fact book-2009-
TRANSCRIPT
Fact Book2009
NATIONAL STOCK EXCHANGE OF INDIA LIMITEDJune 2009
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C O N T E N T S
SECTION 1- NATIONAL STOCK EXCHANGE OF INDIA
Introduction .......................................................................................................3
Incorporation and Management .........................................................................4
Market Segments And Products .........................................................................4
Achievements/Milestones ..................................................................................8
Developments during the year ...........................................................................9
Facts And Figures .............................................................................................11
Technology ......................................................................................................12
NSE Family ......................................................................................................16
NSCCL ............................................................................................................16
NSDL ...............................................................................................................16
NSE Infotech services Ltd ...............................................................................17
NSE.IT ............................................................................................................17
IISL ...............................................................................................................17
Dotex International Ltd. ..................................................................................18
NCDEX ...........................................................................................................18
NCCL ..............................................................................................................18
PXIL ...............................................................................................................18
SECTION 2- MEMBERSHIP ADMINISTRATION
Eligibility Criteria ............................................................................................23
Trading Membership ........................................................................................23
Clearing Membership .......................................................................................24
Currency Derivative Membership ...................................................................24
Growth and Distribution Of Members ...........................................................25
Transaction Charges .........................................................................................25
SECTION 3- LISTING OF SECURITIES
Benefits Of Listing On NSE ............................................................................33
Listing Criteria .................................................................................................33
Listing Agreement ............................................................................................34
Compliance By Listed Companies ...................................................................34
Disclosures By Listed Companies ....................................................................34
De-Listing .........................................................................................................34
CM Segment .....................................................................................................35
Listing Fees .......................................................................................................36
Contd...
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Shareholding Pattern ........................................................................................36
WDM Segment .................................................................................................37
Funds Mobilisation On the Exchange ..............................................................37
Initial Public Offerings (IPO’s) .................................................................... 37
Rights Issues .................................................................................................. 38
Preferential Allotment/ Private Placement ................................................ 38
QIPs .............................................................................................................. 38
SECTION 4- CAPITAL MARKET SEGMENT
NEAT System ..................................................................................................55
Market Performance ........................................................................................56
Trading Volume ........................................................................................... 56
Liquidity ....................................................................................................... 56
Distribution of turnover .............................................................................. 57
Market Capitalisation .................................................................................. 57
Sectoral Distribution .................................................................................... 58
Trading Records during 2008-09 ................................................................. 58
Internet Trading .......................................................................................... 58
On-line IPOs ................................................................................................. 59
Indices...............................................................................................................59
Volatility Index ............................................................................................ 60
Mutual Funds And Exchange Traded Funds ...................................................61
Charges .............................................................................................................61
Clearing & Settlement ......................................................................................62
Settlement Agencies ...................................................................................... 63
Settlement Cycles .......................................................................................... 64
Settlement Statistics ...................................................................................... 64
Risk Management System ................................................................................65
Capital Adequacy ......................................................................................... 65
On-Lime Monitoring .................................................................................... 65
Surveillance, Investigation & Inspection ..........................................................65
Margin Requirements .......................................................................................66
Categorisation of newly listed securities ..........................................................66
Value at Risk Margin ........................................................................................67
Extreme Loss Margin .......................................................................................67
Mark to Market Margin ...................................................................................67
Contd...
Contd...
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Close out Facility .............................................................................................68
Index –based Market wide Circuit Breakers ....................................................68
Settlement Guarantee Fund .............................................................................69
SECTION 5- WHOLESALE DEBT MARKET SEGMENT
Trading Mechanism ..........................................................................................97
Market Performance ........................................................................................98
Turnover ....................................................................................................... 98
Market Capitalistion ................................................................................. 100
Transaction Charges .......................................................................................100
Settlement .......................................................................................................100
FIMMDA-NSE MIBID/MIBOR ...................................................................101
Zero Coupon Yield Curve .............................................................................102
NSE-VAR System ..........................................................................................103
GOI- bond Index ............................................................................................103
SECTION 6- FUTURES &OPTIONS SEGMENT
Trading Mechanism ........................................................................................118
Contract Specification ....................................................................................118
Selection Criteria For Stocks And Index Eligibility For Trading ..................120
Trading Value & Contracts Traded ...............................................................121
Product wise turnover on F&O segment .................................................... 123
Futures and Options on Benchmark Indices .............................................. 123
Sectorwise Stock Futures & Options Turnover ......................................... 124
Participant wise turnover on F&O Segment ............................................. 125
Member wise turnover on the Exchange .................................................... 125
High Volume Members ............................................................................... 125
Internet Trading ......................................................................................... 126
Traded Value Records ................................................................................ 126
Top 20 Futures And Options Contracts ........................................................127
Number of Trades ..........................................................................................127
Charges ...........................................................................................................127
Clearing And Settlement ................................................................................128
Clearing Mechanism ................................................................................... 129
Settlement Mechanism ................................................................................ 129
Settlement Statistics .................................................................................... 131
Risk Management System ..............................................................................131
Contd...
Contd...
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NSE-SPAN® ..................................................................................................132
Margins ....................................................................................................... 133
Position Limits .......................................................................................... 134
SECTION 7- CURRENCY DERIVATIVES SEGMENT
Trading Mechanism ........................................................................................159
Contract Specifications for Currency Futures ...............................................160
Turnover ........................................................................................................161
Traded Value Records ....................................................................................162
Charges ...........................................................................................................162
Clearing and Settlement .................................................................................163
Clearing Entities ........................................................................................ 163
Clearing Mechanism .................................................................................. 163
Settlement Mechanism ............................................................................... 164
Settlement Statistics ................................................................................... 165
Risk Management ...........................................................................................165
Margining System ...................................................................................... 166
Position Limits for Currency Futures ....................................................... 167
SECTION 8- INVESTOR SERVICES, ARBITRATION
Investor Services .............................................................................................171
Arbitration .....................................................................................................172
SECTION 9- KNOWLEGDE INITIATIVE
NSE’s Certification in Financial Markets ......................................................177
Launch of New NCFM Modules ...................................................................177
NCFM Tests conducted in Regional languages..............................................178
CBSE- NSE joint Certification in Financial Markets .....................................178
NSE Research Initiative .................................................................................178
Investor Awareness and Education Programmes ..........................................178
National Institute of Securities (NISM) ........................................................179
Launch of Currency Derivatives Certification Examination by NISM ........179
Contd...
SPAN® is a registered trademark of the Chicago Mercantile Exchange (CME) used here under license.
National Stock Exchange of India 1
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1National Stock Exchange of India
Since its inception in 1992, National Stock Exchange of India has been at the vanguard of change in the Indian securities market. This period has seen remarkable changes in markets, from how capital is raised and traded, to how transactions are cleared and settled.
The market has grown in scope and scale in a way that could not have been imagined at the time. Average daily trading volumes have jumped from Rs. 17 crore in 1994-95 when NSE started its Cash Market segment to Rs.11,325 crore in 2008-09. Similarly, market capitalization of listed Indian firms went up from Rs.363,350 crore at the end of March 1995 to Rs.2,896,194 crore at end March 2009. Indian equity markets are today among the most deep and vibrant markets in the world.
This transformation was the result of a number of initiatives led by the Government, market regulators and infrastructure providers like exchanges and depositories. NSE’s efforts in this area have included the creation of the first clearing corporation in the country in the form of the National Securities Clearing Corporation Limited (NSCCL). NSCCL today provides central counterparty services and manages settlement risk for multiple products, and is a major factor in the confidence market participants have in the ability of Indian markets to handle extreme shocks without causing any defaults. NSCCL is also the first clearing corporation in the country to receive.
NSE has many other firsts to its name, including the first systematic process of member inspections, a sophisticated market surveillance system, and a country wide high capacity data network supporting close to 200,000 dealer terminals.
The year 2008-09 was an eventful year for NSE, as it saw the launch of new and important products for the securities market. Introduction of Mini Nifty Futures and Options contracts on S&P CNX Nifty during the year has given retail investors an increased ability to participate in index futures and options trading. NSE also started publishing the first volatility index in the country India VIX*. Market participants now have an important tool to assess volatility and create trading strategies to exploit volatility movements. In May 2008, NSE developed a new trading application, NOW, or ‘NEAT on Web’. The NOW platform allows trading members to connect to the exchange through the internet, and has resulted in a significant reduction in both the access cost and turnaround time for providing access. This year also saw a watershed in the Indian currency market in the form of a currency futures contract. NSE was the first stock exchange in the country to launch the contract on August 29, 2008 in USDINR pair. The contract was an instant success, and currently has daily trading volumes in excess of Rs. 2,000 crore and open interest in excess of Rs. 1,000 crore. Other significant developments include Long term Options Contracts on S&P CNX Nifty, Short selling
* “VIX” is a trademark of Chicago Board Options Exchange, Incorporated ("CBOE") and Standard & Poor’s has granted a license to NSE, with permission from CBOE, to use such mark in the name of the India VIX and for purposes relating to the India VIX.
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and Securities Lending and Borrowing Scheme, Direct Market Access (DMA), Futures and Options contracts on S&P CNX Defty index and the NSE E-Bids for Debt Segment. Further NSE also ventured into a new segment by promoting a Power Exchange (Power Exchange India Ltd -PXIL) along with NCDEX.
Today, NSE offers a wide range of products for multiple markets, including equity shares, Exchange Traded Funds (ETF) , Mutual Funds, Debt instruments, Index futures and Options, Stock Futures and Options and Currency futures. Our Exchange has more than 1,400 companies listed in the Capital Market and more than 95% of these companies are actively traded. The debt market has more than 3,954 securities available for trading. Index futures and options trade on seven different indices and on more than 230 stocks in stock futures and options. In currency futures contracts are currently traded in the USDINR pair. Globally, NSE is ranked first in single stock futures in terms of number of contracts traded, and third in stock index futures and stock index options. We also rank third in terms of number of equity shares traded and are the eighth largest derivatives exchange in the world.
Incorporation and Management
The NSE is owned by a set of leading Indian and International financial institutions, banks, insurance companies, private equity funds, mutual funds, venture capital funds etc. NSE was incorporated in November 1992, and received recognition as a stock exchange under the Securities Contracts (Regulation) Act, 1956 in April 1993. It is managed by professionals who do not directly or indirectly trade on the Exchange. The trading rights are with trading members who offer their services to the investors. The Board of NSE comprises of senior executives from promoter institutions and eminent professionals, without having any representation from trading members. While the Board deals with the broad policy issues, the Executive Committees (ECs), which include trading members, formed under the Articles of Association and the Rules of NSE for different market segments, set out rules and parameters to manage the day-to-day affairs of the Exchange. The day-to-day management of the Exchange is delegated to the Managing Director and CEO who is supported by a team of professional staff. Therefore, though the role of trading members at NSE is to the extent of providing only trading services to the investors, the Exchange involves trading members in the process of consultation and participation in vital inputs towards decision making.
Tables 1-1 and 1-2 gives the composition of its Board of Directors and the Executive Committees.
Market Segments and Products
NSE provides a trading platform for of all types of securities for investors under one roof – Equity, Corporate Debt, Central and State Government Securities, T-Bills, Commercial Paper (CPs), Certificate of Deposits (CDs), Warrants, Mutual Funds (MFs) units, Exchange Traded Funds (ETFs), Derivatives like Index Futures, Index Options, Stock Futures, Stock Options and Currency Futures. The Exchange provides trading
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in 4 different segments viz., Wholesale Debt Market (WDM) segment, Capital Market (CM) segment, Futures & Options (F&O) segment and the Currency Derivatives Segment (trading on which commenced on August 29, 2008)
The Wholesale Debt Market segment provides the trading platform for trading of a wide range of debt securities which includes State and Central Government securities, T-Bills, PSU Bonds, Corporate debentures, CPs, CDs etc. However, along with these financial instruments, NSE also launched various products e.g. FIMMDA-NSE MIBID/MIBOR owing to the market need. A reference rate is said to be an accurate measure of the market price. In the fixed income market, it is the interest rate that the market respects and closely matches. In response to this, NSE started computing and disseminating the NSE Mumbai Inter-bank Bid Rate (MIBID) and NSE Mumbai Inter-Bank Offer Rate (MIBOR). Owing to the robust methodology of computation of these rates and its extensive use, this product has become very popular among the market participants. Keeping in mind the requirements of the banking industry, FIs, MFs, insurance companies, who have substantial investments in sovereign papers, NSE also started the dissemination of its yet another product, the ‘Zero Coupon Yield Curve’. This helps in valuation of sovereign securities across all maturities irrespective of its liquidity in the market. The increased activity in the government securities market in India and simultaneous emergence of MFs (Gilt MFs) had given rise to the need for a well defined bond index to measure the returns in the bond market. NSE constructed such an index, ‘NSE Government Securities Index’. This index provides a benchmark for portfolio management by various investment managers and gilt funds. The average daily turnover in the WDM Segment is Rs.1,394 crore (US $ 273.60 million) during 2008-09.
The Capital Market (CM) segment offers a fully automated screen based trading system, known as the National Exchange for Automated Trading (NEAT) system. This operates on a price/time priority basis and enables members from across the country to trade with enormous ease and efficiency. Various types of securities e.g. equity shares, warrants, debentures etc. are traded on this system. The average daily turnover in the CM Segment of the Exchange during 2008-09 was Rs. 11,325 crore. (US $ 2,223 million).
Futures & Options (F&O) segment of NSE provides trading in derivatives instruments like Index Futures, Index Options, Stock Options, Stock Futures. The futures and options segment of NSE has made a mark for itself globally. In the Futures and Options segment, trading in S&P CNX Nifty Index, CNX IT index, Bank Nifty Index, CNX Nifty Junior, CNX 100 index, Nifty Midcap 50 index , S&P CNX Defty and single stocks are available. The average daily turnover in the F&O Segment of the Exchange during 2008-09 was Rs.45,311 crore (US $ 8,893 million).
Currency Derivatives Segment (CDS) at NSE commenced operations on August 29, 2008. with the launch of Currency futures trading in US Dollar-Indian Rupee (USD-INR). On the very first day of operations a total number of 65,798 contracts valued at Rs.291 crore were traded on the Exchange. Since then trading activity in this segment has been witnessing a rapid growth. During August 29, 2008 to March 31, 2009 the segment reported a trading value of Rs.162,272 crore (US $ 31,849 million). A total
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number of 518 trading members which includes 22 banks have taken membership in this market segment as at end March 2009.
Trading Value(Rs.crore)
Segment/Year 2005-06 2006-07 2007-08 2008-09
CM 1,569,558 1,945,287 3,551,038 2,752,023
F&O 4,824,250 7,356,271 13,090,478 11,010,482
CDS* – – – 162,272
WDM 475,523 219,106 282,317 335,952
Total 6,869,332 9,520,664 16,923,833 14,260,729
* Trading in Currency Futures on Currency Derivatives Segment (CDS) commenced on August 29, 2008 the trading value is from August 29, 2008 to 31st March 2009.
Market Segments Indicators- Trading Volume
Market Capitalisation (As at end March)
(Rs.crore)
Segment/Year Mar-06 Mar-07 Mar-08 Mar-09
CM 2,813,201 3,367,350 4,858,122 2,896,194
WDM 1,567,574 1,784,801 2,123,346 2,848,315
Total 4,380,775 5,152,151 6,981,468 5,744,510
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Market Segment Indicators- Market Capitalisation
NSEs Worldwide Ranking in 2008 (Jan-Dec)
• NSE Ranks 3rd in Number of Trades in Equity Shares.
• NSE Ranks 2nd in terms of Number of Contracts traded in Single Stock Futures.
• NSE Ranks 3rd in terms of Number of Contracts traded in Stock Index Futures.
• NSE Ranks 4th in terms of Number of Contracts traded in Stock Index Options.
• NSE is the 8th Largest Derivatives Exchange in the World.Source:WFE & FIA
NSEs Worldwide Ranking for the period Jan-April 2009
• NSE Ranks 1st in terms of Number of Contracts traded in Single Stock Futures
• NSE Ranks 3rd in terms of Number of Contracts traded in Stock Index Futures.
• NSE Ranks 3rd in terms of Number of Contracts traded in Stock Index Options.
• NSE Ranks 4th in Number of Trades in Equity Shares.Source:WFE & FIA
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Achievements/MilestonesMonth/Year Event
November 1992 Incorporation
April 1993 Recognition as a stock exchange.
June 1994 WDM segment goes live.
November 1994 CM segment goes live through VSAT.
October 1995 Became largest stock exchange in the country.
April 1996 Commencement of clearing and settlement by NSCCL.
April 1996 Launch of S&P CNX Nifty.
November 1996 Setting up of National Securities Depository Ltd., first depository in India, co-promoted by NSE.
December 1996 Commencement of trading/settlement in dematerialised securities.
December 1996 Launch of CNX Nifty Junior.
May 1998 Promotion of joint venture, India Index Services & Products Limited (IISL) (along with CRISIL) for index services.
May 1998 Launch of NSE’s Web-site : www.nseindia.com.
July 1998 Launch of ‘NSE’s Certification Programme in Financial Markets’ (NCFM)
October 1999 Setting up of NSE.IT Ltd.
June 2000 Commencement of Derivatives Trading (in Index Futures).
June 2001 Commencement of Trading in Index Options
July 2001 Commencement of Trading in Options on Individual Securities
November 2001 Commencement of Trading in Futures on Individual Securities
January 2002 Launch of Exchange Traded Funds (ETFs).
August 2003 Launch of Futures and Options on CNX IT Index
June 2005 Launch of Futures & Options on BANK Nifty Index
August 2006 Setting up of NSE Infotech Services Ltd.
December 2006 ‘Derivative Exchange of the Year’, by Asia Risk magazine
March 2007 Launch of Gold BeES- Exchange Traded Fund (ETF).(First Gold ETF)
June 2007 Launch of Futures & Options on CNX 100 and CNX Nifty Junior contracts.
October 2007 Launch of Futures & Options on Nifty Midcap 50
January 2008 Launch of Mini Nifty derivative contracts
March 2008 Launch of long term option contracts on S&P CNX Nifty Index.
April 2008 Launch of Securities Lending & Borrowing Scheme
April 2008 Launch of - India VIX* The Volatility Index
April 2008 Direct Market Access (DMA)
June 2008 Setting up of Power Exchange India Ltd.
July 2008 Launch of NOW ‘Neat on Web’
August 2008 Launch of Currency Derivatives Segment with commencement of trading on Currency Futures on August 29, 2008.
September 2008 Launch of ASBA (Applications supported by Blocked Amount)
December2008 Launch of derivative contracts in DEFTY index
February 2009 Cross Margining Benefit in CM and F&O Segment
March 2009 Launch of NSE E-Bids for Debt Segment
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Developments during the year.
The year 2008-09 was a significant year wherein major securities market reforms and launch of new products took place.
April 2008 Launch of India VIX*
Volatility Index is a measure of market’s expectation of volatility over the near term. Volatility is often described as the “rate and magnitude of changes in prices” and in finance often referred to as risk. Volatility Index is a measure, of the amount by which an underlying Index is expected to fluctuate, in the near term, (calculated as annualised volatility, denoted in percentage e.g. 20%) based on the order book of the underlying index options.
India VIX is a volatility index based on the Nifty 50 Index Option prices. From the best bid-ask prices of Nifty 50 Options contracts, a volatility figure (%) is calculated which indicates the expected market volatility over the next 30 calendar days.
April 2008 Launch of Securities Lending & Borrowing Scheme
A Securities Lending & Borrowing mechanism allows market participants to take short positions effectively with less cost. It also provides the holder of idle securities with an alternative to earn a return on such holdings without risk.
The Exchange launched a Securities Lending & Borrowing Scheme (SLBS) on April 21, 2008. The Exchange provides automated, screen based, order matching platform to participants to execute lending and borrowing transactions. Securities available for trading in F&O segment of the Exchange have been initially permitted to trade in this segment.
The SLBS was revised from December 22, 2008 to increase the trading time & the lending/borrowing period.
April 2008 Direct Market Access
During April 2008, Securities & Exchange Board of India (SEBI) allowed the direct market access (DMA) facility to the institutional investors. DMA allows brokers to offer clients direct access to the exchange trading system through the broker’s infrastructure without manual intervention by the broker. DMA facility gives clients direct control over orders, help in faster execution of orders, reduce the risk of errors from manual order entry and lend greater transparency and liquidity. DMA also leads to lower impact cost for large orders, better audit trails and better use of hedging and arbitrage opportunities through the use of decision support tools/algorithms for trading.
* “VIX” is a trademark of Chicago Board Options Exchange, Incorporated ("CBOE") and Standard & Poor’s has granted a license to NSE, with permission from CBOE, to use such mark in the name of the India VIX and for purposes relating to the India VIX.
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April 2008 CBCS - Corporate Bond Clearing and Settlement
CBCS is a corporate bond reporting and integrated clearing system. The platform supports trade reporting system where both sides of a corporate bond trade report the deal to the platform. The deal can then be cleared through a settlement system if required. CBCS fills an important need in the corporate bond clearing and settlement space. As transaction volumes rise in the corporate bond market, participants will need to use common clearing and settlement facilities in order to reduce risks and increase settlement efficiency.
July 2008 NOW ‘Neat on Web’
NSE is also offering internet based trading services to NSE members. This facility is branded as NOW ‘Neat on Web’. NOW provides an internet portal for NSE members and their authorized clients to transact orders and trades to the various market of NSE viz. CM, F&O and Currency. The members can also access NOW through their existing VSAT/Leased line, in addition to internet links. The various features provided by NOW are:
(a) Comprehensive Administration features
(b) Flexible Risk Management System
(c) High speed dealer terminals
(d) Online trading facility for investors
August 2008 Launch of Currency Futures
On August 29, 2008, NSE launched trading in currency future contracts for the first time in India. To start with 12 monthly future contracts on the USD-INR pair have been made available for trading. The minimum lot size has been kept small at USD 1000 and applicable margins are also comparably very low due to the less volatile nature of the underlying.
September 2008 ASBA – Application supported by blocked amount
ASBA is an application for subscribing to an issue, containing an authorisation to block the application money in a bank account.
The ASBA process is available in all public issues made through the book building route. An ASBA investor has to submit an ASBA physically or electronically through the internet banking facility, to the SCSB with whom the bank account to be blocked, is maintained. The SCSB then blocks the application money in the bank account specified in the ASBA, on the basis of an authorisation to this effect given by the account holder in the ASBA. The application money remains blocked in the bank account till finalisation of the basis of allotment in the issue or till withdrawal/ failure of the issue or till withdrawal/ rejection of the application, as the case may be. The application data is thereafter uploaded by the SCSB in the electronic bidding system through a web enabled interface provided by the NSE.
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December 2008 Launch of derivative contracts on S&P CNX DEFTY index
The Exchange introduced trading in futures and options contracts of S&P CNX Defty index from December 10, 2008. S&P CNX Defty is S&P CNX Nifty, measured in US dollars.
February 2009 Cross Margining Benefit
On February 9, 2009, Cross margining was made available for positions across index futures to stock/stock futures and stock futures to stocks. It is available to all categories of market participant and benefit is computed on online real time basis.
March 2009 NSE e-bids
NSE e-bids, NSE’s latest offering for credit markets, is an open bidding platform for FIIs to bid for allotments under the overall FII debt limits. After a one time signup, FIIs can bid for allotments and get updates of results.
FACTS AND FIGURES
The growth in the stock market activity across the different market segments and products is visible from records reached as at the end of March 2009 as cited in the table below :
Facts & Figures upto March 31, 2009
Sr. No.
Parameter Date Magnitude
Capital Market Segment
1. Number of Members March 31, 2009 1,181
2. Number of Securities available for trading March 31, 2009 1,583
3. Number of VSATs March 31, 2009 2,648
4. Number of Cities covered March 31, 2009 201
5. Settlement Guarantee Fund March 31, 2009 Rs.4,843.50 crore (US $ 950.64 million)
6. Investor Protection Fund March 31, 2009 Rs.285.36 crore (US $ 56 million)
6 Record number of trades January 7, 2009 8,959,510
7 Record daily turnover (quantity) January 7, 2009 12,599.46 lakh
8. Record daily turnover (value) November 01, 2007 Rs.28,476.07 cr. (US $ 7,124.36 mn.)
9. Record market capitalisation January 07, 2008 Rs.6,745,724.00 cr. (US $ 1,687,696.77 mn.)
10. Record value of S&P CNX Nifty Index January 08, 2008 6357.10
11. Record value of CNX Nifty Junior Index January 04, 2008 13209.35
Contd...
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Sr. No.
Parameter Date Magnitude
Clearing & Settlement
Record Pay-in/Pay-out (Rolling Settlement):
1 Funds Pay-in/Pay-out October 23, 2007 * Rs.4,567.70 cr. (US $ 1,142.78 mn.)
2 Securities Pay-in/Pay-out (Value) December 31, 2007 * Rs.9,195.56 cr. (US $ 2,300.62 mn.)
3 Securities Pay-in/Pay-out (Qty) January 12, 2009 * 3,511.61 lakhs
* Settlement Date
Derivatives (F&O segment)
1. Number of Members March 31, 2009 1,055
2. Number of Contracts available for trading March 31, 2009 19,480 a
3. Settlement Guarantee Fund March 31, 2009 Rs.23,655.86 crore (US $ 4,642.95 million)
4. Investor Protection Fund March 31, 2009 Rs.50.65 crore (US $ 9.94 million)
5. Record number of trades January 7, 2009 1,874,697
6. Record daily turnover (value) October 18,2007 Rs. 110,564 crore (US $ 27,661.50 mn.)
7. Record Number of Contracts Traded January 7, 2009 4,757,297
Currency Derivatives Segment (Currency Futures)
1. Number of Members March 31, 2009 518
2. Record Daily turnover March 20, 2009 Rs.3,911 crore
3. Record number of trades March 20, 2009 25,702
4. Record number of contracts March 20, 2009 7,75,933
Wholesale Debt Market Segment
1. Number of Members March 31, 2008 62
2. Record daily turnover (value) August 25,2003 Rs.13,911.57 cr. (US $ 3,179.79 mn.)
a No. of contracts available for trading in F&O segment as on 31st March 2009 includes 3 Nifty index Futures, 3 CNX IT Futures , 3 Bank Nifty Futures, 3 CNX 100 Futures , 3 Nifty Junior Futures, 3 Nifty Midcap50 futures, 3 Mini Nifty Futures, 3 Defty Futures, 700 stock futures, 768 Nifty index options, 110 CNX IT options, 152 Bank Nifty options, 114 CNX 100 options, 132 Nifty Junior index options ,86 Nifty Midcap50 options, 114 Mini Nifty Options, 126 Defty Options, 17,136 stock option and 18 interest rate futures contracts
Technology
Technology has been the backbone of the Exchange. Providing the services to the investing community and the market participants using technology at the cheapest possible cost has been its main thrust. NSE chose to harness technology in creating a new market design. It believes that technology provides the necessary impetus for
Contd...
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the organisation to retain its competitive edge and ensure timeliness and satisfaction in customer service. In recognition of the fact that technology will continue to redefine the shape of the securities industry, NSE stresses on innovation and sustained investment in technology to remain ahead of competition. NSE is the first exchange in the world to use satellite communication technology for trading. It uses satellite communication technology to energize participation from about 2,648 VSATs from nearly 201 cities spread all over the country.
Its trading system, called National Exchange for Automated Trading (NEAT), is a state of-the-art client server based application. At the server end all trading information is stored in an in-memory database to achieve minimum response time and maximum system availability for users. It has uptime record of 99.7%. For all trades entered into NEAT system, there is uniform response time of less than 1.5 seconds. NSE has been continuously undertaking capacity enhancement measures so as to effectively meet the requirements of increased users and associated trading loads. NSE has also put in place NIBIS (NSEs Internet Based Information System) for on-line real-time dissemination of trading information over the Internet.
As part of its business continuity plan, NSE has established a disaster back-up site at Chennai along with its entire infrastructure, including the satellite earth station and the high-speed optical fibre link with its main site at Mumbai. This site at Chennai is a replica of the production environment at Mumbai. The transaction data is backed up on near real time basis from the main site to the disaster back-up site through the 2 mbps high-speed link to keep both the sites all the time synchronised with each other.
The various application systems that NSE uses for its trading as well clearing and settlement and other operations form the backbone of the Exchange. The application systems used for the day-to-day functioning of the Exchange can be divided into (a) Front end applications and (b) Back office applications.
In the front office, there are 6 applications:
(i) NEAT – CM system takes care of trading of securities in the Capital Market segment that includes equities, debentures/notes as well as retail Gilts. The NEAT – CM application has a split architecture wherein the split is on the securities and users. The application runs on two Stratus systems with Open Strata Link (OSL). The application has been benchmarked to support 15,000 users and handle more than 3 million trades daily. This application also provides data feed for processing to some other systems like Index, OPMS through TCP/IP. This is a direct interface with the trading members of the CM segment of the Exchange for entering the orders into the main system. There is a two way communication between the NSE main system and the front end terminal of the trading member.
(ii) NEAT – WDM system takes care of trading of securities in the Wholesale Debt Market (WDM) segment that includes Gilts, Corporate Bonds, CPs, T-Bills, etc. This is a direct interface with the trading members of the WDM segment
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of the Exchange for entering the orders/trades into the main system. There is a two way communication between the NSE main system and the front end terminal of the trading member.
(iii) NEAT – F&O system takes care of trading of securities in the Futures and Options (F&O) segment that includes Futures on Index as well as individual stocks and Options on Index as well as individual stocks. This is a direct interface with the trading members of the F&O segment of the Exchange for entering the orders into the main system. There is a two way communication between the NSE main system and the front end terminal of the trading member.
(iv) NEAT – IPO system is an interface to help the initial public offering of companies which are issuing the stocks to raise capital from the market. This is a direct interface with the trading members of the CM segment who are registered for undertaking order entry on behalf of their clients for IPOs. NSE uses the NEAT IPO system that allows bidding in several issues concurrently. There is a two way communication between the NSE main system and the front end terminal of the trading member.
(v) NEAT – MF system is an interface with the trading members of the CM segment for order collection of designated Mutual Funds units.
(vi) NEAT- CD system is trading system for currency derivatives. Currently, currency futures are trading in the segment.
The exchange also provides a facility to its members to use their own front end software through the CTCL (computer to computer link) facility. The member can either develop his own software or use products developed by CTCL vendors.
In the back office, the following important application systems are operative:
(a) NCSS (Nationwide Clearing and Settlement System) is the clearing and settlement system of the NSCCL for the trades executed in the CM segment of the Exchange. The system has 3 important interfaces – OLTL (Online Trade loading) that takes each and every trade executed on real time basis and allocates the same to the clearing members, Depository Interface that connects the depositories for settlement of securities and Clearing Bank Interface that connects the 13 clearing banks for settlement of funds. It also interfaces with the clearing members for all required reports. Through collateral management system it keeps an account of all available collaterals on behalf of all trading/clearing members and integrates the same with the position monitoring of the trading/clearing members. The system also generates base capital adequacy reports.
(b) FOCASS is the clearing and settlement system of the NSCCL for the trades executed in the F&O segment of the Exchange. It interfaces with the clearing members for all required reports. Through collateral management system it
15
keeps an account of all available collaterals on behalf of all trading/clearing members and integrates the same with the position monitoring of the trading/clearing members. The system also generates base capital adequacy reports.
(c) CDCSS is the clearing and settlement system for trades executed in the currency derivative segment.Through collateral management system it keeps an account of all available collateral on behalf of all trading /clearing members and integrates the same with the position monitoring of the trading/clearing members. The System also generates base capital adequacy report.
(c) Surveillance system offers the users a facility to comprehensively monitor the trading activity and analyse the trade data online and offline.
(d) OPMS – the online position monitoring system that keeps track of all trades executed for a trading member vis-à-vis its capital adequacy.
(e) PRISM is the parallel risk management system for F&O trades using Standard Portfolio Analysis (SPAN). It is a system for comprehensive monitoring and load balancing of an array of parallel processors that provides complete fault tolerance. It provides real time information on initial margin value, mark to market profit or loss, collateral amounts, contract-wise latest prices, contract-wise open interest and limits. The system also tracks online real time client level portfolio base upfront margining and monitoring.
(f) PRISM-CD is the risk management system of the currency derivatives segment. It is similar in features to the PRISM of F&O Segment.
(f) Data warehousing that is the central repository of all data in CM as well as F&O segment of the Exchange.
(g) Listing system that captures the data from the companies which are listed in the Exchange for corporate governance and integrates the same to the trading system for necessary broadcasts for data dissemination process and
(h) Membership system that keeps track of all required details of the Trading Members of the Exchange.
The exchange operates and manages a nationwide IP network of over 2500 VSATs and 2169 Leased Lines. In the new IP network, members have an advantage of a more generic and latest IP protocol and an overall better design, in terms of bandwidth and resilience.
NOW
NSE is also offering internet based trading services to NSE members. This facility is branded as NOW ‘NEAT on Web’. NOW provides an internet portal for NSE members and their authorized clients to transact orders and trades to the various market of NSE viz. CM, F&O and Currency. The members can also access NOW through their
16
existing VSAT/Leased line, in addition to internet links. The various features provided by NOW are:
(a) Comprehensive Administration features
(b) Flexible Risk Management System
(c) High speed dealer terminals
(d) Online trading facility for investors
NSE Family
NSCCL
The National Securities Clearing Corporation Ltd. (NSCCL), a wholly-owned subsidiary of NSE, was incorporated in August 1995 and commenced clearing corporation in April 1996. It was the first clearing corporation in the country to provide novation/settlement guarantee that revolutionized the entire concept of settlement system in India. It was set up to bring and sustain confidence in clearing and settlement of securities; to promote and maintain short and consistent settlement cycles; to provide counter-party risk guarantee, and to operate a tight risk containment system. It carries out the clearing and settlement of the trades executed in the equities and derivatives segments of the NSE. It operates a well-defined settlement cycle and there are no deviations from the same. It also operates Subsidiary General Ledger (SGL) for settling trades in government securities for its constituents. It is the first clearing corporation in the country to establish the Settlement Guarantee Fund (SGF) in June 1996. It has been managing, clearing and settlement functions since its inception without a single failure or clubbing of settlements. NSCCL has also introduced the facility of direct payout to clients account on both the depositories viz., NSDL and CDSL.
Today NSCCL settles trades under the T+2 rolling settlement. It has the credit of continuously upgrading the clearing and settlement procedures and has also bought Indian financial markets in line with international markets
CRISIL has assigned its highest corporate credit rating of ‘AAA’ to the National Securities Clearing Corporation Ltd (NSCCL). ‘AAA’ rating indicates highest degree of strength with regard to honouring debt obligations. NSCCL is the first Indian Clearing Corporation to get this rating. The rating reflects NSCCL’s status as Clearing Corporation for NSE, India’s largest stock exchange. The rating also factors in NSCCL’s rigorous risk management controls and adequate settlement guarantee cover.
NSDL
Prior to trading in a dematerialized environment, settlement of trades required moving the securities physically from the seller to the ultimate buyer, through the seller’s broker and buyer’s broker, which involved lot of time and the risk of delay somewhere along the chain. Further, the system of transfer of ownership was grossly inefficient as every
17
transfer involved physical movement of paper to the issuer for registration, with the change of ownership being evidenced by an endorsement on the security certificate. In many cases, the process of transfer took much longer than stipulated in the then regulations. Theft, forgery, mutilation of certificates and other irregularities were rampant. All these added to the costs and delays in settlement, restricted liquidity. To obviate these problems, NSE to promote dematerialization of securities joined hands with UTI and IDBI to set up the first depository in India called the “National Securities Depository Limited” (NSDL). The depository system gained quick acceptance and in a very short span of time it was able to achieve the objective of eradicating the paper from the trading and settlement of securities, and was also able to get rid of the risks associated with fake/forged/stolen/bad paper. Dematerialized delivery today constitutes almost 100% of total of the total delivery based settlement.
NSE Infotech Services Ltd
NSE Infotech Services Ltd Information Technology has been the back bone of conceptualization, formation, running and the success of National Stock Exchange of India Limited (NSE). NSE has been at the forefront in spearheading technology changes in the securities market. It was important to give a special thrust and focus on Information Technology to retain the primacy in the market. Towards this a wholly owned subsidiary M/s. NSE Infotech Services Limited (NSETECH) was incorporated to cater to the needs of NSE and all it’s group companies exclusively.
NSE.IT
NSE.IT Limited, a 100% technology subsidiary of NSE, was incorporated in October 1999 to provide thrust to NSE’s technology edge, concomitant with its overall goal of harnessing latest technology for optimum business use. It provides the securities industry with technology that ensures transparency and efficiency in the trading, clearing and risk management systems. Additionally, NSE.IT provides consultancy services in the areas of data warehousing, internet and business continuity plans. Amongst various products launched by NSE.IT are NEAT XS, a Computer-To-Computer Link (CTCL) order routing system, NEAT iXS, an internet trading system and Probos, professional broker’s back office system. NSE.IT also offers an e-learning portal, finvarsity (www.finvarsity.com) dedicated to the finance sector. The site is powered by Enlitor - a learning management system developed by NSE.IT jointly with an e-learning partner. New initiatives include payment gateways, products for derivatives segments and Enterprise Management Services.
IISL
India Index Services and Products Limited (IISL), a joint venture of CRISIL and NSE, was set up in May 1998 to provide indices and index services. It has a licensing and marketing agreement with Standard and Poor’s (S&P), the world’s leading provider of investible equity indices, for co-branding equity indices. IISL is India’s first specialized company focusing upon the index as a core product. It provides a broad range of
18
services, products and professional index services. It maintains over 96 equity indices comprising broad-based benchmark indices, sectoral indices and customised indices. Many investment and risk management products based on IISL indices have developed in the recent past, within India and abroad. These include index based derivatives on NSE and on Singapore Exchange, India’s first exchange traded fund, a number of index funds, and Licensing of the Index for various structured products.
DOTEX INTERNATIONAL LTD.
The data and info-vending products of NSE are provided through a separate company DotEx International Ltd., a 100% subsidiary of NSE, which is a professional set-up dedicated solely for this purpose. DotEx data provides products like : On-line streaming data feed, Intra-day Snapshot data feed, end of day data and Historical Data.
NCDEX
NSE joined hand with other financial institutions in India to promote the NCDEX which provides for a world class commodity exchange platform for Market Participants to trade in wide spectrum of commodity derivatives. Currently NCDEX facilitates trading of 48 agro based commodities, 2 precious metal, 6 base metal, 3 energy products and 3 polymers.
NCCL
National Commodity Clearing Limited (NCCL) is a company promoted by National Stock Exchange of India Limited (NSEIL). It was incorporated in the year 2006. One of the objectives of NCCL is to provide and manage clearing and settlement, risk management and collateral management services to commodity exchanges. NCCL is having the requisite experience and exposure in providing clearing and settlement facility, risk and collateral management services in the commodities market including funds settlement with multiple clearing banks. Currently NCCL is providing clearing and settlement services to NCDEX.
PXIL
A National Level Power Exchange by the name of Power Exchange India Limited (PXIL) has been set up through a Joint Venture by India's two leading Exchanges, National Stock Exchange of India Ltd (NSE) and National Commodity & Derivatives Exchange Ltd (NCDEX). PXIL has got the in-principle approval from CERC to set up and operate the power exchange and will operate as a National Level electricity exchange covering the entire Indian electricity market.
19
Table 1-1 : Board of Directors*
1 Mr. S. B. MathurFormer Chairman, Life Insurance Corporation of India
Chairman
2 Mr. Ravi NarainNational Stock Exchange of India Ltd.
Managing Director
3 Ms. Chitra RamkrishnaNational Stock Exchange of India Ltd.
Deputy Managing Director
4 Mr. C. AchuthanFormer Presiding Officer, Securities Appellate Tribunal
Director
5 Mr. Anjan BaruaChief General Manager ( Global Markets), State Bank of India
Director
6 Rear Admiral Madan Mohan Chopra AVSM (Retd.) Director
7 Mr. A. P. Kurian Chairman, Association of Mutual Funds in India
Director
8 Dr. Rajiv B. LallManaging Director & CEO, Infrastructure Development Finance Company Limited
Director
9 Mr. Lawrence LeibowitzGroup EVP, Head of US Markets & Global TechnologyNYSE Euronext
Director
10 Mr. Anand G. MahindraVice Chairman & Managing Director, Mahindra & Mahindra Ltd.
Director
11 Mr. Y. H. MalegamChairman Emeritus, M/s. S.B. Billimoria & Co. Chartered Accountants
Director
12 Prof. (Dr.) K. R. S. MurthyProfessor & Former Director, Indian Institute of Management, Bangalore
Director
13 Dr. R. H. PatilChairman, The Clearing Corporation of India Limited
Director
14 Ms. Bhagyam RamaniGeneral Manager, General Insurance Corporation of India
Director
15 Dr. V. A. Sastry Director
16 Mr. Onkar Nath SinghFormer Chairman & Mananging DirectorIndustrial Investment Bank of India Ltd.
Director
17 Mr. Justice B.N.Srikrishna (Retd.)Former Judge, Supreme Court of India
Director
18 Mr. T. S. VijayanChairmanLife Insurance Corporation of India
Director
* As on May 19, 2009
20
Table 1-2 : Executive Committees*
I CM & WDM SEGMENTS1 Mr. Ravi Narain MD &CEO, National Stock Exchange of
India LimitedChairman
2 Mr. Ashok Kumar Agarwal Chairman, Globe Capital Market Ltd. Trading Member
3 Mr. D. C. Anjaria Director, International Financial Solutions Pvt. Ltd.
Public Representative
4 Mr. Vimal Bhandari Country Manager – India AEGON International NV.
Public Representative
5 Mr. C. J. George Managing Director, Geojit Financial Services Ltd.
Trading Member
6 Mr. Vivek Agarwal Director,M/s. East India Securities Limited
Trading Member
7 Mr. Mayank Shah Director,M/s. Anagram Capital Limited
8 Mr. Y. H. Malegam Chairman Emeritus, S.B.Billimoria & Co. Chartered Accountants
Public Representative
9 Ms. Chitra Ramkrishna Deputy Managing Director, National Stock Exchange of India Ltd
Other Nominees
10 Mr. P. M. Venkatasubramanian Ex-Managing Director, GIC Other Nominees
11 Mr. Gagan Rai Managing Director & CEO, National Securities Depository Limited
Other Nominees
II F&O MARKET SEGMENT1 Mr. Ravi Narain MD &CEO, National Stock Exchange of
India LimitedChairman
2 Mr. D.C.Anjaria Director, International Finance Solutions Pvt. Ltd.
Public Representative
3 Prof. V. Ravi Anshuman Indian Institute of Management, Bangalore Public Representative
4 Mr. Sunil Godhwani Managing Director, Religare Securities Ltd.
Trading Member
5 Mr. Shailesh Haribhakti Executive Chairman and Managing Partner, BDO Haribhakti
Public Representative
6 Mr. Ketan Marwadi Managing Director, Marwadi Shares and Finance Limited
Trading Member
7 Mr. A.V. Rajwade Forex and Treasury Management Consultant
Public Representative
8 Mr. M. Raghavendra Ex-General Manager, General Insurance Corporation of India
Other Nominees
9 Ms. Chitra Ramkrishna Deputy Managing Director, National Stock Exchange of India Ltd
Other Nominees
10 Ms. T. S. Jagadharini Vice President, National Stock Exchange of India Limited
Other Nominees
III CDS SEGMENT1 Mr. Ravi Narain Managing Director & CEO, National
Stock Exchange of India LimitedChairman
2 Mr. V. Srikanth Managing Director, Head of Markets, Citibank N.A.
Trading Member
3 Dr. R. H. Patil Chairman, The Clearing Corporation of India Limited
Public Representative
4 Mr. M. G.Bhide Former Chairman, Bank of India Public Representative
5 Mr. Suresh Senapaty Chief Financial Officer & Director,Wipro Limited
Public Representative
6 Ms. Chitra Ramkrishna Deputy Managing Director, National Stock Exchange of India Limited
Other Nominees
* As on May 19, 2009
Membership Administration 2
22
23
2Membership Administration
The trading in NSE has a three tier structure-the trading platform provided by the Exchange, the broking and intermediary services and the investing community. The trading members have been provided exclusive rights to trade subject to their continuously fulfilling the obligation under the Rules, Regulations, Byelaws, Circulars, etc. of the Exchange. The trading members are subject to its regulatory discipline. Any person can become a trading member by complying with the prescribed eligibility criteria and exit by surrendering trading membership without any hidden/overt cost. There are no entry/exit barriers to trading membership.
Eligibility Criteria
The Exchange stresses on factors such as corporate structure, capital adequacy, track record, education, experience, etc. while granting trading rights to its members. This reflects a conscious effort by the Exchange to ensure quality broking services which enables to build and sustain confidence in the Exchange’s operations. The standards stipulated by the Exchange for trading membership are substantially in excess of the minimum statutory requirements as also in comparison to those stipulated by other exchanges in India. The exposure and volume of transactions that can be undertaken by a trading member are linked to liquid assets in the form of cash, bank guarantees, etc. deposited by the member with the Exchange as part of the membership requirements.
The trading members are admitted to the different segments of the Exchange subject to the provisions of the Securities Contracts (Regulation) Act, 1956, the Securities and Exchange Board of India Act, 1992, the rules, circulars, notifications, guidelines, etc., issued there under and the byelaws, Rules and Regulations of the Exchange. All trading members are registered with SEBI.
Trading Membership
A prospective trading member is admitted to any of the following combinations of market segments:
• Wholesale Debt Market (WDM) segment
• Capital Market (CM) and the Futures and Options (F&O) segments
• CM Segment and the WDM segment
• CM Segment, the WDM and the F&O segment.
• Currency Derivatives (CD) segment.
• CD along with either or all segments listed above.
In order to be admitted as a trading member, the individual trading member/at least two partners of the applicant firm/at least two directors of the applicant corporate must
24
be graduates and must possess at least two years’ experience in securities markets. The applicant for trading membership/any of its partners/shareholders/directors must not have been declared defaulters on any stock exchange, must not be debarred by SEBI for being associated with capital market as intermediaries and must not be engaged in any fund-based activity. In case of corporate applicant, the minimum paid up capital should be Rs. 30 lakh and the dominant promoter/shareholder group should hold at least 51% of paid-up equity capital of unlisted corporate entity. In case of listed corporate entity, persons named as promoters in any document for offer of securities to the public or existing shareholders or in the shareholding pattern disclosed by the corporate trading member under the provisions of the Listing Agreement, whichever is later, is deemed to be in control. Clearing Membership
The trades executed on the Exchange may be cleared and settled by a clearing member. The trading members in the CM segment are also clearing members. In the F&O segment, some members, who are registered with SEBI as self-clearing members, clear and settle their own trades. Certain others, registered as trading member-cum-clearing member, clear and settle their own trades as well as trades of other trading members. Besides this, there is a special category of members, called professional clearing members (PCMs), who do not trade but only clear trades executed by others. This means that some members clear and settle their trades through a trading member-cum-clearing member or a PCM, not themselves. The members clearing their own trades or trades of others and the PCMs are required to bring in additional security deposits in respect of every trading member whose trades they undertake to clear and settle. The requirements of trading membership and clearing membership in the different market segments are presented in Tables 2-1A to 2-1C. With effect from July 1, 2008 a processing fee of Rs. 10,000/- and an admission fee of Rs.5,00,000/- is charged for taking up new membership.
Currency Derivatives Membership
Trading in Currency Derivatives commenced on August 29, 2008 at NSE. As of March 2009 a total number of 518 members are registered in this segment. The membership of the currency futures market is separate from the membership of the equity derivative segment or the cash segment. Membership for both trading and clearing, in the currency futures market is subject to the guidelines issued by the SEBI. Table 2-1 D contains the Eligibility Criteria for Membership in Currency Derivatives for Corporates, Individuals and Firms. Banks authorized by the Reserve Bank of India under section 10 of the Foreign Exchange Management Act, 1999 as ‘AD Category - I bank’ are permitted to become trading and clearing members of the currency futures market of the recognized stock exchanges, on their own account and on behalf of their clients, subject to fulfilling the following minimum prudential requirements as mentioned below :
a) Minimum net worth of Rs. 500 crores.
b) Minimum CRAR of 10 per cent.
