Post on 09-Mar-2015
A
CASE STUDY ON
HDFC DEMATE ACCOUNT
COMPARISION WITH ICICI DEMATE ACCOUNT
MASTER OF BUSINESS ADMINSTRATION
II – SEM.
JAIPUR INSTITUTE OF MANEGEMENT STUDIES,
JAIPUR
SABMITTED TO : Dr. R K Sharma
SABMITTED BY : Dipak K Prajapati
MARCH - 2010
PREFACE
As management attitude are becoming more rewarding it helps up
to acquire. The students with modern management concept it helps us in
developing entrepreneur and analytical skills as applied to business
environment and that prepare us for pressuring a professional career.
The main objectives of MBA level is to gain practical analysis
which is vast different from the bookish knowledge, it helps to develop a
practical knowledge in student, as a supplement to the theoretical study of
management general. The case study at MBA level aims at given knowledge
about particular area in the business.
Case study gave me a practical view of how actually runs and have
it is managed. This case study has enhanced my knowledge allow the
company. Case study helps me to exposure and 10% of realities which is
totally different than what it helped me to know the reality as what actual
happens in company.
The main aim of this case study is to develop the student about
the industrial environment and business practical with the help of me get
capable of facing the challenging world
Date -
Place - Dipak Prajapat
ACKNOWLEDGEMENT
A case study is not only of our subject but is the golden
opportunity for our knowledge enhancement with the great pleasure; here I
take the opportunity to express my gratitude towards all who helped me at
various stage of my practical part.
At once, I would like to place on record my thanks to the
management of our college for their kind co-operative in providing the
required data.
In a special way, I would like to place on record my practical
case study Incharge Prof.D.N.Sharma, Principal Sir – Mr. R.K.Sharma
and Lokesh Arora Madam , who though out my visit and in preparing the
case study and internet facilities.
Lastly, I would like to thanks management and officers and
staff of different department, who spend their precious of units and provided
insight. I would like to acknowledge to valuable help offered to the person.
Introduction about demate account
The term Demat, in India, refers to a dematerialized account. For
individual Indian citizens to trade in listed stocks or debentures the
Securities Exchange Board of India (SEBI) requires the investor to maintain
a Demat account. In a demat account shares and securities are held in
electronic form instead of taking actual possession of certificates. A Demat
Account is opened by the investor while registering with an investment
broker (or sub broker). The Demat account number which is quoted for all
transactions to enable electronic settlements of trades to take place.
Access to the demat account requires an internet password and a
transaction password as well as initiating and confirming transfers or
purchases of securities. Purchases and sales of securities on the Demat
account are automatically made once transactions are executed and
completed.
Just as you have to open an account with a bank if you want to save
your money, make cheque payments etc, Nowadays, you need to open a
demat account if you want to So it is just like a bank account where actual
money is replaced by shares. You have to approach the DPs (remember, they
are like bank branches), to open your demat account. Let's say your portfolio
of shares looks like this: 150 of Infosys, 50 of Wipro, 200 of HLL and 100
of ACC. All these will show in your demat account. So you don't have to
possess any physical certificates showing that you own these shares. They
are all held electronically in your account. As you buy and sell the shares,
they are adjusted in your account. Just like a bank passbook or statement, the
DP will provide you with periodic statements of holdings and transactions.
Is a demat account a must ? Nowadays, practically all trades have to
be settled in dematerialized form. Although the market regulator, the
Securities and Exchange Board of India (SEBI), has allowed trades of upto
500 shares to be settled in physical form, nobody wants physical shares any
more.
Advantages of Demat
1. The demat account reduces brokerage charges, makes
pledging/hypothecation of shares easier, enables quick ownership of
securities on settlement resulting in increased liquidity, avoids
confusion in the ownership title of securities, and provides easy
receipt of public issue allotments.
2. It also helps you avoid bad deliveries caused by signature mismatch,
postal delays and loss of certificates in transit.
3. Further, it eliminates risks associated with forgery, counterfeiting and
loss due to fire, theft or mutilation.
