessary









46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

46


























exchanges





47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

47







of 100












2925 The FTSE 100





the index




48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

48








America



















India

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

49





method


2941 Concept











methodology









50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

50





course























51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

51













gt0 - 5 005 gt50 - 55 055

gt5 - 10 010 gt55 - 60 060

gt10 - 15 015 gt60 - 65 065

gt15 - 20 020 gt65 - 70 070

gt20 - 25 025 gt70 - 75 075

gt25 - 30 030 gt75 - 80 080

gt30 - 35 035 gt80 - 85 085

gt35 - 40 040 gt85 - 90 090

gt40 - 45 045 gt90 - 95 095

gt45 - 50 050 gt95 - 100 100


295 BSE Indices






52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

52











May 22 2006




















53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

53

2951 BSE-100 Index








Base Year 1983-84










2952 Base Year




2953 Dollex-100






54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

54


suspension etc










2101 Meaning

















55




























not worry


56








overpriced

55




























not worry


56








overpriced

56








overpriced

Documents

CHAPTER 2 STOCK MARKET: AN OVERVIEW - …shodhganga.inflibnet.ac.in/bitstream/10603/42567/11/11_chapter 2.pdf · CHAPTER 2 STOCK MARKET: AN OVERVIEW ... the Amex expanded it niche