25
c) Net NPA should not exceed 3 per cent.
d) Made net profit for last 3 years.
Growth and Distribution of Members
As at end March 2009, the Exchange had 1,227 members. A large majority (88.59%) of them were corporate members, and the remaining, individuals, firms and banks. The growth of membership on NSE is presented in Table 2-2. A total of 31,798 (1,630 corporates, 2,240 partnership firms and 27,928 individuals) sub-brokers were affiliated to 585 trading members of the Exchange on March 31, 2009.
Transaction Charges
In addition to annual fees, members are required to pay transaction charges on trades undertaken by them. They pay transaction charges at the rate of Rs. 3.5 for every Rs. 1 lakh of turnover in the CM segment. The transaction charges payable to the exchange by the trading member for the trades executed by him on the F&O segment are fixed at the rate of Rs. 2 per lakh of turnover (0.002%) subject to a minimum of Rs. 1 lakh per year. However, in the options sub-segment the transaction charges are levied on the premium value at the rate of 0.05% (each side) instead of on the strike price as levied earlier. Derivatives on S&P CNX Defty were launched on December 10, 2008. Transaction charges have been waived in respect of all trades done in the futures and options contracts of S&P CNX Defty till September 30, 2009. In order to encourage active participation in the Currency Derivatives segment, the Exchange, has waived the transaction charges till June 30, 2009. Transaction charges in the Wholesale Debt Market Segment too have been waived for the period April 1, 2009 to March 31, 2010.
26
Tab
le 2
-1 A
: E
ligib
ility
Cri
teri
a fo
r M
embe
rshi
p C
orpo
rate
s(A
mou
nt in
Rs.
lakh
)P
arti
cula
rs/
Segm
ents
CM
C
M a
nd F
&O
WD
MC
M a
nd W
DM
C
M,W
DM
and
F&
OM
inim
um P
aid-
up c
apita
l30
3030
3030
Net
Wor
th
100
100
(Mem
bers
hip
in C
M
segm
ent
and
Tra
ding
/T
radi
ng a
nd s
elf
clea
ring
m
embe
rshi
p in
F&
O
segm
ent)
300
(Mem
bers
hip
in C
M se
gmen
t and
Tra
ding
an
d C
lear
ing
mem
bers
hip
in F
&O
segm
ent)
200
200
200(
Mem
bers
hip
in
WD
M
segm
ent,
CM
se
gmen
t an
d T
radi
ng/T
radi
ng
and
Self
Cle
arin
g m
embe
rshi
p in
F&
O
segm
ent)
300(
Mem
bers
hip
in
WD
M
segm
ent,
CM
se
gmen
t an
d T
radi
ng
and
Cle
arin
g m
embe
rshi
p in
F&
O
segm
ent)
Inte
rest
Fr
ee
Secu
rity
Dep
osit
(IFSD
) with
NSE
IL85
110
150
235
260
Inte
rest
Fre
e Sec
urity
Dep
osit
(IFSD
) w
ith N
SCC
L15
15 *
NIL
1515
*
Col
late
ral
Secu
rity
Dep
osit
(CSD
) w
ith N
SCC
L25
25**
NIL
2525
**
Ann
ual S
ubsc
ript
ion
11
12
2
Adv
ance
Min
imum
Tra
nsac
tion
Cha
rges
for
Futu
res S
egm
ent
NIL
1N
ILN
IL1
Educ
atio
nT
wo
dire
ctor
s sh
ould
be
grad
uate
s. D
eale
rs sh
ould
al
so
have
pa
ssed
SE
BI
appr
oved
ce
rtifi
catio
n te
st f
or C
apita
l M
arke
t M
odul
e of
NC
FM.
Tw
o di
rect
ors
shou
ld b
e gr
adua
tes.
Dea
lers
sho
uld
also
ha
ve
pass
ed
SEBI
ap
prov
ed
cert
ifica
tion
test
fo
r D
eriv
ativ
es
and
Cap
ital M
arke
t M
odul
e of
N
CFM
.
Tw
o di
rect
ors
shou
ld
be
grad
uate
s. D
eale
rs
shou
ld a
lso h
ave
pass
ed
FIM
MD
A-N
SE
Deb
t M
arke
t (B
asic
Mod
ule)
of
NC
FM.
Tw
o di
rect
ors
shou
ld
be
grad
uate
s. D
eale
rs
shou
ld
also
ha
ve
pass
ed
FIM
MD
A-N
SE
Deb
t M
arke
t (B
asic
Mod
ule)
of
NC
FM. &
Cap
ital M
arke
t M
odul
e of
NC
FM.
Tw
o di
rect
ors
shou
ld
be
grad
uate
s. D
eale
rs
shou
ld
also
ha
ve
pass
ed
FIM
MD
A-N
SE
Deb
t M
arke
t (B
asic
M
odul
e)
of
NC
FM
Cap
ital
Mar
ket
Mod
ule
of N
CFM
.& S
EBI
appr
oved
ce
rtifi
catio
n te
st fo
r D
eriv
ativ
es
Expe
rien
ce---
------
------
Tw
o ye
ar’s
expe
rien
ce in
secu
ritie
s mar
ket--
------
------
------
---
Tra
ck R
ecor
dT
he D
irec
tors
shou
ld n
ot b
e de
faul
ters
on
any
stoc
k ex
chan
ge.
The
y m
ust n
ot b
e de
barr
ed b
y SE
BI fo
r be
ing
asso
ciat
ed w
ith c
apita
l mar
ket a
s int
erm
edia
ries
T
hey
mus
t be
enga
ged
sole
ly in
the
busin
ess o
f sec
uriti
es a
nd m
ust n
ot b
e en
gage
d in
any
fund
-bas
ed a
ctiv
ity.
Net
wor
th r
equi
rem
ent
for
Prof
essio
nal C
lear
ing
mem
bers
in F
&O
seg
men
t is
Rs.
300
lakh
s. Fu
rthe
r a
Prof
essio
nal C
lear
ing
mem
ber
need
s to
bri
ng I
FSD
of
25 la
khs
with
NSC
CL
and
Col
late
ral S
ecur
ity D
epos
it (C
SD) o
f 25
lakh
s w
ith N
SCC
L as
dep
osits
.*
Add
ition
al IF
SD o
f 25
lakh
s w
ith N
SCC
L is
requ
ired
for
Tra
ding
and
Cle
arin
g (T
M-C
M) a
nd fo
r T
radi
ng a
nd S
elf c
lear
ing
mem
ber
(TM
/SC
M).
**
Add
ition
al C
olla
tera
l Sec
urity
Dep
osit
(CSD
) of
25 la
kh w
ith N
SCC
L is
requ
ired
for
Tra
ding
and
Cle
arin
g (T
M-C
M) a
nd fo
r T
radi
ng a
nd S
elf c
lear
ing
mem
ber
(TM
/SC
M).
In a
dditi
on, a
mem
ber
clea
ring
for
othe
rs is
req
uire
d to
bri
ng in
IFSD
of R
s. 2
lakh
and
CSD
of R
s. 8
lakh
per
trad
ing
mem
ber
he u
nder
take
s to
clea
r in
the
F&O
segm
ent.
27
Table 2-1B : Requirements for Professional Clearing Memberhip(All values in Rs. lakh)
Particulars CM Segment F&O Segment CM and F&O Segment
Eligibility Trading Member of NSE/SEBI Registered Custodians/Recognised Banks
Net Worth 300 300 300
Interest Free Security Deposit (IFSD) * 25 25 34
Collateral Security Deposit (CSD) 25 25 50
Annual Subscription 2.5 Nil 2.5
* The Professional Clearing Member (PCM) is required to bring in IFSD of Rs. 2 lakh and CSD of Rs. 8 lakh per trading member whose trades he undertakes to clear in the F&O segment and IFSD of Rs. 6 lakh and CSD of Rs. 17.5 lakh (Rs. 9 lakh and Rs. 25 lakh respectively for corporate Members) per trading member in the CM segment.
28
Tab
le 2
-1 C
: E
ligib
ility
Cri
teri
a fo
r M
embe
rshi
p- I
ndiv
idua
ls/ P
artn
ersh
ip F
irm
s.(A
mou
nt in
Rs.
lakh
)
Par
ticu
lars
CM
C
M a
nd F
&O
W
DM
CM
and
WD
MC
M,W
DM
and
F&
O
Net
Wor
th
7575
(M
embe
rshi
p in
C
M
segm
ent
and
Tra
ding
m
embe
rshi
p in
F&
O
segm
ent)
100
(Mem
bers
hip
in C
M s
egm
ent
and
Tra
ding
and
Sel
f cl
eari
ng m
embe
rshi
p
in th
e F&
O se
gmen
t)
300
(Mem
bers
hip
in C
M s
egm
ent
and
Tra
ding
and
Cle
arin
g m
embe
rshi
p in
F&O
segm
ent)
200
200
200
(Mem
bers
hip
in W
DM
seg
men
t,
CM
se
gmen
t an
d T
radi
ng/T
radi
ng
and
Self
Cle
arin
g m
embe
rshi
p in
F&
O
segm
ent)
300 (
Mem
bers
hip
in W
DM
segm
ent,C
M
segm
ent
and
Tra
ding
an
d cl
eari
ng
mem
bers
hip
on F
&O
segm
ent)
Inte
rest
Fre
e Se
curi
ty D
epos
it
(IFSD
) with
NSE
IL26
.551
.515
017
6.5
201.
5
Inte
rest
Fre
e Se
curi
ty D
epos
it
(IFSD
) with
NSC
CL
66
*N
IL6
6*
Col
late
ral S
ecur
ity D
epos
it (C
SD)
with
NSC
CL
17.5
17.5
**
NIL
17.5
17.5
**
Ann
ual S
ubsc
ript
ion
0.5
0.5
11.
51.
5
Adv
ance
Min
imum
Tra
nsac
tion
Cha
rges
for
Futu
res S
egm
ent
NIL
1N
ILN
IL1
* A
dditi
onal
IFSD
of 2
5 la
khs
with
NSC
CL
is re
quir
ed fo
r T
radi
ng a
nd C
lear
ing
Mem
ber
(TM
-CM
) and
for
Tra
ding
and
Sel
f cle
arin
g m
embe
r (T
M/S
CM
).**
A
dditi
onal
Col
late
ral S
ecur
ity D
epos
it (C
SD) o
f 25
lakh
with
NSC
CL
is re
quir
ed fo
r T
radi
ng a
nd C
lear
ing
(TM
-CM
) and
for
Tra
ding
and
Sel
f cle
arin
g m
embe
r (T
M/S
CM
).
29
Tab
le 2
-1 D
: C
UR
REN
CY
DER
IVA
TIV
ES- C
orpo
rate
s, In
divi
dual
s and
Fir
ms
(Am
ount
in R
s. la
kh)
Par
ticu
lars
NSE
Mem
bers
NC
DE
X M
embe
rsN
ew A
pplic
ants
Pro
fess
iona
l C
lear
ing
Mem
bers
hip
Tra
ding
M
embe
rshi
pT
radi
ng c
um
Cle
arin
g M
embe
rshi
p
Tra
ding
M
embe
rshi
pT
radi
ng c
um
Cle
arin
g M
embe
rshi
p
Tra
ding
M
embe
rshi
pT
radi
ng c
um
Cle
arin
g M
embe
rshi
p
Net
wor
th10
010
0010
010
0010
010
0010
00
Inte
rest
Fre
e Se
curi
ty D
epos
it (IF
SD)
with
NSE
IL2
22
22
2–
Col
late
ral S
ecur
ity D
epos
it (C
SD)
with
NSE
IL8
810
.513
1318
–
Inte
rest
Fre
e Se
curi
ty D
epos
it (IF
SD)
with
NSC
CL
–25
–25
–25
–
Col
late
ral S
ecur
ity D
epos
it (C
SD)
with
NSC
CL
–25
–25
–25
25
Cle
arin
g m
embe
r pa
ys R
s. 10
lakh
s for
cle
arin
g ev
ery
trad
ing
mem
ber’
s tra
des i
n ca
sh &
non
-cas
h fo
rm.
In c
ase
the
mem
ber
is op
ting
for
mem
bers
hip
of a
ny o
ther
seg
men
t(s) i
n co
mbi
natio
n w
ith th
e m
embe
rshi
p of
Cur
renc
y D
eriv
ativ
es s
egm
ent,
the
appl
icab
le n
et w
orth
will
be
the
min
imum
net
wor
th r
equi
red
for
the
othe
r se
gmen
t(s) o
r th
e m
inim
um n
et w
orth
req
uir
30
Tab
le 2
-2 :
Gro
wth
and
Dis
trib
utio
n of
Mem
bers
Mon
th/Y
ear
(end
of
peri
od)
CM
Seg
men
tW
DM
Seg
men
tC
M &
WD
M
Segm
ent
CM
, WD
M &
F
&O
Seg
men
tC
M &
F&
O
Segm
ent
CD
Seg
men
tC
D a
long
wit
h an
y of
the
oth
er
Segm
ents
*T
otal
Pro
fess
iona
l C
lear
ing
Mem
ber
Apr
-07
145
69
4780
2 --
--
1,
009
19
May
-07
145
69
4780
4 --
--
1,
011
19Ju
n-07
140
69
4781
2 --
--
1,
014
19Ju
l-07
139
69
4781
2 --
--
1,
013
19A
ug-0
713
46
947
824
-- --
1,02
0 19
Sep-
0713
16
848
829
-- --
1,02
2 19
Oct
-07
126
68
4883
6 --
--
1,
024
19N
ov-0
712
66
848
836
-- --
1,02
4 19
Dec
-07
125
68
4884
4 --
--
1,
031
19Ja
n-08
124
68
4885
3 --
--
1,
039
19Fe
b-08
124
68
4887
1 --
--
1,
057
19M
ar-0
811
96
848
894
-- --
1,07
5 19
Apr
-08
120
68
4890
2 --
--
1,
084
19M
ay-0
811
96
848
913
-- --
1,09
4 19
Jun-
0811
86
848
935
-- --
1,11
5 19
Jul-0
811
76
848
943
-- --
1,12
2 19
Aug
-08
118
69
4895
112
304
1,14
4 19
Sep-
0811
86
947
960
1731
7
1,
157
19O
ct-0
812
16
947
964
1735
9
1,
164
19N
ov-0
811
96
947
973
1936
9
1,
173
19D
ec-0
811
96
947
981
2242
4
1,
184
20Ja
n-09
119
69
4799
426
442
1,20
1 20
Feb-
0911
86
947
1,00
3 35
460
1,21
8 20
Mar
-09
117
69
4710
0840
478
1,22
7 20
* T
his
incl
udes
mem
bers
hip
in C
urre
ncy
Der
ivat
ives
Seg
men
t (C
DS)
alo
ng w
ith e
ither
of t
he o
ther
seg
men
ts (C
M, W
DM
, F&
O) a
nd n
ot in
clud
ed in
tot
al b
ecau
se o
f mul
tiple
m
embe
rshi
p.
Listing of Securities 3
32
33
3Listing of Securities
The stocks, bonds and other securities issued by issuers require listing for providing liquidity to investors. Listing means formal admission of a security to the trading platform of the Exchange. It provides liquidity to investors without compromising the need of the issuer for capital and ensures effective monitoring of conduct of the issuer and trading of the securities in the interest of investors. The issuer wishing to have trading privileges for its securities satisfies listing requirements prescribed in the relevant statutes and in the listing regulations of the Exchange. It also agrees to pay the listing fees and comply with listing requirements on a continuous basis. All the issuers who list their securities have to satisfy the corporate governance requirement framed by regulators.
Benefits of Listing on NSE
The benefits of listing on NSE are as enumerated below:
• NSE provides a trading platform that extends across the length and breadth of the country. Listing on NSE thus, enables issuers to reach and service investors across the country.
• NSE being the largest stock exchange in terms of trading volumes, the securities trade at low impact cost and are highly liquid. This in turn reduces the cost of trading to the investor.
• The trading system of NSE provides unparallel level of trade and post-trade information. The best 5 buy and sell orders are displayed on the trading system and the total number of securities available for buying and selling is also displayed. This helps the investor to know the depth of the market. Further, corporate announcements, results, corporate actions etc are also available on the trading system, thus reducing scope for price manipulation or misuse.
• The facility of making initial public offers (IPOs), using NSE's network and software, results in significant reduction in cost and time of issues.
• NSE’s web-site www.nseindia.com provides a link to the web-sites of the companies that are listed on NSE, so that visitors interested in any company can visit that company’s web-site from the NSE site.
• Listed companies are provided with monthly trade statistics of the securities of the company listed on the Exchange.
• The listing fee is nominal.
Listing Criteria
The Exchange has laid down criteria for listing of new issues by companies through IPOs, companies listed on other exchanges, etc. in conformity with the Securities
34
Contracts (Regulation) Rules, 1957, SEBI Guidelines and other relevant guidelines/acts. The criteria include minimum paid-up capital and market capitalisation, company/promoter's track record, etc. The listing criteria for companies in the CM Segment are presented in Table 3-1. The issuers of securities are required to adhere to provisions of the Securities Contracts (Regulation) Act, 1956, the Companies Act, 1956, the Securities and Exchange Board of India Act, 1992, and the rules, circulars, notifications, guidelines, etc. prescribed there under.
Listing Agreement
All companies seeking listing of their securities on the Exchange are required to enter into a formal listing agreement with the Exchange. The agreement specifies all the quantitative and qualitative requirements to be continuously complied with by the issuer for continued listing. The Exchange monitors such compliance and companies who do not comply with the provisions of the listing agreement may be suspended from trading on the Exchange. The agreement is being increasingly used as a means to improve corporate governance.
Compliance by Listed Companies
NSE has institutionalised a process of verifying compliance of various conditions of the listing agreement. It conducts a periodic review for compliance on account of announcement of book closure/record date, announcement of quarterly results, submission of shareholding pattern, annual reports, appointment of compliance officer, corporate governance report, investor grievances and various disclosures etc.
Disclosures by Listed Companies
It is essential that all critical price sensitive/material information relating to securities is made available to the market participants and the investors immediately to enable them to take informed decisions in respect of their investments in securities. The Exchange therefore ensures certain important timely disclosures by listed companies and disseminates them to market through the NEAT terminals and through its website. These disclosures include corporate actions, quarterly/half yearly results, decisions at board meeting, non-promoters’ holding, announcements / press releases etc.
De-listing
There are two kinds of delisting which can be done from the Exchanges as per the SEBI (Delisting of Securities) Guidelines, 2003 in the following manner:
Voluntary De-listing of Companies
Any promoter or acquirer desirous of delisting securities of the company under the provisions of these guidelines are required obtain the prior approval of shareholders of the company by a special resolution passed at its general meeting, make a public announcement in the manner provided in these guidelines, make an application to
35
the delisting exchange in the form specified by the exchange, and comply with such other additional conditions as may be specified by the concerned stock exchanges from where securities are to be de-listed. Any promoter of a company which desires to de-list from the stock exchange should also determine an exit price for delisting of securities in accordance with the book building process as stated in the guidelines. The stock exchanges shall provide the infrastructure facility for display of the price at the terminal of the trading members to enable the investors to access the price on the screen to bring transparency to the delisting process.
Compulsory De-listing of Companies
The stock exchanges may de-list companies which have been suspended for a minimum period of six months for non-compliance with the listing agreement. The stock exchanges have to give adequate and wide public notice through newspapers and also give a show cause notice to a company. The exchange shall provide a time period of 15 days within which representation may be made to the exchange by any person who may be aggrieved by the proposed delisting.
The Stock Exchanges may, after consideration of the representation received from the aggrieved persons, delist the securities of such companies. The stock exchange shall ensure that adequate and wide public notice is given through newspaper and on the notice boards/trading systems of the stock exchanges and shall ensure disclosure in all such notices of the fair value of such securities. The stock exchange shall display the name of such company on its website. Where the securities of the company are de-listed by an exchange, the promoter of the company shall be liable to compensate the security holders of the company by paying them the fair value of the securities held by them and acquiring their securities, subject to their option to remain security-holders with the company. The companies delisted during 2008-09 are mentioned in the table below.
Sr. No. Name of the Company Date of Delisting
1 Bosch Chassis Systems India Limited 7-Nov-08
2 Pentamedia Graphics Limited 09-Jan-09
3 Pentasoft Technologies Limited 09-Jan-09
CM Segment
Two categories, namely ‘listed’ and ‘permitted to trade’ categories of securities (equity shares, preference shares and debentures) are available for trading in the CM segment. However, the permitted to trade category has been phased out gradually and no new company is been given the benefit of this category. At the end of March 2009, 1,432 companies were listed while 1,291 companies available for trading. These securities had a market capitalisation of Rs. 2,896,194 crore (US $ 568,439 million). The growth of securities available for trading on the CM segment is presented in Table 3-2.
36
Listing Fees
The listing fees charged by the Exchange are presented in the following table:
Listing Fees in the CM Segment
Sr. No. Listing FeesAmount
(Rs.)1 Initial Listing Fees 25,000
2 Annual Listing Fees (based on paid up share, bond and/ or debenture and/or debt capital, etc.)
a) Upto Rs. 1 Crore 10,000
b) Above Rs. 1 Crore and upto Rs.5 Crores 15,000
c) Above Rs. 5 Crore and upto Rs.10 Crores 25,000
d) Above Rs. 10 Crore and upto Rs.20 Crores 45,000
e) Above Rs. 20 Crore and upto Rs.30 Crores 70,000
f) Above Rs. 30 Crore and upto Rs.40 Crores 75,000
g) Above Rs. 40 Crore and upto Rs.50 Crores 80,000
h) Above Rs. 50 Crores and upto Rs.100 Crores 1,30,000
i) Above Rs. 100 Crore and upto Rs.150 Crores 1,50,000
j) Above Rs. 150 Crore and upto Rs.200 Crores 1,80,000
k) Above Rs. 200 Crore and upto Rs.250 Crores 2,05,000
l) Above Rs. 250 Crore and upto Rs.300 Crores 2,30,000
m) Above Rs. 300 Crore and upto Rs.350 Crores 2,55,000
n) Above Rs. 350 Crore and upto Rs.400 Crores 2,80,000
o) Above Rs. 400 Crore and upto Rs.450 Crores 3,25,000
p) Above Rs. 450 Crore and upto Rs.500 Crores 3,75,000
Companies which have a paid up share, bond and/ or debenture and/or debt capital, etc. of more than Rs.500 crores will have to pay minimum fees of Rs.3,75,000 and an additional listing fees of Rs.2,500 for every increase of Rs.5 crores or part thereof in the paid up share, bond and/ or debenture and/or debt capital, etc.
Companies which have a paid up share, bond and/ or debenture and/or debt capital, etc. of more than Rs.1,000 crores will have to pay minimum fees of Rs.6,30,000 and an additional listing fees of Rs.2,750 for every increase of Rs.5 crores or part thereof in the paid up share, bond and/ or debenture and/or debt capital, etc.
Shareholding Pattern
In the interest of transparency, the issuers are required to disclose shareholding pattern on a quarterly basis. Table 3-3 presents the sector-wise shareholding pattern at end-March 2009 of companies listed on NSE. On an average, the promoters hold more than 57.86%
37
of total shares. Though the public shareholding is nearly 40.49 %, Indian public held only 13.29% and the institutional holdings by (Financial Institutions, Banks, Central and State governments, Insurance companies , FIIs , MFs, VCF’s and FVCF’s) accounted for 17.34 %.
WDM Segment
In the WDM segment, all government securities, state development loans and treasury bills are ‘deemed’ listed as and when they are issued. Other than those mentioned above, all eligible debt securities whether publicly issued or privately placed can be made available for trading in the WDM segment. Amongst other requirements, privately placed debt paper of banks, institutions and corporates require an investment grade credit rating to be eligible for listing. The listing requirements for securities on the WDM segment are presented in Table 3-4.
The growth of securities available for trading on the WDM segment is presented in Table 3-5. As at end March 2009, 3,954 securities with issued capital of Rs. 2,848,315 crore (US $ 559,041 million) and a market capitalisation of Rs.2,848,315 crore (US $ 559,041 million) were available for trading on the WDM segment.
FUNDS MOBILISATION ON THE EXCHANGE
During the year 2008-09, the resources raised through Public Issues, Rights Issues, QIP and Preferential Allotments is summarized in the table below.
Particulars No. of Issues Amount Mobilised
(Rs. Cr.) (US $ mn.)
Public Issues 19 3,833.48 752.40
IPOs 19 3,833.48 752.40
FPOs – – –
Rights Issues 17 31,656.37 6,213.22
QIP 2 188.82 37.06
Preferential Allotment 168 40,607.80 7,970.13
Total 206 76,286.46 14,972.81
Initial Public Offerings (IPO’s)
During the year 2008-09, 19 companies were listed through IPO mobilizing an amount of Rs 3,833 crore (US $ 752.40 million). Tata Capital Ltd. came out with an IPO for non-convertible Debentures (NCD) mobilizing Rs. 1,500 crore (US $ 294.41 million) which was the third largest IPO. KSK Energy Ventures Limited was the largest IPO raising Rs. 830.66 crore (US $ 163.04 million) followed by Gammon Infrastructure Projects Limited raising Rs. 276.39 crore (US $ 54.25 million) The details of IPOs listed on NSE during 2008-09 is presented in Table 3-6.
38
RIGHTS ISSUES
There were 17 Rights issues during 2008-09, out of which State Bank of India was the largest in terms of issue size of Rs.16,722.27 crore (US $ 3,282.09 million). The details of Rights Issues listed on NSE during 2008-09 is presented in Table 3-7.
PREFERENTIAL ALLOTMENT/PRIVATE PLACEMENT
During 2008-09, there were 169 preferential allotments that raised Rs.40,607.80 crore (US $ 7,970.13 million). The details of Preferential Allotment listed on NSE during 2008-09 are presented in Table 3-8.
QIPs
The amount raised through 2 QIPs during 2008-09, was Rs.188.82 crore (US $ 37.06 million).The details of QIPs are presented in Table 3-9.
Chart 3-1 : Number of Companies Listed
39
Table 3-1 : Listing Criteria for Companies on the CM Segment of NSE
Criteria Initial Public Offerings (IPOs) Companies listed on other exchanges
Paid-up EquityCapital (PUEC)/Market Capitalisation(MC) /Net Worth
PUEC ≥ Rs. 10 cr. and MC ≥ Rs. 25 cr.
PUEC ≥ Rs. 10 cr. and MC ≥ Rs. 25 cr. OR PUEC ≥ Rs. 25 cr. ORMC ≥ Rs. 50 cr. OR The company shall have a net worth of not less than Rs.50 crores in each of the preceding financial years.
Company/Promoter’s Track Record
Atleast 3 years track record of eithera) the applicant seeking listing OR b) the promoters/promoting
company incorporated in or outside India OR
c) Partnership firm and subsequently converted into Company not in existence as a Company for three years) and approaches the Exchange for listing. The Company subsequently formed would be considered for listing only on fulfillment of conditions stipulated by SEBI in this regard.
Atleast three years track record of eithera) the applicant seeking listing; ORb) the promoters/promoting company,
incorporated in or outside India.
Dividend Record / Net worth / Distributable Profits
– Dividend paid in at least 2 out of the last 3 financial years immediately preceding the year in which the application has been made OR The networth of the applicants atleast Rs.50 crores OR The applicant has distributable profits in at least two out of the last three financial years.
Listing – Listed on any other stock exchange for at least last three years OR listed on the exchange having nationwide trading terminals for at least one year.
Other Requirements (a) No disciplinary action by other stock exchanges/regulatory authority in past 3 yrs.
(b) Satisfactory redressal mechanism for investor grievances,
(c) distribution of shareholding (d) details of litigation record in past
3 years(e) Track record of Directors of the
Company
(a) No disciplinary action by other stock exchanges/regulatory authority in past 3 yrs.
(b) Satisfactory redressal mechanism for investor grievances,
(c ) distribution of shareholding and (d) details of litigation record in past
3 years.(e) Track record of Directors of the
Company(f) Change in control of a Company/
Utilisation of funds raised from public
40
Note:
1. (a) In case of IPOs, Paid up Equity Capital means post issue paid up equity capital.
(b) In case of Existing companies listed on other exchanges, the existing paid up equity capital as well as the paid up equity capital after the proposed issue for which listing is sought shall be taken into account.
2. (a) In case of IPOs, market capitalisation is the product of the issue price and the post-issue number of equity shares.
(b) In case of case of Existing companies listed on other stock exchanges the market capitalisation shall be calculated by using a 12 month moving average of the market capitalisation over a period of six months immediately preceding the date of application. For the purpose of calculating the market capitalisation over a 12 month period, the average of the weekly high and low of the closing prices of the shares as quoted on the National Stock Exchange during the last twelve months and if the shares are not traded on the National Stock Exchange such average price on any of the recognised Stock Exchanges where those shares are frequently traded shall be taken into account while determining market capitalisation after making necessary adjustments for Corporate Action such as Rights / Bonus Issue/Split.
3. In case of Existing companies listed on other stock exchanges, the requirement of Rs.25 crores market capital shall not be applicable to listing of securities issued by Government Companies, Public Sector Undertakings, Financial Institutions, Nationalised Banks, Statutory Corporations and Banking Companies who are otherwise bound to adhere to all the relevant statutes, guidelines, circulars, clarifications etc. that may be issued by various regulatory authorities from time to time
4. Net worth means paid-up equity capital + reserves excluding revaluation reserve - miscellaneous expenses not written off - negative balance in profit and loss account to the extent not set off.
5. Promoters mean one or more persons with minimum 3 years of experience of each of them in the same line of business and shall be holding at least 20 % of the post issue equity share capital individually or severally.
6. In case a company approaches the Exchange for listing within six months of an IPO, the securities may be considered as eligible for listing if they were otherwise eligible for listing at the time of the IPO. If the company approaches the Exchange for listing after six months of an IPO, the norms for existing listed companies may be applied and market capitalisation be computed based on the period from the IPO to the time of listing.
41
Table 3-2 : Companies Listed,Permitted to Trade, Available for Trading on the CM Segment
Month/Year (end of period)
No. of Companies
Listed*
No. of Companies
Permitted to Trade
No. of Companies
Available for Trading *@
Market Capitalisation *
(Rs. crore) (US $ mn)
Nov-94 0 300 300 292,637 93,108
Mar-95 135 543 678 363,350 115,606
Mar-96 422 847 1,269 401,459 116,873
Mar-97 550 934 1,484 419,367 116,880
Mar-98 612 745 1,357 481,503 121,807
Mar-99 648 609 1,254 491,175 115,761
Mar-00 720 479 1,152 1,020,426 240,496
Mar-01 785 320 1,029 657,847 141,048
Mar-02 793 197 890 636,861 130,504
Mar-03 818 107 788 537,133 113,081
Mar-04 909 18 787 1,120,976 258,349
Mar-05 970 1 839 1,585,585 362,419
Mar-06 1,069 – 929 2,813,201 630,621
Mar-07 1,228 – 1,084 3,367,350 772,505
Apr-07 1,246 – 1,104 3,650,368 913,277
May-07 1,267 – 1,126 3,898,078 975,251
Jun-07 1,283 – 1,143 3,978,381 995,342
Jul-07 1,293 – 1,150 4,317,571 1,080,203
Aug-07 1,316 – 1,170 4,296,994 1,075,055
Sep-07 1,319 – 1,173 4,886,561 1,222,557
Oct-07 1,327 – 1,180 5,722,227 1,431,630
Nov-07 1,343 – 1,197 5,876,742 1,470,288
Dec-07 1,353 – 1,207 6,543,272 1,637,046
Jan-08 1,362 – 1,216 5,295,387 1,324,840
Feb-08 1,372 – 1,227 5,419,942 1,356,003
Mar-08 1,381 – 1,236 4,858,122 1,215,442
Apr-08 1,390 – 1,244 5,442,780 1,068,259
May-08 1,398 – 1,252 5,098,873 1,000,760
Jun-08 1,407 – 1,262 4,103,651 805,427
Jul-08 1,417 – 1,272 4,432,427 869,956
Aug-08 1,422 – 1,278 4,472,461 877,814
Sep-08 1,424 – 1,278 3,900,185 765,493
Oct-08 1,431 – 1,282 2,820,388 553,560
Nov-08 1,430 – 1,286 2,653,281 520,762
Dec-08 1,428 – 1,283 2,916,768 572,477
Jan-09 1,427 – 1,286 2,798,707 549,305
Feb-09 1,425 – 1,284 2,675,622 525,147
Mar-09 1,432 – 1,291 2,896,194 568,439 * At the end of the period @ Excludes suspended companies.
42
Tab
le 3
-3 :
Sha
reho
ldin
g P
atte
rn a
t the
end
of M
arch
200
9 of
com
pani
es L
iste
d on
NSE
(In p
er c
ent)
Sect
ors
Pro
mot
ers
Pub
licSh
ares
hel
d by
C
usto
dian
s a
nd a
gain
st
whi
ch
Dep
osit
ory
Rec
eipt
s ha
ve b
een
issu
ed
Inst
itut
iona
lN
on- I
nsti
tuti
onal
Indi
an
Pro
mot
ers
For
eign
P
rom
oter
sF
inan
cial
In
stit
utio
ns/
Ban
ks/C
entr
al
Gov
ernm
ent/
Stat
e G
over
nmen
t(s)
/In
sura
nce
Com
pani
es
For
eign
In
stit
utio
nal
Inve
stor
s
Mut
ual
Fun
dsV
entu
re
Cap
ital
F
unds
incl
udin
g F
orei
gn
Ven
ture
C
apit
al
Fun
ds
Any
oth
erB
odie
s C
orpo
rate
Indi
vidu
als
Any
Oth
er
Bank
s46
.34
1.08
9.54
14.2
73.
830.
000.
635.
6413
.59
1.05
4.02
Engi
neer
ing
26.3
91.
9510
.92
7.34
11.5
70.
000.
759.
0522
.49
8.37
1.17
Fina
nce
43.6
32.
108.
5813
.01
2.92
0.03
1.61
6.22
15.8
55.
380.
66
FMC
G
18.1
916
.08
12.8
112
.72
8.11
0.00
0.00
4.91
13.2
313
.54
0.42
Info
rmat
ion
Tec
hnol
ogy
39.2
27.
862.
3212
.44
2.17
0.39
0.22
7.88
17.8
66.
712.
94
Infr
astr
uctu
re
73.9
11.
543.
327.
312.
110.
030.
023.
676.
661.
220.
20
Man
ufac
turi
ng
48.1
89.
126.
637.
283.
120.
050.
266.
4315
.16
2.33
1.44
Med
ia &
Ent
erta
inm
ent
48.3
84.
862.
7711
.42
5.72
0.26
0.00
8.48
14.9
31.
911.
28
Petr
oche
mic
als
56.5
37.
774.
384.
772.
110.
000.
265.
7111
.61
2.55
4.31
Phar
mac
eutic
als
39.3
212
.96
4.90
7.88
3.51
0.19
0.06
6.93
19.5
73.
561.
11
Serv
ices
44
.14
13.8
65.
438.
393.
300.
200.
006.
9913
.38
3.42
0.88
Tel
ecom
mun
icat
ion
53.8
98.
064.
656.
851.
730.
000.
033.
599.
9310
.27
0.98
Misc
ella
neou
s45
.02
2.59
2.14
8.39
2.95
0.00
0.11
9.32
22.3
76.
520.
59
Num
ber
of S
hare
s97
,388
,396
,771
13
,366
,653
,976
1
1,06
8,48
3,43
3 16
,087
,186
,434
5,
924,
758,
415
117
,438
,911
501
,700
,319
11,
102,
308,
040
25,4
37,7
50,9
95
7,25
5,11
7,32
4 3,
154,
419,
003
% to
Tot
al N
umbe
r of
Sha
res
50.8
86.
985.
788.
403.
100.
060.
265.
8013
.29
3.79
1.65
43
Table 3-4 : Eligibility Criteria for Securities on WDM Segment
Issuer Eligibility Criteria for listing
Public Issue /Private Placement
Corporates (Public limited companies and Private limited companies)
• Paid-up capital of Rs.10 crores; or• Market capitalisation of Rs.25 crores (In case of unlisted companies Networth more than Rs.25 crores)• Credit rating
Public Sector Undertaking, Statutory Corporation established/ constituted under Special Act of Parliament /State Legislature, Local bodies/authorities,
• Credit rating
Mutual Funds:Units of any SEBI registered Mutual Fund/scheme :• Investment objective to invest
predominantly in debt or• Scheme is traded in secondary
market as debt instrument
• Qualifies for listing under SEBI’s Regulations
Infrastructure companies• Tax exemption and
recognition as infrastructure company under related statutes/regulations
• Qualifies for listing under the respective Acts, Rules or Regulations under which the securities are issued.
• Credit rating
Financial Institutions u/s. 4A of Companies Act, 1956 including Industrial Development Corporations
Public Issue Private Placement
Qualifies for listing under the respective Acts, Rules or Regulations under which the securities are issued.
Credit rating
Banks • Scheduled banks • Networth of Rs.50 crores or
above• Qualifies for listing under
the respective Acts, Rules or Regulations under which the securities are issued.
• Scheduled Banks• Networth of Rs.50 crores or
above• Credit rating
44
Table 3-5 : Securities Available for Trading on WDM Segment (as on March 31)
Securities 2008 2009
Number Amount Amount Number Amount Amount
(Rs.cr) (US $ mn) (Rs.cr) (US $ mn)
Government Securities 1,336 1,682,607 420,968 1,391 2,272,333 445,993
T-Bills 52 113,947 28,508 52 147,617 28,973
PSU Bonds 777 97,282 24,339 783 129,499 25,417
Institutional Bonds 262 32,419 8,111 263 57,628 11,311
Bank Bonds 396 99,615 24,922 459 132,662 26,038
Corporate Bonds 738 76,489 19,136 1,000 107,782 21,154
Others 5 723 181 6 795 156
Total 3,566 2,103,082 526,165 3,954 2,848,315 559,041
45
Tab
le 3
-6 :
Initi
al P
ublic
Offe
ring
s (IP
Os)
duri
ng 2
008-
09
Sr.
No.
Com
pany
Nam
eSe
ctor
Issu
e siz
e D
ate
of
List
ing
No.
of
Secu
ritie
s iss
ued
Issu
e Pr
ice
Clo
se
Pric
e on
fir
st d
ayof
trad
ing
Clo
se P
rice
at
end
of
Mar
ch 2
009
Pric
e A
ppre
ciat
ion/
D
epre
ciat
ion
on th
e fir
st d
ay o
f tra
ding
with
the
issu
e pr
ice
Pric
e A
ppre
ciat
ion/
D
epre
ciat
ion
at e
nd M
arch
20
09w
ith th
e iss
ue p
rice
(Rs.c
r)(R
s.)(%
)
1G
amm
on In
fras
truc
ture
Pro
jects
Lim
ited
Infr
astr
uctu
re27
6.39
3-A
pr-0
816
,550
,000
16
7.00
158.
15
52.0
0 (5
.30)
(68.
86)
2Si
ta S
hree
Foo
d Pr
oduc
ts Li
mite
dM
anuf
actu
ring
31.5
07-
Apr
-08
10,5
00,0
00
30.0
043
.70
5.65
45
.67
(81.
17)
3Ti
taga
rh W
agon
s Lim
ited
Man
ufac
turin
g12
8.72
21-A
pr-0
82,
383,
768
540.
0070
6.85
14
1.70
30
.90
(73.
76)
4K
iri D
yes a
nd C
hem
ical
s Lim
ited
Man
ufac
turin
g56
.25
22-A
pr-0
83,
750,
053
150.
0015
8.95
12
9.25
5.
97
(13.
83)
5G
okul
Ref
oils
and
Solv
ent L
imite
dM
anuf
actu
ring
139.
594-
Jun-
087,
158,
392
195.
0018
2.05
20
5.85
(6
.64)
5.56
6Se
jal A
rchi
tect
ural
Gla
ss L
imite
dM
anuf
actu
ring
105.
731-
Jul-0
89,
194,
155
115.
0081
.25
22.9
0 (2
9.35
)(8
0.09
)
7A
rchi
dply
Indu
strie
s Lim
ited
Man
ufac
turin
g48
.96
4-Ju
l-08
6,61
5,72
0 74
.00
50.7
0 13
.55
(31.
49)
(81.
69)
8Fi
rst W
inne
r Ind
ustr
ies L
imite
dM
anuf
actu
ring
68.7
58-
Jul-0
85,
500,
043
125.
0089
.20
12.6
0 (2
8.64
)(8
9.92
)
9Lo
tus E
ye C
are H
ospi
tal L
imite
dSe
rvic
es38
.00
11-Ju
l-08
10,0
00,0
00
38.0
035
.65
28.0
5 (6
.18)
(26.
18)
10K
SK E
nerg
y V
entu
res L
imite
dIn
fras
truc
ture
830.
6614
-Jul-0
834
,611
,000
24
0.00
191.
75
189.
55
(20.
10)
(21.
02)
11Bi
rla C
otsy
n (In
dia)
Lim
ited
Man
ufac
turin
g14
4.18
30-Ju
l-08
102,
982,
730
14.0
09.
45
3.45
(3
2.50
)(7
5.36
)
12V
ishal
Info
rmat
ion
Tech
nolo
gies
Lim
ited
Serv
ices
41.8
611
-Aug
-08
2,79
0,82
9 15
0.00
194.
60
35.8
0 29
.73
(76.
13)
13N
u Te
k In
dia L
imite
dTe
leco
mm
unic
atio
n86
.40
27-A
ug-0
84,
500,
000
192.
0019
9.15
29
.35
3.72
(8
4.71
)
14R
esur
gere
Min
es &
Min
eral
s Ind
ia L
imite
dM
anuf
actu
ring
120.
151-
Sep-
084,
450,
000
270.
0053
3.55
45
.25
97.6
1 (8
3.24
)
15A
ustr
al C
oke &
Pro
jects
Lim
ited
Man
ufac
turin
g14
2.30
4-Se
p-08
7,26
0,00
0 19
6.00
225.
95
225.
10
15.2
8 14
.85 Con
td...
46
Sr.
No.
Com
pany
Nam
eSe
ctor
Issu
e siz
e D
ate
of
List
ing
No.
of
Secu
ritie
s iss
ued
Issu
e Pr
ice
Clo
se
Pric
e on
fir
st d
ayof
trad
ing
Clo
se P
rice
at
end
of
Mar
ch 2
009
Pric
e A
ppre
ciat
ion/
D
epre
ciat
ion
on th
e fir
st d
ay o
f tra
ding
with
the
issu
e pr
ice
Pric
e A
ppre
ciat
ion/
D
epre
ciat
ion
at e
nd M
arch
20
09w
ith th
e iss
ue p
rice
(Rs.c
r)(R
s.)(%
)
1620
Mic
rons
Lim
ited
Man
ufac
turin
g23
.93
6-O
ct-0
84,
351,
251
55.0
033
.65
15.1
0 (3
8.82
)(7
2.55
)
17A
lkal
i Met
als L
imite
dM
anuf
actu
ring
26.2
76-
Nov
-08
2,55
0,00
0 10
3.00
173.
40
234.
30
68.3
5 12
7.48
18Ed
serv
Sof
tsyste
ms L
imite
dSe
rvic
es23
.84
2-M
ar-0
93,
973,
908
60.0
013
7.70
19
.55
129.
50
(67.
42)
Initi
al P
ublic
Offe
ring
s (IP
Os)
of N
on-c
onve
rtib
le D
eben
ture
s (N
CD
s) du
ring
200
8-09
Sr.
No.
Com
pany
Nam
e &
Ser
ies
Sect
orIs
sue
size
Dat
e of
Li
stin
gN
o. o
f Se
curi
ties
issue
d
Issu
e Pr
ice
Clo
se
Pric
e on
fir
st d
ayof
trad
ing
Clo
se P
rice
at
end
of
Mar
ch 2
008
Pric
e A
ppre
ciat
ion/
D
epre
ciat
ion
on th
e fir
st d
ay o
f tra
ding
Pric
e A
ppre
ciat
ion/
D
epre
ciat
ion
at e
nd M
arch
20
08
(Rs.c
r)(R
s.)(R
s.)(R
s.)(%
)(%
)
1Ta
ta C
apita
l Lim
ited-
N1
FIN
AN
CE
61.7
117
-Mar
-09
6,17
110
0,00
0.00
102,
010.
66
108,
000.
00
2.01
8.
00
Tata
Cap
ital L
imite
d-N
216
2.59
17-M
ar-0
91,
625,
906
1,00
0.00
1,03
2.44
1,
074.
00
3.24
7.
40
Tata
Cap
ital L
imite
d- N
374
5.74
17-M
ar-0
97,
457,
427
1,00
0.00
1,03
7.45
1,
074.
94
3.75
7.
49
Tata
Cap
ital L
imite
d-N
452
9.96
17-M
ar-0
95,
299,
567
1,00
0.00
1,02
0.68
1,
087.
50
2.07
8.
75
Con
td...
47
Table 3-7 : Rights Issues during 2008-09
S. No. Company Name Amount Mobilised
(Rs. Crore)
Amount Mobilised (US $ mn)
Date of Listing
1 State Bank Of India 16,722.27 3,282.09 7-Apr-2008
2 The Dhanalakshmi Bank Ltd. 198.76 39.01 8-May-2008
3 Network 18 Fincap Limited 102.96 20.21 22-May-2008
4 Godrej Consumer Products Limited 396.46 77.81 27-May-2008
5 The Indian Hotels Company Limited 843.88 165.63 30-May-2008
6 The Indian Hotels Company Limited 602.79 118.31 2-Jun-2008
7 Century Extrusions Limited 13.20 2.59 11-Aug-2008
8 Entegra Limited 127.15 24.96 16-Sep-2008
9 The Oudh Sugar Mills Ltd 23.99 4.71 19-Sep-2008
10 JK Tyre & Industries Limited 87.25 17.12 25-Sep-2008
11 Hindalco Industries Ltd. 4,544.63 891.98 24-Oct-2008
12 Tata Investment Corporation Ltd. 447.74 87.88 4-Nov-2008
13 Tata Motors Limited 4,139.33 812.43 4-Nov-2008
14 Tata Motors Limited 1,957.36 384.17 5-Nov-2008
15 Federal-Mogul Goetze (India) Limited. 128.86 25.29 22-Dec-2008
16 Dish TV India Limited 1,139.93 223.73 23-Jan-2009
17 Thomas Cook (India) Ltd 179.81 35.29 28-Jan-2009
Total 31,656.37 6,213.22
48
Table 3-8 : Preferential Allotments by NSE Listed Companies during 2008-09
S. No. Company Name Amount Raised
Rs. CroreAmount Raised
US $ mn
1 Aditya Birla Nuvo Limited 341.27 66.98
2 Allied Digital Services Limited 61.84 12.14
3 Agro Dutch Industries Limited 8.95 1.76
4 Aksh Optifibre Limited 11.30 2.22
5 Alkyl Amines Chemicals Ltd. 10.00 1.96
6 Allcargo Global Logistics Limited 0.09 0.02
7 Alok Industries Limited 109.48 21.49
8 Alphageo (India) Limited 7.51 1.47
9 Ansal Housing and Construction Limited 18.17 3.57
10 Antarctica Ltd 1.25 0.25
11 Apollo Hospitals Enterprise Ltd 68.60 13.46
12 Apollo Tyres Ltd 82.04 16.10
13 Aptech Limited 30.09 5.91
14 Arihant Foundations & Housing Ltd 2.30 0.45
15 Aro Granite Industries Limited 4.43 0.87
16 Arvind Limited 49.92 9.80
17 Assam Company Limited 188.33 36.96
18 Aurionpro Solutions Limited 95.97 18.84
19 Autoline Industries Limited 52.92 10.39
20 Autolite (India) Limited 0.50 0.10
21 B.A.G Films and Media Limited 69.54 13.65
22 Banco Products (I) Ltd 10.17 2.00
23 Banswara Syntex Limited 2.84 0.56
24 Bartronics India Limited 60.19 11.81
25 Blue Coast Hotels and Resorts Limited 42.77 8.40
26 BOC India Limited 597.30 117.23
27 Bombay Rayon Fashions Limited 126.27 24.78
28 Cairn India Limited 2534.59 497.47
29 Cinevistaas Limited 3.18 0.62
30 Classic Diamonds (India) Limited 5.60 1.10
31 Core Projects and Technologies Limited 33.00 6.48
32 Cubex Tubings Ltd. 9.58 1.88
33 Cybertech Systems And Software Ltd. 2.32 0.46
34 Delta Corp Limited 123.45 24.23
35 Dwarikesh Sugar Industries Limited 7.52 1.47
Contd...