4. Demat account holders can also avoid stamp duty (as against 0.5 per
cent payable on physical shares), avoid filling up of transfer deeds,
and obtain quick receipt of such benefits as stock splits and bonuses.
5. Its a safe and convenient way to hold securities
6. Immediate transfer of securities is there
7. There is no stamp duty on transfer of securities
8. Elimination of risks associated with physical certificates such as bad
delivery, fake securities, delays, thefts etc
9. There is a major reduction in paperwork involved in transfer of
securities, reduction in transaction cost etc
10.No odd lot problem, even one share can be sold thus there is an
advantage
11.Change in address recorded with DP gets registered with all
companies in which investor holds securities electronically
eliminating the need to correspond with each of them separately;
12.Transmission of securities is done by DP eliminating correspondence
with companies;
13.Automatic credit into demat account of shares, arising out of
bonus/split/consolidation/merger etc.
14. Holding investments in equity and debt instruments in a single
account.
Benefit to the Company
a. The depository system helps in reducing the cost of new issues due to
less printing and distribution cost.
b. It increases the efficiency of the registrars and transfer agents and the
Secretarial Department of the company.
c. It provides better facilities for communication and timely services
with shareholders, investor etc.
d. Benefit to the Investor The depository system reduces risks involved
in holding physical certificated, e.g., loss, theft, mutilation, forgery,
etc.
e. It ensures transfer settlements and reduces delay in registration of
shares. It ensures faster communication to investors.
f. It helps avoid bad delivery problem due to signature differences, etc.
g. It ensures faster payment on sale of shares.
h. No stamp duty is paid on transfer of shares. It provides more
acceptability and liquidity of securities.
i. Benefit to Brokers the depository system reduces risk of delayed
settlement.
j. It ensures greater profit due to increase in volume of trading. It
eliminates chances of forgery – bad delivery.
k. It increases overall of trading and profitability. It increases confidence
in investors.
Disadvantages of Demat
1. The disadvantages of dematerialization of securities can be
summarized as follows:
2. Trading in securities may become uncontrolled in case of
dematerialized securities.
3. It is incumbent upon the capital market regulator to keep a close
watch on the trading in dematerialized securities and see to it that
trading does not act as a detriment to investors.
4. The role of key market players in case of dematerialized securities,
such as stock-brokers, needs to be supervised as they have the
capability of manipulating the market.
5. Multiple regulatory frameworks have to be confirmed to, including
the Depositories Act, Regulations and the various By-Laws of various
depositories.
6. Additionally, agreements are entered at various levels in the process
of dematerialization.
7. These may cause anxiety to the investor desirous of simplicity in
terms of transactions in dematerialized securities.
8. However, the advantages of dematerialization outweigh its
disadvantages and the changes ushered in by SEBI and the Central
Government in terms of compulsory dematerialization of securities is
important for developing the securities market to a degree of
advancement.
9. Freely traded securities are an essential component of such an
advanced market and dematerialization addresses such issues and is a
step towards the advancement of the marke
Indian Market Scenario
Indian capital market has seen unprecedented boom in its activity in
the last 15 years in terms of number of stock exchanges, listed companies,
trade volumes, market intermediaries, investor population, etc. However,
this surge in activity has brought with it numerous problems that threaten the
very survival of the capital markets in the long run, most of which are due to
the large volume of paper work involved and paper based trading, clearing
and settlement.
Until the late eighties, the common man kept away from capital
market and thus the quantum of funds mobilized through the market was
meager. A major problem, however, continued to plague the market. The
Indian markets were drowned in shares in the form of paper and hence it was
problematic to handle them. Fake and stolen shares, fake signatures and
signature mismatch, duplication and mutilation of shares, transfer problems,
etc. The investors were scared and were under compensated for the risk
borne by them. The century old system of trading and settlement requires
handling of huge volumes of paper work. This has made the investors, both
retail and institutional, wary of entering the capital market. However, lack of
modernization become a hindrance to growth and resulted in creation of
cumbersome procedures and paper work.
