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8/2/2019 Presentation on Stock

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RECENT DEVELOPMENTS IN SECONDARYMARKET

By Davinder Kaur


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A depositary is a nominee who keep

the scrips on behalf of the investor. Itleads the capital market towards a scripless system through immobilizationand dematerialization of sharecertificates.

The depository system has beenapproved by the parliament on July23,1996.It helps to avoid forgery, theft,delay in settlement and to speed up thetransfer of securities.


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Reducing the time

Avoiding the risk of settlementInhance liquidity and efficiency

Reduce cost of trasection

Central handling system is promotePromote the competitiveness of the country by

complying with global standard


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Accepting deposit of security for custody.

Making computerized book entry deliveries ofsecurity which are immobilized in its custody.

Creating computerized book entry, pledges ofsecurities in its custody

Providing for withdrawal of securitiesUndertaking corporate actions like distribution of

dividend and interest

Redemption of security on maturity.


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CENTRAL DEPOISITARY:- He is a nominee who holds thesecurity on behalf of the investor and maintain records relatingto that electronic mode .

SHARE REGISTRAR AND TRANSFER AGENT:- He is aninstitution that controls the issuance of security, he is one whoretains the names and addresses of registered securities ownersand re-registered securities in the name of owner.

CLEARING AND SETTELMENT CORPORATION:- it is acenter to do trade matching and settle the funds and exchangesecurities.


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DEPOSITORYDEPOSITORY

PARTICIPANTS

INVESTORREGISTRAR

De-materializationProcess


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DEPOSITORYDEPOSITORY

PARTICIPANTS

INVESTORREGISTRAR

Re MaterializationProcess


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To control heavy fluctuations in the prices ofshares and to adjusting the demand andsupply of shares in the market, companieshave been permitted to buy their own shares.the companies ordinance ,1999 has been

promulgated :-1. Restricting buy back of shares to 25% of

the paid up capital.

2. Imposing a limit on the usages of once for

the purpose of buy back to 25% of the paidup capital and free reserve , and

3. Restricting the further issue of the samesecurities with in 24 months after the buy

back.


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The buy back is authorized by its articles

A special resolution has been passed in general metting of thecompany authorizing buy backThe buy back does not exceed 25%of the total paid up capitaland free reserves of the companyDebt- equity ratio does not exceed to 2:1 after the proposed

buy back .All shares and or other specified securities are fully paid upThe buy back is in accordance with SEBI regulations framedfor this purpose


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In India, public sector undertaking is a termused for a government-ownedcorporation The term is used to refer to

companies in which the government owneda majority that is 51 percent or more of thecompany equity.Eg.1. Air India transport service Ltd.2.Airports authority of India Ltd.

To speed up the process of disinvestment theministry of finance has proposed to set up aspecial purpose vehicle. Government hasplans to raise Rs 40,000 cr throughdisinvestment during 2010-2011.


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Self regulatory organization is Non-government

organization which has statutory responsibility toregulate its own members through the adoption andenforcement of rules of conduct for fair, ethical andefficient practices. Examples include NASD (National

Association of Securities Dealers) and the nationalsecurities and commodities exchanges.


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SROs would reduce the work of regulatory authoritieslike SEBI . For this purpose , SEBI is encouraging

various market intermediaries like merchant bankers,stock brokers mutual funds etc. to start the organizing

themselves in to SROs and to get recoginsation fromthe SEBI. Various SROs are ;

1. Association of merchant bankers of India

2. Association of mutual funds of India.3. Registrars of association of India.


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It simply works as a mathematical model which keeps a constant watch on themarket movements. It would bring to light

automatically scrips which are under alert .This alert list divides the scrips in to threecategories such as least bothersome ,bothersome and most bothersomeindicating blue yellow and red singles

respectively this process would facilitateand immediate audit of the scrips putunder alert so that undesirable trading and

the players who do it can be traced out .


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