49
S. No. Company Name Amount Raised
Rs. CroreAmount Raised
US $ mn
36 Easun Reyrolle Ltd 17.23 3.38
37 Electrosteel Castings Ltd 46.44 9.11
38 Electrotherm (India) Ltd. 140.50 27.58
39 Era Infra Engineering Limited 243.54 47.80
40 Escorts Ltd 30.26 5.94
41 Everonn Systems India Limited 91.39 17.94
42 Fresenius Kabi Oncology Limited 7.12 1.40
43 Garware Wall Ropes Ltd. 19.91 3.91
44 Garware Offshore Services Limited 31.33 6.15
45 GATI LIMITED 59.65 11.71
46 Gemini Communication Limited 1.73 0.34
47 Genesys International Corporation Limited 6.37 1.25
48 Genus Power Infrastructures Limited 19.90 3.91
49 The Great Eastern Shipping Co. Limited 0.31 0.06
50 Goldstone Infratech Limited 33.00 6.48
51 Goldstone Technologies Ltd. 5.44 1.07
52 GTL Infrastructure Limited 382.02 74.98
53 Gujarat NRE Coke Ltd. 30.00 5.89
54 Havells India Limited 155.25 30.47
55 Himadri Chemicals And Industries Ltd 7.79 1.53
56 Heritage Foods (India) Ltd. 48.81 9.58
57 Hikal Limited 64.46 12.65
58 Himatsingka Seide Ltd 3.33 0.65
59 Horizon Infrastructure Limited 1.65 0.32
60 ibn18 Broadcast Limited 225.18 44.20
61 ICSA (India) Limited 60.16 11.81
62 Idea Cellular Limited 7294.48 1,431.69
63 Ifb Agro Industries Ltd 2.01 0.39
64 Ifb Industries Ltd. 8.70 1.71
65 IMP Powers Ltd 23.02 4.52
66 Indo Asian Fusegear Limited 12.00 2.36
67 Ind-Swift Laboratories Ltd. 17.06 3.35
68 Infotech Enterprises Ltd 98.06 19.25
69 IOL Netcom Limited 6.65 1.31
70 Jayant Agro Organics Ltd. 18.00 3.53
71 JBF Industries Ltd. 30.63 6.01
Contd...
Contd...
50
S. No. Company Name Amount Raised
Rs. CroreAmount Raised
US $ mn
72 JCT Electronics Limited 114.34 22.44
73 JHS Svendgaard Laboratories Limited 1.84 0.36
74 JIK Industries Limited 30.04 5.90
75 Jindal Drilling And Industries Limited 153.60 30.15
76 Jain Irrigation Systems Limited 99.63 19.55
77 Jain Irrigation Systems Limited 52.72 10.35
78 JK Lakshmi Cement Limited 40.00 7.85
79 JMT Auto Limited 3.24 0.64
80 Jaiprakash Associates Limited 397.00 77.92
81 JSL Limited 118.68 23.29
82 JSW Steel Limited 217.60 42.71
83 Kalindee Rail Nirman (Engineers) Limited 3.60 0.71
84 Karuturi Global Limited 195.28 38.33
85 Khandwala Securities Limited 2.67 0.52
86 Kinetic Motor Company Limited 6.50 1.28
87 Klg Systel Ltd. 27.93 5.48
88 KDL Biotech Limited 8.73 1.71
89 Kopran Ltd. 4.53 0.89
90 K S Oils Limited 130.75 25.66
91 Lakshmi Energy and Foods Limited 58.91 11.56
92 Logix Microsystems Limited 10.63 2.09
93 Lyka Labs Ltd 6.70 1.31
94 Maars Software International Ltd. 7.72 1.52
95 Magma Fincorp Limited 32.29 6.34
96 Maharashtra Seamless Ltd 0.00 0.00
97 Malwa Cotton Spg. Mills Ltd 4.00 0.79
98 Marksans Pharma Limited 16.90 3.32
99 Mcnally Bharat Engineering Company Limited 20.97 4.11
100 Micro Technologies (India) Limited 5.01 0.98
101 Mid-Day Multimedia Limited 10.00 1.96
102 Morepen Laboratories Ltd 11.59 2.28
103 NCL Industries Limited 6.37 1.25
104 Neocure Therapeutics Ltd 3.90 0.76
105 Nuchem Ltd 0.75 0.15
106 Onward Technologies Ltd 5.94 1.17
107 Orchid Chemicals Ltd 92.38 18.13
Contd...
Contd...
51
Contd...
S. No. Company Name Amount Raised
Rs. CroreAmount Raised
US $ mn
108 Pantaloon Retail (India) Ltd. 427.00 83.81
109 Parekh Aluminex Limited 80.59 15.82
110 Patel Integrated Logistics Limited 13.32 2.61
111 Pearl Polymers Ltd 1.22 0.24
112 Phillips Carbon Black Ltd. 44.70 8.77
113 Pioneer Embroideries Limited 1.73 0.34
114 Pitti Laminations Limited 2.88 0.57
115 Ponni Sugars (Erode) Limited 2.00 0.39
116 Prajay Engineers Syndicate Limited 80.30 15.76
117 Prakash Industries Ltd 148.75 29.20
118 Premier Limited 16.97 3.33
119 Prime Securities Limited 51.43 10.09
120 Provogue (India) Limited 373.52 73.31
121 Radico Khaitan Limited 92.00 18.06
122 Rain Commodities Limited 101.27 19.88
123 Ranbaxy Laboratories Ltd 3409.22 669.13
124 Reliance Industries Ltd 16824.00 3,302.06
125 Shree Renuka Sugars Limited 37.54 7.37
126 Radha Madhav Corporation Limited 38.80 7.62
127 Rohit Ferro-Tech Limited 21.59 4.24
128 Rpg Cables Ltd 43.68 8.57
129 Ruchi Soya Industries Ltd. 49.60 9.74
130 Sagar Cements Ltd. 75.45 14.81
131 Sah Petroleums Limited 31.98 6.28
132 Sambhaav Media Limited 13.28 2.61
133 Sanghvi Movers Ltd. 12.31 2.42
134 Sb&T International Ltd 2.00 0.39
135 SEL Manufacturing Company Limited 36.08 7.08
136 Shri Lakshmi Cotsyn Limited 14.19 2.79
137 Shriram City Union Finance Limited 186.00 36.51
138 Simbhaoli Sugars Limited 6.37 1.25
139 Simplex Infrastructures Limited 8.02 1.57
140 Sintex Industries Ltd. 122.23 23.99
141 S. Kumars Nationwide Ltd 43.73 8.58
142 Sona Koyo Steering Systems Ltd. 16.26 3.19
143 SREI Infrastructure Finance Limited 72.00 14.13
Contd...
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S. No. Company Name Amount Raised
Rs. CroreAmount Raised
US $ mn
144 Steel Strips Wheels Limited 31.35 6.15
145 Strides Arcolab Limited 201.83 39.61
146 Sterlite Technologies Limited 28.00 5.50
147 Sujana Universal Industries Limited 12.00 2.36
148 Summit Securities Limited 16.06 3.15
149 Su-Raj Diamonds and Jewellery Limited 30.77 6.04
150 Surana Corporation Limited 50.00 9.81
151 Suryajyoti Spinning Mills Limited 6.50 1.28
152 Talbros Automotive Components Limited 3.61 0.71
153 Techno Electric and Engineering Co Ltd 12.80 2.51
154 Tourism Finance Corpn Of India Ltd 63.83 12.53
155 Television Eighteen India Ltd. 111.44 21.87
156 UFLEX Limited 179.07 35.15
157 United Phosphorous Limited 206.96 40.62
158 UTV Software Communications Limited 842.58 165.37
159 Vakrangee Softwares Limited 54.23 10.64
160 Viceroy Hotels Limited 78.37 15.38
161 Vijay Shanthi Builders Limited 3.53 0.69
162 Visu International Limited 4.38 0.86
163 VLS Finance Ltd. 4.00 0.79
164 Walchandnagar Industries Ltd 50.72 9.95
165 Webel-SL Energy Systems Limited 3.75 0.74
166 Welspun Gujarat Stahl Rohren Limited 150.01 29.44
167 West Coast Paper Mills Ltd 22.25 4.37
168 XL Telecom Limited 16.34 3.21
169 Xpro India Limited 2.08 0.41
Total 40,607.80 7,970.13
Contd...
Table 3-9 : Amount raised through QIP during 2008-09
Sr. No Name of the company
Amount Raised
(Rs.cr) (US $ mn)
1 Dynamatic Technologies Ltd. 74.53 14.63
2 ibn18 Broadcast Limited 114.29 22.43
TOTAL 188.82 37.06
Capital Market Segment 4
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4Capital Market Segment
The Trading on the NSE’s capital market commenced on November 4, 1995 and has been witnessing a substantial growth over the years. The growth of NSE turnover figures shows a substantial rise from Rs. 1,805 crore (US $ 574.29 million) in the year 1994-95 to Rs. 2,752,023 crore (US $ 540,141.59 million) in 2008-09. With the increase in volumes, efficient and transparent trading platform, a wide range of securities like equity, preference shares, debt warrants, exchange traded funds as well as retail government securities, NSE upholds its position as the largest stock exchange in the country. The CM segment of NSE provides an efficient and transparent platform for trading of equity, preference shares, debentures, warrants, exchange traded funds as well as retail Government securities.
NEAT System
National Exchange for Automated Trading (NEAT) is the trading system of NSE. NEAT facilitates a system on-line, fully automated, nationwide, anonymous, order driven, screen-based trading. In this system a member can punch into the computer quantities of securities and the prices at which he likes to transact and the transaction is executed as soon as it finds a matching sale for buy order for a counter party. The numerous advantages of the NEAT system are detailed out below :
• It electronically matches orders on a price/time priority and hence cuts down on time, cost and risk of error, as well as on fraud resulting in improved operational efficiency.
• It allows faster incorporation of price sensitive information into prevailing prices, thus increasing the informational efficiency of markets.
• It enables market participants to see the full market on real-time, making the market transparent. It allows a large number of participants, irrespective of their geographical locations, to trade with one another simultaneously, improving the depth and liquidity of the market.
• It provides tremendous flexibility to the users in terms of kinds of orders that can be placed on the system. It ensures full anonymity by accepting orders, big or small, from members without revealing their identity, thus providing equal access to everybody.
• It provides a perfect audit trail which helps to resolve disputes by logging in the trade execution process in entirety.
• The trading platform of the CM segment is accessed not only from the computer terminals from the premises of brokers spread over about 192 cities, but also from the personal computers in the homes of investors through the Internet.
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Market Performance
Trading Volume
Over the years the Capital market has witnessed a growth in the trading volumes from Rs. 1,805 crore (US $ 574.29 million) in 1994-95 the volumes increased to Rs. 2,752,023 crore (US $ 540,142 million) in 2008-09. The average daily trading volume increased from Rs. 17 crore during 1994-95 to Rs. 11,325 crore (US $ 2,223 million) during 2008-09. In the reporting year 2008-09 the volumes decreased by 22.50 % to Rs. 2,752,023 crore (US $ 540,142 million) from Rs. 3,551,038 crore (US $ 888,426 million) during 2007-08. The business growth of the CM segment is presented in Table 4-1 and Chart 4-1.
Chart 4-1 : Business Growth of Capital Market Segment
Liquidity
The liquidity in the CM segment, as measured by the turnover ratio, has witnessed a steady increase and reached nearly 95.02 % during the year 2008-2009 compared to 73.09% during the year 2007-08. The securities available for trading for more than 100 days accounted for 97.85% as indicated in the table below:
Frequency Distribution of Securities Traded During 2008-09
No. of Days Traded No. of Securities % to Total
Above 100 1,273 97.8591-100 5 0.3881-90 4 0.3171-80 0 0.0061-70 1 0.08
Contd...
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No. of Days Traded No. of Securities % to Total
51-60 2 0.1541-50 4 0.3131-40 4 0.3121-30 2 0.1511-20 3 0.231-10 3 0.23Total 1,301 100.00
The percentage of companies traded compared to the number of companies available for trading is quite high at more than 99% for all the months during the fiscal 2008-09. The month wise statistics are indicated in the table below:
Trading Frequency of Companies during the period 2008-09
Month Companies Available for Trading*
No. of companies Traded
% of Traded to Available for Trading
Apr-08 1,244 1,240 99.68 May-08 1,252 1,246 99.52 Jun-08 1,262 1,256 99.52 Jul-08 1,272 1,267 99.61 Aug-08 1,278 1,274 99.69 Sep-08 1,278 1,275 99.77 Oct-08 1,282 1,277 99.61 Nov-08 1,286 1,282 99.69 Dec-08 1,283 1,282 99.92 Jan-09 1,286 1,281 99.61 Feb-09 1,284 1,280 99.69 Mar-09 1,291 1,283 99.38
*At the end of the period. Includes listed/permitted to trade companies but excludes suspended companies
Distribution of Turnover
The concentration of trading among top ‘N’ Securities/members is presented in Table 4-2. It is observed that the top ‘5’ and ‘100’ securities account for about 20.48 % and 87.69 % of total turnover in the CM segment in 2008-09. The top ‘50’ securities accounted for 74.66 % of the total turnover, details of which are presented in Table 4-3.
Member-wise distribution of turnover as presented in Table 4-2 indicates increasing diffusion of trades among a large number of trading members over the years. During 2008-09, top ‘5’ brokers accounted for only 13.56% of turnover, while top ‘100’ brokers accounted for 75.42% of total turnover.
Market Capitalisation
The total market capitalisation of securities available for trading on the CM segment increased from Rs. 363,350 crore (US $ 115,606 million) as at end March 1995 to
Contd...
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Rs. 2,896,194 crore (US $ 568,439 million) as at end March 2009. The Market capitalization witnessed a huge decrease of 40.38 % during 2008-09 as compared to the market capitalization of Rs.4,858,122 crore (US $ 1,215,442 million) in 2007-08. The details of ‘50’ top companies by market capitalisation, which accounted for 70.48 % of total market capitalisation as at end March 2009, are presented in Table 4-4.
Sectoral Distribution
Table 4-5 presents the sectoral classification of ‘Top 50’ companies based on their trading value and on their Market capitalization. The trading value of the banking stocks featuring in the ‘Top 50’ witnessed a rise and contributed to 14.98 % of the trading value in comparison to 9.35 % in the previous fiscal 2007-08. Amongst the other sectors there has been no significant change in the contribution of the “Top 50 companies” in comparison to the previous fiscal.
The infrastructure sector continued to dominate with 18.78 % of the trading value in the “Top 50” companies . On the other hand the Petrochemicals sector too continued to have the maximum share of 26.67 % of the market capitalisation in the “Top 50 companies”.
On the whole the Infrastructure, Petrochemicals, Manufacturing and Banking sector continue to be the major contributors in the share of trading value and market capitalisation of the “Top 50” companies.
Trading Records during 2008-09
Ten of NSE’s most Active trading days in terms of trading values are presented in Table 4-6 . During the fiscal, the highest trading value of Rs.20,418.14 cr (US $ 4,007 million). THE Individual Securities Single day Trading Records are presented in Table 4-7.
Internet Trading –
At the end of March 2009, a total number of 349 members were permitted to allow investor’s web based access to NSE’s trading system. The members of the exchange in turn had registered 5,627,789 clients for web based access as on March 31, 2009. During the year 2008-09 10.58 % of the trading value in the Capital Market segment (Rs. 582,070 - US $ 114,243 million) was routed and executed through the internet. The table below shows the growth of internet trading from the fiscal years 2007-08 and 2008-09.
Year Enabled Members*
Registered Clients*
Internet Trading Volume
(Rs. crore)
Internet Trading Volume
(US $ million)
% of total trading volume
2007-08 305 4,405,134 649,658 162,536 9.15
2008-09 349 5,627,789 582,070 114,243 10.58
* At the end of the financial year Note : Figures for IBT turnover and registered clients are as reported by trading members to the Exchange
Figures of Turnover are Buy Turnover + Sell turnover.
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On-line IPOs
The on-line trading system of NSE is used by companies to make IPOs through book building. It is a fully automated screen based bidding system that allows trading members to enter bids on behalf of their clients. All bids received by the system are numbered, time stamped, and stored in the book till the last day of the book building process and the offer price is determined after the bid closing date. While ensuring efficient price discovery, this system reduces time taken for completion of the issue process. 298 companies have used the on-line IPO system of NSE by the end of March 2009.
Indices
India Index Services and Products Ltd. (IISL), in technical partnership with S&P, have developed and have been maintaining scientifically an array of indices of stock prices on NSE. The popular indices are the S&P CNX Nifty, CNX Nifty Junior, S&P CNX Defty, S&P CNX 500, CNX Midcap, CNX 100, Nifty Midcap 50, S&P CNX Industry indices and CNX segment indices. S&P CNX Nifty, introduced in November 3, 1995, is based on 50 largest and highly liquid stocks. CNX Nifty Junior, introduced in December 1996, is built out of the next 50 large and liquid stocks. These indices are monitored and updated dynamically and are reviewed regularly. The comparative movement of major sectoral indices along with that of S&P CNX Nifty is presented in Chart 4-2.
Chart 4-2 : Movement of Sectoral Indices: 2007-08
The S&P CNX Nifty accounted for 65.35% of total market capitalisation as at end March 2009, while the CNX Nifty Junior accounted for 9.894% of market capitalisation (Table 4-8). The compositions of these two indices as at end March 2009 are presented in Table
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4-9 and Table 4-10. The industry wise weightages of securities included in S&P CNX Nifty are presented in Table 4-11. The movements in S&P CNX Nifty and CNX Nifty Junior are presented in Table 4-12 and Table 4-13 respectively. The Performance of few of the indices is presented in Table 4-14.
Volatility Index
Volatility Index is a measure of market’s expectation of volatility over the near term. Volatility is often described as the “rate and magnitude of changes in prices” and in finance often referred to as risk. Volatility Index is a measure, of the amount by which an underlying Index is expected to fluctuate, in the near term, (calculated as annualised volatility, denoted in percentage e.g. 20%) based on the order book of the underlying index options. Volatility Index is a good indicator of the investors’ perception on how volatile markets are expected to be in the near term. Usually, during periods of market volatility, market moves steeply up or down and the volatility index tends to rise. As volatility subsides, option prices tend to decline, which in turn causes volatility index to decline.
India VIX*
NSE has been in the forefront of bringing the latest products and services to the Indian capital markets for the benefit of the investors. In another innovation in the Indian markets, NSE launched the India VIX on 08th April, 2008 a volatility index based on the Nifty 50 Options prices. From the best bidask prices of Nifty 50 Options contracts (which are traded on the F&O segment of NSE), a volatility figure (%) is calculated which indicates the expected market volatility over the next 30 calendar days. Higher the implied volatility higher the India VIX value and vice versa.
There are some differences between a price index, such as the Nifty 50 and India VIX. Nifty 50 is calculated based on the price movement of the underlying 50 stocks which comprises the index. India VIX is calculated based on the bid-offer prices of the near and mid month Nifty 50 Index Options. Nifty 50 Index is an absolute number, e.g. 4500, 5000 etc., whereas India VIX is a percentage value (eg. 20%, 30% etc.). Whereas Nifty 50 signifies how the markets have moved directionally, India VIX indicates the expected near term volatility and how the volatility is changing from time to time.
Uses of Volatility Index
Volatility Index offers great advantages in terms of trading, hedging and introducing derivative products on this index. Investors can use volatility index for various purposes as mentioned :
* “VIX” is a trademark of Chicago Board Options Exchange, Incorporated ("CBOE") and Standard & Poor’s has granted a license to NSE, with permission from CBOE, to use such mark in the name of the India VIX and for purposes relating to the India VIX.
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• Investors’ portfolios are exposed to the market volatility. Investors could hedge their portfolios against volatility with an off-setting position in India VIX* futures or options contracts.
• Volatility index depicts the collective consensus of the market on the expected volatility and being contrarian in nature helps in predicting the direction. Investors therefore could appropriately use this information for taking trading positions.
• Investors could also use the implied volatility information given by the index, in identifying mis-priced options.
• Short sale positions could expose investors to directional risk. Derivatives on volatility index could help investors in safeguarding their positions and thus avoid systemic risk for the market Based on the experience gained with the benchmark broad based index, sector specific volatility indices could be constructed to enable hedging by investors in those specific sectors.
Mutual Funds and Exchange Traded Funds
Table 4-15 (A) & (B) presents the details of the names and volumes of Mutual funds and Exchange traded funds listed on the exchange. At the end of March 2009 a total of 11 Mutual funds and 14 Exchange traded funds were listed on the exchange.
Charges
Brokerage Charges
The maximum brokerage chargeable by trading member in respect of trades effected in the securities admitted to dealing on the CM segment of the Exchange is fixed at 2.5% of the contract price, exclusive of statutory levies like, securities transaction tax, SEBI turnover fee, service tax and stamp duty. However, the brokerage charges as low as 0.10% are also observed in the market.
Transaction Charges
A member is required to pay the exchange transaction charges at the rate of 0.0035% (Rs. 3.5 per Rs. 1 lakh) of the turnover.
Securities Transaction Tax
STT is levied on all transactions of sale and / or purchase of equity shares and units of equity oriented fund and sale of derivatives entered into in a recognised stock exchange.
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The existing rates are as follows :-
Sr. No
Taxable securities transaction Rate (%) Payable by
1 Purchase of an equity share in a company or a unit of an equity oriented fund, where –
0.125 Purchaser.
(a) the transaction of such purchase is entered into in a recog-nised stock exchange; and
(b) the contract for the purchase of such share or unit is settled by the actual delivery or transfer of such share or unit.
2 Sale of an equity share in a company or a unit of an equity oriented fund, where –
0.125 Seller.
(a) the transaction of such sale is entered into in a recognised stock exchange; and
(b) the contract for the sale of such share or unit is settled by the actual delivery or transfer of such share or unit.
3 Sale of an equity share in a company or a unit of an equity oriented fund, where –
0.025 Seller.
(a) the transaction of such sale is entered into in a recognised stock exchange; and
(b) the contract for the sale of such share or unit is settled otherwise than by the actual delivery or transfer of such share or unit.
Contribution to Investor Protection Fund (CM Segment)
The trading members contribute to Investor Protection Fund of CM Segment at the rate Re. 1/- per Rs 100 crores of the traded value (each side) in case of Capital Market segment
Clearing & Settlement
While NSE provides a platform for trading to its trading members, the National Securities Clearing Corporation Ltd. (NSCCL) determines the funds/securities obligations of the trading members and ensures that trading members meet their obligations. The core processes involved in clearing and settlement are:
(a) Trade Recording : The key details about the trades are recorded to provide basis for settlement. These details are automatically recorded in the electronic trading system of the exchanges.
(b) Trade Confirmation : The parties to a trade agree upon the terms of trade like security, quantity, price, and settlement date, but not the counterparty which is the NSCCL. The electronic system automatically generates confirmation by direct participants.
(c) Determination of Obligation : The next step is determination of what counter-parties owe, and what counter-parties are due to receive on the settlement date. The NSCCL interposes itself as a central counterparty between the counterparties to trades and nets the positions so that a member has security wise net obligation to receive or deliver a security and has to either pay or receive funds.
(d) Pay-in of Funds and Securities : The members bring in their funds/securities to the NSCCL. They make available required securities in designated accounts with the
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depositories by the prescribed pay-in time. The depositories move the securities available in the accounts of members to the account of the NSCCL. Likewise members with funds obligations make available required funds in the designated accounts with clearing banks by the prescribed pay-in time. The NSCCL sends electronic instructions to the clearing banks to debit member’s accounts to the extent of payment obligations. The banks process these instructions, debit accounts of members and credit accounts of the NSCCL.
(e) Pay-out of Funds and Securities : After processing for shortages of funds/securities and arranging for movement of funds from surplus banks to deficit banks through RBI clearing, the NSCCL sends electronic instructions to the depositories/clearing banks to release pay-out of securities/funds. The depositories and clearing banks debit accounts of the NSCCL and credit accounts of members. Settlement is complete upon release of pay-out of funds and securities to custodians/members.
(f) Risk Management : A sound risk management system is integral to an efficient settlement system. The NSCCL ensures that trading members’ obligations are commensurate with their net worth. It has put in place a comprehensive risk management system, which is constantly monitored and upgraded to pre-empt market failures. It monitors the track record and performance of members and their net worth; undertakes on-line monitoring of members’ positions and exposure in the market, collects margins from members and automatically disables members if the limits are breached. The risk management methods adopted by NSE have brought the Indian financial market in line with the international markets.
Settlement Agencies
The NSCCL, with the help of clearing members, custodians, clearing banks and depositories settles the trades executed on exchanges. The roles of each of these entities are explained below:
(a) NSCCL : The NSCCL is responsible for post-trade activities of a stock exchange. Clearing and settlement of trades and risk management are its central functions. It clears all trades, determines obligations of members, arranges for pay-in of funds/securities, receives funds/securities, processes for shortages in funds/securities, arranges for pay-out of funds/securities to members, guarantees settlement, and collects and maintains margins/collateral/base capital/other funds. It is the counterparty to all settlement obligations of the members.
(b) Clearing Members : They are responsible for settling their obligations as determined by the NSCCL. They have to make available funds and/or securities in the designated accounts with clearing bank/depositories, as the case may be, to meet their obligations on the settlement day.
(c) Custodians : Custodian is a clearing member but not a trading member. They settle trades assigned to them by trading members. They are required to confirm whether they are going to settle a particular trade or not. If it is confirmed, the NSCCL
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assigns that obligation to that custodian and the custodian is required to settle it on the settlement day.
(d) Clearing Banks : Every clearing member is required to open a dedicated clearing account with one of the clearing banks. Based on his obligation as determined through clearing, the clearing member makes funds available in the clearing account for the pay-in and receives funds in case of a pay-out.
(e) Depositories : Depositories help in the settlement of the dematerialised securities. Each custodian/clearing member is required to maintain a clearing pool account with the depositories. He is required to make available the required securities in the designated account on settlement day. The depository runs an electronic file to transfer the securities from accounts of the custodians/clearing member to that of NSCCL. As per the schedule of allocation of securities determined by the NSCCL, the depositories transfer the securities on the pay-out day from the account of the NSCCL to those of members/custodians.
(f) Professional Clearing Member : NSCCL admits special category of members namely, professional clearing members. Professional Clearing Member (PCM) may clear and settle trades executed for their clients (individuals, institutions etc.). In such an event, the functions and responsibilities of the PCM would be similar to Custodians. PCMs may also undertake clearing and settlement responsibility for trading members. In such a case, the PCM would settle the trades carried out by the trading members connected to them. A PCM has no trading rights but has only clearing rights, i.e. he clears the trades of his associate trading members and institutional clients.
Settlement Cycles
NSCCL clears and settles trades as per well-defined settlement cycles, as presented in Table 4-16. Since the beginning of the financial year 2003, all securities are being traded and settled under T+2 rolling settlement. The NSCCL notifies the consummated trade details to clearing members/custodians on the trade day. The custodians affirm back the trades to NSCCL by T+1 day. Based on the affirmation, NSCCL nets the positions of counterparties to determine their obligations. A clearing member has to pay-in/pay-out funds and/or securities. A member has a security-wise net obligation to receive/deliver a security. The obligations are netted for a member across all securities to determine his fund obligations and he has to either pay or receive funds. Members’ pay-in/pay-out obligations are determined latest by T+1 day and are forwarded to them on the same day so that they can settle their obligations on T+2 day. The securities/funds are paid-in/paid-out on T+2 day and the settlement is complete in 3 days from the end of the trading day.
Settlement Statistics
The settlement statistics of the CM segment is presented in Table 4-17. During 2008-09, NSCCL settled trades for Rs. 2,749,450 crore (US $ 539,637 million.) of which 22.44% were settled by delivery. However, these deliveries include only the net deliveries made by the trading members to the clearing corporation. Of total delivery, nearly 100% of
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securities were delivered in demat form in 2008-09. Short deliveries averaged around 0.21 % of total delivery in 2008-09.
Risk Management System
There have been a number of experiments with different risk containment measures in the recent pasts. NSE being aware of the importance of the risk containment measures has a dedicated Risk Group which looks into aspects relating to the risk management. These measures have been repeatedly reviewed and revised. The risk containment measures in vogue are described below:
Capital Adequacy
The capital adequacy requirements stipulated by the NSE are substantially in excess of the minimum statutory requirements as also in comparison to those stipulated by other stock exchanges. A person seeking membership in the CM and F&O segment is required to have a net worth of Rs. 1 crore, and keep an interest free security deposit of Rs. 1.25 crore and collateral security deposit of Rs. 0.25 crore with the Exchange/NSCCL. The deposits kept with the Exchange as part of the membership requirement may be used towards the margin requirement of the member. Additional capital may be provided by the member for taking additional exposure.
On-Line Monitoring
NSCCL has put in place an on-line monitoring and surveillance system, whereby exposure of the members is monitored on a real time basis. A system of alerts has been built in so that both the member and the NSCCL are alerted as per pre-set levels (reaching 70%, 85%, 90%, 95% and 100%) as and when the members approach these limits. The system enables NSSCL to further check the micro-details of members’ positions, if required and take pro-active action.
The on-line surveillance mechanism also generates alerts/reports on any price/volume movement of securities not in line with past trends/patterns. Open positions of securities are also analyzed. For this purpose the exchange maintains various databases to generate alerts. These alerts are scrutinized and if necessary taken up for follow up action. Besides this, rumors in the print media are tracked and where they are found to be price sensitive, companies are approached to verify the same. This is then informed to the members and the public.
Surveillance , Inspection and Investigation
As the securities transactions are prone to a variety of manipulations, the Exchange has instituted a strong surveillance mechanism to protect market integrity. Surveillance mechanism includes monitoring of orders and trades data, open positions and corporate information that flow into the market to identify possible market abuse practices. Various on-line and off-line alerts/reports are generated, on any price/volume movement of
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securities not in line with past trends/patterns. Besides, rumors in the print media are tracked and where they are price sensitive, companies are contacted for verification. Replies received are informed to the members and the public.
The investigation is based on various alerts which require further analysis. If further analysis suggests any possible irregular activity which deviates from the past trends/patterns and concentration of trading at NSE at the client level, then a more detailed investigation is undertaken. If the detailed investigation establishes any irregular activity, then disciplinary action is initiated against the member. If the investigation suggests possible irregular activity across exchanges and/or possible involvement of clients, then the same is informed to SEBI.
As per regulatory requirement, a minimum of 20% of the active trading members in the Capital Market segment and 50 % of active trading members in the derivatives segment are to be inspected every year to verify the level of compliance with various rules, byelaws and regulations of the Exchange. Usually, inspection of more members than the regulatory requirement is undertaken every year. The inspection randomly verifies if investor interests are being compromised in the conduct of business by the members.
Margin Requirements
NSCCL imposes stringent margin requirements as a part of its risk containment measures. The categorization of stocks for imposition of margins has the structure as given below;
• The Stocks which have traded atleast 80% of the days for the previous six months constitute the Group I and Group II.
• Out of the scrips identified for Group I & II category, the scrips having mean impact cost of less than or equal to 1% are categorized under Group I and the scrips where the impact cost is more than 1, are categorized under Group II.
• The remaining stocks are classified into Group III.
• The impact cost is calculated on the 15th of each month on a rolling basis considering the order book snapshots of the previous six months. On the basis of the impact cost so calculated, the scrips move from one group to another group from the 1st of the next month.
• For securities that have been listed for less than six months, the trading frequency and the impact cost is computed using the entire trading history of the security
Categorisation of newly listed securities
For the first month and till the time of monthly review a newly listed security is categorised in that Group where the market capitalization of the newly listed security exceeds or equals the market capitalization of 80% of the securities in that particular group. Subsequently, after one month, whenever the next monthly review is carried out, the actual trading frequency and impact cost of the security is computed, to determine the liquidity categorization of the security.
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In case any corporate action results in a change in ISIN, then the securities bearing the new ISIN shall be treated as newly listed security for group categorization.
Daily margin, comprises of VaR margin, Extreme Loss margin and Mark to Market margin.
1) Value at Risk Margin :
All securities are classified into three groups for the purpose of VaR margin
For the securities listed in Group I, scrip wise daily volatility calculated using the exponentially weighted moving average methodology is applied to daily returns in the same manner as in the derivatives market. The scrip wise daily VaR would be 3.5 times the volatility so calculated subject to a minimum of 7.5%.
For the securities listed in Group II, the VaR margin is higher of scrip VaR (3.5 sigma) or three times the index VaR, and it is scaled up by root 3.
For the securities listed in Group III, the VaR margin is equal to five times the index VaR and scaled up by root 3.
The index VaR, for the purpose, would be the higher of the daily Index VaR based on NSE Nifty 50 or BSE Sensex. The index VaR would be subject to a minimum of 5%.
Security specific Margin: NSCCL may stipulate security specific margins for the securities from time to time.
The VaR margin rate computed as mentioned above will be charged on the net outstanding position (buy value-sell value) of the respective clients on the respective securities across all open settlements. There would be no netting off of positions across different settlements. The VaR margin shall be collected on an upfront basis by adjusting against the total liquid assets of the member at the time of trade. The VaR margin so collected shall be released on completion of pay-in of the settlement
The VaR numbers are recomputed six times during the day taking into account price and volatilities at various time intervals and are provided on the website of the Exchange.
2) Extreme Loss Margin
The Extreme Loss Margin for any security is be higher of 5%, or 1.5 times the standard deviation of daily logarithmic returns of the security price in the last six months. The Extreme Loss Margin is be collected/ adjusted against the total liquid assets of the member on a real time basis
3) Mark to Market Margin
Mark to market loss is calculated by marking each transaction in security to the closing price of the security at the end of trading. In case the security has not been traded on a particular day, the latest available closing price at the NSE is considered
68
as the closing price. In case the net outstanding position in any security is nil, the difference between the buy and sell values is considered as notional loss for the purpose of calculating the mark to market margin payable.
The mark to market margin (MTM) is collected from the member before the start of the trading of the next day. The MTM margin is also collected/adjusted from/against the cash/cash equivalent component of the liquid net worth deposited with the Exchange.
The MTM margin so collected is be released on completion of pay-in of the settlement.
Close Out Facility
An online facility to close–out open positions of members in the capital market segment whose trading facility is withdrawn for any reason, has been provided with effect from June 13, 2007,
On disablement, the trading members will be allowed to place close-out orders through this facility. Only orders which result in reduction of existing open positions at the client level would be accepted through the close-out facility in the normal market. Members would not be allowed to create any fresh position when in the close-out mode, to place close out orders with custodial participant code and to close out open positions of securities in trade for trade segment.
Index-based Market-wide Circuit Breakers
a. An index based market-wide circuit breaker system applies at three stages of the index movement either way at 10%, 15% and 20%. These circuit breakers bring about a coordinated trading halt in trading on all equity and equity derivatives markets across the country. The breakers are triggered by movements in either Nifty 50 or Sensex, whichever is breached earlier.
• In case of a 10% movement in either of these indices, there would be a one-hour market halt if the movement takes place before 1:00 p.m. In case the movement takes place at or after 1:00 p.m. but before 2:30 p.m. there would be trading halt for ½ hour. In case movement takes place at or after 2:30 p.m. there will be no trading halt at the 10% level and market would continue trading.
• In case of a 15% movement of either index, there should be a two-hour halt if the movement takes place before 1 p.m. If the 15% trigger is reached on or after 1:00 p.m. but before 2:00 p.m., there should be a one-hour halt. If the 15% trigger is reached on or after 2:00 p.m. the trading should halt for remainder of the day.
• In case of a 20% movement of the index, trading should be halted for the remainder of the day.
NSE may suo moto cancel the orders in the absence of any immediate confirmation from the members that these orders are genuine or for any other reason as it may deem
69
fit. The Exchange views entries of non-genuine orders with utmost seriousness as this has market –wide repercussion. As an additional measure of safety, individual scrip-wise price bands have been fixed as below:
• Daily price bands of 2% (either way) on a set of specified securities
• Daily price bands of 5% (either way) on a set of specified securities
• Daily price bands of 10% (either way) on a set of specified securities
• Price bands of 20% (either way) on all the remaining securities (including debentures, warrants, preference shares etc. which are traded on CM segment of NSE),
• No price bands are applicable on scrip on which derivative products are available or scrips included in indices on which derivative products are available. However in order to prevent members from entering orders at non-genuine prices in such securities, the Exchange has fixed operating range of 20% for such securities.
The price bands for the securities in the Limited Physical Market are the same as those applicable for the securities in the Normal Market. For Auction market the price bands of 20% are applicable.
Settlement Guarantee Fund
The Settlement Guarantee Fund provides a cushion for any residual risk and operates like a self-insurance mechanism wherein members themselves contribute to the fund. In the event of a trading member failing to meet his settlement obligation, then the fund is utilized to the extent required for successful completion of the settlement. This has eliminated counter-party risk of trading on the Exchange. The market has full confidence that settlement shall take place in time and shall be completed irrespective of default by isolated trading members.
70
Con
td...
Tab
le 4
-1 :
Busi
ness
Gro
wth
of C
M S
egm
ent
Mon
th &
Yea
rN
o. o
f T
radi
ng
Day
s
No.
of
com
pani
es
Tra
ded
No.
of
T
rade
sT
rade
d Q
uant
ity
T
radi
ng V
alue
Ave
rage
Dai
ly
Tra
ding
Val
ueT
urno
ver
Rat
ioD
emat
T
rade
d Q
uant
ity
Dem
at T
radi
ng V
alue
Mar
ket
Cap
ital
isat
ion
(Rs.
lakh
)(la
kh)
(Rs.
cr.
)(U
S $
mn.
)(R
s. c
r.)
(US
$ m
n.)
(%)
(Rs.
lakh
)(R
s. c
r.)
(US
$ m
n.)
(Rs.
cr.
) (U
S $
mn.
)
1994
-95
(Nov
.-Mar
.)10
2–
31,
391
1,80
5–
17–
0.50
00
–36
3,35
0 –
1995
-96
246
–66
39,9
1267
,287
–27
6–
16.7
60
0–
401,
459
–
1996
-97
250
–26
413
5,56
129
4,50
3–
1,17
6–
70.2
32
6–
419,
367
–
1997
-98
244
–38
113
5,68
537
0,19
3–
1,52
0–
76.8
831
535
1–
481,
503
--
1998
-99
251
–54
616
5,32
741
4,47
497
,683
1,65
138
984
.38
8,54
223
,818
5,61
349
1,17
5 11
5,76
0
1999
-200
025
4–
984
242,
704
839,
052
192,
353
3,30
375
782
.23
153,
772
711,
706
163,
159
1,02
0,42
6 23
3,93
3
2000
-01
251
1,20
11,
676
329,
536
1,33
9,51
028
7,20
25,
337
1,14
420
3.62
307,
222
1,26
4,33
727
1,08
465
7,84
714
1,04
8
2001
-02
247
1,01
91,
753
278,
408
513,
167
105,
157
2,07
842
680
.58
277,
717
512,
866
105,
095
636,
861
130,
504
2002
-03
251
899
2,39
736
4,06
661
7,98
913
0,10
32,
462
518
115.
0536
4,04
961
7,98
413
0,10
253
7,13
311
3,08
1
2003
-04
254
804
3,78
071
3,30
01,
099,
534
253,
407
4,32
999
898
.09
713,
300
1,09
9,53
425
3,40
71,
120,
976
258,
349
2004
-05
253
856
4,50
979
7,68
51,
140,
072
260,
588
4,50
61,
030
71.9
079
7,68
51,
140,
072
260,
588
1,58
5,58
5 36
2,41
9
2005
-06
251
928
6,08
9 84
4,48
6 1,
569,
558
351,
840
6,25
3 1,
402
55.7
984
4,48
6 1,
569,
558
351,
840
2,81
3,20
1 63
0,62
1
2006
-07
249
1,11
4 7,
847
855,
456
1,94
5,28
7 44
6,26
97,
812
1,79
257
.77
855,
456
1,94
5,28
7 44
6,26
93,
367,
350
772,
505
Apr
-07
201,
088
678
77,0
81
168,
567
42,1
73
8,42
8 2,
109
–77
,081
16
8,56
7 42
,173
3,
650,
368
913,
277
May
-07
211,
113
802
97,9
11
207,
585
51,9
35
9,88
5 2,
473
–97
,911
20
7,58
5 51
,935
3,
898,
078
975,
251
Jun-
0721
1,13
0 75
1 79
,636
19
3,64
8 48
,448
9,
221
2,30
7 –
79,6
36
193,
648
48,4
48
3,97
8,38
1 99
5,34
2
Jul-0
722
1,14
0 89
7 10
5,31
5 26
7,22
7 66
,857
12
,147
3,
039
–10
5,31
5 26
7,22
7 66
,857
4,
317,
571
1,08
0,20
3
Aug
-07
221,
166
874
106,
218
231,
241
57,8
54
10,5
11
2,63
0 –
106,
218
231,
241
57,8
54
4,29
6,99
4 1,
075,
055
Sep-
0720
1,11
6 91
9 14
3,79
7 26
6,05
0 66
,562
13
,302
3,
328
–14
3,79
7 26
6,05
0 66
,562
4,
886,
561
1,22
2,55
7
Oct
-07
221,
176
1,22
7 17
0,94
5 45
5,58
9 11
3,98
3 20
,709
5,
181
–17
0,94
5 45
5,58
9 11
3,98
3 5,
722,
227
1,43
1,63
0
71
Con
td...
Mon
th &
Yea
rN
o. o
f T
radi
ng
Day
s
No.
of
com
pani
es
Tra
ded
No.
of
T
rade
sT
rade
d Q
uant
ity
T
radi
ng V
alue
Ave
rage
Dai
ly
Tra
ding
Val
ueT
urno
ver
Rat
ioD
emat
T
rade
d Q
uant
ity
Dem
at T
radi
ng V
alue
Mar
ket
Cap
ital
isat
ion
(Rs.
lakh
)(la
kh)
(Rs.
cr.
)(U
S $
mn.
)(R
s. c
r.)
(US
$ m
n.)
(%)
(Rs.
lakh
)(R
s. c
r.)
(US
$ m
n.)
(Rs.
cr.
) (U
S $
mn.
)
Nov
-07
221,
189
1,18
0 17
0,58
8 41
4,41
9 10
3,68
3 18
,837
4,
713
–17
0,58
8 41
4,41
9 10
3,68
3 5,
876,
742
1,47
0,28
8
Dec
-07
191,
202
1,08
8 16
3,96
5 36
6,38
5 91
,665
19
,283
4,
824
–16
3,96
5 36
6,38
5 91
,665
6,
543,
272
1,63
7,04
6
Jan-
0823
1,21
0 1,
252
166,
821
447,
138
111,
868
19,4
41
4,86
4 –
166,
821
447,
138
111,
868
5,29
5,38
7 1,
324,
840
Feb-
0821
1,22
6 1,
072
113,
588
280,
176
70,0
97
13,3
42
3,33
8 –
113,
588
280,
176
70,0
97
5,41
9,94
2 1,
356,
003
Mar
-08
18
1,22
9 98
7 10
2,60
4 25
3,01
2 63
,301
14
,056
3,
517
–10
2,60
4 25
3,01
2 63
,301
4,
858,
122
1,21
5,44
2
2007
-08
251
1,24
4 11
,727
1,
498,
469
3,55
1,03
8 88
8,42
6 14
,148
3,
540
73.0
91,
498,
469
3,55
1,03
8 88
8,42
6 4,
858,
122
1,21
5,44
2
Apr
-08
201,
240
1,07
911
4,28
027
1,22
753
,234
13
,561
2,66
2 –
114,
280
271,
227
53,2
34
5,44
2,78
01,
068,
259
May
-08
201,
246
1,07
111
5,01
427
7,92
354
,548
13
,896
2,72
7 –
115,
014
277,
923
54,5
48
5,09
8,87
31,
000,
760
Jun-
0821
1,25
6 1,
115
108,
548
264,
428
51,9
00
12,5
922,
471
–10
8,54
826
4,42
851
,900
4,
103,
651
805,
427
Jul-0
823
1,26
7 1,
337
134,
285
295,
816
58,0
60
12,8
622,
524
–13
4,28
529
5,81
658
,060
4,
432,
427
869,
956
Aug
-08
201,
274
1,06
710
4,35
223
4,25
145
,977
11
,713
2,29
9 –
104,
352
234,
251
45,9
77
4,47
2,46
187
7,81
4
Sep-
0821
1,27
51,
132
102,
202
262,
261
51,4
74
12,4
892,
451
–10
2,20
226
2,26
151
,474
3,
900,
185
765,
493
Oct
-08
201,
277
1,17
810
9,29
921
6,19
842
,433
10
,810
2,12
2 –
109,
299
216,
198
42,4
33
2,82
0,38
855
3,56
0
Nov
-08
181,
282
1,09
910
6,84
817
3,12
333
,979
9,
618
1,88
8 –
106,
848
173,
123
33,9
79
2,65
3,28
152
0,76
2
Dec
-08
211,
282
1,30
214
4,79
321
2,95
641
,797
10
,141
1,99
0 –
144,
793
212,
956
41,7
97
2,91
6,76
857
2,47
7
Jan-
0920
1,28
1 1,
222
145,
254
191,
184
37,5
24
9,55
91,
876
–14
5,25
419
1,18
437
,524
2,
798,
707
549,
305
Feb-
0919
1,28
0 96
911
1,86
5 14
9,85
729
,413
7,
887
1,54
8 –
111,
865
149,
857
29,4
13
2,67
5,62
2 52
5,14
7
Mar
-09
201,
283
1,08
112
9,61
4 20
2,79
939
,803
10
,140
1,
990
–12
9,61
4 20
2,79
9 39
,803
2,
896,
194
568,
439
2008
-09
243
1,27
7 13
,650
1,
426,
355
2,75
2,02
3 54
0,14
2 11
,325
2,
223
95.0
21,
426,
355
2,75
2,02
3 54
0,14
2 2,
896,
194
568,
439
72
Table 4-2 : Percentage Share of Top ‘N’ Securities/Member in Turnover
No. of Securities/Members
Year 5 10 25 50 100
Securities
1994-95 (Nov.-Mar.) 48.77 55.92 68.98 81.14 91.07
1995-96 82.98 86.60 90.89 93.54 95.87
1996-97 84.55 91.96 95.70 97.03 98.19
1997-98 72.98 85.17 92.41 95.76 97.90
1998-99 52.56 67.11 84.71 92.03 95.98
1999-00 39.56 59.22 82.31 88.69 93.66
2000-01 52.15 72.90 88.93 94.57 97.46
2001-02 44.43 62.92 82.24 91.56 95.91
2002-03 40.58 55.41 77.8 89.16 95.38
2003-04 31.04 44.87 64.32 79.44 91.03
2004-05 25.88 41.65 57.98 72.40 84.26
2005-06 22.15 31.35 46.39 59.22 73.12
2006-07 16.97 25.25 43.46 61.94 77.22
2007-08 16.29 26.78 45.46 61.47 77.29
2008-09 20.48 32.58 56.36 74.66 87.69
Members
1994-95 (Nov.-Mar.) 18.19 26.60 44.37 61.71 81.12
1995-96 10.65 16.56 28.61 41.93 58.59
1996-97 5.94 10.08 19.67 30.57 45.95
1997-98 6.29 10.59 18.81 29.21 44.24
1998-99 7.73 11.96 20.77 31.66 47.02
1999-00 7.86 12.99 22.78 34.41 49.96
2000-01 7.78 12.76 23.00 33.86 48.79
2001-02 7.14 12.29 23.63 36.32 53.40
2002-03 10.26 16.41 29.07 42.49 59.15
2003-04 11.58 17.36 30.34 44.05 61.37
2004-05 13.52 20.20 34.97 49.01 65.09
2005-06 14.62 22.57 38.17 52.57 38.45
2006-07 14.72 24.27 42.61 56.71 71.22
2007-08 14.57 25.71 44.70 60.11 73.90
2008-09 13.56 23.62 43.55 61.21 75.42
73
Contd...
