Indian Financial Markets

Contents Financial Markets Shares and Stocks Regulatory Environment in India SEBI RBI

Financial Markets A Market is a place where buyers and sellers come together to exchange something Financial Markets are where financial Instruments/products are exchanged. A Financial Market is known by type of product traded in it

Different Financial Markets Money Market Debt Market Forex Market Capital Market

Money Market Markets for short term Primarily used by Banks Borrowing Lending Primarily used by Banks Typical Financial Instruments Bankers Acceptance Certificate of Deposit (CD) Treasury Bills Repo’s

Debt Market Debt Participants Instruments Contract One Party lends to another Party Predetermined Interest Rates and Term Participants Banks Financial Institutions Mutual Funds Insurance Companies etc. Instruments Government Securities (G-Secs) Public Sector Units Bonds Corporate Securities

Foreign Exchange Market Foreign Goods Payments in Foreign Currency Forex Market Participants Government Payments for Imports Repayment of Loans Importers Exchange Rates – One Currency in terms of other (Eg. 1 US Dollar = 45 Rupees) Bid Rate Offer Rate

Capital Market Long Term Funds Raised by Trading Instruments used Government Corporates Trading Instruments used Shares Derivatives Units of Mutual Funds

Financial Markets Primary Market Secondary Market Instruments issued for first time Used by Government/Corporates/PSU’s IPO Initial Public Offering Secondary Market Trading of already issued Stocks Bonds Stock Exchange

The primary market is that part of the capital markets that deals with the issue of new securities. Companies, governments or public sector institutions can obtain funding through the sale of a new stock or bond issue. An initial public offering (IPO), referred simply as an "offering" or "flotation", is when a company (called the issuer) issues common stock or shares to the public for the first time

Secondary Market The secondary market, also known as the aftermarket, is the financial market where previously issued securities and financial instruments such as stock, bonds, options, and futures are bought and sold.

Stock and Shares Stock Share Capital raised by corporations Through issue and distribution of shares Share Signifies ownership in the company A company might have thousands of Shareholders.

Stock Exchange Place where the shares are traded BSE NSE BSE – Bombay Stock Exchange Oldest Stock Exchange in Asia Sensex – Sensitive Index Index of 30 Actively traded Companies NSE – National Stock Exchange Incorporated in 1992 Nifty Index of 50 Actively traded Companies

Functions of stock exchange Maintains active trading. Fixation of prices. Ensures safe and fair dealing. Aids in financing the industry. Dissemination of information. Performance inducer. Self regulating organization.

1.Bombay stock exchange 2.National stock exchange(Mumbai) 3.Banglore stock exchange 4.Utter pradesh stock exchange(kanpur) 5.Magadh stock exchange(Patna) 6.Ahmedabad stock exchange 7.vadodara stock exchange(Baroda) 8.Bhubaneswar stock exchange 9.Calcutta stock exchange(kolkata) 10.Madras stock exchange

11.Cochin stock exchange 12.coimbatore stock exchange 13.Gauhati stock exchange 14.Hydrabad stock exchange 15.Madhya pradesh stock exchange(indore) 16.Jaipur stock exchange 17.Ludhina stock exchange 18.Mangalore stock exchange 19.Pune stock exchange 20.saurashtrakutch stock exchange

Ahmedabad » Bangalore » Bhubaneshwar » Calcutta » Cochin » Coimbatore » Delhi » Guwahati » Hyderabad » Jaipur » Ludhiana » Madhya Pradesh » Madras » Magadh » Mangalore » Meerut » OTC Exchange Of India » Pune » Saurashtra Kutch » UttarPradesh » Vadodara

HOW RATING IS GIVEN TO THE COMPANY? Basically rating is given after see the company 'image,management quality,assets quality,auditors quality,accounting accuracy.Rating is not fixed, it may be change. The rating grades are: AAA: HIGHEST SAFTY AA: HIGH SAFTY A: ADEQUATE SAFTY BBB: MODERATE SAFTY BB: IN ADEQUATE SAFTY BC&D: HIGH RISK AND DEFAULT

CREDIT RATING AGENCY IN INDIA 1.CRISIL 2.ICRA 3.CARE 4.DPCR

Regulatory Environment in India RBI – Reserve Bank of India Established in 1935 Bankers Bank Regulates Indian Financial Markets SEBI –Securities and Exchange Board of India Incorporated in 1992 Regulation of Securities Market Protecting the interests of Investors

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