Table 4-3 : ‘50’ Most Active Securities during 2008-09 in Terms of Trading Value
Rank Name of Security & Industry
Trading Value % Share in Total Trading Value
Market Capitalisation as on March 31,2009
% Share in Total Market
Capitali-sation
(Rs. cr.) (US $ mn.) (Rs. cr.) (US $ mn.)
1 Reliance Industries Ltd--Petrochemicals
198,440 38,948 7.21 239,965 47,098 8.29
2 ICICI Bank Ltd.--Banks 118,915 23,340 4.32 37,034 7,269 1.28
3 Reliance Capital Limited--Finance
99,308 19,491 3.61 8,682 1,704 0.30
4 Bharti Airtel Limited--Telecommunication
74,260 14,575 2.70 118,782 23,314 4.10
5 State Bank Of India--Banks
72,639 14,257 2.64 67,748 13,297 2.34
6 Larsen & Toubro Ltd.--Engineering
71,991 14,130 2.62 39,316 7,717 1.36
7 Infosys Technologies Ltd--Information Technology
68,397 13,424 2.49 75,837 14,885 2.62
8 Reliance Infrastructure Ltd--Infrastructure
67,355 13,220 2.45 11,743 2,305 0.41
9 Housing Development Finance Corporation Ltd.--Finance
62,914 12,348 2.29 40,171 7,884 1.39
10 DLF Limited--Infrastructure
62,493 12,266 2.27 28,395 5,573 0.98
11 Bharat Heavy Electricals Ltd--Manufacturing
62,234 12,215 2.26 73,944 14,513 2.55
12 Reliance Communications Limited--Telecommunication
54,372 10,672 1.98 36,090 7,083 1.25
13 Satyam Computer Services Ltd--Information Technology
50,476 9,907 1.83 2,591 509 0.09
14 Reliance Natural Resources Limited--Manufacturing
49,831 9,780 1.81 7,325 1,438 0.25
15 Reliance Petroleum Limited--Petrochemicals
49,592 9,734 1.80 42,795 8,399 1.48
16 Tata Steel Limited--Manufacturing
44,236 8,682 1.61 15,047 2,953 0.52
17 Jaiprakash Associates Limited--Infrastructure
41,968 8,237 1.52 9,956 1,954 0.34
18 Axis Bank Limited--Banks
41,853 8,215 1.52 14,897 2,924 0.51
74
Contd...
Rank Name of Security & Industry
Trading Value % Share in Total Trading Value
Market Capitalisation as on March 31,2009
% Share in Total Market
Capitali-sation
(Rs. cr.) (US $ mn.) (Rs. cr.) (US $ mn.)
19 Oil & Natural Gas Corpn Ltd--Petrochemicals
41,681 8,181 1.51 166,875 32,753 5.76
20 HDFC Bank Ltd--Banks 39,775 7,807 1.45 41,406 8,127 1.43
21 Suzlon Energy Limited--Manufacturing
37,557 7,371 1.36 6,345 1,245 0.22
22 Housing Development And Infrastructure Limited--Infrastructure
37,260 7,313 1.35 2,255 443 0.08
23 Unitech Ltd--Infrastructure
37,082 7,278 1.35 5,666 1,112 0.20
24 Educomp Solutions Limited--Information Technology
34,471 6,766 1.25 3,608 708 0.12
25 Steel Authority Of India Ltd.--Manufacturing
31,898 6,261 1.16 39,838 7,819 1.38
26 Cairn India Limited--Petrochemicals
28,547 5,603 1.04 34,918 6,853 1.21
27 NTPC Limited--Infrastructure
28,149 5,525 1.02 148,295 29,106 5.12
28 IFCI Limited--Finance 27,195 5,338 0.99 1,471 289 0.05
29 Ranbaxy Laboratories Ltd--Pharmaceuticals
26,974 5,294 0.98 6,966 1,367 0.24
30 Tata Consultancy Services Limited--Information Technology
24,268 4,763 0.88 52,703 10,344 1.82
31 Indiabulls Real Estate Limited--Infrastructure
24,175 4,745 0.88 2,560 502 0.09
32 Sterlite Industries ( India ) Limited--Manufacturing
24,141 4,738 0.88 25,335 4,973 0.87
33 Sesa Goa Ltd.--Manufacturing
22,887 4,492 0.83 7,841 1,539 0.27
34 ITC Ltd.--FMCG 22,655 4,447 0.82 69,770 13,694 2.41
35 Reliance Power Limited--Infrastructure
22,307 4,378 0.81 24,531 4,815 0.85
36 Punj Lloyd Limited--Infrastructure
20,775 4,078 0.75 2,762 542 0.10
37 Jindal Steel & Power Ltd.--Manufacturing
20,541 4,032 0.75 18,644 3,659 0.64
Contd...
75
Rank Name of Security & Industry
Trading Value % Share in Total Trading Value
Market Capitalisation as on March 31,2009
% Share in Total Market
Capitali-sation
(Rs. cr.) (US $ mn.) (Rs. cr.) (US $ mn.)
38 Chambal Fertilizers & Chemicals Ltd--Petrochemicals
20,135 3,952 0.73 1,742 342 0.06
39 Kotak Mahindra Bank Limited--Banks
19,072 3,743 0.69 9,755 1,915 0.34
40 Hindustan Unilever Limited--FMCG
18,411 3,614 0.67 51,770 10,161 1.79
41 Essar Oil Limited--Petrochemicals
18,357 3,603 0.67 8,717 1,711 0.30
42 United Spirits Limited--FMCG
16,627 3,263 0.60 6,500 1,276 0.22
43 Tata Power Co. Ltd.--Infrastructure
16,559 3,250 0.60 17,019 3,340 0.59
44 Bank Of India--Banks 15,524 3,047 0.56 11,522 2,261 0.40
45 Infrastructure Development Finance Company Limited--Finance
15,524 3,047 0.56 7,007 1,375 0.24
46 Maruti Suzuki India Limited--Manufacturing
15,311 3,005 0.56 22,531 4,422 0.78
47 Aban Offshore Ltd.--Petrochemicals
14,674 2,880 0.53 1,503 295 0.05
48 GMR Infrastructure Limited--Infrastructure
14,095 2,766 0.51 17,269 3,389 0.60
49 Akruti City Limited--Infrastructure
13,614 2,672 0.49 5,716 1,122 0.20
50 Shree Renuka Sugars Limited--Manufacturing
13,033 2,558 0.47 2,517 494 0.09
Total 2,054,549 403,248 74.66 1,695,672 332,811 58.55
Contd...
76
Table 4-4 : Top ‘50’ Companies by Market Capitalisation as on March 31, 2009
Rank Name of Security & Industry
Market Capitalisation
% Share in Total Market
Capitali-sation
Trading Volume Dur-ing2008-09
% Share in
Total Trading Volume
(Rs. cr.) (US $ mn.) (Rs. cr.) (US $ mn.)
1 Reliance Industries Ltd--Petrochemicals
239,965 47,098 8.29 198,440 38,948 7.21
2 Oil & Natural Gas Corpn Ltd--Petrochemicals
166,875 32,753 5.76 41,681 8,181 1.51
3 NTPC Limited--Infrastructure
148,295 29,106 5.12 28,149 5,525 1.02
4 Bharti Airtel Limited--Telecommunication
118,782 23,314 4.10 74,260 14,575 2.70
5 Infosys Technologies Ltd--Information Technology
75,837 14,885 2.62 68,397 13,424 2.49
6 Bharat Heavy Electricals Ltd--Manufacturing
73,944 14,513 2.55 62,234 12,215 2.26
7 ITCLtd.--FMCG 69,770 13,694 2.41 22,655 4,447 0.82
8 State Bank Of India--Banks 67,748 13,297 2.34 72,639 14,257 2.64
9 NMDC Ltd. Manufacturing
61,770 12,124 2.13 476 93 0.02
10 Tata Consultancy Services Limited--Information Technology
52,703 10,344 1.82 24,268 4,763 0.88
11 Hindustan Unilever Limited--FMCG
51,770 10,161 1.79 18,411 3,614 0.67
12 Indian Oil Corporation Ltd- Petrochemicals
46,240 9,076 1.60 3,659 718 0.13
13 Reliance Petroleum Limited--Petrochemicals
42,795 8,399 1.48 49,592 9,734 1.80
14 HDFC Bank Ltd--Banks 41,406 8,127 1.43 39,775 7,807 1.45
15 Power Grid Corporation of India Limited- Infrastructure
40,237 7,897 1.39 7,472 1,466 0.27
16 Housing Development Finance Corporation Ltd.--Finance
40,171 7,884 1.39 62,914 12,348 2.29
17 Steel Authority Of India Ltd.--Manufacturing
39,838 7,819 1.38 31,898 6,261 1.16
18 Larsen & Toubro Ltd.--Engineering
39,316 7,717 1.36 71,991 14,130 2.62
19 ICICI Bank Ltd.--Banks 37,034 7,269 1.28 118,915 23,340 4.32
20 Reliance Communications Limited--Telecommunication
36,090 7,083 1.25 54,372 10,672 1.98
Contd...
77
Rank Name of Security & Industry
Market Capitalisation
% Share in Total Market
Capitali-sation
Trading Volume Dur-ing2008-09
% Share in
Total Trading Volume
(Rs. cr.) (US $ mn.) (Rs. cr.) (US $ mn.)
21 Wipro Ltd- Information Technology
35,999 7,066 1.24 11,034 2,166 0.40
22 Cairn India Limited--Petrochemicals
34,918 6,853 1.21 28,547 5,603 1.04
23 GAIL (India) Limited- Manufacturing
31,154 6,115 1.08 11,910 2,338 0.43
24 DLF Limited--Infrastructure
28,395 5,573 0.98 62,493 12,266 2.27
25 Sterlite Industries ( India ) Limited--Manufacturing
25,335 4,973 0.87 24,141 4,738 0.88
26 Reliance Power Limited--Infrastructure
24,531 4,815 0.85 22,307 4,378 0.81
27 Sun Pharmaceuticals Industries Ltd- Pharmaceuticals
23,020 4,518 0.79 9,887 1,941 0.36
28 Maruti Suzuki India Limited--Manufacturing
22,531 4,422 0.78 15,311 3,005 0.56
29 Hero Honda Motors Ltd.- Manufacturing
21,390 4,198 0.74 7,997 1,570 0.29
30 Hindustan Zinc Ltd.- Manufacturing
19,063 3,741 0.66 1,219 239 0.04
31 Jindal Steel & Power Ltd.--Manufacturing
18,644 3,659 0.64 20,541 4,032 0.75
32 GMR Infrastructure Limited--Infrastructure
17,269 3,389 0.60 14,095 2,766 0.51
33 Cipla Ltd.- Pharmaceuticals
17,104 3,357 0.59 6,045 1,186 0.22
34 Tata Power Co. Ltd.--Infrastructure
17,019 3,340 0.59 16,559 3,250 0.60
35 Power Finance Corporation Limited- Finance
16,597 3,257 0.57 2,522 495 0.09
36 Idea Cellular Limited- Telecommunication
15,531 3,048 0.54 12,418 2,437 0.45
37 Tata Steel Limited--Manufacturing
15,047 2,953 0.52 44,236 8,682 1.61
38 Axis Bank Limited--Banks 14,897 2,924 0.51 41,853 8,215 1.52
39 Tata Communications Limited- Telecommunication
14,773 2,900 0.51 3,288 645 0.12
40 Grasim Industries Ltd.- Manufacturing
14,504 2,847 0.50 6,219 1,221 0.23
Contd...
Contd...
78
Rank Name of Security & Industry
Market Capitalisation
% Share in Total Market
Capitali-sation
Trading Volume Dur-ing2008-09
% Share in
Total Trading Volume
(Rs. cr.) (US $ mn.) (Rs. cr.) (US $ mn.)
41 Neyveli Lignite Corporation Limited- Infrastructure
14,076 2,763 0.49 4,396 863 0.16
42 National Aluminium Company Limited- Manufacturing
13,830 2,714 0.48 3,553 697 0.13
43 Bharat Petroleum Corpn. Ltd- Petrochemicals
13,596 2,668 0.47 5,560 1,091 0.20
44 Punjab National Bank- Banks
12,973 2,546 0.45 10,942 2,148 0.40
45 Mundra Port and Special Economic Zone Limited- services
12,954 2,542 0.45 6,771 1,329 0.25
46 Reliance InfrastructureLtd--Infrastructure
11,743 2,305 0.41 67,355 13,220 2.45
47 Bank Of India--Banks 11,522 2,261 0.40 15,524 3,047 0.56
48 ACC Limited- Manufacturing
10,781 2,116 0.37 6,517 1,279 0.24
49 Ambuja Cements Ltd .- Manufacturing
10,750 2,110 0.37 3,266 641 0.12
50 Mahindra & Mahindra Ltd.- Manufacturing
10,697 2,100 0.37 6,707 1,316 0.24
Total 2,041,226 400,633 70.48 1,545,412 303,319 56.16
Contd...
79
Tab
le 4
–5 :
Indu
stry
Wis
e C
lass
ifica
tion
ofT
op ‘5
0’ C
ompa
nies
by
Tra
ding
Vol
ume
and
Mar
ket C
apita
lisat
ion
Indu
stry
Tra
ding
Val
ue (A
mou
nt)
Tra
ding
Val
ue
(% t
o T
otal
‘Top
50
Co’
s)M
arke
t C
apit
alis
atio
n (A
mou
nt)
Mar
ket
Cap
ital
isat
ion
(% t
o T
otal
‘Top
50
Co’
s)
2007
–08
2008
–09
2007
–08
2008
–09
2007
–08
2008
–09
2007
–08
2008
–09
(Rs.
cr.)
(US
$ m
n.)
(Rs.
cr.)
(US
$ m
n.)
%(R
s.cr
.)(U
S $
mn.
)(R
s.cr
.)(U
S $
mn.
)%
Bank
s20
4,18
2 5,
108
307,
779
60,4
089.
3514
.98
283,
587
7,09
5 18
5,58
1 36
,424
8.
969.
09
Fina
ncia
l Ser
vice
s25
4,52
3 6,
368
204,
941
40,2
2411
.66
9.97
97,7
43
2,44
5 56
,767
11
,142
3.
092.
78
Engi
neer
ing
66,8
12
1,67
2 71
,991
14
,130
3.06
3.50
88,7
02
2,21
9 39
,316
7,
717
2.80
1.93
FMC
G26
,700
66
8 57
,693
11
,324
1.22
2.81
127,
532
3,19
1 12
1,54
0 23
,855
4.
035.
95
Infr
astr
uctu
re50
0,45
8 12
,521
38
5,83
3 75
,728
22.9
318
.78
539,
261
13,4
92
301,
563
59,1
88
17.0
514
.77
IT12
8,79
4 3,
222
177,
613
34,8
605.
908.
6425
1,38
8 6,
289
164,
539
32,2
94
7.95
8.06
Man
ufac
turi
ng43
0,48
4 10
,770
32
1,66
8 63
,134
19.7
215
.66
711,
980
17,8
13
389,
277
76,4
04
22.5
119
.07
Petr
oche
mic
als
388,
646
9,72
3 37
1,42
6 72
,900
17.8
018
.08
725,
669
18,1
55
544,
388
106,
848
22.9
426
.67
Phar
mac
eutic
als
– –
26
,974
5,
294
–1.
3125
,462
6
37
40,1
24
7,87
5 0.
801.
97
Serv
ices
– –
–
0.00
23,1
89
580
12
,954
2,
542
0.73
0.63
Tel
ecom
mun
icat
ions
182,
192
4,55
8 12
8,63
1 25
,247
8.35
6.26
289,
080
7,23
2 18
5,17
6 36
,345
9.
149.
07
Med
ia &
Ent
erta
inm
ent
– –
–
–
–
–
– –
– –
–
Tot
al2,
182,
792
54,6
11
2,0
54,5
49
403,
248
100.
0010
0.00
3,16
3,59
4 79
,149
2,
041,
226
400,
633
100.
0010
0.00
80
Table 4-6 : NSE’s Most Active Trading days during the year 2008-09
Sr No.
Date Highest Single Day Trading Value
(Rs. cr.) (US $ mn.)1 23-Jul-2008 20,418.14 4,007.492 6-Aug-2008 18,615.50 3,653.683 29-May-2008 18,173.38 3,566.914 29-Apr-2008 18,087.42 3,550.035 24-Jul-2008 17,670.09 3,468.126 5-Aug-2008 17,293.10 3,394.137 30-Apr-2008 16,448.43 3,228.358 19-Sep-2008 16,294.38 3,198.119 18-Sep-2008 16,087.70 3,157.5510 5-Jun-2008 16,002.37 3,140.80
Table 4-7 : Individual Securities Single day Trading Records- 2008-09
Rank Symbol Name of Company Date Traded Value (Rs. cr.) (US $ mn.)
1 SATYAMCOMP Satyam Computer Services 7-Jan-2009 2,260 444 2 RELIANCE Reliance Industries Ltd 26-Jun-2008 2,115 415 3 RELIANCE Reliance Industries Ltd 3-Oct-2008 1,928 378 4 AKRUTI Akruti City Limited 19-Mar-2009 1,763 346 5 RELIANCE Reliance Industries Ltd 5-Jun-2008 1,732 340 6 RANBAXY Ranbaxy Labs Ltd 11-Jun-2008 1,641 322 7 RELIANCE Reliance Industries Ltd 18-Sep-2008 1,630 320 8 RCOM Reliance Communications Ltd 1-Aug-2008 1,566 307 9 RELIANCE Reliance Industries Ltd 5-Nov-2008 1,558 306 10 RELIANCE Reliance Industries Ltd 25-Jul-2008 1,544 303
Table 4-8 : Market Capitalisation of Securities in the CM Segment(In Rs. cr.)
Month/Year (end of period)
Total MC MC of S&P CNX Nifty
Share in Total MC (%)
MC of CNX Nifty Junior
Share in Total MC (%)
Mar-95 363,350 – – – –Mar-96 401,459 139,357 34.71 – –Mar-97 419,367 159,758 38.09 25,184 6.01Mar-98 481,503 230,420 47.85 34,654 7.20Mar-99 491,175 236,569 48.16 53,452 10.88Mar-00 1,020,426 373,559 36.61 98,804 9.68Mar-01 657,847 301,085 45.77 31,989 4.86Mar-02 636,861 349,402 54.86 42,446 6.66Mar-03 537,133 316,762 58.97 34,550 6.43Mar-04 1,120,976 638,599 56.97 130,122 11.61Mar-05 1,585,585 951,672 60.02 164,668 10.39Mar-06 2,813,201 1,590,155 56.52 274,823 9.77
Contd...
81
(In Rs. cr.) Month/Year
(end of period)Total MC MC of S&P
CNX NiftyShare in Total
MC (%)MC of CNX Nifty Junior
Share in Total MC (%)
Mar-07 3,367,350 1,909,448 56.70 323,308 9.60Apr-07 3,650,368 2,096,100 57.42 321,560 8.81May-07 3,898,078 2,206,712 56.61 343,150 8.80Jun-07 3,978,381 2,219,151 55.78 388,710 9.77Jul-07 4,317,571 2,358,907 54.64 397,396 9.20Aug-07 4,296,994 2,331,929 54.27 393,906 9.17Sep-07 4,886,561 2,774,625 56.78 448,284 9.17Oct-07 5,722,227 3,328,356 58.17 487,986 8.53Nov-07 5,876,742 3,257,297 55.43 525,730 8.95Dec-07 6,543,272 3,522,527 53.83 643,625 9.84Jan-08 5,295,387 2,966,421 56.02 522,450 9.87Feb-08 5,419,942 3,016,694 55.66 528,511 9.75Mar-08 4,858,122 2,848,773 58.64 453,625 9.34Apr-08 5,442,780 3,108,589 57.11 522,020 9.59 May-08 5,098,873 2,933,759 57.54 468,104 9.18 Jun-08 4,103,651 2,434,104 59.32 379,051 9.24 Jul-08 4,432,427 2,617,902 59.06 421,873 9.52 Aug-08 4,472,461 2,639,434 59.02 434,157 9.71 Sep-08 3,900,185 2,406,508 61.70 385,721 9.89 Oct-08 2,820,388 1,785,998 63.32 273,943 9.71 Nov-08 2,653,281 1,706,210 64.31 245,652 9.26 Dec-08 2,916,768 1,832,610 62.83 295,471 10.13 Jan-09 2,798,707 1,790,600 63.98 269,166 9.62 Feb-09 2,675,622 1,721,191 64.33 253,285 9.47 Mar-09 2,896,194 1,892,629 65.35 286,405 9.89
Contd...
Table 4-9 : Composition of S&P CNX Nifty Index as on March 31, 2009
Sl. No.
Name of Security Issued Capital
Market Capitali-
sation
Weightage Beta R2 Volatility Return Impact Cost
(Rs. cr.) (Rs. cr.) (%) (%) (%) (%) 1 ABB Ltd.–Electrical
Equipment42 9,042 0.48 0.89 0.53 2.36 16.20 0.09
2 ACC Ltd.–Cement And Cement Products
188 10,781 0.57 0.70 0.38 2.22 6.36 0.08
3 Ambuja Cements Ltd.–Cement And Cement Products
304 10,750 0.57 0.88 0.41 2.25 11.09 0.13
4 Axis Bank Ltd.–Banks 1,898 14,897 0.79 1.38 0.62 5.61 19.27 0.10
5 Bharti Airtel Ltd.–Telecommunication - Services
490 118,782 6.28 0.96 0.61 2.79 (2.00) 0.09
6 Bharat Heavy Electricals Ltd.–Electrical Equipment
362 73,944 3.91 1.02 0.59 2.92 7.60 0.07
7 Bharat Petroleum Corporation Ltd.–Refineries
1,779 13,596 0.72 0.52 0.17 2.63 (1.79) 0.08
8 Cairn India Ltd.–Oil Exploration/Production
155 34,918 1.84 1.00 0.38 3.00 10.21 0.10
Contd...
82
Contd...
Sl. No.
Name of Security Issued Capital
Market Capitali-
sation
Weightage Beta R2 Volatility Return Impact Cost
(Rs. cr.) (Rs. cr.) (%) (%) (%) (%) 9 Cipla Ltd.–Pharmaceuticals 341 17,104 0.90 0.51 0.31 1.83 14.91 0.1010 DLF Ltd.–Construction 84 28,395 1.50 1.54 0.56 4.73 10.07 0.1011 GAIL (India) Ltd.–Gas 846 31,154 1.65 0.79 0.44 2.86 20.63 0.1112 Grasim Industries
Ltd.–Cement And Cement Products
92 14,504 0.77 0.72 0.37 2.72 15.22 0.07
13 HCL Technologies Ltd.–Computers - Software
133 6,835 0.36 1.00 0.38 3.18 1.85 0.12
14 Housing Development Finance Corporation Ltd.–Finance - Housing
284 40,171 2.12 1.24 0.62 4.16 10.80 0.07
15 HDFC Bank Ltd.–Banks 354 41,406 2.19 1.04 0.59 3.25 9.43 0.0916 Hero Honda Motors
Ltd.–Automobiles - 2 And 3 Wheelers
40 21,390 1.13 0.36 0.17 2.19 15.21 0.07
17 Hindalco Industries Ltd.–Aluminium
123 8,851 0.47 1.18 0.55 4.41 34.84 0.11
18 Hindustan Unilever Ltd.–Diversified
218 51,770 2.74 0.44 0.27 2.26 (6.31) 0.09
19 ICICI Bank Ltd.–Banks 1,111 37,034 1.96 1.64 0.74 5.28 1.60 0.0820 Idea Cellular Ltd.–
Telecommunication - Services
2,635 15,531 0.82 1.09 0.50 3.33 6.60 0.14
21 Infosys Technologies Ltd.–Computers - Software
286 75,837 4.01 0.70 0.41 2.26 7.52 0.06
22 ITC Ltd.–Cigarettes 377 69,770 3.69 0.53 0.36 2.67 0.98 0.0923 Larsen & Toubro Ltd.–
Engineering58 39,316 2.08 1.12 0.67 3.51 9.39 0.08
24 Mahindra & Mahindra Ltd.–Automobiles - 4 Wheelers
246 10,697 0.57 0.98 0.40 3.07 23.08 0.09
25 Maruti Suzuki India Ltd.–Automobiles - 4 Wheelers
144 22,531 1.19 0.72 0.37 2.44 15.14 0.07
26 National Aluminium Co. Ltd.–Aluminium
644 13,830 0.73 0.98 0.32 3.16 3.07 0.15
27 NTPC Ltd.–Power 8,245 148,295 7.84 0.79 0.56 2.04 (2.78) 0.0928 Oil & Natural Gas
Corporation Ltd.–Oil Exploration/Production
2,139 166,875 8.82 0.85 0.55 2.78 12.91 0.10
29 Punjab National Bank–Banks
315 12,973 0.69 0.96 0.52 5.08 21.88 0.09
30 Power Grid Corporation Of India Ltd.–Power
4,209 40,237 2.13 0.82 0.48 1.89 (1.34) 0.11
31 Ranbaxy Laboratories Ltd.–Pharmaceuticals
187 6,966 0.37 0.70 0.18 4.36 2.41 0.07
32 Reliance Communications Ltd.–Telecommunication - Services
1,032 36,090 1.91 1.50 0.59 4.62 12.48 0.08
33 Reliance Capital Ltd.–Finance
237 8,682 0.46 1.56 0.64 5.93 0.26 0.06
34 Reliance Industries Ltd.–Refineries
1,454 239,965 12.68 1.25 0.74 3.34 20.43 0.05
35 Reliance Infrastructure Ltd.–Power
4,500 11,743 0.62 1.79 0.74 5.03 4.99 0.06
Contd...
83
Contd...
Sl. No.
Name of Security Issued Capital
Market Capitali-
sation
Weightage Beta R2 Volatility Return Impact Cost
(Rs. cr.) (Rs. cr.) (%) (%) (%) (%) 36 Reliance Petroleum Ltd.–
Refineries4,130 42,795 2.26 1.03 0.64 3.09 24.56 0.08
37 Reliance Power Ltd.–Power
134 24,531 1.30 1.04 0.25 3.34 2.40 0.09
38 Steel Authority Of India Ltd–Steel And Steel Products
632 39,838 2.10 1.28 0.55 4.67 26.82 0.09
39 State Bank Of India–Banks 67 67,748 3.58 1.10 0.64 3.86 4.08 0.0640 Siemens Ltd.–Electrical
Equipment142 9,039 0.48 0.99 0.41 3.63 23.07 0.09
41 Sterlite Industries (India) Ltd.–Metals
104 25,335 1.34 1.34 0.53 3.66 46.05 0.07
42 Sun Pharmaceutical Industries Ltd.–Pharmaceuticals
299 23,020 1.22 0.28 0.08 2.36 9.23 0.07
43 Suzlon Energy Ltd.–Electrical Equipment
285 6,345 0.34 1.55 0.49 4.16 4.18 0.09
44 Tata Communications Ltd.–Telecommunication - Services
386 14,773 0.78 1.03 0.45 3.20 28.19 0.11
45 Tata Motors Ltd.–Automobiles - 4 Wheelers
220 8,112 0.43 1.15 0.50 5.15 20.76 0.07
46 Tata Power Co. Ltd.–Power
731 17,019 0.90 1.03 0.52 3.86 5.74 0.08
47 Tata Steel Ltd.–Steel And Steel Products
98 15,047 0.80 1.44 0.62 5.49 19.16 0.07
48 Tata Consultancy Services Ltd.–Computers - Software
325 52,703 2.78 0.90 0.44 3.88 11.48 0.09
49 Unitech Ltd.–Construction 292 5,666 0.30 1.68 0.42 5.31 23.54 0.1250 Wipro Ltd.–Computers
- Software43 35,999 1.90 0.99 0.52 2.70 18.51 0.08
Total 43,440 1,892,629 100.00 1.00 – 2.34 9.31 0.08
* Beta & R2 are calculated for the period 01-April-2008 to 31-March-2009* Beta measures thedegree to which any portfolio of stocks is affected as compared to the effect on the
market as a whole.* The coefficient of determination (R2) measures the strength of relationship between two variables the
return ona security versus that of the market.* Volatility is the Std. deviation of the daily returns for the period 01-March-2009 to 31-March-2009* Last day of trading was 31-March-2009* Impact Cost for S&P CNX Nifty is for a portfolio of Rs. 50 Lakhs* Impact Cost for S&P CNX Nifty is the weightage average impact cost
84
Contd...
Table 4-10 : Composition of CNX NIFTY Junior Index - as on March 31, 2009
Sl. No.
Name of Security Issued Capital
Market Capitali-
sation
Weigh- tage
Beta R2 Volatility Returns Impact Cost
(Rs. cr.) (Rs. cr.) (%) (%) (%) (%)
1 Aditya Birla Nuvo Ltd. --Textiles - Synthetic
95 4,227 1.48 0.85 0.40 4.70 7.01 0.23
2 Adani Enterprises Ltd. --Trading
25 6,600 2.30 0.89 0.44 1.49 9.36 0.25
3 Andhra Bank --Banks 485 2,192 0.77 0.79 0.50 3.45 4.87 0.184 Apollo Tyres Ltd. --
Tyres 50 920 0.32 0.55 0.19 6.70 21.26 0.24
5 Ashok Leyland Ltd. --Automobiles - 4 Wheelers
133 2,415 0.84 0.70 0.38 3.21 8.36 0.18
6 Asian Paints Ltd. --Paints
96 7,543 2.63 0.26 0.12 1.74 -0.01 0.30
7 Bank of Baroda --Banks 364 8,537 2.98 0.89 0.48 4.35 6.47 0.138 Bank of India --Banks 525 11,522 4.02 1.09 0.58 3.99 -2.73 0.129 Bharat Electronics Ltd.
--Electronics - Industrial 80 7,074 2.47 0.52 0.27 1.74 2.71 0.15
10 Bharat Forge Ltd. --Castings/Forgings
45 2,179 0.76 0.72 0.30 4.41 3.16 0.20
11 Biocon Ltd. --Pharmaceuticals
100 2,863 1.00 0.62 0.25 3.61 40.69 0.19
12 Canara Bank --Banks 410 6,794 2.37 0.80 0.44 2.51 0.09 0.1313 Chennai Petroleum
Corporation Ltd. --Refineries
149 1,406 0.49 0.70 0.36 2.78 4.19 0.17
14 Container Corporation of India Ltd. --Travel And Transport
130 9,344 3.26 0.31 0.13 1.33 13.19 0.26
15 Corporation Bank --Banks
143 2,591 0.90 0.61 0.38 1.97 8.08 0.21
16 Cummins India Ltd. --Diesel Engines
40 3,663 1.28 0.53 0.29 1.99 18.51 0.25
17 Dr. Reddy’s Laboratories Ltd. --Pharmaceuticals
84 8,256 2.88 0.38 0.14 3.36 25.10 0.14
18 Glaxosmithkline Pharmaceuticals Ltd. --Pharmaceuticals
85 9,253 3.23 0.14 0.06 1.79 -8.98 0.14
19 Glenmark Pharmaceuticals Ltd. --Pharmaceuticals
25 3,931 1.37 0.71 0.15 4.28 8.39 0.14
20 GMR Infrastructure Ltd. --Construction
364 17,269 6.03 1.26 0.56 4.13 20.14 0.16
21 Housing Development and Infrastructure Ltd. --Construction
275 2,255 0.79 1.75 0.59 4.57 11.59 0.12
22 IDBI Bank Ltd. --Banks 725 3,290 1.15 1.07 0.71 3.49 -6.20 0.1523 Infrastructure
Development Finance Co. Ltd. --Financial Institution
1,295 7,007 2.45 1.43 0.61 3.52 2.27 0.13
24 IFCI Ltd. --Financial Institution
762 1,471 0.51 1.54 0.66 3.62 6.63 0.17
85
Contd...
Contd...
Sl. No.
Name of Security Issued Capital
Market Capitali-
sation
Weigh- tage
Beta R2 Volatility Returns Impact Cost
(Rs. cr.) (Rs. cr.) (%) (%) (%) (%)
25 Indian Hotels Co. Ltd. --Hotels
72 2,854 1.00 0.56 0.31 1.93 9.28 0.18
26 Indian Overseas Bank --Banks
545 2,484 0.87 0.97 0.49 3.97 -1.62 0.15
27 Jindal Steel & Power Ltd. --Steel And Steel Products
15 18,644 6.51 1.18 0.52 2.67 15.59 0.11
28 Jaiprakash Associates Ltd. --Diversified
237 9,956 3.48 1.85 0.72 5.54 27.42 0.12
29 JSW Steel Ltd. --Steel And Steel Products
187 4,355 1.52 1.19 0.40 5.72 23.72 0.13
30 Kotak Mahindra Bank Ltd. --Banks
346 9,755 3.41 1.34 0.64 4.84 8.77 0.14
31 LIC Housing Finance Ltd. --Finance - Housing
85 1,906 0.67 1.15 0.53 3.34 10.51 0.12
32 Lupin Ltd. --Pharmaceuticals
83 5,669 1.98 0.49 0.22 2.78 5.43 0.14
33 United Spirits Ltd. --Brew/Distilleries
100 6,500 2.27 0.95 0.26 3.59 4.21 0.09
34 Moser Baer India Ltd. --Computers - Hardware
168 894 0.31 1.19 0.45 3.70 6.63 0.17
35 Mphasis Ltd. --Computers - Software
209 4,247 1.48 0.70 0.25 3.33 20.62 0.18
36 Mangalore Refinery & Petrochemicals Ltd. --Refineries
1,753 7,187 2.51 0.91 0.46 1.60 4.86 0.24
37 Mundra Port and Special Economic Zone Ltd. --Travel And Transport
401 12,954 4.52 0.84 0.32 3.29 -5.37 0.20
38 Oracle Financial Services Software Ltd. --Computers - Software
42 6,219 2.17 0.80 0.28 4.00 3.32 0.16
39 Patni Computer Systems Ltd. --Computers - Software
26 1,651 0.58 0.61 0.26 3.28 31.95 0.20
40 Power Finance Corporation Ltd. --Financial Institution
1,148 16,597 5.79 0.83 0.49 2.74 0.17 0.19
41 Raymond Ltd. --Textile Products
61 467 0.16 0.49 0.22 2.75 -1.99 0.22
42 Reliance Natural Resources Ltd. --Gas
817 7,325 2.56 1.52 0.62 6.20 8.73 0.11
43 Sesa Goa Ltd. --Mining 79 7,841 2.74 0.91 0.35 4.55 22.96 0.0944 Syndicate Bank --Banks 522 2,508 0.88 0.67 0.41 4.61 -1.54 0.1545 Tech Mahindra Ltd. --
Computers - Software 122 3,227 1.13 0.92 0.38 2.26 6.62 0.14
46 Tata Teleservices (Maharashtra) Ltd. --Telecommunication - Services
1,897 4,335 1.51 0.89 0.44 6.13 -3.18 0.16
86
Contd...
Sl. No.
Name of Security Issued Capital
Market Capitali-
sation
Weigh- tage
Beta R2 Volatility Returns Impact Cost
(Rs. cr.) (Rs. cr.) (%) (%) (%) (%)
47 UltraTech Cement Ltd. --Cement And Cement Products
124 6,864 2.40 0.60 0.27 3.21 17.28 0.23
48 Union Bank of India --Banks
505 7,418 2.59 0.82 0.46 3.66 13.31 0.15
49 Vijaya Bank --Banks 434 1,012 0.35 0.73 0.52 2.63 -2.71 0.1550 Wockhardt Ltd. --
Pharmaceuticals 55 934 0.33 0.63 0.36 4.33 6.22 0.24
Total 16,517 286,405 100 1.00 -- 8.94 2.38 0.16
* Beta & R2 are calculated for the period 01-April-2008 to 31-March 2009* Beta measures the degree to which any portfolio of stocks is affected as compared to the effect on the market as a
whole.* The coefficient of determination (R2) measures the strength of relationship between two variables, the return on a
security versus that of the market.* Volatility is the Std. deviation of the daily returns for the period 01-March 2009 to 31-March 2009* Last day of trading was 31 March 2009* Impact Cost for CNX Nifty Junior is for a portfolio of Rs. 25 lakhs * Impact Cost for CNX Nifty Junior is the weightage average impact cost
Table 4-11 : Industry-wise Weightages of S&P CNX NIFTY Securities as on 31st March, 2009
Sl. No. Industry Market Cap Weightage(Rs. cr.)
1 Refineries 296,356 15.66%2 Telecommunication - Services 185,176 9.78%3 Computers - Software 180,056 9.51%4 Power 241,824 12.78%5 Banks 159,162 8.41%6 Oil Exploration 201,792 10.66%7 Electrical Equipment 98,371 5.20%8 Construction 34,060 1.80%9 Steel & Steel Products 54,884 2.90%10 Engineering 39,316 2.08%11 Cigarettes 69,770 3.69%12 Pharmaceuticals 47,090 2.49%13 Finance - Housing 40,171 2.12%14 Automobile - 4 wheelers 41,340 2.18%15 Cement & Cement Products 36,034 1.90%16 Metals 25,335 1.34%17 Diversified 51,770 2.74%18 Aluminium 22,682 1.20%19 Gas 31,154 1.65%20 Automohiles - 2 and 3 wheelers 21,390 1.13%21 Media & Entertainment 14,897 0.79%
Total 1,892,629 100.00%
87
Table 4-12 : S&P CNX NIFTY Index*
Month & Year Open High Low Close Volatility (%)
Price To Earning Ratio#
1995-96 (Nov.-Mar.) 1000.00 1067.49 813.12 985.30 1.62 –1996-97 988.33 1203.11 775.43 968.30 1.67 –1997-98 931.95 1297.10 929.05 1116.90 1.52 –1998-99 1117.15 1247.15 800.10 1078.05 1.86 16.531999-2000 1082.55 1818.15 916.00 1528.45 1.93 24.602000-01 1528.70 1636.95 1098.75 1148.20 1.98 17.212001-02 1148.10 1207.00 849.95 1129.55 1.40 18.102002-03 1129.85 1153.30 920.10 978.20 0.99 13.362003-04 977.40 2014.65 920.00 1771.90 1.43 20.702004-05 1771.45 2183.45 1292.20 2035.65 1.61 14.602005-06 2035.90 3433.85 1896.30 3402.55 1.04 20.262006-07 3403.15 4245.30 2595.65 3821.55 1.77 18.40Apr-07 3820.00 4217.90 3617.00 4087.90 1.73 19.48May-07 4089.45 4306.75 3981.15 4295.80 0.86 20.41Jun-07 4296.05 4362.95 4100.80 4318.30 0.84 20.60Jul-07 4318.40 4647.95 4304.00 4528.85 1.15 20.49Aug-07 4528.85 4532.90 4002.20 4464.00 2.04 20.20Sep-07 4466.65 5055.80 4445.55 5021.35 1.08 22.58Oct-07 5021.50 5976.00 5000.95 5900.65 2.48 25.74Nov-07 5903.80 6011.95 5394.35 5762.75 1.73 25.21Dec-07 5765.45 6185.40 5676.70 6138.60 1.67 27.62Jan-08 6136.75 6357.10 4448.50 5137.45 3.27 21.97Feb-08 5140.60 5545.20 4803.60 5223.50 2.46 22.27Mar-08 5222.80 5222.80 4468.55 4734.50 3.04 20.632007-08 3820.00 6357.10 3617.00 4734.50 2.02 20.63Apr-08 4735.65 5230.75 4628.75 5165.90 1.28 22.20May-08 5265.30 5298.85 4801.90 4870.10 1.21 20.74Jun-08 4869.25 4908.80 4021.70 4040.55 1.91 17.28Jul-08 4039.75 4539.45 3790.20 4332.95 2.97 18.22Aug-08 4331.60 4649.85 4201.85 4360.00 1.61 18.43Sep-08 4356.10 4558.00 3715.05 3921.20 2.32 16.85Oct-08 3921.85 4000.50 2252.75 2885.60 5.03 12.57Nov-08 2885.40 3240.55 2502.90 2755.10 3.83 12.08Dec-08 2755.15 3110.45 2570.70 2959.15 2.46 12.97Jan-09 2963.30 3147.20 2661.65 2874.80 2.73 13.40Feb-09 2872.35 2969.75 2677.55 2763.65 1.81 13.12Mar-09 2764.60 3123.35 2539.45 3020.95 2.34 14.302008-09 4735.65 5298.85 2252.75 3020.95 2.66 14.30
* S&P CNX Nifty commenced from November 3, 1995# At the end of the periodNote : Volatility is calculated as standard deviation of the Natural Log of returns for the respective month/
year.
88
Table 4-13 : CNX NIFTY Junior Index*
Month & Year Open High Low Close Volatility (%)
Price To Earning Ratio#
1996-97 (Nov.-Mar.) 1000.00 1208.87 907.02 1032.95 1.76 –1997-98 1028.30 1395.25 1016.65 1339.40 1.44 –1998-99 1339.75 2079.10 1177.20 2069.20 2.14 18.921999-2000 2099.75 5365.90 1631.90 3695.75 2.46 33.472000-01 3720.45 3771.80 1570.20 1601.80 2.75 9.692001-02 1601.40 1676.25 1038.75 1566.95 1.60 6.802002-03 1568.40 1690.35 1231.95 1259.55 1.23 11.682003-04 1260.75 3702.60 1259.75 3392.05 1.57 11.932004-05 3398.00 4705.25 2493.70 4275.15 1.83 13.822005-06 4275.35 6437.40 3998.80 6412.10 0.95 20.252006-07 6415.25 7566.65 4463.75 6878.05 2.05 18.48Apr-07 6675.85 7554.55 6559.55 7527.30 1.53 17.23May-07 7610.45 8153.05 7429.15 8022.55 0.95 17.30Jun-07 8047.10 8708.35 7799.70 8699.05 1.10 20.19Jul-07 8720.50 9247.00 8564.30 8849.60 1.13 18.71Aug-07 8829.65 8966.25 7700.20 8632.75 2.30 18.51Sep-07 8658.20 9838.30 8658.20 9820.90 1.11 21.06Oct-07 9831.65 10726.65 8908.55 10643.30 2.85 21.43Nov-07 10757.05 11740.95 10020.35 11431.65 2.05 23.09Dec-07 11471.60 12533.95 11455.05 12488.25 1.70 26.48Jan-08 12488.65 13209.35 8336.55 10130.00 4.40 19.89Feb-08 10269.75 10684.40 9025.60 9636.10 2.42 19.56Mar-08 9526.40 9526.40 7235.25 7975.75 4.16 16.692007-08 6675.85 13209.35 6559.55 7975.75 2.41 16.69Apr-08 7982.75 9272.25 7699.35 9170.95 1.40 18.96May-08 9236.40 9541.00 8075.50 8221.35 1.72 16.27Jun-08 8228.20 8305.15 6201.05 6233.20 2.43 12.08Jul-08 6239.20 7363.20 5756.85 6936.80 3.68 13.15Aug-08 6877.80 7177.15 6799.55 7138.30 2.02 13.68Sep-08 7118.20 7400.25 5633.10 6043.15 2.48 12.13Oct-08 6070.10 6203.65 3603.20 4291.30 4.83 8.44Nov-08 4435.40 4937.65 3706.70 3848.85 3.19 7.53Dec-08 3853.85 4695.30 3675.50 4555.70 2.30 8.99Jan-09 4568.55 5007.25 3964.95 4230.15 2.94 8.60Feb-09 4214.15 4337.65 3869.25 3980.55 1.70 8.12Mar-09 3941.55 4405.60 3587.60 4336.45 2.38 8.692008-09 7982.75 9541.00 3587.60 4336.45 2.80 8.69
* CNX Nifty Junior commenced from November 4, 1996.# At the end of periodNote : Volatility is calculated as standard deviation of the Natural Log of returns for the respective month/
year
89
Table 4-14 : Performance of NSE Indices during the year 2008-09
Indices Record high Date Closing index values
(31-03-09)
Average Daily
Volatility
Y-o-Y Returns
Value
S&P CNX Nifty 5298.85 02-May-2008 3020.95 2.65 -36.26
CNX Junior 9541.00 05-May-2008 4336.45 2.79 -45.07
CNX 100 5089.95 05-May-2008 2833.55 2.65 -37.53
S&P CNX 500 4315.95 05-May-2008 2294.85 2.50 -39.89
CNX Midcap 7192.40 05-May-2008 3407.45 2.14 -45.11
Nifty Midcap 50 2823.10 05-May-2008 1165.00 2.58 -50.87
CNX FMCG 6346.89 07-May-2008 5134.66 1.75 -17.11
CNX IT 4773.65 02-Jun-2008 2318.70 2.86 -36.90
Finance 5600.00 02-May-2008 1824.86 3.05 -60.87
Petrochemicals 6600.15 21-May-2008 3222.47 2.39 -31.10
Pharmaceuticals 5402.18 17-Jun-2008 3465.02 1.58 -23.46
Table 4-15 : Details of Mutual Funds and Exchange Traded Funds Listed on NSE
A: List of Mutual Funds (MF’s) and Exchange Traded Funds (ETF’s)
MUTUAL FUNDS
Sr. No.
Symbol Company Name Date of Listing
1 FTCSF3YDIV Franklin Templeton Mutual Fund-Capital Safety Fund-3Y (Divdend Option)
28-May-2007
2 FTCSF3YGRO Franklin Templeton Mutual Fund-Capital Saftey Fund 3Y (Growth Option)
28-May-2007
3 FTCSF5YDIV Franklin Templeton Mutual Fund-Capital Safety Fund-5Y Dividend Option
28-May-2007
4 FTCSF5YGRO Franklin Templeton Mutual Fund-Capital Safety Fund-5Y (Growth Option)
28-May-2007
5 FTCPOF3YDV Franklin Templeton Capital Protection Oriented Fund 25-Jun-2007
6 FTCPOF3YGR Franklin Templeton Capital Protection Oriented Fund 25-Jun-2007
7 FTCPOF5YDV Franklin Templeton Capital Protection Oriented Fund 25-Jun-2007
8 FTCPOF5YGR Franklin Templeton Capital Protection Oriented Fund 25-Jun-2007
9 UFTI5-10DP UTI Mutual Fund (Fixed Term Income Fund-SrV-Plan X-Ret Div Payout Opt)
26-Mar-2009
10 UFTI5-10DR UTI Mutual Fund (Fixed Term Income Fund-SrV-PlanX-Ret Div Reinvst Opt)
26-Mar-2009
11 UFTI5-10GP UTI Mutual Fund (Fixed Term Income Fund-SrV-Plan X-Retail Growth Opt)
26-Mar-2009
Contd...
90
B : No of Trades and Trading Value
Month & Year
Mutual Funds(MF’s)
Exchange traded funds(ETF’s)
No. of Trades
Trading Value No. of Trades
Trading Value
(Rs. cr.) (US $ mn.) (Rs. cr.) (US $ mn.)
Apr-07 4,676 16.51 4.13 31,467 129.28 32.34
May-07 5,476 15.39 3.85 27,911 94.37 23.61
Jun-07 5,507 24.33 6.09 19,449 106.16 26.56
Jul-07 7,544 24.67 6.17 16,105 123.30 30.85
Aug-07 6,241 17.22 4.31 15,400 174.79 43.73
Sep-07 7,043 24.53 6.14 15,818 123.99 31.02
Oct-07 10,241 37.15 9.29 20,505 260.64 65.21
Nov-07 7,169 20.94 5.24 26,693 162.94 40.76
Dec-07 6,640 29.51 7.38 15,971 134.05 33.54
Jan-08 26,382 36.71 9.18 28,646 190.24 47.59
Feb-08 12,522 18.56 4.64 24,398 153.39 38.38
Mar-08 7,731 23.31 5.83 51,728 259.42 64.90
2007-08 107,172 288.84 72.26 294,091 1,912.55 478.50
Sr. No.
Symbol Company Name Date of Listing
1 NIFTYBEES Benchmark Mutual Fund 8-Jan-2002
2 JUNIORBEES Benchmark Mutual Fund-Nifty Junior Benchmark ETF 6-Mar-2003
3 UTISUNDER UTI Mutual Fund 16-Jul-2003
4 LIQUIDBEES Benchmark Asset Management Company Private Limited 16-Jul-2003
5 BANKBEES Benchmark Asset Management Company Pvt. Ltd. 4-Jun-2004
6 GOLDBEES Benchmark Mutual Fund - Gold Benchmark Exchange Traded Scheme
19-Mar-2007
7 GOLDSHARE UTI Mutual Fund - UTI Gold Exchange Traded Fund 17-Apr-2007
8 KOTAKGOLD Kotak Mutual Fund - Gold Exchange Traded Fund 8-Aug-2007
9 PSUBNKBEES Benchmark Mutual Fund - PSU Bank Benchmark Exchange Traded Scheme
1-Nov-2007
10 KOTAKPSUBK Kotak Mahindra Mutual Fund 16-Nov-2007
11 RELGOLD Reliance Mutual Fund - Gold Exchange Traded Fund 26-Nov-2007
12 QGOLDHALF Quantum Gold Fund -Exchange Traded Fund (ETF) 28-Feb-2008
13 RELBANK Reliance Mutual Fund -Banking Exchange Traded Fund (ETF)
27-Jun-2008
14 QNIFTY Quantum Index Fund -Exchange Traded Fund (ETF) 18-Jul-2008
Contd...
Contd...
EXCHANGE TRADED FUNDS
91
Table 4-16 : Settlement Cycle and Process in CM Segment
Settlement Cycle
Activity T+2 Rolling Settlement (From April 1, 2003)
Trading T
Custodial Confirmation T+1
Determination of Obligation T+1
Securities/Funds Pay-in T+2
Securities/Funds Pay-out T+2
Valuation Debit T+2
Auction T+3
Bad Delivery Reporting T+4
Auction Pay-in/Pay-out T+5
Close Out T+5
Rectified Bad Delivery Pay-in/Pay-out T+6
Re-bad Delivery Reporting T+8
Close Out of Re-bad Delivery T+9
Month & Year
Mutual Funds(MF’s)
Exchange traded funds(ETF’s)
No. of Trades
Trading Value No. of Trades
Trading Value
(Rs. cr.) (US $ mn.) (Rs. cr.) (US $ mn.)
Apr-08 5,632 18.97 3.72 34,930 588.88 115.58
May-08 4,605 17.19 3.37 52,396 221.75 43.52
Jun-08 5,247 26.29 5.16 50,864 252.92 49.64
Jul-08 4,685 68.13 13.37 67,007 584.22 114.67
Aug-08 2,742 14.18 2.78 81,896 237.00 46.52
Sep-08 5,622 21.35 4.19 88,739 486.11 95.41
Oct-08 5,253 20.47 4.02 147,770 541.54 106.29
Nov-08 2,513 7.09 1.39 119,429 277.60 54.48
Dec-08 2,338 14.99 2.94 111,034 309.10 60.67
Jan-09 685 0.90 0.18 85,273 268.22 52.64
Feb-09 384 0.47 0.09 102,870 310.93 61.03
Mar-09 531 0.92 0.18 95,849 322.24 63.25
2008-09 40,237 210.95 41.40 1,038,057 4,400.50 863.69
Contd...
92
Tab
le 4
-17
: Set
tlem
ent S
tatis
tics i
n C
M S
egm
ent
Mon
th/Y
ear
No.
of
Tra
des
Tra
ded
Qua
ntit
y Q
uant
ity
of S
hare
s D
eliv
e-ra
ble
% o
f Sh
ares
D
eliv
e-ra
ble
to
Tot
al
Shar
es
Tra
ded
Tra
ding
V
olum
e T
radi
ng
Vol
ume
Val
ue o
f Sh
ares
D
eliv
e-ra
ble
%of
D
eliv
e-ra
ble
to
Val
ue o
f Sh
ares
T
rade
d
Secu
riti
es
Pay
-in
Shor
t D
eliv
ery
(Auc
tion
ed
quan
tity
)
% o
f Sh
ort
Del
iver
y to
Tot
al
Del
ive-
rabl
e
Unr
ecti
fied
B
ad
Del
iver
y (A
ucti
oned
qu
anti
ty)
% o
f U
nrec
ti-
fied
Bad
D
eliv
ery
to
Del
ive-
rabl
e
Fun
ds
Pay
-in
(lakh
)(la
kh)
(lakh
)(R
s. c
r.)
(US
$ m
n.)
(Rs.
cr.
)(R
s. c
r.)
(lakh
)(la
kh)
(Rs.
cr.
)
Nov
94-
Mar
95
3
1,3
30
688
51
.74
1,7
28
-- 8
98
51.9
7 6
11
6
0.85
1.7
6 0.
26 3
00
1995
-96
64
39,
010
7,2
64
18.6
2 6
5,74
2 --
11,
775
17.9
1 5
,805
1
79
2.46
32.
17
0.44
3,2
58
1996
-97
262
1
34,3
17
16,
453
12.2
5 2
92,3
14
-- 3
2,64
0 11
.17
13,
790
382
2.
3266
.25
0.40
7,2
12
1997
-98
383
1
35,2
17
22,
051
16.3
1 3
70,0
10
-- 5
9,77
5 16
.15
21,
713
333
1.
51 7
2.90
0.
33 1
0,82
7
1998
-99
550
165,
310
27,9
9116
.93
413,
573
--66
,204
16.0
130
,755
305
1.09
69.7
30.
2512
,175
1999
-00
958
238,
605
48,7
1320
.42
803,
050
184,
099
82,6
0710
.29
79,7
8363
51.
3011
0.13
0.23
27,9
92
2000
-01
1,61
430
4,19
650
,203
16.5
01,
263,
898
270,
990
106,
277
8.41
94,9
6233
90.
6811
.58
0.02
345
,937
2001
-200
21,
720
274,
695
59,2
9921
.59
508,
121
104,
123
71,7
6614
.12
64,3
5336
40.
610.
080.
0001
28,0
48
2002
-03
2,39
736
5,40
382
,353
22.5
462
1,56
913
0,85
787
,956
14.1
587
,447
469
0.57
0.00
0.00
0034
,092
2003
-04
3,75
070
4,53
317
5,55
024
.92
1,09
0,96
325
1,43
222
1,36
420
.29
220,
341
1,01
40.
580.
000.
0081
,588
2004
-05
4,50
378
7,99
620
2,27
725
.67
1,14
0,96
926
0,79
327
7,10
124
.29
276,
120
871
0.43
0.00
0.00
97,2
41
2005
-06
6,00
081
8,43
822
7,24
027
.77
1,51
6,83
934
0,02
240
9,35
326
.99
407,
976
894
0.39
0.00
0.00
131,
426
2006
-07
7,85
7 85
0,51
5 23
9,07
4 28
.11
1,94
0,09
4 44
5,07
854
4,43
4 28
.06
543
,048
7
69
0.32
0.00
0.00
173,
188
Apr
-07
674
76,
643
20,6
19
26.9
016
8,18
1 42
,077
48
,349
28
.75
48,2
28
520.
250.
000.
0014
,528
May
-07
786
95,
458
24,6
35
25.8
119
9,17
0 49
,830
55
,670
27
.95
55,5
30
640.
260.
000.
0015
,431
Jun-
0775
2 7
7,90
9 21
,663
27
.81
192,
100
48,0
61
52,8
25
27.5
0 52
,702
57
0.27
0.00
0.00
15,0
74
Jul-0
789
0 10
6,88
2 30
,283
28
.33
264,
949
66,2
87
75,3
49
28.4
4 75
,147
97
0.32
0.00
0.00
20,9
38
Aug
-07
871
101,
384
25,7
53
25.4
022
6,23
9 56
,602
63
,766
28
.19
63,6
51
620.
240.
000.
0024
,264
Sep-
0789
4 13
5,86
5 34
,119
25
.11
252,
895
63,2
71
73,0
52
28.8
9 72
,837
93
0.27
0.00
0.00
21,4
96
Con
td...
93
Con
td...
Mon
th/Y
ear
No.
of
Tra
des
Tra
ded
Qua
ntit
y Q
uant
ity
of S
hare
s D
eliv
e-ra
ble
% o
f Sh
ares
D
eliv
e-ra
ble
to
Tot
al
Shar
es
Tra
ded
Tra
ding
V
olum
e T
radi
ng
Vol
ume
Val
ue o
f Sh
ares
D
eliv
e-ra
ble
%of
D
eliv
e-ra
ble
to
Val
ue o
f Sh
ares
T
rade
d
Secu
riti
es
Pay
-in
Shor
t D
eliv
ery
(Auc
tion
ed
quan
tity
)
% o
f Sh
ort
Del
iver
y to
Tot
al
Del
ive-
rabl
e
Unr
ecti
fied
B
ad
Del
iver
y (A
ucti
oned
qu
anti
ty)
% o
f U
nrec
ti-
fied
Bad
D
eliv
ery
to
Del
ive-
rabl
e
Fun
ds
Pay
-in
(lakh
)(la
kh)
(lakh
)(R
s. c
r.)
(US
$ m
n.)
(Rs.
cr.
)(R
s. c
r.)
(lakh
)(la
kh)
(Rs.
cr.
)
Oct
-07
1,20
7 17
2,47
9 41
,641
24
.14
444,
407
111,
185
121,
822
27.4
1 12
1,56
1 10
80.
260.
000.
0041
,417
Nov
-07
1,19
3 16
9,62
2 37
,921
22
.36
415,
129
103,
860
107,
494
25.8
9 10
7,26
8 10
80.
280.
000.
0031
,607
Dec
-07
1,07
7 16
3,03
7 40
,474
24
.83
374,
515
93,6
99
110,
578
29.5
3 11
0,27
7 13
30.
330.
000.
0031
,670
Jan-
081,
262
167,
860
41,5
81
24.7
744
9,26
1 11
2,40
0 12
6,80
8 28
.23
126,
552
122
0.29
0.00
0.00
45,5
24
Feb-
081,
057
111,
923
24,3
63
21.7
728
1,39
5 70
,402
7
2,12
3 25
.63
72,0
14
510.
210.
000.
0025
,790
Mar
-08
982
102,
166
24,9
18
24.3
925
1,67
6 62
,966
6
4,96
7 25
.81
64,8
52
490.
200.
000.
0021
,804
2007
-08
11,6
45
1,48
1,22
9 36
7,97
1 24
.84
3,51
9,91
9 88
0,64
0 97
2,80
3 27
.64
970
,618
99
7 0.
270.
000.
0030
9,54
3
Apr
-08
1,06
9 11
1,36
4 24
,919
22
.38
262,
423
51,5
06
63,
492
24.1
963
,383
55
0.
220.
000.
0019
,339
May
-08
1,07
9 11
5,49
9 25
,379
21
.97
278,
962
54,7
52
68,
903
24.7
068
,799
54
0.
210.
000.
0021
,745
Jun-
081,
122
110,
685
23,8
71
21.5
727
2,69
7 53
,522
6
4,33
0 23
.59
64,2
17
55
0.23
0.00
0.00
22,2
16
Jul-0
81,
329
131,
998
25,3
11
19.1
829
0,69
9 57
,056
6
1,40
6 21
.12
61,3
11
55
0.22
0.00
0.00
21,0
15
Aug
-08
1,08
2 10
6,90
9 22
,822
21
.35
238,
279
46,7
67
54,
447
22.8
554
,369
43
0.
190.
000.
0017
,862
Sep-
081,
054
95,5
56
24,0
74
25.1
924
7,18
9 48
,516
6
1,03
9 24
.69
60,9
34
44
0.18
0.00
0.00
26,2
08
Oct
-08
1,22
6 11
1,15
7 28
,655
25
.78
230,
192
45,1
80
54,
690
23.7
654
,585
67
0.
230.
000.
0025
,889
Nov
-08
1,11
9 10
9,96
8 24
,724
22
.48
178,
208
34,9
77
36,
880
20.6
936
,811
40
0.
160.
000.
0014
,772
Dec
-08
1,29
0 14
2,29
4 28
,148
19
.78
213,
387
41,8
82
40,
854
19.1
540
,800
47
0.
170.
000.
0015
,075
Jan-
091,
211
141,
964
27,6
42
19.4
718
7,39
3 36
,780
3
6,52
9 19
.49
36,4
64
48
0.17
0.00
0.00
12,7
26
Feb-
091,
002
116,
896
21,7
98
18.6
5 15
2,62
5 29
,956
3
0,26
0 19
.83
30,2
08
42
0.19
0.
000.
0010
,525
Mar
-09
1,05
7 12
4,64
0 26
,581
21
.33
1973
95.5
38,7
43
38,
706
19.6
1 38
,617
75
0.28
0.
000.
0013
,332
2008
-09
13,
639
1,41
8,92
8 30
3,92
5 21
.42
2,74
9,45
0 53
9,63
7 61
1,53
5 22
.44
610
,498
6
25
0.21
0.00
0.00
220,
704
94
Wholesale Debt Market Segment 5
96
97
5Wholesale Debt Market Segment
The Exchange started its trading operations in June 1994 by enabling the Wholesale Debt Market (WDM) segment of the Exchange. This segment provides a trading platform for a wide range of fixed income securities that includes Central government securities, treasury bills (T-bills), state development loans (SDLs), bonds issued by public sector undertakings (PSUs), floating rate bonds (FRBs), zero coupon bonds (ZCBs), index bonds, commercial papers (CPs), certificates of deposit (CDs), corporate debentures, SLR and non-SLR bonds issued by financial institutions (FIs), bonds issued by foreign institutions and units of mutual funds (MFs).
To further encourage wider participation of all classes of investors, including the retail investors, the Retail Debt Market segment (RDM) was launched on January 16, 2003. This segment provides for a nation wide, anonymous, order driven, screen based trading system in government securities. The settlement cycle is same as in the case of equity market i.e., T+2 rolling settlement cycle.
Trading Mechanism
The WDM trading system, known as NEAT (National Exchange for Automated Trading), is a fully automated screen based trading system that enables members across the country to trade simultaneously with enormous ease and efficiency. It supports an anonymous order driven market which operates on a price/time priority and provides tremendous flexibility to users in terms of orders with various time/price/quantity related conditions that can be placed on the system. It also provides on-line market information like total order depth, best buys and sells available, quantity traded, the high, low and last traded price for securities are available at all points of time.
The WDM Trading system provides two market sub-types: continuous market and negotiated market. In the continuous market, the buyer and seller do not know each other and they put their best buy/sell orders, which are stored in order book with price/time priority. If orders match, it results into a trade. The trades in WDM segment are settled directly between the participants, who take an exposure to the settlement risk attached to any unknown counter-party. In the NEAT-WDM system, all participants can set up their counter-party exposure limits against all probable counter-parties. This enables the trading member/participant to reduce/ minimize the counter-party risk associated with the counter-party to trade. A trade does not take place if both the buy/sell participants do not invoke the counter-party exposure limit in the trading system.
In the negotiated market, the trades are normally decided by the seller and the buyer outside the exchange, and reported to the Exchange through a trading member for approval. Thus, deals negotiated or structured outside the exchange are disclosed to the market through NEAT-WDM system. In negotiated market, as buyers and sellers know each other and have agreed to trade, no counter-party exposure limit needs to be invoked.
98
The trades on the WDM segment could be either outright trades or repo transactions with settlement cycle of T+2 and repo periods (1 to 14 days). For every trade, it is necessary to specify the number of settlement days and the trade type (repo or non-repo), and in the event of a repo trade, the repo term and repo rate.
Market Performance
Turnover
The trading volume on the WDM Segment of the Exchange witnessed a year on year increase of 19.00 % from Rs. 282,317 crore (US $ 70,632 million) during 2007-08 to Rs. 335,952 crore (US $ 65,937 million) during 2008-09. The average daily trading volume also accelerated from Rs.1,138 crore (US $ 285 million) during 2007-08 to Rs.1,412 crore (US $ 277 million) in fiscal 2008-09. The highest recorded WDM trading volume of Rs. 13,912 crore ( US $ 3,206 million) was registered on August 25, 2003. The business growth of the WDM segment is presented in Table 5-1 and Chart 5-1.
Chart 5-1 : Business Growth of WDM Segment
The transactions in government securities accounted for a substantial share of 69.74 % during 2008-09 on the WDM segment. The details of transactions in different securities are presented in Table 5-2. and Chart 5-2a There were no repo transactions recorded from the fiscal 2005-06 onwards till the current fiscal. The WDM’s SGL Outright Transactions as a percentage to the total SGL Outright transactions was 43.81 % in 2008-09.
The participant-wise distribution of WDM trades is presented in Table 5-3 and Chart 5-2(b). The trading members accounted for 44.65 % of the total WDM trades followed by foreign banks which held a share of 27.26 %. Share of Indian banks in WDM trades
99
declined to 18.11 % during 2008-09 as compared with its share of 23.78 % in the corresponding period last year.
Chart 5-2 (a) : Security-wise Distribution of WDM Trades (2008-09)
Chart 5-2 (b) : Participant-wise distribution of WDM trades (2008-09)
The share of top ‘N’ securities/trading members/participants in turnover in WDM segment is presented in Table 5-4. The share of top ‘10’ securities decreased from 53.31 % in 2007-08 to 43.05 % in 2008-09. The share of top ‘50’ and top ‘100’ securities accounted for 72.45% and 83.87% respectively in the current year.
100
Market Capitalisation
Market capitalisation of the WDM segment has witnessed a constant increase indicating an increase in the number of securities available for trading on this segment. Total market capitalisation of the securities available for trading on WDM segment stood at Rs. 2,848,315 crore (US $ 559,041 million) as on March 31, 2009. Central Government securities accounted for the largest share of the market capitalisation with 64.95%. The details of market capitalisation of WDM securities are presented in Table 5-5.
Transaction Charges
The Exchange has waived the transaction charges for the Wholesale Debt Market segment of the Exchange for the period April 1, 2009 to March 31, 2010.
Settlement
Settlement is on a rolling basis, i.e. there is no account period settlement. Each order has a unique settlement date specified upfront at the time of order entry and used as a matching parameter. It is mandatory for trades to be settled on the predefined settlement date. The Exchange currently allows settlement periods ranging from same day (T+0) settlement to a maximum of (T+2) for non-government securities while settlement of all outright secondary market transactions in government securities was standardized to T+1. In case of repo transactions in government securities, first leg can be settled either on T+0 basis or T+1 basis.
In case of government securities, the actual settlement of funds and securities are effected directly between participants or through Reserve Bank of India (RBI). All trades in government securities are reported to RBI-SGL through the Negotiated Dealing System (NDS) of RBI, and Clearing Corporation of India Limited (CCIL) provides settlement guarantee for transactions in government securities including repos. The trades are settled on a net basis through the DvP-III system. In the DvP-III, the settlement of Securities and Funds are carried out on a net basis.
For securities other than government securities and T-bills, trades are settled on a gross basis directly between participants on delivery versus payment basis.
On the scheduled settlement date, the Exchange provides data/information to the respective member/participant regarding trades to be settled on that day with details like security, counter party and consideration.
The settlement details for non-government securities, i.e. certificate no., Cheque no., constituent etc. are reported by the member/participant to the Exchange.
The Exchange closely monitors the settlement of transactions through the reporting of settlement details by members and participants. In case of deferment of settlement or cancellation of trade, participants are required to seek prior approval from the Exchange. For any dispute arising in respect of the trades or settlement, the exchange has established arbitration mechanism for resolving the same.
101
FIMMDA-NSE MIBID/MIBOR
A reference rate is an accurate measure of the market price. In the fixed income market, it is an interest rate that the market respects and closely matches. On these lines, NSE has been computing and disseminating the NSE Mumbai Inter-bank Bid Rate (MIBID) and NSE Mumbai Inter-bank Offer Rate (MIBOR) for the overnight money market from June 15, 1998, the 3 day rates from June 06, 2008, the 14-day MIBID/MIBOR from November 10, 1998 and the 1 month and 3 month MIBID/MIBOR from December 1, 1998. In view of the robust methodology of computation of these rates and their extensive use by market participants, these have been co-branded with Fixed Income and Money Market Dealers Association (FIMMDA) from March 4, 2002. These are now known as FIMMDA-NSE MIBID/MIBOR. These are presented in Table 5-6. The Chart 5-3 presents overnight MIBID/MIBOR for 2008-09.
Chart 5-3 : Overnight MIBID/MIBOR Rates, from 02nd April 2008 to 31st March 2009
FIMMDA-NSE MIBID/MIBOR are based on rates polled by NSE from a representative panel of 33 banks /primary dealers. Overnight Rates for Saturdays is calculated and disseminated at 1030Hrs (IST). The 3 day rates are polled and processed on the last working day of the week. The rates are broadcast through NEAT-WDM trading system immediately on release and also disseminated through websites of NSE and FIMMDA , through leading information vendors ,financial dailies and email.
The FIMMDA-NSE MIBID/MIBOR is used as a benchmark rate for majority of deals struck for interest rate swaps, forward rate agreements, floating rate debentures and term deposits.
102
Zero Coupon Yield Curve
Keeping in mind the requirements of the banking industry, financial institutions, mutual funds, insurance companies, etc. that have substantial investment in sovereign papers, NSE disseminates a ‘Zero Coupon Yield Curve’ (NSE Zero Curve) to help in valuation of securities across all maturities irrespective of its liquidity in the market. This product has been developed by using Nelson-Siegel functional form to estimate the term structure of interest rate at any given point of time and been successfully tested by using daily WDM trades data. This is being disseminated daily.
The ZCYC depicts the relationship between spot interest rates in the economy and the associated term to maturity. It provides daily estimates of the term structure of interest rates using information on secondary market trades in government securities from the WDM segment. The term structure forms the basis for the valuation of all fixed income instruments. Modelled as a series of cashflows due at different points of time in the future, the underlying price of such an instrument is calculated as the net present value of the stream of cashflows. Each cashflow, in such a formulation, is discounted using the interest rate for the associated term to maturity; the appropriate rates are read off the estimated ZCYC. Once estimated, the interest rate-maturity mapping is used to compute underlying valuations even for securities that do not trade on a given day. Changes in the economy cause shifts in the term structure, changing the underlying valuations of fixed income instruments. The daily ZCYC captures these changes, and is used to track the value of portfolios of government securities on a day-to-day basis.
Chart 5-4 plots the spot interest rates at different maturities for the year 2008-09.
Chart 5-4 : Zero Coupon Yield Curve, 2008-09
103
NSE-VaR System
NSE has developed a VaR system for measuring the market risk inherent in Government of India (GOI) securities. NSE-VaR system builds on the NSE database of daily yield curves (ZCYC) and provides measures of VaR using 5 alternative methods (variance-covariance (normal), historical simulation method, weighted normal, weighted historical simulation and extreme value method). Together, these 5 methods provide a range of options for market participants to choose from.
NSE-VaR system releases daily estimates of security-wise VaR at 1-day and multi-day horizons for securities traded on WDM segment of NSE and all outstanding GoI securities with effect from January 1, 2002. Participants can compute their portfolio risk as weighted average of security-wise VaRs, the weights being proportionate to the market value of a given security in their portfolio. 1-day VaR (99%) measure for GoI Securities traded on NSE-WDM on March 31, 2009 is presented in Table 5-7.
GOI-Bond Index
The increased activity in the government securities market in India and simultaneous emergence of mutual (gilt) funds has given rise to the need for a well defined Bond Index to measure returns in the bond market. The NSE-Government Securities Index prices components off the NSE Benchmark ZCYC, so that the movements reflect returns to an investor on account of change in interest rates only, and not those arising on account of the impact of idiosyncratic factors. The index provides a benchmark for portfolio management by various investment managers and gilt funds. It also forms the basis for designing index funds and for derivative products such as options and futures. Some of the salient features of this index are:• The base date for the index is 1st January 1997 and the base date index value is 100• The index is calculated on a daily basis from 1st January 1997 onwards; weekends
and holidays are ignored. • The index uses all Government of India bonds issued after April 1992. These
were issued on the basis of an auction mechanism that imparted some amount of market-relatedness to their pricing. Bonds issued prior to 1992 were on the basis of administered interest rates.
• Each day, the prices for all these bonds are estimated off the NSE Benchmark-ZCYC for the day.
• The constituents are weighted by their market capitalisation.• Computations are based on arithmetic and not geometric calculations. • The index uses a chain-link methodology i.e. today’s values are based on the
previous value times the change since the previous calculations. This gives the index the ability to add new issues and remove old issues when redeemed.
• Coupons and redemption payments are assumed to be re-invested back into the index in proportion to the constituent weights.
• Both the Total Returns Index and the Principal Returns Index are computed. • The indices provided are: Composite, 1-3, 3-8, 8+ years, TB index, GS index.
104
Tab
le 5
-1 :
Busi
ness
Gro
wth
of W
DM
Seg
men
t
Mon
th/Y
ear
All
Tra
des
Ret
ail T
rade
No.
of
activ
e se
curi
ties
Num
ber
of T
rade
sT
radi
ng V
olum
eA
vera
ge D
aily
Tra
ding
V
olum
eA
vera
ge
Tra
de
Size
Num
ber
of T
rade
sT
radi
ng V
olum
eSh
are
in T
otal
T
radi
ng V
olum
e
(Rs.
cr.)
( US
$ m
n) (R
s. cr
.)( U
S $
mn)
(Rs.
cr.)
(Rs.
cr.)
( US
$ m
n)(%
)
1994
- 95
(Jun
e-M
arch
) 1
83
1,02
16,
781
–30
–6.
6416
831
.00
–0.
4519
95-9
6 3
04
2,99
111
,868
–41
–3.
971,
115
207.
00–
1.74
1996
-97
524
7,
804
42,2
78–
145
–5.
421,
061
201.
00–
0.47
1997
-98
719
16
,821
111,
263
–38
5–
6.61
1,39
028
8.66
–0.
2619
98-9
9 1
,071
16
,092
105,
469
24,8
5736
586
6.55
1,52
230
7.77
72.5
40.
2919
99-0
0 1
,057
46
,987
304,
216
69,7
421,
035
237
6.47
936
217.
7649
.92
0.07
2000
-01
1,0
38
64,4
7042
8,58
291
,891
1,48
331
86.
6549
813
1.00
28.0
90.
0320
01-0
2 9
79
144,
851
947,
190
194,
096
3,27
767
26.
5437
811
0.00
22.5
40.
0120
02-0
3 1
,123
16
7,77
81,
068,
701
224,
990
3,59
875
86.
371,
252
300.
0063
.16
0.03
2003
-04
1,0
78
189,
518
1,31
6,09
630
3,31
84,
477
1,03
26.
941,
400
331.
7069
.83
0.03
2004
-05
1,1
51
124,
308
887,
294
202,
810
3,02
869
27.
141,
278
410.
1393
.74
0.05
2005
-06
897
6
1,89
1 4
75,5
23
106
,596
1
,755
39
3 7
.68
892
3
10.0
0 6
9.49
0.
07
2006
-07
762
1
9,57
5 2
19,1
06
50,
265
898
20
6 1
1.19
3
99
102
.52
23.
29
0.05
A
pr-0
7 9
8 9
28
17,
159
4,2
93
903
2
26
18.
49
12
3.0
9 0
.75
0.02
M
ay-0
7 1
45
1,0
93
17,
483
4,3
74
833
2
08
16.
00
18
6.0
0 1
.50
0.03
Ju
n-07
143
1
,065
1
7,33
5 4
,337
8
25
207
1
6.28
3
8 6
.00
1.5
0 0.
03
Jul-0
7 1
84
2,0
89
33,
815
8,4
60
1,5
37
385
1
6.19
9
3
.00
0.7
5 0.
01
Aug
-07
128
1
,230
2
1,43
1 5
,362
1
,021
2
55
17.
42
8
4.0
0 1
.00
0.02
Se
p-07
148
9
34
16,
902
4,2
29
845
2
11
18.
10
27
4.0
0 1
.00
0.02
Con
td...
105
Mon
th/Y
ear
All
Tra
des
Ret
ail T
rade
No.
of
activ
e se
curi
ties
Num
ber
of T
rade
sT
radi
ng V
olum
eA
vera
ge D
aily
Tra
ding
V
olum
eA
vera
ge
Tra
de
Size
Num
ber
of T
rade
sT
radi
ng V
olum
eSh
are
in T
otal
T
radi
ng V
olum
e
(Rs.
cr.)
( US
$ m
n) (R
s. cr
.)( U
S $
mn)
(Rs.
cr.)
(Rs.
cr.)
( US
$ m
n)(%
)
Oct
-07
147
1
,411
2
5,49
3 6
,378
1
,159
2
90
18.
07
10
4.0
0 1
.00
0.02
N
ov-0
7 1
10
1,0
83
17,
704
4,4
29
843
2
11
16.
35
7
2.0
0 0
.50
0.01
D
ec-0
7 1
17
1,5
85
32,
865
8,2
23
1,7
30
433
2
0.74
1
2 4
.00
1.0
0 0.
01
Jan-
08 1
44
2,3
59
42,
724
10,
689
1,8
58
465
1
8.11
2
7 7
.00
1.7
5 0.
02
Feb-
08 1
18
1,4
97
24,
044
6,0
15
1,1
45
286
1
6.06
7
2
.00
0.5
0 0.
01
Mar
-08
148
9
05
15,
362
3,8
43
853
2
14
16.
97
36
4.0
0 1
.00
0.03
20
07-0
8 6
01
16,
179
282
,317
7
0,63
2 1
,138
2
85
17.
45
211
4
9.00
12.
26
0.02
A
pr-0
8 1
22
1,0
16
19,
893
3,9
04
995
1
95
19.5
86
2.10
0.41
0.01
May
-08
137
1
,200
2
0,65
6 4
,054
1
,033
2
03
17.2
13
0.35
0.07
0.00
Jun-
08 1
90
956
1
8,23
3 3
,579
8
68
170
19
.07
106
20.3
53.
980.
11Ju
l-08
127
8
15
18,
745
3,6
79
815
1
60
23.0
010
3.39
0.67
0.02
Aug
-08
75
594
1
1,50
2 2
,257
6
05
119
19
.36
164.
980.
980.
04Se
p-08
124
7
83
19,
779
3,8
82
989
1
94
25.2
612
3.43
0.67
0.02
Oct
-08
126
9
22
19,
966
3,9
19
1,1
09
218
21
.66
102.
450.
480.
01N
ov-0
8 1
40
1,0
93
23,
143
4,5
42
1,2
86
252
21
.17
72.
790.
550.
01D
ec-0
8 2
18
2,8
57
46,
864
9,1
98
2,2
32
438
16
.40
116.
031.
180.
01Ja
n-09
232
2
,218
4
5,01
5 8
,835
2
,251
4
42
20.3
015
4.77
0.94
0.01
Feb-
09 2
21
1,8
91
42,
949
8,4
30
2,2
60
444
22
.71
285.
781.
130.
01M
ar-0
9 2
65
1,7
84
49,
205
9,6
58
2,5
90
508
27
.58
337.
171.
410.
0120
08-2
009
711
1
6,12
9 3
35,9
52
65,
937
1,4
12
277
20
.83
257
64.0
012
.56
0.02
Con
td...
106
Tab
le 5
-2 :
Secu
rity
-wis
e D
istr
ibut
ion
of W
DM
Tra
des
Mon
th &
Yea
rT
urno
ver
(In
Rs.
Cr.
)T
urno
ver
(In
%)
Gov
ernm
ent
Secu
riti
esT
-Bill
s P
SU /
Inst
. B
onds
/Oth
ers
Oth
ers
Tot
al T
urno
ver
Gov
ernm
ent
Secu
riti
esT
-Bill
s P
SU /
Inst
. Bon
dsO
ther
s
1995
-96
7,72
92,
260
1,14
972
911
,868
65.1
319
.04
9.69
6.14
1996
-97
27,3
52
10,9
572,
769
1,19
942
,278
64.7
025
.92
6.55
2.84
1997
-98
84,7
16
18,8
70
4,05
03,
627
111,
263
76.1
416
.96
3.64
3.26
1998
-99
84,5
76
10,7
05
5,04
15,
147
105,
469
80.1
910
.15
4.78
4.88
1999
-00
282,
891
11,0
13
4,86
75,
445
304,
216
92.9
93.
621.
601.
79
2000
-01
390,
952
23,1
43
7,88
6 6,
600
428,
582
91.2
25.
401.
841.
54
2001
-02
902,
105
25,5
7410
,987
8,61
994
7,19
195
.24
2.70
1.16
0.91
2003
-03
1,00
0,51
8 32
,275
19
,985
15
,924
1,06
8,70
193
.62
3.02
1.87
1.49
2003
-04
1,21
8,70
5 55
,671
27
,112
14,6
091,
316,
096
92.6
04.
232.
061.
11
2004
-05
724,
830
124,
842
17,8
3519
,787
887,
294
81.6
914
.07
2.01
2.23
2005
-06
345,
563
105,
233
12,1
7312
,554
475,
523
72.6
722
.13
2.56
2.64
2006
-07
153,
370
51,9
54
4,41
89,
365
219,
106
70.0
023
.71
2.02
4.27
Apr
-07
12,0
99
4,30
7 16
558
917
,159
70.5
125
.10
0.96
3.43
May
-07
11,6
06
4,77
8 18
591
417
,483
66.3
827
.33
1.06
5.23
Jun-
079,
964
6,20
9 25
790
517
,335
57.4
835
.82
1.48
5.22
Jul-0
722
,632
7,
260
2,29
61,
626
33,8
1566
.93
21.4
76.
794.
81
Aug
-07
14,1
93
5,35
5 88
999
221
,431
66.2
324
.99
4.15
4.63
Sep-
0712
,433
3,27
7 36
782
716
,902
73.5
619
.39
2.17
4.89
Oct
-07
11,7
6511
,230
1,
275
1,22
425
,493
46.1
5 44
.05
5.00
4.80
Con
td...
107
Con
td...
Mon
th &
Yea
rT
urno
ver
(In
Rs.
Cr.
)T
urno
ver
(In
%)
Gov
ernm
ent
Secu
riti
esT
-Bill
s P
SU /
Inst
. B
onds
/Oth
ers
Oth
ers
Tot
al T
urno
ver
Gov
ernm
ent
Secu
riti
esT
-Bill
s P
SU /
Inst
. Bon
dsO
ther
s
Nov
-07
10,9
145,
547
455
788
17,7
0461
.65
31.3
32.
574.
45
Dec
-07
26,2
895,
567
316
693
32,8
6579
.99
16.9
40.
962.
11
Jan-
0832
,082
6,35
3 1,
619
2,67
042
,724
75.0
914
.87
3.79
6.25
Feb-
0819
,014
3,24
4 1,
007
779
24,0
4479
.08
13.4
94.
193.
24
Mar
-08
11,3
552,
937
401
668
15,3
6273
.92
19.1
22.
614.
35
2007
-08
194,
347
66,0
62
9,23
212
,676
282,
317
68.8
423
.40
3.27
4.49
Apr
-08
13,4
66
3,75
1 1,
886
790
19,8
9367
.69
18.8
59.
483.
97
May
-08
16,2
93
2,36
5 1,
201
798
20,6
5678
.88
11.4
55.
813.
87
Jun-
0812
,026
3,
145
1,65
41,
407
18,2
3365
.96
17.2
59.
077.
72
Jul-0
813
,831
3,
034
553
1,32
618
,745
73.7
916
.19
2.95
7.07
Aug
-08
8,24
3 2,
643
377
238
11,5
0271
.67
22.9
83.
282.
07
Sep-
0812
,854
5,
212
939
774
19,7
7964
.99
26.3
54.
753.
91
Oct
-08
13,8
59
3,83
6 1,
887
384
19,9
6669
.41
19.2
19.
451.
92
Nov
-08
16,5
26
4,96
0 96
569
323
,143
71.4
121
.43
4.17
2.99
Dec
-08
32,7
25
6,95
2 5,
093
2,09
546
,864
69.8
314
.83
10.8
74.
47
Jan-
0933
,734
4,
251
5,16
0 1,
870
45,0
1574
.94
9.44
11.4
64.
15
Feb-
0927
,053
8,
152
5,28
7 2,
457
42,9
4962
.99
18.9
812
.31
5.72
Mar
-09
33,6
77
8,52
2 5,
006
2,00
049
,205
68.4
417
.32
10.1
74.
06
2008
-200
923
4,28
8 56
,824
30
,008
14
,831
335,
952
69.7
416
.91
8.93
4.41
108
Tab
le 5
-3 :
Part
icip
ant w
ise
Dis
trib
utio
n of
WD
M T
urno
ver
Mon
th/Y
ear
Tur
nove
r (I
n R
s.C
r.)
Tur
nove
r (I
n %
)T
radi
ng
Mem
bers
F
Is/M
Fs/
C
orpo
rate
sP
rim
ary
Dea
lers
In
dian
B
anks
F
orei
gn
Ban
ks
Tot
al
Tur
nove
rT
radi
ng
Mem
bers
F
Is/M
Fs/
C
orpo
rate
sP
rim
ary
Dea
lers
In
dian
Ban
ks
For
eign
Ban
ks
1994
-95
(Jun
e-M
arch
)3,
921
436
1 96
0 1,
463
6,78
1 57
.82
6.43
0.02
14.1
621
.57
1995
-96
2,78
790
2 13
83,
569
4,47
311
,868
23.4
87.
601.
1630
.07
37.6
9
1996
-97
9,70
31,
611
2,57
912
,688
15,6
9842
,278
22.9
53.
816.
1030
.01
37.1
3
1997
-98
21,9
75 4
,784
13,4
1845
,885
25
,201
11
1,26
3 19
.75
4.30
12.0
641
.24
22.6
5
1998
-99
16,3
27 5
,200
15
,441
44,4
2424
,079
105,
469
15.4
84.
9314
.64
42.1
222
.83
1999
-00
56,6
7512
,716
59
,079
12
9,96
1 45
,785
30
4,21
6 18
.63
4.18
19.4
242
.72
15.0
5
2000
-01
99,6
0217
,915
94
,888
14
3,74
6 72
,430
42
8,58
2 23
.24
4.18
22.1
433
.54
16.9
0
2001
-02
222,
779
39,4
03
213,
118
346,
672
125,
219
947,
191
23.5
24.
1622
.50
36.6
013
.22
2002
-03
265,
145
40,2
90
235,
435
414,
336
113,
496
1,06
8,70
1 24
.81
3.77
22.0
338
.77
10.6
2
2003
-04
458,
001
60,0
14
224,
131
478,
533
95,4
17
1,31
6,09
6 34
.80
4.56
17.0
336
.36
7.25
2004
-05
301,
325
45,6
07
164,
149
265,
212
111,
000
887,
294
33.9
65.
1418
.50
29.8
912
.51
2005
-06
152,
215
18,6
41
104,
092
133,
479
67,0
9647
5,52
332
.01
3.92
21.8
928
.07
14.1
1
2006
-07
67,6
605,
916
43,4
2757
,033
45
,070
219,
106
30.8
82.
7019
.82
26.0
320
.57
Apr
-07
5,2
06
319
2
,902
4
,811
3
,921
1
7,15
9 30
.34
1.86
16.9
128
.04
22.8
5
May
-07
7,1
40
135
1
,962
4
,142
4
,105
1
7,48
3 40
.84
0.77
11.2
223
.69
23.4
8
Jun-
07 6
,600
2
69
2,2
47
4,8
14
3,4
05
17,
335
38.0
71.
5512
.96
27.7
719
.64
Jul-0
7 1
3,60
4 1
,150
4
,149
9
,272
5
,640
3
3,81
5 40
.23
3.40
12.2
727
.42
16.6
8
Aug
-07
9,8
07
606
1
,633
4
,087
5
,298
2
1,43
1 45
.76
2.83
7.62
19.0
724
.72
Sep-
07 7
,670
3
38
887
3
,776
4
,231
1
6,90
2 45
.38
2.00
5.25
22.3
425
.03
Con
td...
109
Con
td...
Mon
th/Y
ear
Tur
nove
r (I
n R
s.C
r.)
Tur
nove
r (I
n %
)T
radi
ng
Mem
bers
F
Is/M
Fs/
C
orpo
rate
sP
rim
ary
Dea
lers
In
dian
B
anks
F
orei
gn
Ban
ks
Tot
al
Tur
nove
rT
radi
ng
Mem
bers
F
Is/M
Fs/
C
orpo
rate
sP
rim
ary
Dea
lers
In
dian
Ban
ks
For
eign
Ban
ks
Oct
-07
12,
380
398
1
,412
6
,057
5
,247
2
5,49
3 48
.56
1.56
5.54
23.7
620
.58
Nov
-07
7,3
47
338
1
,238
3
,015
5
,766
1
7,70
4 41
.50
1.91
6.99
17.0
332
.57
Dec
-07
10,
639
792
2
,363
8
,466
1
0,60
6 3
2,86
5 32
.37
2.41
7.19
25.7
632
.27
Jan-
08 1
6,15
4 1
,226
3
,004
9
,429
1
2,91
1 4
2,72
4 37
.81
2.87
7.03
22.0
730
.22
Feb-
08 7
,201
7
57
1,8
63
6,0
47
8,1
75
24,
044
29.9
53.
157.
7525
.15
34.0
0
Mar
-08
3,9
59
273
7
45
3,2
18
7,1
66
15,
362
25.7
71.
784.
8520
.95
46.6
5
2007
-08
107
,704
6
,606
2
4,39
2 6
7,13
5 7
6,48
0 2
82,3
17
38.1
52.
348.
6423
.78
27.0
9
Apr
-08
7,0
16
400
1
,102
3
,233
8
,142
1
9,89
3 35
.27
2.01
5.54
16.2
540
.93
May
-08
5,5
83
361
1
,739
5
,540
7
,432
2
0,65
6 27
.03
1.75
8.42
26.8
235
.98
Jun-
08 6
,755
3
30
841
3
,306
7
,002
1
8,23
3 37
.05
1.81
4.61
18.1
3 3
8.40
Jul-0
8 8
,746
1
74
1,4
30
3,4
88
4,9
06
18,
745
46.6
60.
937.
6318
.61
26.1
7
Aug
-08
5,3
84
109
1
,064
1
,856
3
,088
1
1,50
2 46
.81
0.95
9.25
16.1
426
.85
Sep-
08 9
,969
1
35
775
3
,054
5
,847
1
9,77
9 50
.40
0.68
3.92
15.4
429
.56
Oct
-08
7,4
35
1,2
32
1,7
37
3,7
54
5,8
08
19,
966
37.2
46.
178.
7018
.80
29.0
9
Nov
-08
8,5
47
1,4
35
1,5
21
3,7
26
7,9
15
23,
143
36.9
36.
206.
5716
.10
34.2
0
Dec
-08
22,
898
2,0
57
4,5
46
9,7
76
7,5
87
46,
864
48.8
64.
399.
7020
.86
16.1
9
Jan-
09 2
1,33
7 1
,373
3
,412
5
,388
1
3,50
5 4
5,01
5 47
.40
3.05
7.58
11.9
730
.00
Feb-
09 2
1,27
3 1
,503
2
,414
6
,983
1
0,77
6 4
2,94
9 49
.53
3.50
5.62
16.2
625
.09
Mar
-09
25,
070
2,2
98
1,5
25
10,
746
9,5
66
49,
205
50.9
54.
673.
1021
.84
19.4
4
2008
-09
150
,014
1
1,40
8 2
2,10
6 6
0,85
1 9
1,57
3 3
35,9
52
44.6
53.
406.
5818
.11
27.2
6
110
Table 5-4 : Share of Top ‘N’ Securities/Trading Members/Participants in Turnover in WDM Segment.
Year In PercentTop 5 Top 10 Top 25 Top 50 Top 100
Securities1994-95 42.84 61.05 80.46 89.81 97.161995-96 57.59 69.46 79.60 86.58 93.241996-97 32.93 48.02 65.65 78.32 90.171997-98 30.65 46.92 71.25 85.00 92.151998-99 26.81 41.89 64.30 78.24 86.661999-00 37.11 55.57 82.12 90.73 95.282000-01 42.20 58.30 80.73 89.97 95.132001-02 51.61 68.50 88.73 94.32 97.192002-03 43.10 65.15 86.91 92.74 96.132003-04 37.06 54.43 81.58 90.66 95.142004-05 43.70 57.51 71.72 80.59 89.552005-06 47.42 59.78 72.02 81.04 89.362006-07 40.90 51.29 65.82 77.15 86.912007-08 39.65 53.31 68.35 79.64 89.552008-09 31.31 43.05 60.42 72.45 83.87Trading Members1994-95 51.99 73.05 95.37 100.00 –1995-96 44.36 68.58 96.10 100.00 –1996-97 30.02 51.27 91.57 99.96 100.001997-98 27.17 47.85 83.38 99.82 100.001998-99 29.87 50.45 86.55 99.98 100.001999-00 32.38 53.41 84.46 100.00 –2000-01 35.17 54.25 86.82 100.00 –2001-02 35.18 58.68 88.36 100.00 –2002-03 31.77 53.71 85.49 100.00 –2003-04 30.72 53.01 86.71 100.00 –2004-05 35.75 56.84 86.74 100.00 –2005-06 39.68 60.63 89.38 100.00 –2006-07 57.75 78.01 96.43 100.00 –2007-08 65.32 80.24 97.60 100.00 –2008-09 69.92 82.89 98.38 100.00 –Participants1994-95 18.37 27.38 38.40 42.20 –1995-96 29.66 47.15 70.49 76.32 76.581996-97 25.27 44.92 67.00 76.33 77.101997-98 23.60 38.96 65.59 77.96 80.221998-99 22.47 37.39 62.79 79.27 84.511999-00 15.54 27.87 52.51 74.76 81.322000-01 17.51 28.85 50.64 69.72 76.782001-02 17.49 29.25 50.19 69.16 76.492002-03 17.27 28.29 49.22 68.14 75.202003-04 16.66 25.96 44.25 59.87 65.172004-05 16.82 28.64 47.24 61.71 66.002005-06 17.5 30.53 53.61 65.84 67.972006-07 25.85 40.65 59.99 68.17 69.092007-08 28.36 40.64 55.58 61.77 61.842008-09 24.08 38.24 51.19 55.34 55.38
111
Tab
le 5
-5 :
Mar
ket C
apita
lisat
ion
of W
DM
Sec
uriti
es
Mon
th/
Yea
rG
ovt.
se
curi
ties
PSU
bon
dsSt
ate
loan
sT
-bill
sO
ther
sT
otal
Tot
alG
ovt.
se
curi
ties
PSU
bon
ds
Stat
e lo
ans
T-b
ills
Oth
ers
(Rs.
cr)
(US
$ m
n)(in
per
cent
)
Jun-
9460
,719
2
0,43
9 1,
833
18,4
76
20,0
52
121,
518
38,6
6349
.97
16.8
21.
5115
.20
16.5
0
Mar
-95
86,1
75
25,6
75
5,86
7 17
,129
23
,334
15
8,18
150
,328
54.4
816
.23
3.71
10.8
314
.75
Mar
-96
125,
492
30,0
74
13,8
50
8,45
2 29
,915
20
7,78
360
,490
60.4
014
.47
6.67
4.07
14.4
0
Mar
-97
169,
830
36,2
11
18,8
91
13,4
60
54,3
80
292,
772
81,5
9858
.01
12.3
76.
454.
6018
.57
Mar
-98
196,
290
35,3
23
23,9
89
17,4
97
70,0
91
343,
191
86,8
18
57.2
010
.29
6.99
5.10
20.4
2
Mar
-99
260,
002
34,9
94
30,5
16
11,2
92
74,6
66
411,
470
96,9
76
63.1
98.
507.
422.
7418
.15
Mar
-00
319,
865
39,3
57
39,4
77
15,3
45
79,9
89
494,
033
113,
258
64.7
57.
977.
993.
1116
.19
Mar
-01
397,
228
36,3
65
44,6
24
17,7
25
84,8
94
580,
836
113,
258
68.3
96.
267.
683.
0514
.62
Mar
-02
542,
601
39,9
44
61,3
85
23,8
49
89,0
16
756,
794
155,
719
71.7
05.
288.
113.
1511
.76
Mar
-03
658,
002
38,3
83
72,0
94
34,9
19
61,0
84
864,
481
181,
996
76.1
24.
448.
344.
047.
06
Mar
-04
959,
302
56,8
32
79,3
40
32,6
92
87,6
98
1,21
5,86
428
0,21
878
.90
4.67
6.53
2.69
7.21
Mar
-05
1,00
6,10
7 68
,398
22
3,20
8 73
,502
90
,519
1,
461,
734
334,
111
68.8
34.
6815
.27
5.03
6.19
Mar
-06
1,05
9,78
9 88
,716
24
1,92
7 70
,186
10
6,95
6 1,
567,
574
351,
395
67.6
15.
6615
.43
4.48
6.82
Mar
-07
1,18
2,27
8 89
,628
24
9,84
7 11
5,18
3 14
7,86
5 1,
784,
801
409,
452
66.2
45.
0214
.00
6.45
8.28
Apr
-07
1,18
8,18
5 90
,289
24
5,88
8 11
9,43
3 15
3,13
4 1
,796
,928
44
9,56
9 66
.12
5.02
13.6
86.
658.
53
May
-07
1,19
3,74
9 90
,293
24
7,10
5 12
5,89
2 15
5,63
4 1
,812
,673
45
3,50
8 65
.86
4.98
13.6
36.
958.
58
Jun-
071,
216,
175
88,9
40
250,
399
144,
375
161,
619
1,8
61,5
09
465,
727
65.3
34.
7813
.45
7.76
8.68
Jul-0
71,
252,
307
91,3
00
247,
614
150,
513
162,
866
1,9
04,6
00
476,
507
65.7
54.
7913
.00
7.90
8.55
Aug
-07
1,26
8,34
4 90
,283
25
5,60
1 15
4,92
4 16
7,65
5 1
,936
,806
48
4,56
5 65
.49
4.66
13.2
08.
008.
66
Con
td...
112
Con
td...
Mon
th/
Yea
rG
ovt.
se
curi
ties
PSU
bon
dsSt
ate
loan
sT
-bill
sO
ther
sT
otal
Tot
alG
ovt.
se
curi
ties
PSU
bon
ds
Stat
e lo
ans
T-b
ills
Oth
ers
(Rs.
cr)
(US
$ m
n)(in
per
cent
)
Sep-
071,
282,
109
91,4
67
258,
683
145,
437
176,
891
1,9
54,5
86
489,
013
65.5
94.
6813
.23
7.44
9.05
Oct
-07
1,30
9,57
9 92
,094
26
3,32
9 15
5,47
3 18
0,58
5 2
,001
,060
50
0,64
1 65
.44
4.60
13.1
67.
779.
02
Nov
-07
1,31
4,98
5 94
,626
26
8,66
7 14
3,65
0 18
4,81
6 2
,006
,743
50
2,06
2 65
.53
4.72
13.3
97.
169.
21
Dec
-07
1,31
8,41
9 94
,287
27
8,96
6 12
4,16
9 18
6,74
0 2
,002
,581
50
1,02
1 65
.84
4.71
13.9
36.
209.
32
Jan-
081,
357,
485
96,5
42
294,
341
124,
393
197,
104
2,0
69,8
65
517,
855
65.5
84.
6614
.22
6.01
9.53
Feb-
081,
386,
566
97,4
33
307,
112
120,
665
201,
300
2,1
13,0
76
528,
666
65.6
24.
6114
.53
5.71
9.53
Mar
-08
1,39
2,21
9 96
,268
31
5,66
1 11
1,56
2 20
7,63
6 2,
123,
346
531,
235
65.5
74.
5314
.87
5.25
9.77
Apr
-08
1,43
7,64
3 98
,524
31
4,71
6 11
0,28
0 20
7,48
8 2
,168
,651
42
5,64
3 66
.29
4.54
14.5
15.
099.
57
May
-08
1,43
8,74
3 98
,845
31
7,97
2 12
6,46
9 21
0,15
4 2
,192
,183
43
0,26
2 65
.63
4.51
14.5
05.
779.
59
Jun-
081,
434,
072
101,
085
317,
095
133,
061
209,
648
2,1
94,9
61
430,
807
65.3
34.
6114
.45
6.06
9.55
Jul-0
81,
424,
369
101,
200
319,
827
133,
488
207,
843
2,1
86,7
27
429,
191
65.1
44.
6314
.63
6.10
9.50
Aug
-08
1,45
5,39
7 10
3,86
6 32
2,44
7 13
3,76
8 21
0,11
7 2
,225
,595
43
6,81
9 65
.39
4.67
14.4
96.
019.
44
Sep-
081,
471,
565
108,
330
325,
475
135,
187
213,
708
2,2
54,2
65
442,
447
65.2
84.
8114
.44
6.00
9.48
Oct
-08
1,53
5,82
6 10
8,92
2 32
4,21
8 14
1,68
0 21
8,95
9 2
,329
,604
45
7,23
3 65
.93
4.68
13.9
26.
089.
40
Nov
-08
1,62
1,94
2 11
1,17
8 33
2,92
3 14
6,15
4 23
0,37
2 2
,442
,569
47
9,40
5 66
.40
4.55
13.6
35.
989.
43
Dec
-08
1,80
8,27
0 11
9,16
5 34
4,72
1 14
1,88
8 25
4,87
2 2
,668
,916
52
3,83
0 67
.75
4.46
12.9
25.
329.
55
Jan-
091,
848,
128
129,
070
364,
204
145,
121
265,
364
2,7
51,8
88
540,
115
67.1
64.
6913
.23
5.27
9.64
Feb-
091,
868,
684
129,
609
376,
820
144,
336
290,
538
2,8
09,9
87
551,
518
66.5
04.
6113
.41
5.14
10.3
4
Mar
-09
1,84
9,97
1 12
9,49
9 42
2,36
2 14
7,61
7 29
8,86
7 2
,848
,315
55
9,04
1 64
.95
4.55
14.8
35.
1810
.49
113
Table 5-6 : FIMMDA NSE MIBID/MIBOR Rates 2008-09
Month/Date
OVERNIGHT AT
9.40 a.m.
3 DAY AT 9.40 a.m.
14 DAY AT 11.30 a.m.
1 MONTH RATE AT 11.30 a.m.
3 MONTH RATE AT11.30 a.m.
MIBID MIBOR MIBID MIBOR MIBID MIBOR MIBID MIBOR MIBID MIBOR
30-Apr-08 7.79 8.77 6.28 7.41 6.73 7.87 7.79 8.7731-May-08 7.53 7.93 6.51 7.53 6.88 8.07 7.89 8.8730-Jun-08 8.69 8.77 – – 8.59 9.13 8.90 9.56 9.39 9.9431-Jul-08 8.37 8.51 – – 8.58 9.28 9.07 9.89 9.62 10.3930-Aug-08 9.38 9.49 6.16 6.26 9.53 10.12 9.98 10.55 10.44 11.2229-Sep-08 13.87 14.57 – – 10.75 11.84 10.78 11.77 10.97 11.8631-Oct-08 19.14 20.30 19.48 20.73 10.24 10.63 10.13 11.08 10.84 11.7329-Nov-08 6.48 6.82 – – 9.25 8.10 9.88 8.97 10.63 10.4331-Dec-08 5.17 5.27 – – 6.27 7.19 7.58 8.04 8.45 8.8931-Jan-09 4.17 4.23 – – 5.30 5.68 6.00 6.44 7.05 7.8328-Feb-09 4.10 4.16 – – 5.04 5.37 5.72 6.18 6.99 7.6431-Mar-09 4.78 5.02 – – 5.04 5.61 5.68 6.26 7.07 7.64
Overnight : Disseminated since June 15, 1998.3 Day : Disseminated since June 06, 2008 is calculated and disseminated on every last working
day of the week14 Day : Disseminated since November 10, 1998.1 Month : Disseminated since December 1, 1998.3 Month : Disseminated Since December 1, 1998.
Table 5-7 : 1-day Value-at-Risk (99%) for Government of India Securities Traded as on March 31, 2009
Security Type
Security Name
Issue Name
Normal Weighted Normal
Historical Simulation
Weighted Historical Simulation
EVT Clean Price(off
NSE-ZCYC)
Accrued_Interest
GS CG2009 5.48% 0.224 0.485 0.287 0.449 0.258 100.27 1.64GS CG2010 11.30% 0.771 2.046 0.951 1.947 0.858 107.59 1.98GS CG2010 12.25% 0.752 1.982 0.93 1.899 0.842 108.40 3.03GS CG2010 12.29% 0.617 1.541 0.745 1.478 0.684 106.00 2.05GS CG2010 7.55% 0.72 1.875 0.877 1.84 0.805 102.61 2.87GS CG2011 6.57% 0.897 2.444 1.108 2.064 0.959 101.47 0.68GS CG2012 7.00% 1.07 2.749 1.29 4.428 1.036 101.36 0.43GS CG2013 7.27% 1.137 2.723 1.331 1.671 0.992 101.55 0.57GS CG2014 7.56% 1.211 2.665 1.308 1.388 0.967 102.22 3.11GS CG2017 7.99% 1.444 2.771 1.556 3.221 1.164 104.76 1.82GS CG2019A 6.05% 1.767 3.256 1.845 5.214 1.449 92.03 0.99TB 182D 170409 0.059 0.12 0.076 0.106 0.066 99.82 0.00TB 364D 120210 0.638 1.61 0.767 1.537 0.706 95.88 0.00TB 364D 250310 0.683 1.751 0.836 1.657 0.760 95.26 0.00TB 364D 290110 0.622 1.559 0.749 1.492 0.689 96.09 0.00TB 91D 290509 0.184 0.393 0.237 0.638 0.209 99.35 0.00
114
Futures & Options Segment 6
116
117
6Futures & Options Segment
In the year 2008, NSE ranked as the eighth largest derivatives exchange in the world, the second largest exchange in terms of number of contracts traded in single stock futures and the third largest in terms number of contracts traded in the index futures category.
The derivatives trading at NSE commenced on June 12, 2000 with futures trading on S&P CNX Nifty Index. Subsequently, the product base has been increased to include trading in options on S&P CNX Nifty Index, futures and options on CNX IT Index, Bank Nifty Index, CNX Nifty Junior, CNX 100, Nifty Midcap 50 Indices, S&P CNX Defty and 234 single stocks (Table 6-1) as of March 2009. The various products on the derivative segment of NSE and their date of launch is shown in the table below.
Products available for trading on Derivatives Segment
Products on Derivative Segment Date of Launch
S&P CNX Nifty Futures June 12, 2000S&P CNX Nifty Options June 4, 2001Single Stock Options July 2, 2001Single Stock Futures November 9, 2001Interest Rate Futures June 24, 2003CNX IT Futures & Options August 29, 2003Bank Nifty Futures & Options June 13, 2005CNX Nifty Junior Futures & Options June 1, 2007CNX 100 Futures & Options June 1, 2007Nifty Midcap 50 Futures & Options October 5, 2007Mini Nifty Futures & Options on S&P CNX Nifty January 1, 2008Long term Options on S&P CNX Nifty March 3, 2008S&P CNX Defty Futures and Options December 10, 2008
Number of Securities on which F&O Contracts were available for Trading (2008-09)
Month/Year Number of Securities*
Apr-08 227May-08 230Jun-08 229Jul-08 230
Aug-08 266Sep-08 267Oct-08 267Nov-08 265Dec-08 263Jan-09 259Feb-09 255Mar-09 2342008-09 234
* at the end of the month
118
Trading on single stock options commenced on July 2, 2001 while single stock futures were launched on November 9, 2001.
Since inception, NSE established itself as the sole market leader in this segment in the country and during 2008-09, it accounted for 99 % of the market share.
Trading Mechanism
The derivatives trading system at NSE is called NEAT-F&O trading system. It provides a fully automated screen-based trading for all kind of derivative products available on NSE on a nationwide basis. It supports an anonymous order driven market, which operates on a strict price/time priority. It provides tremendous flexibility to users in terms of kinds of orders that can be placed on the system. Various time and price related conditions like Immediate or Cancel, Limit/Market Price, Stop Loss, etc. can be built into an order. Trading in derivatives is essentially similar to that of trading of securities in the CM segment.
The NEAT-F&O trading system distinctly identifies two groups of users. The trading user more popularly known as trading member has access to functions such as, order entry, order matching and order & trade management. The clearing user (clearing member) uses the trader workstation for the purpose of monitoring the trading member(s) for whom he clears the trades. Additionally, he can enter and set limits on positions, which a trading member can take.
Contract Specification
The contract specification for derivative products traded on NSE are summarised in Table 6-2 & Table 6-3.
The index futures and index options contracts traded on NSE are based on S&P CNX Nifty Index, CNX IT Index, Bank Nifty, CNX Nifty Junior, CNX 100, Nifty Midcap 50 and S&P CNX Defty while stock futures and options are based on individual securities. Mini futures and options contracts and long term options contracts are also available on S&P CNX Nifty. Stock futures and options were available on 234 securities as of March 2009.
At any point of time there are only three contract months available for trading, with 1 month, 2 months and 3 months to expiry. These contracts expire on last Thursday of the expiry month and have a maximum of 3-month expiration cycle. If the last Thursday is a trading holiday, the contracts expire on the previous trading day. A new contract is introduced on the next trading day following the expiry of the near month contract. All the derivatives contracts are presently cash settled.
119
The long term option contracts are available for 3 serial month contracts, 3 quarterly months of the cycle March / June / September / December and 5 following semi-annual months of the cycle June / December. Thus, at any point in time there are atleast 3 year tenure option available.
Introduction of strike prices for option contracts
Stock Options
NSE introduces option strikes on a daily basis based on the price of the underlying. With regard to options on stocks the Exchange provides a minimum of seven strike prices for every option type (i.e Call & Put) during the trading month. At any time, there are atleast three strikes in-the-money (ITM), three strikes out-of-the-money (OTM) and one strike at-the-money (ATM). The table below gives details of generation of strike price interval for stock options.
Generation of strikes for Stock Options
Price of underlying Strike Price Interval Schemes of Strikes
Less than or equal to Rs.50 2.5 3-1-3
> Rs.50 - Rs.250 5 3-1-3
> Rs.250 - Rs. 500 10 3-1-3
> Rs.500 - Rs.1000 20 3-1-3
> Rs.1000 - Rs.2500 30 3-1-3
> Rs.2500 50 3-1-3
Index Options
The number of strikes provided in options on Indices- S&P CNX Nifty, CNX Nifty Junior, CNX 100, CNX IT, Bank Nifty Nifty Midcap 50 and S&P CNX Defty are related to the range in which previous day’s closing value of the index falls as per the table below.
Generation of strikes for Index Options
Index Level From To Revised Strike Interval Revised number of strikesIn the money-At the money-Out of
the money
Upto 2000 2.5 4-1-4
2001 to 4000 5 6-1-6
4001 to 6000 10 6-1-6
> 6000 20 7-1-7
120
Selection Criteria for Stocks and Index eligibility for trading
Eligibility Criteria of Stocks
The eligibility criteria for inclusion of scrips in F&O segment is as under:
• The stock is chosen from amongst the top 500 stocks in terms of average daily market capitalization and average daily traded value in the previous six months on a rolling basis.
• The stock’s median quarter sigma order size over the last six months should not be less than Rs. 5 lakh.
• The market wide position limit (MWPL) in the stock should not be less than Rs. 100 crore.
The criteria for exclusion of scrips in F&O segment will be as under:
For an existing F&O stock, the continued eligibility criteria is that market wide position limit in the stock should not be less than Rs. 60 crores and stock’s median quarter-sigma order size over the last six months shall be not less than Rs. 2 lakh. The stock is excluded if the above criteria is not fulfilled for consecutively three months.
Further, once the stock is excluded from the F&O list, it is not considered for re-inclusion for a period of one year.
Eligibility Criteria of Indices
• The Exchange may consider introducing derivative contracts on an index if the stocks contributing to 80% weightage of the index are individually eligible for derivative trading. However, no single ineligible stocks in the index should have a weightage of more than 5% in the index.
• The above criteria is applied every month, if the index fails to meet the eligibility criteria for three months consecutively, then no fresh month contract are issued on that index. However, the existing unexpired contacts are permitted to trade till expiry and new strikes may also be introduced in the existing contracts.
Re-introduction of dropped stocks
A stock which is dropped from derivatives trading may become eligible once again. In such instances, the stock is required to fulfill the eligibility criteria for three consecutive months to be re-introduced for derivatives trading.
Eligibility criteria of stocks for derivatives trading especially on account of corporate restructuring
The eligibility criteria for stocks for derivatives trading on account of corporate
121
restructuring is as under. All the following conditions should be met in the case of shares of a company undergoing restructuring through any means for eligibility to reintroduce derivative contracts on that company from the first day of listing of the post restructured company/(s) (as the case may be) stock (herein referred to as post restructured company) in the underlying market.
a) The Futures and options contracts on the stock of the original (pre restructure) company were traded on any exchange prior to its restructuring;
b) The pre restructured company had a market capitalisation of at least Rs.1000 crores prior to its restructuring;
c) The post restructured company would be treated like a new stock and if it is, in the opinion of the exchange, likely to be at least one-third the size of the pre restructuring company in terms of revenues, or assets, or (where appropriate) analyst valuations; and
d) In the opinion of the exchange, the scheme of restructuring does not suggest that the post restructured company would have any characteristic (for example extremely low free float) that would render the company ineligible for derivatives trading.
If the above conditions are satisfied, then the exchange takes the following course of action in dealing with the existing derivative contracts on the pre-restructured company and introduction of fresh contracts on the post restructured company
a) In the contract month in which the post restructured company begins to trade, the Exchange introduce near month, middle month and far month derivative contracts on the stock of the restructured company.
b) In subsequent contract months, the normal rules for entry and exit of stocks in terms of eligibility requirements would apply. If these tests are not met, the exchange shall not permit further derivative contracts on this stock and future month series shall not be introduced.
Trading Value & Contract Traded
The total turnover on the F&O Segment declined by 15.89% to Rs. 11,010,482 crore (US $ 2,161,037 million) during 2008-09 as compared with Rs.13,090,478 crore (US $ 3,275,076 million) during 2007-08. The average daily turnover during 2008-09 was Rs.45,311 crore (US $ 8,893 million), a year on year decline of 13.12 %. The business growth of F&O segment and the number of contracts traded during the year is presented in Table 6-4 and Chart 6-1.
122
Chart 6-1 : Business Growth of F&O Segment
The total number of contracts traded increased by 54.68% to 66 crore contracts during 2008-09. Out of the total contracts traded, 33.71% of the contracts were traded on Stock futures followed by index options on which 32.26% of the contracts were traded. Number of contracts traded on Index futures was 32.01% while 2.02% of the total contracts were traded on stock options. (Chart 6-2).
Chart 6-2 : Product wise Number of Contracts Traded during 2008-09
123
Product wise turnover on F&O Segment:
During 2008-09, the traded value of index futures saw a year-on-year decline of 6.56 % and amounted to Rs.3,570,111 crore (US $ 700,709 million) in 2008-09 as against Rs.3,820,667 crore (US $ 955,884 million) during 2007-08.
The traded value in stock futures declined by 53.90 % to Rs.3,479,642 crore (US $ 682,952 million) during 2008-09 over the turnover of Rs.7,548,563 crore (US $ 1,888,557 million) during 2007-08.
Index options recorded turnover of Rs.3,731,502 crore (US $ 732,385 million) during 2008-09 , an increase of 173.95 % over the turnover of Rs.1,362,111 crore (US $ 340,783 million) during 2007-08.
Stock options recorded turnover of Rs. 229,227 crore (US $ 44,991 million) during 2008-09, a decrease of 36.17 % over the turnover of Rs. 359,137 crore (US $ 89,852 million) during 2007-08.
Index Options accounted for 33.89% of the total turnover during the 2008-09 fiscal followed by the trading in index futures at 32.42 %, Stock futures (31.60%) and stock options (2.08%) (Chart 6-3).
Chart 6-3 : Product wise trading volumes during 2008-09
Futures and Options on Benchmark Indices
The details of traded volumes on Index Futures and Options, having the underlying as the NSE indices is shown in the table below.
124
Benchmark Indices Contracts & Trading Volume in F&O Segment of NSE (2008-09)
Products
Underlying
No. of Contracts
Turnover
Rs.cr. US $ mn
NIFTY S&P CNX Nifty 396,820,905 7,067,827 1,387,208
BANKNIFTY BANK Nifty 7,473,386 104,377 20,486
MINIFTY S&P CNX Nifty 18,107,079 127,266 24,979
JUNIOR CNX Nifty Junior 6,370 128 25
CNXIT CNX IT 103,485 1,870 367
CNX100 CNX 100 154 3 1
Nifty Midcap 50 Nifty Midcap 50 2,459 58 11
Long term Option Contracts
S&P CNX Nifty 623,416 14,585 2,863
DEFTY S&P CNX Defty 2,709 84 17
TOTAL 423,139,963 7,316,198 1,435,956
During 2008-09, the S&P CNX Nifty Index accounted for more than 96.61 % of the turnover in Index futures and options. The S&P CNX Nifty accounted for 93.78 % of the total contracts.
Sectorwise Stock Futures & Options Turnover
Sectorwise turnover of stock futures and options is presented in the table below. Companies belonging to the IT Sector and FMCG Sector accounted for 20.90 % and 20.84% respectively of the total stock futures and options turnover on the Exchange.
Sectorwise Classification of turnover of the Single Stock Futures during 2008-09
Classification Total Turnover (Rs. crs) Total Turnover ( US $ mn)Manufacturing 775,253 152,160 Petrochemicals 772,781 151,674 Infrastructure 609,975 119,720 Banks 490,837 96,337 Information Technology 279,708 54,899 Finance 238,199 46,752 Telecommunication 214,268 42,055 Pharmaceuticals 115,267 22,624 Engineering 99,063 19,443 FMCG 66,115 12,976 Media & Entertainment 23,654 4,643 Services 14,357 2,818 Miscellaneous 9,391 1,843 TOTAL 3,708,869 727,943
The stock futures and option turnover of top 5 companies in each sector for the period 2008-09 is presented in Table 6-5.
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Participant wise turnover on F&O Segment:
During 2008-09, the retail investors accounted for 55.63 % of the turnover on the F&O segment of the Exchange. The gross turnover of the retail participants in the F&O Segment amounted to Rs.12,250,029 crore (US $ 2,404,324 million) followed by the Proprietory segment with gross turnover of Rs.6,826,484 crore (US $ 1,339,840 million) and the Institutional players with gross turnover of Rs. 2,944,454 crore (US $ 577,911 million). The share of retail participants and institutional participants in the gross turnover was 31.00 % and 13.37 % respectively.
The month wise details of the turnover for the participants in the F&O segment is presented in Table 6-6. Chart 6-4 shows the participantswise F&O turnover during 2008-09.
Chart 6-4 : Participant wise F&O Turnover during 2008-09
Memberwise turnover on the Exchange:
During 2008-09, there were 661 members which accounted for turnover of Rs.1,000 crore and more while 91 members registered turnover between Rs.500 crore and Rs.1,000 crore collectively in the futures and options category. In the month of September 2008, 301 trading members accounted for a turnover of Rs.1,000 crore and more, which was the highest number of members during the fiscal year 2008-09.
The number of members in different turnover brackets in Futures and Options segment is presented in table 6-7a & 6-7b.
High Volume Members
The turnover of the top ‘5’ and ‘10’ members accounted to Rs.1,198,458 crore (US $ 235,222.39 million) and Rs.1,762,438 crore (US $ 345,915.21 million) respectively in
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2008-09 in the Futures segment. However, the turnover of the top ‘5’ and ‘10’ members in the options segment accounted to Rs.712,931 crore (US $ 139,927.61 million) and Rs. 1,227,826 crore (US $ 240,986.44 million) respectively in the same period.
In the Futures segment, the share of top 5 and top ‘10’ members in turnover was 17% and 25% respectively, while in the options segment the share of top 5 and top 10 trading members in in turnover was 18% and 31 % respectively. (Table 6-7c).
Internet Trading
At the end of March 2009, a total number of 337 members were permitted to allow investor’s web based access to NSE’s trading system. The members of the exchange in turn had registered 4,426,577 clients for web based access as on March 31, 2009. In the Futures and Options Segment the trading volume of Rs.1,685,692 crore (US $ 421,739 million) during the year 2008-09, constituting 7.65 % of total trading volume was routed and executed through the internet. The following table shows the growth of internet trading during 2007-08 to 2008-09.
Internet Trading in the F&O Segment of the Exchange
Year
Enabled Members*
Registered Clients*
Internet Trading Value
Internet Trading Value
% to Total Trading Value (Rs.cr) (US $ mn)
2007-08 305 3,432,780 2,372,514 593,574 9.06
2008-09 337 4,426,577 1,685,692 330,852 7.65
* At the end of Financial year.Note : Figures for IBT turnover and registered clients are as reported by trading members to the Exchange
Figures of Turnover are Buy Turnover + Sell turnover.
Traded Value Records
Trading volumes in the F&O Segment during 2008-09 reached a high of Rs.82,698 crore (US $ 16,231 million) on September 25, 2008. The following table gives the record turnover of different products in the F&O Segment.
Records Achieved in the F&O Segment during 2008-09
Product Traded Value (Rs. in crores)
Traded Value (US $ Mn)
Date
Index Futures 31,638 6,210 25-Jun-08
Stock Futures 32,501 6,379 29-May-08
Index Options 32,782 6,434 24-Mar-09
Stock Options 2,099 412 25-Mar-09
Total F&O Traded Value 82,698 16,231 25-Sep-08
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Top 20 Futures and Option contracts
During 2008-09, top 20 Futures and options contracts in terms of number of contracts traded have been presented in Table 6-8 and Table 6-9.
The top 20 Futures contracts accounted for 46.41 % of the total no. of contracts traded in the Futures segment while top 20 Option contracts accounted for 21.61 % of the total option contracts traded during 2008-09.
Among the top 20 future contracts, Nifty July 2008 futures accounted for 10.12 % of the total top 20 contracts while Nifty October 2008 futures and Nifty November 2008 contributed 9.86 % and 9.17 % respectively.
Top 3 option contracts on the basis of number of contracts traded during 2008-09 were Nifty March 2009 CE 2800, Nifty February 2009 PE 2700 and Nifty Nifty February 2009 PE 2800. Together these three option contracts formed 19.13 % of the total number of top 20 option contracts.
Number of Trades
During 2008-09, maximum number of trades in the F&O Segment were witnessed in Stock Futures (57.78 %), Index futures (22.21 %), Index Options (16.49 %) and Stock Options (3.52 %) as mentioned in the table below.
Number of Trades in F&O Segment (2008-09)
Products Number of Trades (%)
Stock Futures 57.78
Index Futures 22.21
Index Options 16.49
Stock Options 3.52
TOTAL 100
The details of month wise trades on Index futures & options and stock futures & options is presented in Table 6-10.
Charges
Brokerage Charges
The maximum brokerage chargeable by a trading member in relation to trades effected in the contracts admitted to dealing on the F&O segment of NSE is fixed at 2.5% of the contract value in case of index futures and stock futures. In case of index options and stock options it is 2.5% of notional value of the contract [(Strike Price + Premium) × Quantity)], exclusive of statutory levies.
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Transaction Charges
The transaction charges payable to the exchange by the trading member for the trades executed by him on the F&O segment are fixed at the rate of Rs. 2 per lakh of turnover (0.002%) subject to a minimum of Rs. 1,00,000 per year. However, for the transactions in the options sub-segment the transaction charges will be levied on the premium value at the rate of 0.05% (each side) instead of on the strike price as levied earlier.
For a trading Member participating in trading S&P CNX Defty at any time during the year till September 30, 2009 there would be no transaction charges. The trading member would be required to make a lump sum contribution of Rs.500/- for the whole year as a contribution to Investor Protection Fund.
Securities Transaction Tax
The trading members are also required to pay securities transaction tax (STT) on non-delivery transactions at the rate of 0.017 (payable by the seller) for derivatives w. e. f June 1, 2008.
Taxable securities transaction Rate (%) Taxable Value Payable by
Sale of an option in securities 0.017 Option premium Seller
Sale of an option in securities, where option is exercised
0.125 Settlement Price Purchaser
Sale of a futures in securities 0.017 Sale Price Seller
Value of taxable securities transaction relating to an “option in securities” will be the option premium, in case of sale of an option in securities.
Value of taxable securities transaction relating to an “option in securities” will be the settlement price, in case of sale of an option in securities, where option is exercised.
Contribution to Investor Protection Fund (F&O Segment)
The trading members contribute to Investor Protection Fund of F&O segment at the rate of Re.1/- per Rs. 100 crore of the traded value (each side) in case of Futures segment and Rs.1/- per Rs. 100 crore of the premium amount (each side) in case of Options segment.
CLEARING AND SETTLEMENT
Clearing and Settlement
NSCCL undertakes clearing and settlement of all trades executed on the F&O Segment of the Exchange. It also acts as legal counterparty to all trades on this segment and guarantees their financial settlement. The Clearing and Settlement process comprises of three main activities, viz., Clearing, Settlement and Risk Management.
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Clearing Mechanism
The first step in clearing process is working out open positions and obligations of clearing (self-clearing/trading-cum-clearing/professional clearing) members (CMs). The open positions of a CM is arrived at by aggregating the open positions of all the trading members (TMs) and all custodial participants (CPs) clearing though him, in the contracts which they have traded. The open position of a TM is arrived at by summing up his proprietary open position and clients’ open positions, in the contracts which they have traded. While entering orders on the trading system, TMs identify orders as either proprietary or client. Proprietary positions are calculated on net basis for each contract and that of clients are arrived at by summing together net positions of each individual client. A TM’s open position is the sum of proprietary open position, client open long position and client open short position.
Settlement Mechanism
All futures and options contracts are cash settled i.e. through exchange of cash. The underlying for index futures/options of the index cannot be delivered. The settlement amount for a CM is netted across all their TMs/clients, across various settlements. For the purpose of settlement, all CMs are required to open a separate bank account with NSCCL designated clearing banks for F&O segment.
Settlement of Futures Contracts on Index or Individual Securities
Futures contracts have two types of settlements, the MTM settlement which happens on a continuous basis at the end of each day, and the final settlement which happens on the last trading day of the futures contract.
• MTM Settlement for Futures: The positions in futures contracts for each member are marked-to-market to the daily settlement price of the relevant futures contract at the end of each day. The CMs who have suffered a loss are required to pay the mark-to-market (MTM) loss amount in cash which is in turn passed on to the CMs who have made a MTM profit. This is known as daily mark-to-market settlement. CMs are responsible to collect and settle the daily MTM profits/losses incurred by the TMs and their clients clearing and settling through them. Similarly, TMs are responsible to collect/pay losses/ profits from/to their clients by the next day. The pay-in and pay-out of the mark-to-market settlement are effected on the day following the trade day (T+1).
After completion of daily settlement computation, all the open positions are reset to the daily settlement price. Such positions become the open positions for the next day.
• Final Settlement for Futures: On the expiry day of the futures contracts, after the close of trading hours, NSCCL marks all positions of a CM to the final settlement price and the resulting profit/loss is settled in cash. Final settlement loss/profit amount is debited/credited to the relevant CM’s clearing bank account on the day following expiry day of the contract.
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• Settlement Prices for Futures: Daily settlement price on a trading day is the closing price of the respective futures contracts on such day. The closing price for a futures contract is currently calculated as the last half an hour weighted average price of the contract in the F&O Segment of NSE. Final settlement price is the closing price of the relevant underlying index/security in the Capital Market segment of NSE, on the last trading day of the Contract. The closing price of the underlying Index/security is currently its last half an hour weighted average value in the Capital Market Segment of NSE.
Settlement of Options Contracts on Index or Individual Securities
Options contracts have three types of settlements, daily premium settlement, interim exercise settlement in the case of option contracts on securities and final settlement.
• Daily Premium Settlement for Options: Buyer of an option is obligated to pay the premium towards the options purchased by him. Similarly, the seller of an option is entitled to receive the premium for the option sold by him. The premium payable amount and the premium receivable amount are netted to compute the net premium payable or receivable amount for each client for each option contract. The CMs who have a premium payable position are required to pay the premium amount to NSCCL which in turn passed on to the members who have a premium receivable position. This is known as daily premium settlement. CMs are also responsible to collect and settle for the premium amounts from the TMs and their clients clearing and settling through them. The pay-in and pay-out of the premium settlement is on T+1 day (T=Trade day). The premium payable amount and premium receivable amount are directly credited/debited to the CMs clearing bank account.
• Interim Exercise Settlement: Interim exercise settlement takes place only for option contracts on individual securities. An investor can exercise his in-the-money options at any time during trading hours, through his trading member. Interim exercise settlement is effected for such options at the close of the trading hours, on the day of exercise. Valid exercised option contracts are assigned to short positions in the option contract with the same series (i.e. having the same underlying, same expiry date and same strike price), on a random basis, at the client level. The CM who has exercised the option receives the actual profit or loss per unit of the option from the CM who has been assigned the option contract.
Exercise settlement value is debited/credited to the relevant CMs clearing bank account on T+1 day (T=exercise date).
• Final Exercise Settlement: Final Exercise settlement is effected for option positions at in-the-money strike prices existing at the close of trading hours, on the expiration day of an option contract. All long positions at in-the-money strike prices are automatically assigned to short positions in option contracts with the same series, on a random basis.
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For index options contracts, exercise style is European style, while for options contracts on individual securities, exercise style is American style. Final Exercise is Automatic on expiry of the option contracts.
Final settlement loss/profit amount for option contracts on Index is debited/credited to the relevant CMs clearing bank account on T+1 day (T=expiry day). Final settlement loss/profit amount for option contracts on Individual Securities is debited/credited to the relevant CMs clearing bank account on T+1 day. Open positions, in option contracts, cease to exist after their expiration day.
The pay-in / pay-out of funds for a CM on a day is the net amount across settlements and all TMs/clients, in F&O Segment.
Settlement of Custodial Participant (CP) Deals
NSCCL provides a facility to entities like institutions to execute trades through any TM, which may be cleared and settled by their own CM. Such entities are called Custodial Participants (CP). To avail of this facility, a CP is required to register with NSCCL through this CM, which allots them a unique CP code. The CP and the CM are required to enter into an agreement as per specified format. Thereafter, all trades executed by such CP through any TM are required to have the CP code in the relevant field on the F&O trading system at the time of order entry. Such trades executed on behalf of a CP are required to be confirmed by their CM (and not the CM of the TM through whom the trade was executed), within the time specified by NSE, using the confirmation facility provided by NSCCL to the CMs in the F&O segment. Till such time the trade is confirmed by the CM of the CP, the same is considered as a trade of the TM and the responsibility of settlement of such trade vests with the CM of the TM. Once the trades have been confirmed by the CM of the CP, they form part of the obligations of the CM of the CP and they shall be responsible for all obligations arising out of such trades including the payment of margins and settlement of obligations.
Settlement Statistics
All derivative contracts are currently cash settled. The participants discharge their obligations through payment/receipt of cash. During 2008-09, such cash settlement amounted to Rs. 91,839.97 crore (US $ 18,025.51 million). The settlement of futures and options involved Rs.76,691.89 crore (US $ 15,052.38 million) and Rs. 15,148.08 (US $ 2,973.13 million) respectively. The details of settlement in the futures and options segment is presented in Table 6-11.
Risk Management System
NSCCL has developed a comprehensive risk containment mechanism for the F&O segment. The salient features of risk containment measures on the F&O segment are:
• The financial soundness of the members is the key to risk management. Therefore, the requirements for membership in terms of capital adequacy (net worth, security
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SPAN® is a registered trademark of the Chicago Mercantile Exchange (CME) used here under license.
deposits) are quite stringent. These requirements have already been explained in Table 2-1 in Chapter 2 of this publication.
• NSCCL charges an upfront initial margin for all the open positions of a Clearing Member (CM). It specifies the initial margin requirements for each futures/options contract on a daily basis. It follows VaR-based margining computed through SPAN. The CM in turn collects the initial margin from the trading members (TMs) and their respective clients.
• The open positions of the members are marked to market based on contract settlement price for each contract at the end of the day. The difference is settled in cash on a T+1 basis.
• NSCCL’s on-line position monitoring system monitors a CM’s open position on a real-time basis. Limits are set for each CM based on his effective deposits. The on-line position monitoring system generates alert messages whenever a CM reaches 70 %, 80 %, 90 % and a disablement message at 100 % of the limit. NSCCL monitors the CMs for Initial Margin violation, Exposure margin violation, while TMs are monitored for Initial Margin violation and position limit violation.
• CMs are provided a trading terminal for the purpose of monitoring the open positions of all the TMs clearing and settling through him. A CM may set limits for a TM clearing and settling through him. NSCCL assists the CM to monitor the intra-day limits set up by a CM and whenever a TM exceed the limits, it stops that particular TM from further trading.
• A member is alerted of his position to enable him to adjust his exposure or bring in additional capital. Margin violations result in disablement of trading facility for all TMs of a CM in case of a violation by the CM.
• A separate Settlement Guarantee Fund for this segment has been created out of deposits of members.
The most critical component of risk containment mechanism for F&O segment is the margining system and on-line position monitoring. The actual position monitoring and margining is carried out on-line through Parallel Risk Management System (PRISM) using SPAN® (Standard Portfolio Analysis of Risk) system for the purpose of computation of on-line margins, based on the parameters defined by SEBI.
NSE - SPAN®
The objective of NSE-SPAN is to identify overall risk in a portfolio of all futures and options contracts for each member. The system treats futures and options contracts uniformly, while at the same time recognising the unique exposures associated with options portfolios, like extremely deep out-of-the-money short positions and inter-month risk.
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Its over-riding objective is to determine the largest loss that a portfolio might reasonably be expected to suffer from one day to the next day based on 99% VaR methodology.
SPAN considers uniqueness of option portfolios. The following factors affect the value of an option:
i. Underlying market price.
ii. Volatility (variability) of underlying instrument, and
iii. Time to expiration.
iv. Interest rate
v. Strike price
As these factors change, the value of options maintained within a portfolio also changes. Thus, SPAN constructs scenarios of probable changes in underlying prices and volatilities in order to identify the largest loss a portfolio might suffer from one day to the next. It then sets the margin requirement to cover this one-day loss.
The complex calculations (e.g. the pricing of options) in SPAN are executed by NSCCL. The results of these calculations are called risk arrays. Risk arrays, and other necessary data inputs for margin calculation are provided to members daily in a file called the SPAN Risk Parameter file. Members can apply the data contained in the Risk Parameter files, to their specific portfolios of futures and options contracts, to determine their SPAN margin requirements.
Hence, members need not execute a complex option pricing calculations, which is performed by NSCCL. SPAN has the ability to estimate risk for combined futures and options portfolios, and also re-value the same under various scenarios of changing market conditions.
NSCCL generates six risk parameters file for a day taking into account price and volatilities at various time intervals and are provided on the website of the Exchange.
Margins
The margining system for F&O segment is as below:
• Initial margin: Margin in the F&O segment is computed by NSCCL upto client level for open positions of CMs/TMs. These are required to be paid up-front on gross basis at individual client level for client positions and on net basis for proprietary positions. NSCCL collects initial margin for all the open positions of a CM based on the margins computed by NSE-SPAN. A CM is required to ensure collection of adequate initial margin from his TMs up-front. The TM is required to collect adequate initial margins up-front from his clients.
• Premium Margin: In addition to Initial Margin, Premium Margin is charged at client level. This margin is required to be paid by a buyer of an option till the premium settlement is complete.
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• Assignment Margin for Options on Securities: Assignment margin is levied in addition to initial margin and premium margin. It is required to be paid on assigned positions of CMs towards interim and final exercise settlement obligations for option contracts on individual securities, till such obligations are fulfilled. The margin is charged on the net exercise settlement value payable by a CM towards interim and final exercise settlement.
• Exposure Margins: Clearing members are subject to exposure margins in addition to initial margins.
• Client Margins: NSCCL intimates all members of the margin liability of each of their client. Additionally members are also required to report details of margins collected from clients to NSCCL, which holds in trust client margin monies to the extent reported by the member as having been collected form their respective clients.
Position Limits
The market wide limit of open position (in terms of the number of underlying stock) on futures and option contracts on a particular underlying stock should be 20% of the number of shares held by non-promoters in the relevant underlying security i.e. free–float holding. This limit is applicable on all open positions in all futures and option contracts on a particular underlying stock. The enforcement of the market wide limits is done in the following manner:
• At end of the day the exchange tests whether the market wide open interest for any scrip exceeds 95% of the market wide position limit for that scrip. In case it does so, the exchange takes note of open position of all client/TMs as at end of that day for that scrip and from next day onwards they can trade only to decrease their positions through offsetting positions.
• At the end of each day during which the ban on fresh positions is in force for any scrip, the exchange tests whether any member or client has increased his existing positions or has created a new position in that scrip. If so, that client is subject to a penalty equal to a specified percentage (or basis points) of the increase in the position (in terms of notional value). The penalty is recovered before trading begins next day.
• The normal trading in the scrip is resumed after the open outstanding position comes down to 80% or below of the market wide position limit. Further, the exchange also checks on a monthly basis, whether a stock has remained subject to the ban on new position for a significant part of the month consistently for three months. If so, then the exchange phases out derivative contracts on that underlying.
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Trading Member wise Position Limits
Index Futures Contract:
The trading member position limits in equity index futures contracts is higher of Rs.500 Crore or 15% of the total open interest in the market in equity index futures contracts. This limit would be applicable on open positions in all futures contracts on a particular underlying index.
Index Options Contract:
The trading member position limits in equity index option contracts is higher of Rs.500 Crore or 15% of the total open interest in the market in equity index option contracts. This limit would be applicable on open positions in all option contracts on a particular underlying index.
Futures and Option contracts on individual securities :
i. For stocks having applicable market-wise position limit (MWPL) of Rs. 500 crores or more, the combined futures and options position limit is 20% of applicable MWPL or Rs. 300 crores, whichever is lower and within which stock futures position cannot exceed 10% of applicable MWPL or Rs. 150 crores, whichever is lower.
ii. For stocks having applicable market-wise position limit (MWPL) less than Rs. 500 crores, the combined futures and options position limit would be 20% of applicable MWPL and futures position cannot exceed 20% of applicable MWPL or Rs. 50 crore which ever is lower. The Clearing Corporation shall specify the trading member-wise position limits on the last trading day of the month which shall be reckoned for the purpose during the next month.
Client level position limits
The gross open position for each client, across all the derivative contracts on an underlying, should not exceed 1% of the free float market capitalization (in terms of number of shares) or 5% of the open interest in all derivative contracts in the same underlying stock (in terms of number of shares) whichever is higher.
Disclosure for Client Positions in Index based contracts
Any person or persons acting in concert who together own 15% or more of the open interest on a particular underlying index is required to report this fact to the Exchange/ Clearing Corporation. Failure to do so shall be treated as a violation and shall attract appropriate penal and disciplinary action in accordance with the Rules, Byelaws and Regulations of Clearing Corporation.
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Position limits for FII, Mutual Funds:
FII & MF Position limits in Index options contracts: FII & MF position limit in all index options contracts on a particular underlying index is Rs.500 Crores or 15 % of the total open interest of the market in index options, whichever is higher. This limit would be applicable on open positions in all options contracts on a particular underlying index.
FII & MF Position limits in Index futures contracts : FII & MF position limit in all index futures contracts on a particular underlying index is Rs. 500 crores or 15 % of the total open interest of the market in index futures, whichever is higher. This limit would be applicable on open positions in all futures contracts on a particular underlying index.
In addition to the above, FIIs & MF’s shall take exposure in equity index derivatives subject to the following limits:
a) Short positions in index derivatives (short futures, short calls and long puts) not exceeding (in notional value) the FII’s / MF’s holding of stocks.
b) Long positions in index derivatives (long futures, long calls and short puts) not exceeding (in notional value) the FII’s / MF’s holding of cash, government securities, T-Bills and similar instruments.
The FIIs should report to the clearing members (custodian) the extent of the FIIs holding of stocks, cash, government securities, T-bills and similar instruments before the end of the day. The clearing member (custodian) in turn should report the same to the exchange. The exchange monitors the FII position limits. The position limit for sub-account is same as that of client level position limits.
Stock Futures & Options:
For stocks having applicable market-wise position limit (MWPL) of Rs. 500 crores or more, the combined futures and options position limit is 20% of applicable MWPL or Rs. 300 crores, whichever is lower and within which stock futures position cannot exceed 10 % of applicable MWPL or Rs.150 crores, whichever is lower.
For stocks having applicable market-wise position limit (MWPL) less than Rs. 500 crores, the combined futures and options position limit is 20% of applicable MWPL and futures position cannot exceed 20 % of applicable MWPL or Rs. 50 crore which ever is lower
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Table 6-1 : List of Securities on which Futures & Options are available at NSE (as on 31 March 2009)
Sr.No
Security Symbol Launch Date
Market Lot
1 3I Infotech Ltd. 3IINFOTECH 06-Sep-07 10800
2 Aban Offshore Ltd. ABAN 29-Dec-06 400
3 ABB Ltd. ABB 20-Apr-05 500
4 ABG Shipyard Limited ABGSHIP 21-Aug-08 3300
5 Aditya Birla Nuvo Limited ABIRLANUVO 14-May-07 400
6 Adlabs Films Ltd ADLABSFILM 14-May-07 1800
7 Allahabad Bank ALBK 20-Apr-05 4900
8 Alok Industries Ltd. ALOKTEXT 27-May-05 22152
9 Alstom Projects India Ltd APIL 14-May-07 1200
10 Ambuja Cements Ltd. AMBUJACEM 02-Jul-01 4124
11 Amtek Auto Ltd. AMTEKAUTO 29-Dec-06 4800
12 Andhra Bank ANDHRABANK 29-Aug-03 4600
13 Aptech Limited APTECHT 06-Sep-07 3900
14 Arvind Limited ARVIND 26-Sep-03 17200
15 Ashok Leyland Ltd ASHOKLEY 20-Apr-05 19100
16 Asian Paints Limited ASIANPAINT 21-Aug-08 400
17 Associated Cement Co. Ltd. ACC 02-Jul-01 752
18 Aurobindo Pharma Ltd. AUROPHARMA 12-May-05 2800
19 Axis Bank Ltd. AXISBANK 20-Apr-05 900
20 Bajaj Auto Limited BAJAJ-AUTO 26-May-08 800
21 Bajaj Hindustan Ltd. BAJAJHIND 29-Dec-06 5700
22 Bajaj Holdings & Investment Ltd. BAJAJHLDNG 14-Mar-08 1000
23 Balaji Telefilms Ltd. BALAJITELE 21-Aug-08 5000
24 Ballarpur Industries Limited BALLARPUR 31-Mar-08 14600
25 Balrampur Chini Mills Ltd. BALRAMCHIN 29-Dec-06 9600
26 Bank Of Baroda BANKBARODA 29-Aug-03 1400
27 Bank Of India BANKINDIA 29-Aug-03 950
28 Bata India Ltd. BATAINDIA 29-Dec-06 4200
29 Bharat Earth Movers Ltd. BEML 29-Dec-06 750
30 Bharat Electronics Ltd. BEL 31-Jan-03 552
31 Bharat Forge Co Ltd BHARATFORG 20-Apr-05 4000
32 Bharat Heavy Electricals Ltd. BHEL 02-Jul-01 300
33 Bharat Petroleum Corporation Ltd. BPCL 02-Jul-01 1100
34 Bharti Airtel Ltd BHARTIARTL 20-Apr-05 500
35 Bhushan Steel & Strips Lt BHUSANSTL 06-Sep-07 1000
36 Biocon Limited. BIOCON 06-Sep-07 3600
37 Birla Corporation Ltd BIRLACORPN 14-May-07 3400
38 Bombay Dyeing & Mfg. Co Ltd. BOMDYEING 29-Dec-06 1800
Contd...
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Sr.No
Security Symbol Launch Date
Market Lot
39 Bombay Rayon Fashions Ltd BRFL 14-May-07 2300
40 Cairn India Limited CAIRN 09-Jan-07 2500
41 Canara Bank CANBK 29-Aug-03 1600
42 Central Bank Of India CENTRALBK 21-Aug-07 8000
43 Century Textiles Ltd CENTURYTEX 20-Apr-05 1696
44 CESC Ltd. CESC 12-May-05 1100
45 Chambal Fertilizers Ltd. CHAMBLFERT 12-May-05 6900
46 Chennai Petroleum Corporation Ltd. CHENNPETRO 20-Apr-05 3600
47 Cipla Ltd. CIPLA 02-Jul-01 1250
48 Colgate Palmolive Ltd COLPAL 17-Dec-07 550
49 Container Corporation Of India Limited CONCOR 21-Aug-08 500
50 Corporation Bank CORPBANK 12-May-05 1200
51 Crompton Greaves Ltd. CROMPGREAV 29-Dec-06 2000
52 Cummins India Ltd CUMMINSIND 20-Apr-05 1900
53 Dabur India Ltd. DABUR 20-Apr-05 2700
54 Deccan Chronicle Holdings Ltd. DCHL 21-Aug-08 6800
55 Dena Bank DENABANK 14-May-07 10500
56 Develop Credit Bank Ltd DCB 30-Nov-07 14000
57 Dish Tv India Limited DISHTV 21-Aug-08 20600
58 Divi’S Laboratories Ltd. DIVISLAB 12-May-05 310
59 DLF Limited DLF 05-Jul-07 1600
60 Dr. Reddy’S Laboratories Ltd. DRREDDY 02-Jul-01 800
61 Edelweiss Capital Ltd EDELWEISS 12-Dec-07 1000
62 Educomp Solutions Ltd EDUCOMP 14-May-07 150
63 Escorts India Ltd. ESCORTS 27-May-05 9600
64 Essar Oil Ltd. ESSAROIL 12-May-05 2824
65 Everest Kanto Cylinder Ltd EKC 14-May-07 2000
66 Everonn Systems India Limited EVERONN 21-Aug-08 800
67 Federal Bank Ltd. FEDERALBNK 12-May-05 1702
68 Financial Technologies (I) Ltd FINANTECH 14-May-07 600
69 Firstsource Solutions Limited FSL 21-Aug-08 19000
70 GAIL (India) Ltd. GAIL 26-Sep-03 1125
71 Gateway Distriparks Ltd. GDL 29-Dec-06 5000
72 Gitanjali Gems Limited GITANJALI 30-Nov-07 4000
73 Glaxosmithkline Pharma Ltd. GLAXO 20-Apr-05 300
74 Gmr Infrastructure Ltd. GMRINFRA 21-Aug-06 5000
75 Grasim Industries Ltd. GRASIM 02-Jul-01 352
76 Great Offshore Ltd GTOFFSHORE 30-Nov-07 1000
77 GTL Infrastructure Limited GTLINFRA 21-Aug-08 9700
78 GTL Ltd. GTL 29-Dec-06 1500
Contd...
Contd...
139
Sr.No
Security Symbol Launch Date
Market Lot
79 Gujarat Alkalies & Chem GUJALKALI 29-Dec-06 5600
80 Gujarat Narmada Fertilizer Co. Ltd. GNFC 12-May-05 5900
81 Gujarat State Petronet Limited GSPL 21-Aug-08 12200
82 GVK Power & Infrastructure Limited GVKPIL 21-Aug-08 19000
83 Havells India Limited HAVELLS 06-Sep-07 2400
84 HCL Infosystems Ltd HCL-INSYS 21-Aug-08 3400
85 HCL Technologies Ltd. HCLTECH 31-Jan-03 2600
86 HDFC Bank Ltd. HDFCBANK 29-Aug-03 400
87 Hero Honda Motors Ltd. HEROHONDA 31-Jan-03 400
88 Hindalco Industries Ltd. HINDALCO 02-Jul-01 7036
89 Hindustan Construction Co HCC 29-Dec-06 8400
90 Hindustan Oil Exploration HINDOILEXP 30-Nov-07 6400
91 Hindustan Petroleum Corporation Ltd. HINDPETRO 02-Jul-01 1300
92 Hindustan Unilever Ltd HINDUNILVR 02-Jul-01 1000
93 Hindustan Zinc Limited HINDZINC 30-Nov-07 1000
94 Hotel Leela Ventures Ltd HOTELEELA 14-May-07 15000
95 Housing Development And Infrastructure Ltd. HDIL 24-Jul-07 3096
96 Housing Development Finance Corporation Ltd. HDFC 02-Jul-01 150
97 ICICI Bank Ltd. ICICIBANK 31-Jan-03 700
98 ICSA (India) Limited ICSA 21-Aug-08 2400
99 Idea Cellular Ltd. IDEA 09-Mar-07 5400
100 IFCI Ltd. IFCI 27-May-05 15760
101 India Cements Ltd. INDIACEM 27-May-05 2900
102 India Infoline Limited INDIAINFO 14-May-07 5000
103 Indiabulls Real Estate Limited IBREALEST 21-Aug-08 2600
104 Indian Bank INDIANB 01-Mar-07 2200
105 Indian Hotels Co. Ltd. INDHOTEL 20-Apr-05 7596
106 Indian Oil Corporation Ltd. IOC 26-Sep-03 600
107 Indian Overseas Bank IOB 20-Apr-05 5900
108 Indusind Bank Ltd. INDUSINDBK 12-May-05 7700
109 Industrial Development Bank Of India Ltd. IDBI 20-Apr-05 4800
110 Infosys Technologies Ltd. INFOSYSTCH 02-Jul-01 200
111 Infrastructure Development Finance Company Ltd. IDFC 12-Aug-05 5900
112 IRB Infrastructure Developers Ltd IRB 25-Feb-08 4400
113 Ispat Industries Limited ISPATIND 30-Nov-07 24900
114 ITC Ltd. ITC 02-Jul-01 2250
115 IVRCL Infrastructure & Projects Ltd. IVRCLINFRA 27-May-05 2000
116 Jaiprakash Associates Ltd. JPASSOCIAT 29-Dec-06 4500
117 Jaiprakash Hydro-Power Ltd. JPHYDRO 18-Apr-05 12500
118 Jet Airways (India) Ltd. JETAIRWAYS 14-Mar-05 2400
Contd...
Contd...
140
Sr.No
Security Symbol Launch Date
Market Lot
119 Jindal Saw Limited JINDALSAW 30-Nov-07 1000
120 Jindal Steel & Power Ltd JINDALSTEL 20-Apr-05 320
121 JSL Ltd. JSL 12-May-05 8000
122 JSW Steel Ltd. JSWSTEEL 29-Dec-06 1650
123 K S Oils Limited KSOILS 21-Aug-08 5900
124 Kesoram Industries Ltd KESORAMIND 14-May-07 2000
125 Kingfisher Airlines Limited KFA 14-May-07 8500
126 Kotak Mahindra Bank Ltd. KOTAKBANK 29-Dec-06 1100
127 KSK Energy Ventures Ltd. KSK 14-Jul-08 1700
128 Lakshmi Machines Ltd LAXMIMACH 06-Sep-07 400
129 Lanco Infratech Ltd. LITL 27-Nov-06 2550
130 Larsen & Toubro Ltd. LT 15-Sep-06 400
131 LIC Housing Finance Ltd LICHSGFIN 20-Apr-05 1700
132 Lupin Ltd. LUPIN 29-Dec-06 350
133 Mahanagar Telephone Nigam Ltd. MTNL 02-Jul-01 3200
134 Maharashtra Seamless Ltd. MAHSEAMLES 12-May-05 2400
135 Mahindra & Mahindra Ltd. M&M 02-Jul-01 1248
136 Mahindra Lifespace Developers Ltd MAHLIFE 14-May-07 1400
137 Mangalore Refinery And Petrochemicals Ltd. MRPL 20-Apr-05 8900
138 Maruti Udyog Ltd. MARUTI 09-Jul-03 800
139 Mercator Lines Limited MLL 21-Aug-08 9800
140 Mindtree Limited MINDTREE 21-Aug-08 1200
141 Monnet Ispat Ltd MONNETISPA 21-Aug-08 1800
142 Moser-Baer (I) Ltd MOSERBAER 14-May-07 4950
143 Motor Industries Co Ltd BOSCHLTD 30-Nov-07 100
144 Mphasis Ltd. MPHASIS 12-May-05 1600
145 MRF Ltd. MRF 21-Aug-08 200
146 Nagarjuna Constrn. Co. Ltd. NAGARCONST 29-Dec-06 4000
147 Nagarjuna Fertiliser & Chemicals Ltd. NAGARFERT 27-May-05 21000
148 National Aluminium Co. Ltd. NATIONALUM 31-Jan-03 2300
149 National Thermal Power Corporation Ltd. NTPC 05-Nov-04 1625
150 Nava Bharat Ventures Limited NBVENTURES 21-Aug-08 3200
151 NDTV Ltd. NDTV 12-May-05 3300
152 Network 18 Fincap Ltd. NETWORK18 30-Nov-07 2000
153 Neyveli Lignite Corporation Ltd. NEYVELILIG 20-Apr-05 5900
154 NIIT Limited NIITLTD 30-Nov-07 8700
155 Noida Toll Bridge Company Ltd NOIDATOLL 21-Aug-08 16400
156 Oil & Natural Gas Corp. Ltd. ONGC 31-Jan-03 450
157 Opto Circuits (India) Limited OPTOCIRCUI 21-Aug-08 4080
158 Oracle Financial Services Software Limited OFSS 30-May-03 600
Contd...
Contd...
141
Sr.No
Security Symbol Launch Date
Market Lot
159 Orchid Chemicals Ltd. ORCHIDCHEM 12-May-05 4200
160 Oriental Bank Of Commerce ORIENTBANK 29-Aug-03 2400
161 Pantaloon Retail (I) Ltd PANTALOONR 14-May-07 1700
162 Patel Engineering Ltd. PATELENG 14-May-07 2000
163 Patni Computer Syst Ltd PATNI 20-Apr-05 2600
164 Peninsula Land Limited PENINLAND 14-May-07 16500
165 Petronet Lng Limited PETRONET 14-May-07 8800
166 Piramal Healthcare Ltd PIRHEALTH 15-Feb-08 1500
167 Polaris Software Lab Ltd. POLARIS 31-Jan-03 5600
168 Power Finance Corporation Ltd. PFC 23-Feb-07 2400
169 Power Grid Corporation Of India Ltd. POWERGRID 05-Oct-07 3850
170 Praj Industries Ltd. PRAJIND 29-Dec-06 4400
171 PTC India Limited PTC 21-Aug-08 4700
172 Punj Lloyd Ltd. PUNJLLOYD 06-Jan-06 1500
173 Punjab National Bank PNB 29-Aug-03 600
174 Rajesh Exports Ltd RAJESHEXPO 14-May-07 9900
175 Ranbaxy Laboratories Ltd. RANBAXY 02-Jul-01 1600
176 Reliance Natural Resources Ltd. RNRL 14-May-07 7152
177 Reliance Capital Ltd RELCAPITAL 20-Apr-05 552
178 Reliance Communications Ltd. RCOM 15-Sep-06 1400
179 Reliance Industrial Infrastructure Limited RIIL 21-Aug-08 800
180 Reliance Industries Ltd. RELIANCE 02-Jul-01 300
181 Reliance Infrastructure Limited RELINFRA 09-Nov-01 552
182 Reliance Petroleum Ltd. RPL 11-May-06 3350
183 Reliance Power Ltd. RPOWER 11-Feb-08 2000
184 Rolta India Ltd ROLTA 14-May-07 1800
185 Rural Electrification Corporation Ltd. RECLTD 12-Mar-08 3900
186 S Kumars Nationwide Ltd SKUMARSYNF 14-May-07 11400
187 Sesa Goa Ltd. SESAGOA 29-Dec-06 3000
188 Shipping Corporation Of India Ltd. SCI 31-Jan-03 4800
189 Shree Renuka Sugars Ltd. RENUKA 29-Dec-06 5000
190 Siemens Ltd SIEMENS 20-Apr-05 1504
191 Sintex Industries Ltd. SINTEX 21-Aug-08 1400
192 SREI Infrastructure Finance Limited SREINTFIN 21-Aug-08 7000
193 SRF Ltd. SRF 27-May-05 3000
194 State Bank Of India SBIN 02-Jul-01 264
195 Steel Authority Of India Ltd. SAIL 15-Sep-06 5400
196 Sterling Biotech Ltd STERLINBIO 14-May-07 1250
197 Sterlite Industries (I) Ltd STER 20-Apr-05 876
198 Strides Arcolab Ltd. STAR 27-May-05 3400
Contd...
Contd...
142
Sr.No
Security Symbol Launch Date
Market Lot
199 Sun Pharmaceuticals India Ltd. SUNPHARMA 20-Apr-05 225
200 Sun Tv Network Ltd. SUNTV 24-Apr-06 2000
201 Suzlon Energy Ltd. SUZLON 19-Oct-05 6000
202 Syndicate Bank SYNDIBANK 26-Sep-03 3800
203 Tata Chemicals Ltd TATACHEM 20-Apr-05 2700
204 Tata Communications Ltd TATACOMM 20-Apr-05 1050
205 Tata Consultancy Services Ltd TCS 25-Aug-04 500
206 Tata Motors Ltd. TATAMOTORS 02-Jul-01 1700
207 Tata Power Co. Ltd. TATAPOWER 02-Jul-01 400
208 Tata Steel Ltd. TATASTEEL 02-Jul-01 1528
209 Tata Tea Ltd. TATATEA 02-Jul-01 550
210 Tata Teleserv(Maharastra) TTML 29-Dec-06 10450
211 Tech Mahindra Limited TECHM 06-Sep-07 1200
212 Television Eighteen India Ltd. TV-18 21-Aug-08 3400
213 The Great Eastern Shipping Co. Ltd. GESHIP 27-Nov-06 2400
214 The Karnataka Bank Ltd. KTKBANK 27-May-05 5000
215 Thermax Ltd THERMAX 21-Aug-08 1800
216 Titan Industries Ltd. TITAN 12-May-05 412
217 Torrent Power Limited TORNTPOWER 21-Aug-08 3400
218 Triveni Engg. & Inds. Ltd. TRIVENI 29-Dec-06 7700
219 Tulip It Services Ltd TULIP 06-Sep-07 1000
220 TVS Motor Company Ltd. TVSMOTOR 12-May-05 11800
221 UCO Bank UCOBANK 21-Aug-08 10000
222 Ultratech Cement Ltd. ULTRACEMCO 29-Dec-06 800
223 Union Bank Of India UNIONBANK 29-Aug-03 2100
224 Unitech Ltd UNITECH 14-May-07 9000
225 United Phosphorous Ltd UNIPHOS 14-May-07 2800
226 United Spirits Ltd. MCDOWELL-N 29-Dec-06 250
227 UTV Software Communications Limited UTVSOF 21-Aug-08 1200
228 Vijaya Bank VIJAYABANK 20-Apr-05 6900
229 Voltas Ltd. VOLTAS 29-Dec-06 5400
230 Welspun Guj St. Ro. Ltd. WELGUJ 06-Sep-07 3200
231 Wipro Ltd. WIPRO 31-Jan-03 1200
232 Wockhardt Ltd. WOCKPHARMA 20-Apr-05 2400
233 Yes Bank Limited YESBANK 06-Sep-07 4400
234 Zee Entertainment Enterprises Ltd. ZEEL 12-Feb-07 2800
Contd...
143
Tab
le 6
-2 :
Con
trac
t Spe
cific
atio
n fo
r In
dex
Futu
res a
nd O
ptio
ns
Par
ticu
lars
Inde
x F
utur
esIn
dex
Opt
ions
M
ini I
ndex
Fut
ures
Min
i Ind
ex O
ptio
nsLo
ng T
erm
Ind
ex O
ptio
ns
Secu
rity
Des
crip
tion
FUT
IDX
O
PTID
X
FUT
IDX
------
------
------
------
------
------
OPT
IDX
------
------
------
------
------
------
----
Und
erly
ing
Inde
xS&
P C
NX
Nift
y/ C
NX
Nift
y Ju
nior
/ C
NX
100
/ Ba
nk
Nift
y/ C
NX
IT/N
ifty
Mid
cap
50/S
&P
CN
X D
efty
------
------
------
------
------
------
------
------
S&P
CN
X N
ifty-
------
------
------
------
------
------
------
------
------
Styl
e of
Opt
ion
NA
Euro
pean
NA
------
------
------
------
------
------
---Eu
rope
an---
------
------
------
------
------
------
Con
trac
t Siz
eA
s spe
cifie
d by
SEB
I, cu
rren
tly m
inim
um R
s.2 la
khs a
t the
tim
e of
intr
oduc
tion
As s
peci
fied
by S
EBI c
urre
ntly
min
imum
Rs.1
lakh
at t
he
time
of in
trod
uctio
nA
s spe
cifie
d by
SEB
I cu
rren
tly m
inim
um
Rs.2
lakh
s at t
he ti
me
of
intr
oduc
tion
Pric
e St
epR
s. 0.
05
Last
Tra
ding
/Exp
irat
ion
Day
Last
Thu
rsda
y of
the
expi
ry m
onth
or
the
prec
edin
g tr
adin
g da
y, if
last
Thu
rsda
y is
a tr
adin
g ho
liday
Expi
ratio
n Pe
riod
upto
3 m
onth
sup
to 3
.5 y
ears
Tra
ding
Cyc
leA
max
imum
of t
hree
mon
th tr
adin
g cy
cle
- •
Nea
r m
onth
(One
)•
Nex
t mon
th (T
wo)
and
•
Far
mon
th (T
hree
).
New
con
trac
t is i
ntro
duce
d on
the
next
trad
ing
day
follo
win
g th
e ex
piry
of n
ear
mon
th c
ontr
act
• 3
near
mon
th e
xpir
ies
• T
hree
follo
win
g qu
arte
rly
expi
ries
of t
he c
ycle
(Mar
ch,
June
, Sep
t & D
ec)
• A
fter
thes
e 5
follo
win
g ha
lf ye
arly
exp
irie
s of c
ycle
Ju
ne /
Dec
)Pr
ice
Band
sN
o pr
ice
band
how
ever
O
pera
ting
rang
e ha
s bee
n ke
pt w
hich
is 1
0 %
of t
he
base
pri
ce
No
Pric
e ba
nd h
owev
er
Ope
ratin
g ra
nge
has b
een
kept
as:
Upp
er r
ange
- 99
%
of th
e ba
se p
rice
or
Rs.
20
whi
ch e
ver
is hi
gher
. Low
er
rang
e - 0
.05
(tick
size
)
No
pric
e ba
nd h
owev
er
Ope
ratin
g ra
nge
has b
een
kept
whi
ch is
10
% o
f the
ba
se p
rice
No
Pric
e ba
nd h
owev
er O
pera
ting
rang
e ha
s bee
n ke
pt a
s: U
pper
ran
ge -
99 %
of t
he b
ase
pric
e or
Rs.
20 w
hich
eve
r is
high
er. L
ower
ran
ge -
0.05
(tic
k siz
e)
Con
td...
144
Par
ticu
lars
Inde
x F
utur
esIn
dex
Opt
ions
M
ini I
ndex
Fut
ures
Min
i Ind
ex O
ptio
nsLo
ng T
erm
Ind
ex O
ptio
ns
No.
of S
trik
e Pr
ices
NA
For
ever
y op
tion
type
( i.e
C
all &
Put
)
Upt
o 20
00 -
9 st
rike
s (4-
1-4)
4 IT
M, 1
AT
M &
4 O
TM
> 2
001
upto
600
0- 1
3 st
rike
s (6-
1-6)
6 IT
M, 1
AT
M, 6
OT
M
>60
00- 1
5 st
rike
s (7-
1-7)
7 IT
M, 1
AT
M, 7
AT
M
NA
For
ever
y op
tion
type
( i.e
Cal
l & P
ut)
Upt
o 20
00 -
9 st
rike
s (4-
1-4)
4 IT
M, 1
AT
M &
4 O
TM
> 2
001
upto
600
0- 1
3 st
rike
s (6-
1-6)
6 IT
M, 1
AT
M, 6
OT
M
>60
00- 1
5 st
rike
s (7-
1-7)
7 IT
M, 1
AT
M, 7
AT
M
Stri
ke P
rice
Inte
rval
(in
Rs.)
NA
Upt
o 20
00
5
0>
200
0
100
NA
Upt
o 20
00
5
0>
200
0
100
Sett
lem
ent
In c
ash
on T
+1
basis
Sett
lem
ent D
ayLa
st tr
adin
g da
y
Mar
gins
Up-
fron
t ini
tial m
argi
n on
dai
ly b
asis
Dai
ly S
ettle
men
t Pri
ceC
losin
g pr
ice
of fu
ture
s co
ntra
ct o
n th
e tr
adin
g da
yPr
emiu
m V
alue
(net
)C
losin
g pr
ice
of fu
ture
s co
ntra
ct o
n th
e tr
adin
g da
yPr
emiu
m V
alue
(net
)Pr
emiu
m V
alue
(net
)
Fina
l Set
tlem
ent P
rice
C
losin
g va
lue
unde
rlyi
ng
Inde
x on
the
last
trad
ing
day
of th
e fu
ture
s con
trac
t.
Clo
sing
valu
e un
derl
ying
In
dex
on th
e la
st tr
adin
g da
y of
the
Opt
ions
con
trac
t.
Clo
sing
valu
e un
derl
ying
In
dex
on th
e la
st tr
adin
g da
y of
the
futu
res c
ontr
act.
Clo
sing
valu
e un
derl
ying
In
dex
on th
e la
st tr
adin
g da
y of
the
Opt
ions
con
trac
t.
Clo
sing
valu
e un
derl
ying
In
dex
on th
e la
st tr
adin
g da
y of
the
Opt
ions
con
trac
t.
Con
td...
145
Table 6-3 : Contract Specification for Stock Futures and Options
Particulars Stock Futures Stock Options
Security Description FUTSTK OPTSTK
Underlying Individual Securities
Style of Option NA American
Contract Size As specified by SEBI; Currently minimum Rs.2 lakhs at the time of introduction
Price Steps Rs. 0.05
Expiration Period Upto 3 months
Trading Cycle A maximum of three month trading cycle - the near month (one), the next month (two) and the far month (three). New contract is introduced on the next trading day following the expiry of near month contract
Last Trading/Expiration Day Last Thursday of the expiry month or the preceding trading day, if last Thursday is a trading holiday
Price Bands No price bands however Operating range has been kept which is 20% of the base price.
No price band however Operating range has been kept which is: Upper range - 99% of the base price or Rs. 20 which ever is higher, Lower range - 0.05 (tick size)
No. of strike Prices NA 7 strikes (3 ITM, 1 ATM and 3 OTM) for every option type (i.e call and put)
Strike Price Interval (in Rs.) NA Between 2.5 and 100 depending on the price of underlying
Settlement In cash on T+1 basis
Settlement Day Last trading day
Margins Up-front initial margin on daily basis
Daily Settlement Price Closing price of futures contract on the trading
day
Premium Value (net)
Final Settlement Price Closing value underlying security on the last trading day of the futures contract.
Closing value of such underlying security on the last trading day of the options
contract.
Note:ITM: In-the-MoneyATM: At-the-MoneyOTM-Out-of-the-Money
146
Tab
le 6
-4 :
Busi
ness
Gro
wth
of F
utur
es &
Opt
ions
Mar
ket S
egm
ent
Mon
th/
Yea
rIn
dex
Futu
res
Stoc
k Fu
ture
s In
dex
Opt
ions
Stoc
k O
ptio
nsT
otal
Ave
rage
Dai
ly
Tra
ding
Val
ueC
all
Put
Cal
lPu
tN
o. o
f C
ontr
acts
T
rade
d
Tra
ding
V
alue
N
o. o
f C
ontr
acts
T
rade
d
Tra
ding
V
alue
No.
of
Con
trac
ts
Tra
ded
Not
iona
l T
radi
ng
Val
ue
No.
of
Con
trac
ts T
rade
d
Not
iona
l T
radi
ng
Val
ue
No.
of
Con
trac
ts
Tra
ded
Not
iona
l T
radi
ng
Val
ue
No.
of
Con
trac
ts
Tra
ded
No-
tiona
l T
radi
ng
Val
ue
No.
of
Con
trac
ts
Tra
ded
Tra
ding
Val
ue
(Rs.
cr.)
(Rs.
cr)
(Rs.
cr)
(Rs.
cr)
(Rs.
cr)
(Rs.c
r)(U
S $
mn)
(Rs.c
r)(U
S $
mn)
Jun-
00 t
o M
ar-0
190
,580
2,36
5-
--
--
--
--
-90
,580
2,36
555
512
2.49
2001
-02
1,02
5,58
821
,482
1,95
7,85
651
,516
113,
974
2,46
661
,926
1,30
076
8,15
918
,780
269,
370
6,38
34,
196,
873
101,
927
20,8
8741
38.
46
2002
-03
2,12
6,76
343
,951
10,6
76,8
4328
6,53
226
9,67
45,
670
172,
567
3,57
72,
456,
501
69,6
441,
066,
561
30,4
8916
,768
,909
439,
864
92,6
031,
752
368.
94
2003
-04
17,1
91,6
6855
4,46
232
,368
,842
1,30
5,94
91,
043,
894
31,8
0168
8,52
021
,022
4,24
8,14
916
8,17
41,
334,
922
49,0
3856
,886
,776
2,13
0,64
9 4
91,0
46
8,38
819
33.2
5
2004
-05
21,6
35,4
4977
2,17
447
,043
,066
1,48
4,06
71,
870,
647
69,3
731,
422,
911
52,5
813,
946,
979
132,
066
1,09
8,13
336
,792
77,0
17,1
852,
547,
053
582,
183
10,0
6723
01.1
2
2005
-06
58,
537,
886
1,5
13,7
91
79,5
86,8
52
2,79
1,72
1 6
,413
,467
1
68,6
32
6,5
21,6
49
169
,837
4,
165,
996
143
,752
1,
074,
780
36,
518
157
,619
,271
4
,824
,250
1
,081
,428
19
,220
43
08.4
8
2006
-07
81,
487,
424
2,5
39,5
75
104,
955,
401
3,83
0,97
2 1
2,63
2,34
9 3
98,2
19
12,
525,
089
393
,693
4,
394,
292
161
,902
8
89,0
18
31,
909
216
,883
,573
7
,356
,271
1
,687
,605
29
,543
67
77.5
3
Apr
-07
10,
383,
282
205
,458
1
0,64
7,86
6 2
96,6
29
2,4
02,7
64
48,
574
2,4
71,6
98
48,
576
506
,497
1
3,73
5 1
28,8
60
3,3
15
26,
540,
967
616
,287
1
54,1
87
30,
814
7,7
09
May
-07
10,
219,
149
214
,523
1
3,35
0,66
7 4
00,0
96
1,9
93,7
61
42,
577
2,0
61,9
21
42,
888
625
,846
1
9,38
0 1
32,4
60
3,9
77
28,
383,
804
723
,443
1
80,9
96
34,
450
8,6
19
Jun-
07 1
1,40
7,86
5 2
40,7
97
14,
287,
983
451
,314
2
,116
,761
4
5,56
8 2
,224
,230
4
6,93
6 5
79,0
74
18,
359
115
,515
3
,569
3
0,73
1,42
8 8
06,5
42
201
,787
3
8,40
7 9
,609
Jul-0
7 1
0,60
5,48
3 2
38,5
77
18,
888,
008
647
,356
1
,684
,458
3
8,41
5 2
,537
,127
5
6,14
6 8
50,1
53
28,
895
172
,005
5
,687
3
4,73
7,23
4 1
,015
,077
2
53,9
60
46,
140
11,
544
Aug
-07
17,
052,
495
363
,988
1
5,79
8,35
1 5
19,3
85
3,1
58,7
58
69,
705
3,2
80,9
21
71,
256
774
,381
2
6,76
9 1
71,0
19
5,6
29
40,
235,
925
1,0
56,7
31
264
,381
4
8,03
3 1
2,01
7
Sep-
07 1
0,90
4,56
4 2
56,4
70
17,
653,
654
670
,968
2
,020
,510
4
8,37
0 2
,599
,916
5
9,59
4 7
97,2
64
31,
958
143
,404
5
,527
3
4,11
9,31
2 1
,072
,889
2
68,4
24
53,
644
13,
421
Oct
-07
17,
842,
671
485
,079
2
4,00
8,47
0 1
,120
,263
2
,808
,150
7
8,73
1 3
,599
,639
9
5,26
2 9
84,1
50
47,
981
142
,394
6
,347
4
9,38
5,47
4 1
,833
,663
4
58,7
60
83,
348
20,
853
Nov
-07
12,
668,
280
365
,564
1
8,03
3,29
4 9
89,1
13
2,0
14,5
33
60,
097
1,9
94,1
75
56,
855
710
,304
4
0,29
7 1
01,3
27
5,3
79
35,
521,
913
1,5
17,3
04
379
,611
6
8,96
8 1
7,25
5
Dec
-07
9,6
09,2
09
287
,357
1
6,56
5,23
6 8
49,9
97
1,6
24,3
54
49,
964
1,8
05,0
71
53,
202
578
,100
3
0,27
9 7
1,33
4 3
,432
3
0,25
3,30
4 1
,274
,230
3
18,7
97
67,
065
16,
779
Con
td...
147
Mon
th/
Yea
rIn
dex
Futu
res
Stoc
k Fu
ture
s In
dex
Opt
ions
Stoc
k O
ptio
nsT
otal
Ave
rage
Dai
ly
Tra
ding
Val
ueC
all
Put
Cal
lPu
tN
o. o
f C
ontr
acts
T
rade
d
Tra
ding
V
alue
N
o. o
f C
ontr
acts
T
rade
d
Tra
ding
V
alue
No.
of
Con
trac
ts
Tra
ded
Not
iona
l T
radi
ng
Val
ue
No.
of
Con
trac
ts T
rade
d
Not
iona
l T
radi
ng
Val
ue
No.
of
Con
trac
ts
Tra
ded
Not
iona
l T
radi
ng
Val
ue
No.
of
Con
trac
ts
Tra
ded
No-
tiona
l T
radi
ng
Val
ue
No.
of
Con
trac
ts
Tra
ded
Tra
ding
Val
ue
(Rs.
cr.)
(Rs.
cr)
(Rs.
cr)
(Rs.
cr)
(Rs.
cr)
(Rs.c
r)(U
S $
mn)
(Rs.c
r)(U
S $
mn)
Jan-
08 1
6,14
8,83
8 4
50,6
57
23,
736,
610
851
,213
2
,018
,823
6
0,75
3 1
,957
,642
5
8,07
4 7
64,9
89
29,
383
103
,561
3
,800
4
4,73
0,46
3 1
,453
,881
3
63,7
43
63,
212
15,
815
Feb-
08 1
4,06
4,21
1 3
52,2
26
14,
491,
601
421
,838
2
,185
,165
5
9,93
1 1
,934
,412
5
0,32
0 4
27,4
83
12,
733
82,
832
2,1
68
33,
185,
704
899
,217
2
24,9
73
42,
820
10,
713
Mar
-08
15,
692,
532
359
,970
16
,126
,212
3
30,3
90
2,6
39,8
45
66,
131
2,2
31,4
04
54,
186
404
,472
8
,674
9
3,20
7 1
,862
3
7,18
7,67
2 8
21,2
15
205
,458
4
5,62
3 1
1,41
4
2007
-08
156,
598,
579
3,8
20,6
67
203,
587,
952
7,54
8,56
3 2
6,66
7,88
2 6
68,8
16
28,
698,
156
693
,295
8,
002,
713
308
,443
1,
457,
918
50,
693
425
,013
,200
13
,090
,478
3
,275
,076
52
,153
1
3,04
8
Apr
-08
12,
063,
172
280,
100
15,
601,
531
336,
901
2,6
72,5
88
67,
954
2,6
92,6
43
65,
611
573
,744
1
3,13
9 1
26,1
46
2,7
25
33,
729,
824
766
,431
1
50,4
28
38,
322
7,5
21
May
-08
11,
161,
427
267,
641
16,
693,
260
380,
161
2,2
43,1
73
58,
115
2,8
35,7
87
70,
951
740
,079
1
7,23
9 1
66,3
29
3,8
01
33,
840,
055
797
,908
1
56,6
06
39,
895
7,8
30
Jun-
08 1
7,94
1,87
0 37
7,93
9 1
9,15
4,94
6 37
5,98
7 6
,056
,056
1
39,9
19
7,5
08,3
80
168
,790
7
40,2
29
17,
009
199
,648
4
,421
5
1,60
1,12
9 1
,084
,064
2
12,7
70
51,
622
10,
132
Jul-0
8 2
0,42
3,13
9 39
5,38
0 2
2,23
2,22
7 38
2,60
1 9
,144
,707
1
98,1
74
7,7
44,9
97
159
,035
9
44,6
02
19,
354
307
,688
5
,630
6
0,79
7,36
0 1
,160
,174
2
27,7
08
50,
442
9,9
00
Aug
-08
14,
433,
984
300,
449
17,
594,
216
324,
011
7,5
68,1
63
174
,797
6
,267
,479
1
37,3
05
820
,895
1
6,88
0 2
08,8
06
4,0
03
46,
893,
543
957
,445
1
87,9
19
47,
872
9,3
96
Sep-
08 1
9,33
2,34
3 38
0,19
8 2
0,07
6,13
8 33
2,72
8 1
2,16
1,14
8 2
68,0
33
9,2
37,2
82
193
,589
1
,035
,531
1
8,68
8 2
69,1
24
4,6
36
62,
111,
566
1,1
97,8
72
235
,107
5
7,04
2 1
1,19
6
Oct
-08
21,
649,
445
324,
962
19,
858,
409
239,
264
12,
967,
476
231
,565
7
,769
,905
1
32,9
45
689
,231
9
,951
2
00,3
62
2,9
60
63,
134,
828
941
,646
1
84,8
18
47,
082
9,2
41
Nov
-08
19,
471,
367
256,
950
17,
949,
270
187,
211
10,
296,
361
158
,042
9
,624
,563
1
34,0
92
561
,864
6
,429
2
41,9
53
2,6
32
58,
145,
378
745
,356
1
46,2
92
41,
409
8,1
27
Dec
-08
20,
007,
895
269
,997
2
2,26
2,78
5 2
30,4
66
11,
144,
623
171
,697
1
0,01
4,15
6 1
41,9
19
927
,467
1
0,56
2 4
36,8
40
4,5
26
64,
793,
766
829
,166
1
62,7
41
39,
484
7,7
50
Jan-
09 1
7,69
5,54
2 2
34,1
41
22,
814,
332
215
,830
1
0,57
3,68
6 1
58,7
02
10,
641,
985
150
,570
1
,214
,695
1
2,87
2 5
62,4
25
6,0
04
63,
502,
665
778
,118
1
52,7
22
38,
906
7,6
36
Feb-
09 1
5,75
0,76
7 2
05,6
79
17,
156,
838
185
,121
9
,986
,938
1
47,3
29
11,
488,
263
158
,270
8
93,0
75
10,
387
468
,695
5
,585
5
5,74
4,57
6 7
12,3
70
139
,818
3
7,49
3 7
,359
Mar
-09
20,
497,
152
276
,677
1
0,18
4,02
8 2
89,3
62
15,
617,
055
228
,218
1
5,83
1,03
0 2
15,8
81
621
,556
1
9,33
2 3
44,9
86
10,
461
63,
095,
807
1,0
39,9
31
204
,108
5
1,99
7 1
0,20
5
2008
-09
210,
428,
103
3,5
70,1
11
221,
577,
980
3,47
9,64
2 11
0,43
1,97
4 2,
002,
544
101
,656
,470
1,
728,
957
9,76
2,96
8 1
71,8
43
3,53
3,00
2 5
7,38
4 6
57,3
90,4
97
11,0
10,4
82
2,1
61,0
37
45,3
11
8,8
93
Con
td...
148
Table 6-5 : Sectorwise Trading Value of Top 5 companies in the F&O Segment (2008-09)
BANKS FMCG
Company Name Turnover (Rs.cr)
Company Name Turnover (Rs.cr)
State Bank of India Ltd. 154,695.13 Hindustan Unilever Ltd. 26,806.87
ICICI Bank Ltd. 130,624.28 ITC LTD. 26,498.97
HDFC Bank 49,174.31 United Spirits Ltd. 9,724.07
AXIS Bank 38,587.19 Tata Tea Ltd. 1,704.15
Bank of India Ltd. 28,388.71 Dabur India Ltd. 897.59
INFRASTRUCTURE MEDIA & ENTERTAINMENT
Company Name Turnover (Rs.cr)
Company Name Turnover (Rs.cr)
DLF Ltd. 104,071.21 Adlabs Films Ltd. 11,240.05
NTPC Ltd. 94,375.84 Zee Entertainment Enterprises Ltd. 5,416.68
Reliance Infrastrucuture Ltd. 61,957.74 Wire and Wireless (India) Ltd. 1,826.93
Housing Development and Infrastrucuture Limited
48,544.36 New Delhi Television Ltd. 1,718.84
UNITECH Ltd. 44,534.44 Dish TV India Ltd. 1,110.56
PHARMACEUTICALS TELECOMMUNICATION
Company Name Turnover (Rs.cr)
Company Name Turnover (Rs.cr)
Ranbaxy Laboratories Ltd. 58,826.24 Reliance Communications Ltd. 87,444.98
Orchid Chemicals & Pharmaceuticals Ltd.
12,836.9 Bharti Airtel Ltd. 75,999.36
Sun Pharmaceuticals Industries Ltd. 9,488.12 Idea Cellular Limited 22,680.14
CIPLA Ltd. 7,741.93 Tata Teleservices (Maharashtra) Ltd.
11,468.56
Sterling Biotech Limited 6,576.48 Tata Communications Limited 7,313.08
Contd...
149
FINANCE INFORMATION TECHNOLOGY
Company Name Turnover (Rs.cr)
Company Name Turnover (Rs.cr)
Reliance Capital Ltd. 123,087.76 Infosys Technologies Ltd. 106,209.29
Housing Development Finance Corporation Ltd.
41,593.76 Satyam Computer Services Ltd. 44,243.64
IFCI Ltd. 31,215.33 Educomp Solutions Ltd. 34,024.03
Infrastructure Development Finance Company Ltd.
22,356.03 Tata Consultancy Services Ltd. 28,587.54
LIC Housing Finance Ltd. 5,832.87 WIPRO Ltd. 18,832.94
PETROCHEMICALS MANUFACTURING
Company Name Turnover (Rs.cr)
Company Name Turnover (Rs.cr)
Reliance Industries Ltd. 368,248.83 Tata Steel Ltd. 104,187.28
Reliance Petroleum Ltd. 145,866.62 Reliance Natural Resources Ltd. 70,316.3
Oil & Natural Gas Corpn. Ltd. 62,888.53 Bharat Heavy Electricals Ltd. 65,734.51
Cairn India Ltd. 50,964.19 Shree Renuka Sugars Ltd. 65,076.77
Essar Oil Ltd. 36,248.97 Steel Authority of India Ltd. 58,808.27
SERVICES ENGINEERING
Company Name Turnover (Rs.cr)
Company Name Turnover (Rs.cr)
The Great Eastern Shipping Co. Ltd.
2,554.72 Larsen & Toubro Ltd. 87,232.74
Indian Hotels Co. Ltd. 1,965.07 Praj Industries Ltd. 10,994.26
Jet Airways (India) Ltd. 1,960.11 BEML Ltd. 356.24
Shipping Corporation of India Ltd. 1,764.49 Reliance Industrial Infrastructure Ltd.
239.88
Hotel Leela Venture Ltd. 1,542.52 Walchandnagar Industries Ltd. 239.6
Contd...
150
Tab
le 6
-6 :
Part
icip
ant w
ise
Tra
ding
Val
ue in
the
F&O
Seg
men
t (20
08-0
9)
Mon
th/Y
ear
Inst
itut
iona
l inv
esto
rsR
etai
lP
ropr
ieta
ryG
ross
Tra
ded
Val
ue%
to
Gro
ssT
urno
ver
Gro
ss T
rade
d V
alue
% t
o G
ross
Tur
nove
rG
ross
Tra
ded
Val
ue
% t
o G
ross
Tur
nove
rR
s. c
rore
US
$ m
nR
s. c
rore
US
$ m
nR
s. c
rore
US
$ m
n
Apr
-07
155
,557
3
8,91
8 1
2.62
7
48,6
14
187
,294
6
0.74
3
28,4
02
82,
162
26.6
4M
ay-0
7 1
47,9
21
37,
008
10.
22
919
,717
2
30,1
02
63.
57
379
,247
9
4,88
3 26
.21
Jun-
07 1
93,9
73
48,
530
12.
03
1,0
05,4
14
251
,542
6
2.33
4
13,6
97
103
,502
25
.64
Jul-0
7 2
53,2
75
63,
366
12.
48
1,2
58,1
73
314
,779
6
1.97
5
18,7
05
129
,774
25
.55
Aug
-07
303
,332
7
5,89
0 1
4.35
1
,263
,505
3
16,1
13
59.
79
546
,625
1
36,7
59
25.8
6Se
p-07
258
,570
6
4,69
1 1
2.05
1
,350
,709
3
37,9
31
62.
95
536
,498
1
34,2
25
25.0
0O
ct-0
7 3
90,7
44
97,
759
10.
66
2,3
49,7
07
587
,868
6
4.07
9
26,8
75
231
,893
25
.27
Nov
-07
258
,570
6
4,69
1 8
.52
2,0
39,4
21
510
,238
6
7.21
7
36,6
18
184
,293
24
.27
Dec
-07
310
,552
7
7,69
6 1
2.19
1
,659
,533
4
15,1
95
65.
11
578
,375
1
44,7
02
22.7
0Ja
n-08
399
,283
9
9,89
6 1
3.73
1
,817
,156
4
54,6
30
62.
49
691
,323
1
72,9
60
23.7
8Fe
b-08
311
,195
7
7,85
7 1
7.30
1
,063
,876
2
66,1
69
59.
16
423
,363
1
05,9
20
23.5
4M
ar-0
8 2
73,0
62
68,
317
16.
63
1,0
09,8
99
252
,664
6
1.48
3
59,4
68
89,
934
21.8
920
07-0
8 3
,256
,034
8
14,6
19
12.
44
16,
485,
724
4,1
24,5
24
62.
97
6,4
39,1
96
1,6
11,0
07
24.5
9A
pr-0
8 2
66,0
39
52,
216
17.
36
852
,917
1
67,4
03
55.
64
413
,906
8
1,23
8 27
.00
May
-08
274
,787
5
3,93
3 1
7.22
8
76,1
67
171
,966
5
4.90
4
44,8
63
87,
314
27.8
8Ju
n-08
331
,733
6
5,11
0 1
5.30
1
,158
,405
2
27,3
61
53.
43
677
,991
1
33,0
70
31.2
7Ju
l-08
319
,854
6
2,77
8 1
3.78
1
,265
,173
2
48,3
17
54.
53
735
,320
1
44,3
22
31.6
9A
ug-0
8 2
50,9
35
49,
251
13.
10
1,0
79,9
34
211
,960
5
6.40
5
84,0
21
114
,626
30
.50
Sep-
08 2
90,7
13
57,
058
12.
13
1,3
61,9
14
267
,304
5
6.85
7
43,1
18
145
,852
31
.02
Oct
-08
233
,594
4
5,84
8 1
2.40
1
,034
,923
2
03,1
25
54.
95
614
,776
1
20,6
63
32.6
4N
ov-0
8 1
66,7
00
32,
718
11.
18
835
,439
1
63,9
72
56.
04
488
,574
9
5,89
3 32
.77
Dec
-08
178
,521
3
5,03
8 1
0.77
9
34,3
67
183
,389
5
6.34
5
45,4
44
107
,055
32
.89
Jan-
09 1
84,7
01
36,
251
11.
87
869
,059
1
70,5
71
55.
84
502
,477
9
8,62
2 32
.29
Feb-
09 1
83,6
07
36,
037
12.
89
807
,243
1
58,4
38
56.
66
433
,891
8
5,16
0 30
.45
Mar
-09
263
,270
5
1,67
2 1
2.66
1
,174
,488
2
30,5
18
56.
47
642
,103
1
26,0
26
30.8
720
08-0
9 2
,944
,454
5
77,9
11
13.
37
12,
250,
029
2,4
04,3
24
55.
63
6,8
26,4
84
1,3
39,8
40
31.0
0
151
Table 6-7a : Number of Members in different turnover brackets during 2008-09
Turnover
Month/Year
Upto Rs. 10 crores
Rs. 10 crores upto
Rs. 50 crores
Rs. 50 crores upto
Rs.250 crores
Rs. 250 crores upto
Rs.500 crores
Rs. 500 crores upto
Rs.1000 crores
Rs. 1000 crores and
more
Apr-07 50 100 192 116 101 220
May-07 38 93 181 116 107 253
Jun-07 37 81 188 103 131 254
Jul-07 36 64 172 106 125 296
Aug-07 35 58 185 108 130 286
Sep-07 27 68 167 113 123 308
Oct-07 18 45 140 97 114 400
Nov-07 20 60 144 106 104 385
Dec-07 25 71 158 100 111 356
Jan-08 25 63 154 104 116 359
Feb-08 51 93 197 117 95 270
Mar-08 55 103 189 105 111 258
2007-08 12 13 45 37 54 691
Apr-08 55 95 218 112 103 242
May-08 59 104 215 109 110 243
Jun-08 50 100 211 109 89 289
Jul-08 58 99 195 126 85 297
Aug-08 64 114 210 117 97 273
Sep-08 58 107 219 114 87 301
Oct-08 78 130 229 102 102 246
Nov-08 90 127 251 96 102 212
Dec-08 80 112 248 106 100 237
Jan-09 93 123 253 99 110 220
Feb-09 100 124 252 103 102 215
Mar-09 72 126 201 118 104 280
2008-09 21 28 81 65 91 661
152
Tab
le 6
-7b
: N
o. o
f mem
bers
in d
iffer
ent T
urno
ver
Brac
kets
in F
utur
es a
nd O
ptio
ns S
egm
ent f
or 2
008-
09
Mon
thF
utur
es S
egm
ent
Opt
ions
Seg
men
t
Num
ber
of M
embe
rsN
umbe
r of
Mem
bers
Upt
o R
s.
10 c
rore
sR
s. 1
0 cr
ores
upt
o R
s. 5
0 cr
ores
Rs.
50
cror
es u
pto
Rs.
250
cror
es
Rs.
250
cr
ores
upt
o R
s.50
0 cr
ores
Rs.
500
cr
ores
upt
o R
s.10
00
cror
es
Rs.
100
0 cr
ores
and
m
ore
Upt
o R
s.
10 c
rore
sR
s. 1
0 cr
ores
upt
o R
s. 5
0 cr
ores
Rs.
50
cror
es u
pto
Rs.
250
cror
es
Rs.
250
cr
ores
upt
o R
s.50
0 cr
ores
Rs.
500
cr
ores
upt
o R
s.10
00
cror
es
Rs.
100
0 cr
ores
and
m
ore
Apr
-07
5810
920
311
010
519
429
718
218
044
3343
May
-07
4310
318
811
610
523
329
418
918
742
3640
Jun-
0742
8919
811
011
723
829
818
518
754
2644
Jul-0
738
7617
611
311
927
729
118
218
755
3648
Aug
-07
3867
198
116
117
266
253
190
187
6640
66Se
p-07
3180
172
113
122
288
269
202
181
5839
57O
ct-0
719
5514
910
411
037
721
918
620
478
4582
Nov
-07
2273
145
107
114
358
255
210
186
6444
60D
ec-0
727
7217
010
411
433
430
219
617
260
3853
Jan-
0830
6417
095
116
346
289
198
188
5043
53Fe
b-08
5710
220
511
396
250
346
189
160
4040
48M
ar-0
863
111
211
9997
240
335
185
167
4739
4820
07-0
813
1450
4257
676
9896
176
9691
295
Apr
-08
6011
022
611
510
121
331
618
918
743
3555
May
-08
6611
123
010
611
521
232
518
919
438
3361
Jun-
0862
119
234
9798
238
271
179
180
6943
106
Jul-0
871
121
222
106
9724
326
216
319
664
6111
4A
ug-0
880
133
229
106
102
225
291
154
209
6357
101
Sep-
0878
121
245
118
9123
326
016
319
573
7012
5O
ct-0
810
315
025
199
9518
929
718
218
176
3811
3N
ov-0
811
415
225
510
582
170
314
190
175
6825
106
Dec
-08
9614
226
910
294
180
316
178
171
7347
98Ja
n-09
111
158
269
9787
176
32
418
017
768
4610
3Fe
b-09
120
156
273
9893
156
31
418
219
148
5510
6M
ar-0
999
142
241
108
104
207
27
017
919
667
4614
320
08-0
929
3695
7010
4 6
13
111
9916
210
390
382
153
Table 6-7c : Segment wise Contribution of Top ‘N’ Members to turnover on Futures and Options segment
(in percent)Month Futures Segment Options Segment
Top 5 Members
Top 10 Members
Top 15 Members
Top 25 Members
Top 5 Members
Top 10 Members
Top 15 Members
Top 25 Members
2005-06 12 20 26 36 23 36 45 55
2006-07 14 22 28 38 23 36 46 58
Apr-07 14 24 31 41 21 35 45 59
May-07 14 23 30 39 20 33 43 57
Jun-07 14 23 30 40 21 34 43 58
Jul-07 14 23 29 39 22 34 43 57
Aug-07 15 24 30 41 20 33 43 56
Sep-07 14 23 29 39 21 33 43 56
Oct-07 14 23 30 40 23 35 44 56
Nov-07 15 23 30 40 26 37 46 58
Dec-07 15 24 31 40 25 37 45 58
Jan-08 16 24 31 41 28 39 48 59
Feb-08 17 24 30 41 25 38 48 60
Mar-08 16 24 30 40 24 37 47 59
2007-08 14 23 29 39 23 34 43 56
Apr-08 17 26 33 43 22 37 48 61
May-08 16 25 32 42 21 35 45 59
Jun-08 17 26 33 43 18 32 42 55
Jul-08 18 26 33 43 17 30 40 54
Aug-08 17 26 32 42 18 31 42 56
Sep-08 16 25 31 41 20 33 42 56
Oct-08 16 23 30 41 21 34 44 56
Nov-08 17 25 31 42 22 34 43 56
Dec-08 17 25 32 42 23 35 44 57
Jan-09 16 24 31 41 21 32 41 55
Feb-09 16 24 31 42 21 32 41 55
Mar-09 15 23 30 41 23 34 42 55
2008-09 17 25 31 41 18 31 40 54
154
Table 6-8 : Top 20 Futures contracts according to number of contracts 2008-09
S. No.
Name of the Contract Number of Contracts
Turnover Percentage of contracts to
Top 20 contracts
(Rs.cr.) (US $ mn)
1 NIFTY JULY 2008 20,297,164 416,401.39 81,727.46 10.122 NIFTY OCTOBER 2008 19,769,423 336,376.23 66,020.85 9.863 NIFTY NOVEMBER 2008 18,387,751 260,656.14 51,159.20 9.174 NIFTY JANUARY 2009 16,821,763 241,115.92 47,324.03 8.395 NIFTY MARCH 2009 15,203,849 208,752.62 40,972.06 7.586 NIFTY DECEMBER 2008 15,002,383 214,939.19 42,186.30 7.487 NIFTY JUNE 2008 14,941,873 338,642.06 66,465.57 7.458 NIFTY SEPTEMBER 2008 14,779,152 313,961.67 61,621.53 7.379 NIFTY FEBRUARY 2009 13,407,466 188,124.83 36,923.42 6.69
10 NIFTY AUGUST 2008 12,456,987 275,209.78 54,015.66 6.2111 NIFTY MAY 2008 10,859,698 274,042.71 53,786.60 5.4212 NIFTY APRIL 2008 8,343,235 201,452.81 39,539.32 4.1613 NIFTY APRIL 2009 4,497,650 67,051.76 13,160.31 2.2414 RELIANCE JULY 2008 2,491,130 39,301.30 7,713.70 1.2415 RELIANCE JANUARY 2009 2,487,318 22,633.26 4,442.25 1.2416 RELIANCE OCTOBER 2008 2,345,192 27,622.72 5,421.53 1.1717 RELIANCE NOVEMBER 2008 2,307,119 20,751.84 4,072.98 1.1518 RELIANCE DECEMBER 2008 2,157,962 19,863.41 3,898.61 1.0819 RELIANCE JUNE 2008 2,007,933 34,002.70 6,673.74 1.0020 RELIANCE FEBRUARY 2009 1,937,277 18,908.86 3,711.26 0.97
TOTAL 200,502,325 3,519,811.20 690,836.35 100.00
Table 6-9 : Top 20 Option contracts according to no. of contracts traded 2008-09
S.No.
Name of the Contract Number of Contracts
Turnover Percentage of contracts to Top 20 contracts
(Rs.cr) (US $ mn)
1 NIFTY March 2009 CE 2800 3,224,838 46,028.25 6.622 NIFTY February 2009 PE 2700 3,056,883 42,109.77 6.283 NIFTY February 2009 PE 2800 3,039,443 43,809.91 6.244 NIFTY March 2009 CE 2700 2,742,878 38,082.10 5.635 NIFTY December 2008 CE 3000 2,722,357 41,735.03 5.596 NIFTY January 2009 PE 2700 2,652,939 36,698.92 5.457 NIFTY January 2009 PE 2800 2,590,551 37,455.22 5.328 NIFTY February 2009 CE 2800 2,583,973 37,171.88 5.309 NIFTY March 2009 PE 2600 2,566,821 34,225.26 5.27
10 NIFTY March 2009 CE 2900 2,505,805 36,878.73 5.1411 NIFTY March 2009 PE 2700 2,499,347 34,683.97 5.1312 NIFTY February 2009 CE 2900 2,411,719 35,799.32 4.9513 NIFTY March 2009 PE 2500 2,371,797 30,200.65 4.8714 NIFTY January 2009 CE 2800 2,337,225 33,470.20 4.8015 NIFTY November 2008 PE 2700 2,088,443 29,216.45 4.2916 NIFTY January 2009 CE 3000 2,009,187 30,995.26 4.1217 NIFTY March 2009 CE 3000 1,912,220 28,928.38 3.9318 NIFTY January 2009 CE 2900 1,859,902 27,610.15 3.8219 NIFTY July 2008 CE 4300 1,788,470 39,062.20 3.6720 NIFTY December 2008 CE 2900 1,748,845 26,223.13 3.59
TOTAL 48,713,643 710,384.78 100.00
155
Table 6-10 : Number of trades in the Futures & Options Segment 2008-09
Month/Year Index Futures Stock Futures Index Options Stock Options Total
Apr-07 2,038,185 8,170,413 769,882 517,312 11,495,792
May-07 2,098,729 10,413,251 707,752 630,424 13,850,156
Jun-07 2,251,004 11,127,763 716,888 578,186 14,673,841
Jul-07 1,871,019 14,313,227 616,592 818,098 17,618,936
Aug-07 3,069,790 12,159,749 1,053,308 760,914 17,043,761
Sep-07 2,125,228 13,888,158 716,206 806,026 17,535,618
Oct-07 3,554,883 18,816,027 1,349,886 983,678 24,704,474
Nov-07 2,572,671 14,446,566 919,748 709,814 18,648,799
Dec-07 1,905,167 13,298,252 720,893 568,343 16,492,655
Jan-08 3,004,614 16,404,002 812,499 635,442 20,856,557
Feb-08 3,149,318 10,189,345 904,751 399,656 14,643,070
Mar-08 3,256,450 9,961,015 1,082,078 359,972 14,659,515
2007-08 30,897,058 153,187,768 10,370,483 7,767,865 202,223,174
Apr-08 3,271,644 11,208,858 1,224,318 544,051 16,248,871
May-08 2,816,276 12,191,813 1,047,539 685,693 16,741,321
Jun-08 4,490,539 13,547,829 2,648,194 681,604 21,368,166
Jul-08 5,557,672 15,679,079 3,713,214 933,961 25,883,926
Aug-08 4,103,495 12,452,067 3,082,063 764,533 20,402,158
Sep-08 5,289,846 13,859,395 4,276,123 844,724 24,270,088
Oct-08 5,781,231 13,374,817 4,458,908 605,226 24,220,182
Nov-08 5,779,280 12,154,631 4,857,126 584,173 23,375,210
Dec-08 6,220,608 14,899,917 4,816,107 934,064 26,870,696
Jan-09 5,136,302 14,413,326 4,226,118 1,155,822 24,931,568
Feb-09 4,631,594 11,035,948 4,021,976 870,032 20,559,550
Mar-09 5,819,745 8,438,603 5,368,456 727,417 20,354,221
2008-09 58,898,232 153,256,283 43,740,142 9,331,300 265,225,957
156
Table 6-11 : Settlement Statistics in F&O Segment
Month/Year Index/Stock Futures Index/Stock Options Total
MTM Settle-ment
Final Settle-ment
Premium Settlement
Exercise Settlement
(Rs.cr) (Rs.cr) (Rs.cr) (Rs.cr) (Rs.cr) (US $ mn)
2000-01 84.08 1.93 -- -- 86.01 18.44
2001-02 505.25 21.93 164.76 93.95 785.88 161.04
2002-03 1,737.90 45.76 331.21 195.88 2,310.76 486.47
2003-04 10,821.98 138.95 858.94 476.12 12,295.98 2833.83
2004-05 13,024.18 227.50 941.06 455.87 14,648.62 3348.25
2005-06 25,585.51 597.89 1,520.58 817.84 28,521.80 6393.59
2006-07 61,313.70 797.54 3,194.38 1,188.84 66,494.47 15254.52
Apr-07 4,162.90 41.96 385.58 188.36 4,778.80 1,197.69
May-07 3,251.10 94.92 294.13 211.43 3,851.58 965.31
Jun-07 3,794.50 72.59 367.07 92.24 4,326.39 1,084.31
Jul-07 4,935.20 71.64 498.15 247.67 5,752.66 1,441.77
Aug-07 11,299.00 107.60 599.84 143.88 12,150.33 3,045.20
Sep-07 5,300.00 103.42 569.62 583.62 6,556.66 1,643.27
Oct-07 15,924.00 222.61 918.41 669.84 17,734.85 4,444.82
Nov-07 16,248.00 282.38 615.11 327.17 17,472.66 4,379.11
Dec-07 14,125.00 77.17 478.38 203.60 14,884.14 3,730.36
Jan-08 39,768.00 105.11 777.95 767.43 41,418.49 10,380.57
Feb-08 13,679.00 64.00 604.58 169.88 14,517.46 3,638.46
Mar-08 12,168.00 68.72 651.35 187.14 13,075.21 3,276.99
2007-08 144,654.70 1,312.12 6,760.17 3,792.26 156,519.23 39,227.88
Apr-08 5,391.50 66.71 785.96 164.02 6,408.19 1,257.74
May-08 5,601.50 203.64 603.59 190.78 6,599.51 1,295.29
Jun-08 9,182.80 137.30 1,126.00 341.86 10,787.96 2,117.36
Jul-08 11,070.00 59.52 1,015.90 208.83 12,354.25 2,424.78
Aug-08 4,844.80 129.30 742.07 145.52 5,861.69 1,150.48
Sep-08 7,120.40 225.92 921.39 178.64 8,446.35 1,657.77
Oct-08 9,409.20 54.34 1,384.10 1,418.90 12,266.54 2,407.56
Nov-08 5,782.10 45.97 785.52 160.42 6,774.01 1,329.54
Dec-08 4,300.70 151.65 770.55 581.94 5,804.84 1,139.32
Jan-09 4,476.70 58.28 936.39 154.79 5,626.16 1,104.25
Feb-09 3,247.10 65.42 800.53 134.22 4,247.27 833.62
Mar-09 4,766.80 300.24 1,088.50 507.66 6,663.20 1,307.79
2008-09 75,193.60 1,498.29 10,960.50 4,187.58 91,839.97 18,025.51
Currency Derivatives Segment 7
158
159
7Currency Derivatives Segment
The Reserve Bank of India in its Annual Policy Statement for the Year 2007-08 proposed to set up a Working Group on Currency Futures to study the international experience and suggest a suitable framework to operationalise the proposal, in line with the current legal and regulatory framework. This Group submitted its report in April, 2008. Following this, RBI and Securities and Exchange Board of India (SEBI) jointly constituted a Standing Technical Committee to inter-alia evolve norms and oversee implementation of Exchange Traded Currency Derivatives. The Committee submitted its report on May 29, 2008. This report laid down the framework for the launch of Exchange Traded Currency Futures in terms of the eligibility norms for existing and new Exchanges and their Clearing Corporations/Houses, eligibility criteria for members of such Exchanges/Clearing Corporations/Houses, product design, risk management measures, surveillance mechanism and other related issues.
The Regulatory framework for currency futures trading in the country, as laid down by the regulators, provide that persons resident in India are permitted to participate in the currency futures market in India subject to directions contained in the Currency Futures (Reserve Bank) Directions, 2008, which have come into force with effect from August 6, 2008.
The membership of the currency futures market of a recognised stock exchange has been mandated to be separate from the membership of the equity derivative segment or the cash segment. Banks authorized by the Reserve Bank of India under section 10 of the Foreign Exchange Management Act, 1999 as ‘AD Category - I bank’ are permitted to become trading and clearing members of the currency futures market of the recognized stock exchanges, on their own account and on behalf of their clients, subject to fulfilling certain minimum prudential requirements pertaining to net worth, non-performing assets etc.
NSE was the first exchange to have received an in-principle approval from SEBI for setting up currency derivative segment. National Stock Exchange was the first exchange to launch Currency futures trading in India. The Currency Derivatives segment at NSE commenced operations on August 29, 2008 with the launch of currency futures trading in US Dollar-India Rupee (USD-INR).
Trading Mechanism
The Currency Derivatives trading system of NSE, called NEAT-CDS (National Exchange for Automated Trading – Currency Derivatives Segment) trading system, provides a fully automated screen-based trading for currency futures on a nationwide basis as well as an online monitoring and surveillance mechanism.
The NEAT-CDS system supports an order driven market, wherein orders match automatically. Order matching is essentially on the basis of security, its price and time. All quantity fields are in contracts and price in Indian rupees. The exchange notifies the
160
contract size and tick size for each of the contracts traded on this segment from time to time. When any order enters the trading system, it is an active order. It tries to find a match on the opposite side of the book. If it finds a match, a trade is generated. If it does not find a match, the order becomes passive and sits in the respective order book in the system.
Contract Specifications for Currency Futures
NSE trades Currency Derivatives contracts having near 12 calendar month expiry cycles. All contracts expire two working days prior to the last working day of every calendar month (subject to holiday calendars). This is also the last trading day for the expiring contract. The contract would cease to trade at 12:00 noon on the last trading day. A new contract with 12th month expiry would be introduced immediately ensuring availability of 12 monthly contracts for trading at any point.
The Instrument type: FUTCUR refers to 'Futures contract on currency' and Contract symbol: USDINR denotes a currency pair of 'US Dollars – Indian Rupee'. Each futures contract has a separate limit order book. All passive orders are stacked in the system in terms of price-time priority and trades take place at the passive order price (order which has come earlier and residing in the system). The best buy order for a given futures contract will be the order to buy at the highest price whereas the best sell order will be the order to sell at the lowest price.
The contract specification for US Dollars – Indian Rupee (USDINR) Currency Futures is summarized in the table below.
Symbol USDINR
Market Type Normal
Instrument Type FUTCUR
Unit of trading Lots (Minimum 1 Lot)
Lot Size 1 Lot is equal to USD 1000
Underlying The exchange rate in Indian Rupees for US Dollars
Tick size 0.25 paise or INR 0.0025
Trading hours Monday to Friday
9:00 a.m. to 5:00 p.m.
Contract trading cycle 12 month trading cycle.
Last trading day Two working days prior to the last business day of the expiry month.upto 12 Noon
Final settlement day Last working day (excluding Saturdays) of the expiry month.
The last working day will be the same as that for Interbank Settlements in Mumbai.
Quantity Freeze 10,001 or greater
Base price Theoretical price on the 1st day of the contract.
On all other days, Daily Settlement Price (DSP) of the contract
Contd...
161
Symbol USDINR
Operating Price range Tenure upto 6 months
Tenure greater than 6 months
+/-3 % of base price +/- 5% of base price
Position limits Clients Trading Members Bankshigher of 6% of total open interest or USD 10 million
higher of 15% of the total open interest or USD 50 million
higher of 15% of the total open interest or USD 100 million
Initial margin SPAN® Based MarginExtreme loss margin 1% of MTM value of open position.Calendar spreads Rs. 250/- per contract for all months of spreadSettlement Daily settlement : T + 1
Final settlement : T + 2Mode of settlement Cash settled in Indian RupeesDaily settlement price Calculated on the basis of the last half an hour weighted average price.(DSP)Final settlement price RBI reference rate(FSP)
TURNOVER
Trading in Currency Futures segment commenced on August 29, 2008. On the very first day of operations a total number of 65,798 contracts valued at Rs.291 crore were traded on the Exchange. Since then trading activity in this segment has been witnessing a rapid growth. The total traded volume from August 2008 till March 2009 was Rs.162,272 crore (US $ 31,849 million). Total number of contracts traded during the August 2008 to March 2009 were 32,672,768. The business growth of Currency Futures Segment is shown in Table 7-1 and Chart 7-1.
Chart 7-1 : Business Growth of Currency Futures
Contd...
SPAN® is a registered trademark of the Chicago Mercantile Exchange (CME) used here under licence.
162
Traded Value Records
Trading Volumes in the CDS Segment during 2008-09 reached a high of Rs.3,911.39 crore (US $ 767.69 million) on March 20, 2009. The following table shows the record highs in the Currency Derivatives segment.
CDS Segment Date Number/Value
Record Number of Trades March 20, 2009 25,702
Record No. of Contracts Traded March 20, 2009 775,933
Record Daily Turnover (value in Rs. crores) March 20, 2009 Rs.3911.39
Top 5 Currency Futures Contracts
During 2008-09, top 5 Currency Futures contracts in terms of contracts traded and trading value are presented in the table below.
Top 5 Currency Futures contracts according to number of contracts 2008-09
S. No.
Name of the Contract
Number of Contracts
Turnover Percentage of contracts to Top
5 contracts(Rs.cr.) (US $ mn)
1 27-Mar-09 9,222,657 47116.17 9,247.53 34.88
2 25-Feb-09 5,783,369 28455.59 5,585.00 21.06
3 28-Jan-09 4,883,849 23867.90 4,684.57 17.67
4 29-Dec-08 4,294,228 21048.27 4,131.16 15.58
5 26-Nov-08 2,962,925 14605.98 2,866.73 10.81
Total 27,147,028 135,094 26,514.99 100.00
CHARGES
Brokerage Charges
The maximum brokerage chargeable by a trading member in relation to trades effected in the contracts admitted to dealing on the Currency Derivatives segment of NSE is fixed at 2.5% of the contract value.
Transaction Charges
The transaction charges payable to the exchange by the trading member for the trades executed by him on the Currency Derivatives segment would be as prescribed by the Exchange from time to time. In order to encourage active participation in the Currency Derivatives Segment, the Exchange has waived the transaction charges till June 30, 2009.
Contribution to Investor Protection Fund
The trading members are required to make a lumpsum contribution of Rs.500/- to Investor Protection Fund of Currency Derivatives segment.
163
CLEARING AND SETTLEMENT
NSCCL undertakes clearing and settlement of all trades executed on the Currency Derivatives Segment (CDS) of the Exchange. It also acts as legal counterparty to all trades on this segment and guarantees their financial settlement. The Clearing and Settlement process comprises of three main activities, viz., Clearing, Settlement and Risk Management.
Clearing Entities
Clearing and settlement activities in the Currency Derivatives segment are undertaken by NSCCL with the help of the following entities:
Clearing members
In the Currency Derivatives segment, trading member-cum-clearing member, clear and settle their own trades as well as trades of other trading members (TMs). Besides, there is a special category of members, called professional clearing members (PCM) who clear and settle trades executed by TMs. The members clearing their own trades and trades of others, and the PCMs are required to bring in additional security deposits in respect of every TM whose trades they undertake to clear and settle.
Clearing banks
Funds settlement takes place through clearing banks. For the purpose of settlement all clearing members are required to open a separate bank account with NSCCL designated clearing bank for Currency Derivatives segment. The Clearing and Settlement process comprises of the following three main activities:
1) Clearing
2) Settlement
3) Risk Management
Clearing Mechanism
The clearing mechanism essentially involves working out open positions and obligations of clearing (trading-cum-clearing/professional clearing) members. This position is considered for exposure and daily margin purposes. The open positions of Clearing Members (CMs) are arrived at by aggregating the open positions of all the TMs and all custodial participants clearing through him, in contracts in which they have traded. A TM's open position is arrived at as the summation of his proprietary open position and clients' open positions, in the contracts in which he has traded. While entering orders on the trading system, TMs are required to identify the orders, whether proprietary (if they are their own trades) or client (if entered on behalf of clients) through 'Pro/Cli' indicator provided in the order entry screen. Proprietary positions are calculated on net basis (buy - sell) for each contract. Clients' positions are arrived at by summing together net (buy - sell) positions of each individual client. A TM's open position is the sum of proprietary open position, client open long position and client open short position.
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Settlement Mechanism
All futures contracts are cash settled, i.e. through exchange of cash in Indian Rupees. The settlement amount for a CM is netted across all their TMs/clients, with respect to their obligations on MTM settlement. Currency futures contracts have two types of settlements, the MTM settlement which happens on a continuous basis at the end of each day, and the final settlement which happens on the last trading day of the futures contract.
• Mark to Market settlement (MTM Settlement):
All futures contracts for each member are marked-to-market (MTM) to the daily settlement price of the relevant futures contract at the end of each day. The profits/losses are computed as the difference between:
1. The trade price and the day's settlement price for contracts executed during the day but not squared up.
2. The previous day's settlement price and the current day's settlement price for brought forward contracts.
3. The buy price and the sell price for contracts executed during the day and squared up.
The CMs who have a loss are required to pay the mark-to-market (MTM) loss amount in cash which is in turn is passed on to the CMs who have made a MTM profit. This is known as daily mark-to-market settlement. CMs are responsible to collect and settle the daily MTM profits/losses incurred by the TMs and their clients clearing and settling through them. Similarly, TMs are responsible to collect/pay losses/profits from/to their clients by the next day. The pay-in and pay-out of the mark-to-market settlement are effected on the day following the trade day. In case a futures contract is not traded on a day, or not traded during the last half hour, a ‘theoretical settlement price’ is computed. After completion of daily settlement computation, all the open positions are reset to the daily settlement price. Such positions become the open positions for the next day.
• Final settlement for futures
On the last trading day of the futures contracts, after the close of trading hours, NSCCL marks all positions of a CM to the final settlement price and the resulting profit/loss is settled in cash. Final settlement loss/profit amount is debited/ credited to the relevant CM's clearing bank account on T+2 working day following last trading day of the contract (Contract expiry Day).
• Settlement prices for futures
Daily settlement price on a trading day is the closing price of the respective futures contracts on such day. The closing price for a futures contract is currently calculated
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as the last half an hour weighted average price of the contract in the Currency Derivatives Segment of NSE. The final settlement price is the RBI reference rate on the last trading day of the futures contract. All open positions shall be marked to market on the final settlement price. Such marked to market profit / loss shall be paid to / received from clearing members.
Settlement Statistics
During August 2008- March 2009, cash settlement for currency futures amounted to Rs.367.37 crore (US $ 72.10 million). The details of settlement statistics for currency futures is presented in Table 7-2.
Risk Management
NSCCL has developed a comprehensive risk containment mechanism for the Currency Derivatives segment. The salient features of risk containment mechanism on the Currency Derivatives segment are:
1. The financial soundness of the members is the key to risk management. Therefore, the requirements for membership in terms of capital adequacy (net worth, security deposits) are quite stringent. These requirements have been explained in the table 2-1 D of Chapter 2. Clearing member pays Rs. 10 lakhs for clearing every trading member’s trades in cash & non-cash form.
2. NSCCL charges an upfront initial margin for all the open positions of a Clearing Member (CM). It specifies the initial margin requirements for each futures contract on a daily basis. It also follows a value at risk (VaR) based margining through SPAN®. The CM in turn collects the initial margin from the TMs and their respective clients.
3. The open positions of the members are marked to market based on contract settlement price for each contract at the end of the day. The difference is settled in cash on a T+1 basis.
4. NSCCL's on-line position monitoring system monitors the member open positions and margins on a real-time basis vis-à-vis the deposits provided by the CM/ limits set for the TM by the CM. The on-line position monitoring system generates alerts whenever the margins of a member reaches X% of the capital deposited by the CM or limits set for the TM by the CM. NSCCL monitors the CMs for initial margin and extreme loss margin violations, while TMs are monitored for initial margin violation.
5. CMs are provided a trading terminal for the purpose of monitoring the open positions of all the TMs clearing and settling through him. A CM may set limits for a TM clearing and settling through him. NSCCL assists the CM to monitor the
SPAN® is a registered trademark of the Chicago Mercantile Exchange (CME) used here under licence.
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intra-day limits set up by a CM and whenever a TM exceed the limits, it stops that particular TM from further trading.
6. A member is alerted of his position to enable him to adjust his position or bring in additional capital. Margin violations result in withdrawal of trading facility for all TMs of a CM in case of a violation by the CM.
7. A separate Settlement Guarantee Fund for this segment has been created out of the capital of members.
The most critical component of risk containment mechanism for the Currency Derivatives Segment is the margining system and on-line position monitoring. The actual position monitoring and margining is carried out on-line through Parallel Risk Management System (PRISM). PRISM uses SPAN® (Standard Portfolio Analysis of Risk) system for the purpose of computation of on-line margins, based on the parameters defined by SEBI.
Margining System
NSCCL has developed a comprehensive risk containment mechanism for the Currency Derivatives segment. The most critical component of a risk containment mechanism is the online position monitoring and margining system. The actual margining is done on-line, on an intra-day basis using PRISM (Parallel Risk Management System) which is the real-time position monitoring and risk management system. The risk of each trading and clearing member is monitored on a real-time basis and alerts/disablement messages are generated if the member crosses the set limits. NSCCL uses the SPAN® (Standard Portfolio Analysis of Risk) system, a portfolio based margining system, for the purpose of calculating initial margins.
Types of margins
The margining system for Currency Derivatives segment is explained below:
a) Initial margin: Margin in the Currency Derivatives segment is computed by NSCCL upto client level for open positions of CMs/TMs. These are required to be paid up-front on gross basis at individual client level for client positions and on net basis for proprietary positions. NSCCL collects initial margin for all the open positions of a CM based on the margins computed by NSCCL- SPAN®. A CM is required to ensure collection of adequate initial margin from his TMs up-front. The TM is required to collect adequate initial margins up-front from his clients.
b) Extreme loss margin of 1% on the value of the gross open positions shall be adjusted from the liquid assets of the clearing member on an on line, real time basis.
SPAN® is a registered trademark of the Chicago Mercantile Exchange (CME) used here under licence.
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c) Client margins: NSCCL intimates all members of the margin liability of each of their client. Additionally members are also required to report details of margins collected from clients to NSCCL, which holds in trust client margin monies to the extent reported by the member as having been collected form their respective clients.
Position Limit for Currency Futures:
Client Level Position Limit
The client level position limit shall be applicable where the gross open position of the client across all contracts exceeds 6% of the total open interest or 10 million USD, whichever is higher.
Trading Member Level Position Limit:
The trading member position limit shall be higher of 15% of the total open interest or 50 million USD. However, the position limit for a Trading Member, which is a bank, shall be higher of 15% of the total open interest or 100 million USD.
Clearing Member Position Limit:
No separate position limit is prescribed at the level of clearing member. However, the clearing member should ensure that his own trading position and the position of each trading member clearing through him are within the limits specified above.
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Table 7-1: Business Growth Of Currency Futures
Month/ Year
No. of Contracts
Traded
Trading Value
(Rs. Cr.)
Trading Value
(US $ mn)
Open Interest
No. of Contracts traded
Trading Value(Rs.Cr.)
Trading Value(US $ mn)
Sep-08* 1,258,099 5,763 1,131 90,871 428 84
Oct-08 2,275,261 11,142 2,187 170,202 851 167
Nov-08 3,233,679 15,969 3,134 146,262 737 145
Dec-08 4,681,593 22,840 4,483 177,520 867 170
Jan-09 4,900,904 23,980 4,707 254,797 1,247 245
Feb-09 6,416,059 31,761 6,234 315,317 1,612 316
Mar-09 9,907,173 50,817 9,974 257,554 1,313 258
Aug 08-Mar09 32,672,768 162,272 31,849 257,554 1,313 258
* Includes turnover details for August 29, 2008-the first day of trading for Currency Futures at NSE
Table 7-2 Settlement Statistics In Currency Futures Segment(in Rs.Cr.)
Month/Year Currency Futures
MTM Settlement Final Settlement
Aug-08 0.22
Sep-08 22.86 0.77
Oct-08 52.33 0.04
Nov-08 58.56 0.95
Dec-08 58.00 1.14
Jan-09 33.76 0.31
Feb-09 59.89 0.54
Mar-09 76.19 1.82
Aug ‘08-Mar ‘09 361.80 5.57
Investor Services,Arbitration 8
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8Investor Services, Arbitration
Investors are the backbone of the securities market. Protection of their interests is paramount for NSE. In furtherance of their interests, NSE has put in place systems to ensure availability of adequate, up-to-date and correct information to investors to enable them to take informed decisions. It ensures that critical and price-sensitive information reaching the exchange is made available to all classes of investor at the same point of time. Such price-sensitive information as bonus announcements, mergers, new line of business, etc. received from the companies is disseminated to all the market participants through the network of NSE terminals all over India. Action is initiated by the Exchange where any kind of price-sensitive information is not provided to the Exchange at the prescribed time. It ascertains the veracity of rumours and disseminates facts in the interest of investors. In an attempt to ease the existing system of information dissemination by the listed companies, NSE launched the electronic interface for listed companies in August 2004. Under the new system, all corporate announcements including that of Board meetings which needs to be disclosed to the market is handled electronically in a straight through and hands free manner. It also conducts various seminars and programs for the investors all over the country with a view to educate them on their rights and obligations. They are also made aware of the precautions they need to take while dealing in the securities market. It makes an audit trail available on request for all transactions executed on NSE to enable investors to counter-check trade details for the trades executed on his behalf by the member. It has also prescribed and makes effort to ensure the implementation of various safeguards like time schedules for issuing contract notes, for receiving funds and securities purchased by investors, segregation of client funds and securities from those of members, etc. The Exchange has also launched a facility to verify trades on the NSE website. Using this facility, an investor who had received a contract note from the trading member of the Exchange can check whether the trade has been executed.
Investor Services
NSE has put in place a system for redressal of investor grievances for matters/issues related to/against trading members/companies. The Investor Services Cell of NSE is manned by a team of professionals possessing relevant experience in the areas of securities markets, company and legal affairs, and specially trained to identify problems faced by the investor and to find and effect a solution quickly. It takes up complaints in respect of trades executed on the NSE through its NEAT terminal and routed through the NSE trading member or SEBI registered sub-broker of NSE trading member and trades pertaining to companies traded on NSE. The status of receipt and disposal of investor grievances by the Exchange is presented in Table 8-1.
Investor Protection Fund
Some cushion to the interests of investors is provided by the Investor Protection Fund (IPF) set up by the stock exchange. The exchanges maintains an IPF to take care of
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investor claims, which may arise out of non settlement of obligations by the trading member, who has been declared a defaulter, in respect of trades executed on the Exchange. The maximum amount of claim payable from the Fund to the investor is reviewed by Exchange periodically maximum amount payable out of IPF was Rs. 10 lakhs upto December 31, 2007 and same has been enhanced to Rs. 11 Lakhs in respect of claims against members declared defaulter after January 1, 2008.
Arbitration
Arbitration is a speedy and alternative dispute resolution mechanism provided by the Exchange for resolving disputes between the trading members and between a trading member and his client, in respect of trades done on the Exchange. The arbitration mechanism is provided by the Exchange in all its Regional offices to facilitate the speedy dispute resolution mechanism. The parties to dispute appoint an arbitrator from the panel of arbitrators maintained by the Exchange and approved by SEBI. The arbitrator(s) pronounces an award after going through various documents submitted by the parties and hearing them. The status of arbitration matters with the Exchange as at end March 2009 is presented in Table 8-2.
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Table 8-1 : Receipt and Disposal of Investor Grievance
Year Against Members Against Companies
Pending at the begin-ning
Received Disposed Pending at the end
Pending at the begin-ning
Received Disposed Pending at the end
1994-95 – – – – – 2 – 2
1995-96 – 56 13 43 2 39 17 24
1996-97 43 320 72 291 24 415 102 337
1997-98 291 259 439 111 337 576 716 197
1998-99 111 383 347 147 197 592 380 409
1999-00 147 197 298 46 409 808 842 375
2000-01 46 263 201 108 375 1,095 1,111 359
2001-02 108 789 710 187 359 607 667 299
2002-03 187 345 418 114 299 587 626 260
2003-04 114 282 253 143 260 527 558 229
2004-05 143 435 409 169 229 1,304 1,128 405
2005-06 169 1,128 1,051 246 405 1,023 1,200 228
2006-07 246 1,367 1,460 153 228 774 769 233
2007-08 153 1,915 1,101 967 233 964 888 309
2008-09 967 5,191 5,020 1,138 309 734 983 60
Table 8-2 : Status Report of Arbitration Matters
Year No. of Cases Received
Withdrawn Awards Pending
1998 164 2 162 0
1999 CM 153 5 147 1
1999 WDM 2 1 1 0
2000 CM 149 6 143 0
2000 WDM 1 0 1 0
2001 CM 342 19 323 0
2001 WDM 0 0 0 0
2001 F&O 1 0 1 0
2002 CM 275 7 268 0
2002 WDM 0 0 0 0
2002 F&O 5 0 5 0
2003 CM 136 4 132 0
2003 WDM 0 0 0 0
2003 F&O 17 0 17 0
Contd...
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Contd...
Year No. of Cases Received
Withdrawn Awards Pending
2004 CM 119 6 113 0
2004 WDM 0 0 0 0
2004 F&O 42 3 39 0
2005 CM 138 3 135 0
2005 WDM 0 0 0 0
2005 F&O 66 0 66 0
2006 CM 224 5 219 0
2006 WDM 0 0 0 0
2006 F&O 191 8 183 0
2006 CO 1 0 1 0
2007 CM 275 9 266 0
2007 F&O 221 3 218 0
2008 CM upto March 2008 61 1 60 0
2008 F&O upto March 2008 116 1 115 0
2008-09 CM 758 21 283 454
2008-09 F&O 2433 98 1356 979
Total 5,890 202 4,254 1,434
Knowledge Initiative 9
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9Knowledge Initiative
Several initiatives have been taken over the last few years to promote the skills of market participants, to educate and protect the investors and to promote high quality research about the working of the securities market. In line with this NSE has launched several initiatives to strengthen the knowledge base of the Indian securities market and to protect investor interest. Major initiatives in this area are discussed below:
NSE’s Certification in Financial Markets (NCFM)
Taking into account international experience and the needs of the Indian financial markets NSE introduced in 1998 a unique testing and certification programme called National Stock Exchange’s Certification in Financial Markets (NCFM). This was introduced with a view for protecting interests of investors in financial markets and more importantly, for minimizing risks of losses arising out of deficient understanding of markets and instruments. NCFM is an on-line testing system which tests the practical knowledge and skills required to operate in the financial markets in a secure and unbiased manner and awards certificates based on relative merits thus ensuring that the caliber of persons entering this field is kept high in the best interests of a mature and vibrant market.
NCFM, has become extremely popular and is sought by the candidates as well as employers due to its unique on-line testing and certification programme. It offers all the certifications mandated by SEBI, NSDL, AMFI, FIMMDA and NSE itself. NCFM offers a comprehensive range of modules covering many different areas in finance (Table 8-1). The entire process from generation of question paper, testing, assessing, scores reporting and certifying is fully automated. It allows tremendous flexibility in terms of testing centres, test dates and test timing and provides easy accessibility and convenience to candidates.
The number of centers from where the NCFM tests are conducted has increased in the recent past. Currently the NCFM tests are conducted from around 100 centers across the country.
Launch of New NCFM Modules
On January 7, 2009, “Mutual Funds : A Beginners’ Module’ was launched under NCFM with a view to educate and create awareness about the role and function of mutual funds, the different mutual fund products being offered in the markets, risk profile of different products, the advantages of investing in mutual funds. This module is useful for first time investors in mutual funds, young students and anyone wanting to know about the basics of mutual funds.
On February 2, 2009 “Options Trading Strategies Module” was launched under NCFM with a view to impart knowledge on the Options trading strategies so that investors can manage their risks better and use these strategies to enhance their income potential under different market conditions. This module has been introduced to explain some of
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the important and basic Options strategies. There are 22 Options strategies covered in this module and the tests are based on these 22 strategies.
NCFM Tests conducted in regional languages
All the NCFM modules were initially in English language. In response to the requests received for tests to be conducted in other languages as well, NSE introduced the Derivatives Market (Dealers) Module in Gujarati and Hindi which was launched on February 15, 2008 and June 19, 2008 respectively. In addition to this, the Capital Market (Dealers) module test in Gujarati and Hindi languages was introduced on February 19, 2009.
CBSE – NSE joint certification in Financial markets
CBSE and NSE introduced a joint certification in Financial Markets for std. XI and XII. The course, titled “Financial Markets Management” had been introduced by CBSE during 2007-2008. This was the first such exercise to introduce financial literacy in schools. The new course comprises of various subjects, such as Languages, Economics, Business Studies, Accounting for Business etc. Besides these, two financial market related subjects, “Introduction to Financial Markets – I” and “Introduction to Financial Markets – II” are taught in Std. XI and XII respectively. Students opting for the course are required to take the NCFM on-line tests in “Financial Markets : A Beginners Module” in Std. XI and both “Capital Markets (Dealers) Module and Derivatives Markets (Dealers) Module”, in Std. XII.
NSE Research Initiative
In order to improve market efficiency further and to set international benchmarks in securities industry, NSE administers a scheme called the NSE Research Initiative. The initiative fosters research which can support and facilitate stock exchanges to design market microstructure, participants to frame their strategies in the market place, help regulators to frame regulations, policy makers to formulate policy and broaden the horizon of knowledge about the securities market. The initiative has received a tremendous response from the academics as well as the market participants from within and outside the country. The studies completed/under progress under the initiative is presented in Table 8-2. The completed research papers and the paper under progress are provided on the NSE website www.nseindia.com.
Investor Awareness and Education Programmes
NSE has been carrying out investor awareness seminars on a regular basis in various parts of the country. During the seminars, the investors are educated about their rights and obligations, new financial products, investment avenues and certification programmes. Various informative booklets and material are also distributed at the seminars. Besides covering the investors, the Exchange also reaches out to a larger number of persons across the country as a part of a Financial Literacy campaign. The purpose is to educate the masses about investing, various investment avenues, benefits of investing in equities and
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upgrade the financial literacy and awareness among the masses. The higher secondary schools and colleges is also one of the focus areas in this exercise since an early education on investing helps the individual to take proper decision while investing in future. Further, this also helps in increasing the overall equity investor base in the country over a period of time with more people being acquainted with the benefits of investing in the equity markets. During 2008-09, there were 606 investor awareness and education programmes conducted by NSE.
National Institute of Securities Market (NISM)
Pursuant to the announcement made by the Finance Minister in his Budget Speech in February 2005, Securities and Exchange Board of India (SEBI) established the National Institute of Securities Markets (NISM) in Mumbai. SEBI, by establishing NISM, has articulated the desire expressed by the Indian government to promote securities market education and research.
Towards accomplishing the desire of Government of India and vision of SEBI, NISM has launched an effort to deliver financial and securities education at various levels and across various segments in India and abroad. To implement its objectives, NISM has established six distinct schools to cater the educational needs of various constituencies such as investor, issuers, intermediaries, regulatory staff, policy makers, academia and future professionals of securities markets.
NISM seeks to add to market quality through educational initiatives. It is an autonomous body governed by its Board of Governors. An international Advisory Council provides strategic guidance to NISM. NISM brings out various publications on securities markets with a view to enhance knowledge levels of participants in the securities industry. NISM is mandated to develop and implement certification examinations for professionals employed in various segments of the Indian securities markets.
Launch of Currency Derivatives Certification Examination by NISM
NISM has launched the Currency Derivatives Certification Examination to create a common minimum knowledge benchmark for persons working in the Currency Derivatives market segment, in order to enable a better understanding of currency markets and exchange traded currency future products, better quality investor service, operational process efficiency and risk controls. As per SEBI requirement, all approved users and sales personnel of trading members of currency derivatives segments of recognised stock exchanges are required to obtain the necessary certification by August 10, 2009. NISM has appointed NSE as one of the test administrators for conducting Currency Derivatives Certification Examination.
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Table 9-1 : NCFM Modules
Sr. No.
Name of Module Fees (Rs.) Test Duration
(in minutes)
No. of Ques-tions
Maxi-mum Marks
Pass Marks
(%)
Certifi-cate
Validity(in years)
1 Financial Markets: A Beginners’ Module
750 60 50 100 50 5
2 Mutual Funds : A Beginners’ Module
750 60 50 100 50 5
3 Securities Market (Basic) Module 1500 105 60 100 60 54 Capital Market (Dealers) Module * 1500 105 60 100 50 55 Derivatives Market (Dealers)
Module **1500 120 60 100 60 3
6 FIMMDA-NSE Debt Market (Basic) Module
1500 120 60 100 60 5
7 NSDL–Depository Operations Module
1500 75 60 100 60 # 5
8 Commodities Market Module 1800 120 60 100 50 39 AMFI-Mutual Fund (Basic)
Module1000 90 62 100 50 No limit
10 AMFI-Mutual Fund (Advisors) Module
1000 120 72 100 50 5
11 Surveillance in Stock Exchanges Module
1500 120 50 100 60 5
12 Corporate Governance Module 1500 90 100 100 60 513 Compliance Officers (Brokers)
Module1500 120 60 100 60 5
14 Compliance Officers (Corporates) Module
1500 120 60 100 60 5
15
Information Security Auditors Module (Part-1)
2250 120 90 100 60
2Information Security Auditors Module (Part-2)
2250 120 90 100 60
16 FPSB India Exam 1 to 4*** 1500 per exam
120 75 140 60 NA
17 Options Trading Strategies Module
1500 120 60 100 60 5
* Candidates have the option to take the CMDM test in English, Gujarati or Hindi language. The workbook for the module is presently available in ENGLISH.
** Candidates have the option to take the DMDM test in English, Gujarati or Hindi language. The workbook for the module is also available in ENGLISH, GUJARATI and HINDI languages.
# Candidates securing 80% or more marks in NSDL-Depository Operations Module ONLY will be certified as ‘Trainers’.
*** Modules of Financial Planning Standards Board India (Certified Financial Planner Certification) i.e. (i) Risk Analysis & Insurance Planning (ii) Retirement Planning & Employee Benefits (iii) Investment Planning and (iv) Tax Planning & Estate Planning. The fees for FPSB Modules 1-4 are Rs. 2000/- per exam from test date April 1, 2009 onwards.
NISM Series I Certification ModulesSr. No.
Name of Module Fees (Rs.) Test Du-ration (in minutes)
No. of Ques-tions
Maxi-mum Marks
PassMarks*
(%)
Cer-tificate # Validity (in years)
1 NISM-Series-I: Currency Deriva-tives Certification Examination
1000 120 60 100 60 3
* Negative marking – 25% of the marks assigned to the question# Passing Certificate will be issued only to those candidates who have furnished/ updated their Income Tax
Permanent Account Number (PAN) in their registration details.
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Contd...
Table 9-2 : Studies under the NSE Research Initiative
SL. No.
Title of Study
Completed Papers
1 Econometric Estimation of Systematic Risk of S&P CNX Nifty Constituents
2 Stock Market Development and its Impact on the Financing Pattern of the Indian Corporate Sector
3 Efficiency of the Market for Small Stocks
4 Determinants of Financial Performance of Indian Corporate Sector in the Post-Liberalization Era: An Exploratory Study
5 Should pension funds invest in equities? An analysis of risk-return tradeoff and asset allocation decisions
6 Changes in liquidity following exposure to foreign shareholders: The effect of foreign listings, inclusion in country funds and issues of American Depositary Receipts
7 Is the Spread Between E/P Ratio and Interest Rate Informative for Future Movement of Indian Stock Market?
8 Merger Announcements and Insider Trading Activity in India: An Empirical Investigation
9 Achieving an Individual Investor Friendly System using the power of the Internet
10 Improved Techniques for using Monte Carlo in VaR estimation
11 Short selling and its Regulation in India in International Perspective
12 Empirical investigation of multi-factor asset pricing models using Artificial Neural Network
13 Idiosyncratic Factors in Pricing Sovereign Bonds: An Analysis of the Government of India Bond Market
14 The Extreme Value Volatility Estimators and Their Empirical Performance in Indian Capital Markets
15 Equity Market Interlinkages: Transmission of Volatility - A Case Of US and India
16 Institutional Investors and Corporate Governance in India
17 Dividend policy of Indian Corporate Firms : An Analysis of Trends & Determinants
18 Market Microstructure Effects of Transparency of Indian Banks
19 Futures Trading, Information and Spot Price Volatility of NSE-50 Index Futures Contract
20 Measuring productive efficiency of stock exchanges using price adjustment coefficients
21 Do Futures and Options trading increase stock market volatility?
22 Section switching stock market price effect in the Indian capital market and the policy implications thereof
23 Study of Common Stochastic Trend and Co-integration in the Emerging Markets - A case study India, Singapore and Taiwan
24 Market Discipline in the Indian Banking Sector: An Empirical Exploration
25 Conditional CAPM and Cross sectional returns - A study on Indian Securities Market
26 Evaluating index fund implementation in India
27 Measuring Volumes in the Indian Financial Markets Some Terminological and Conceptual Issues
28 Corporate Social Responsibility Initiatives by NSE NIFTY Companies - Content, Implementation Strategies & Impact.
29 Measures for Improving Common Investor Confidence in Indian Primary Market : A Survey
30 Informational Content of Trading Volume And Open Interest – An Empirical Study of Stock Options Market In India
31 An analysis of the Dynamic Relationships Between South Asian and Developed Equity Markets
32 Corporate Governance and Market reactions
33 Insider Ownership and Corporate Governance
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SL. No.
Title of Study
34 Improving Index Fund Implementation in India
35 Seasoned Capital Offerings: Earnings Management and Long-Run Operating Performance of Indian Firms
36 Volatility Spillovers Across Stock, Call Money And Foreign Exchange Markets
37 Understanding the Microstructure in Indian Markets
38 Price and Volume Effects of S&P CNX Nifty Index Reorganization
39 Lead-Lag relationship between Equities and Stock Index Futures Market and its variation around Information Release: Empirical Evidence from India
40 On The New Transformation-Based Approach To Measuring Value-At-Risk: An Application To Forex Market In India
41 Optimal Hedge Ratio and Hedging Effectiveness of Stock Index Futures : Evidence from India
42 Evaluating Corporate Governance Risk: A Fuzzy logic approach
43 Do the S&P CNX Nifty Index and Nifty Futures Really Lead/Lag?Error Correction Model: A Cointegration Approach
44 Under-Pricing and long run performance of Initial Public Offerings in Indian Stock Market
45 Price & liquidity effects of stock split: An Empirical evidence from Indian stock market
46 Risk Return Dynamics of Derivative Based Investment Strategies.
47 Pricing of Options on Defty
48 Price Limits Are they Worth the Price?
49 Volatility Persistence and the Feedback trading Hypothesis: Evidence from Indian Markets
50 Dynamic Interaction among Mutual Fund Flows, Stock Market Return and Volatility
51 Correlation Dynamics in Equity Markets: Evidence from India
52 Price Discovery and Arbitrage Efficiency of Indian Equity Futures and Cash Markets
Papers under Progress
1 Do Hetrogeneous beliefs affects trading volume and asset prices.
2 Imbalance created because of structured products in India equity market
3 Forecasting Of Indian Stock Market Index Using Artificial Neural Network
4 Global Stock Futures : A Diagnostic Analysis Of a Selected Emerging And Developed Markets With Special Reference To India
5 Price Behaviour around Block Trades on the National Stock Exchange of India.
6 Does the Stock Market Overreact? An empirical evidence of the Contrarian Returns from the Indian Markets
7 Dynamic Relationship between Stock Return, Trading Volume and Volatility:Evidence from Indian Stock Market
8 Stock Market Seasonality: A Study of the Indian Stock Market
9 Determinants and the Stability of Dividends in India:Application of Dynamic Partial Adjustment Equation using Extended Instrumental Variable Approach
10 Optimal Investment Horizons for S&P CNX Nifty and its Components
11 Forecasting Volatility using High Frequency Data
12 Examining Association between S&P CNX Nifty and selected Asian and US Stock Markets