However, the real growth and change occurred from mid-eighties in
the wake of liberalization initiatives of the Government. The reforms in the
financial sector were envisaged in the banking sector, capital market,
securities market regulation, mutual funds, foreign investments and
Government control. These institutions and stock exchanges experienced
that the certificates are the main cause of investors` disputes and arbitration
cases. Since the paper work was not matching the rapid growth so there was
a need for a better system to ensure removal of these impediments.
Government of India decided to set up a fully automated and high
technology based model exchange that could offer screen-based trading and
depositories as the ultimate answer to all such reforms and eliminate various
bottlenecks in the capital market, particularly, the clearing and settlement
system in stock exchanges. A depository in very simple terms is a pool of
pre-verified shares held in electronic mode which offers settlement of
transactions in an efficient and effective way
Demat conversion
Converting physical holding into electronic holding (dematerialising
securities) In order to dematerialise physical securities one has to fill in a
DRF (Demat Request Form) which is available with the DP and submit the
same along with physical certificates one wishes to dematerialise. Separate
DRF has to be filled for each ISIN Number. The complete process of
dematerialisation is outlined below:
1. Surrender certificates for dematerialization to your depository
participant.
2. Depository participant intimates Depository of the request through the
system. •Depository participant submits the certificates to the registrar
of the Issuer Company. •Registrar confirms the dematerialisation
request from depository
3. After dematerializing the certificates, Registrar updates accounts and
informs depository of the completion of dematerialisation.
4. Depository updates its accounts and informs the depository
participant.
5. Depository participant updates the demat account of the investor.
Demat Options
Banks score over others Around 200 “depository participants” (DPs)
offer the demat account facility.
A comparison of the fees charged by different DPs is detailed below.
But there are three distinct advantages of having a demat account with
a bank — quick processing, accessibility and online transaction.
Generally, banks credit your demat account with shares in case of
purchase, or credit your savings accounts with the proceeds of a sale on the
third day.
Banks are also advantageous because of the number of branches they
have. Some banks give the option of opening a demat account in any branch,
while others restrict themselves to a select set of branches.
Some private banks also provide online access to the demat account.
So, you can check on your holdings, transactions and status of
requests through the net banking facility.
A broker who acts as a DP may not be able to provide these services.
Fees Involved in demate account
There are four major charges usually levied on a demat account:
Account opening fee, annual maintenance fee, custodian fee and transaction
fee. All the charges vary from DP to DP.
Account-opening fee
Depending on the DP, there may or may not be an opening account
fee. Private banks, such as ICICI Bank, HDFC Bank and UTI Bank, do not
have one. However, players such as Karvy Consultants and the State Bank
of India do so. But most players levy this when you re-open a demat
account, though the Stock Holding Corporation offers a lifetime account
opening fee, which allows you to hold on to your demat account over a long
period. This fee is refundable.
Annual maintenance fee
This is also known as folio maintenance charges, and is generally
levied in advance.
Custodian fee
This fee is charged monthly and depends on the number of securities
(international securities identification numbers — ISIN) held in the account.
It generally ranges between Rs 0.5 to Rs 1 per ISIN per month. DPs will not
charge custody fee for ISIN on which the companies have paid one-time
custody charges to the depository.
Transaction fee
The transaction fee is charged for crediting/debiting securities to and
from the account on a monthly basis. While some DPs, such as SBI, charge
a flat fee per transaction, HDFC Bank and ICICI Bank peg the fee to the
transaction value, subject to a minimum amount. The fee also differs based
on the kind of transaction (buying or selling). Some DPs charge only for
debiting the securities while others charge for both. The DPs also charge if
your instruction to buy/sell fails or is rejected. In addition, service tax is also
charged by the DPs.
In addition to the other fees, the DP also charges a fee for converting
the shares from the physical to the electronic form or vice-versa. This fee
varies for both demat and remat requests. For demat, some DPs charge a flat
fee per request in addition to the variable fee per certificate, while others
charge only the variable fee.
For instance, Stock Holding Corporation charges Rs 25 as the request
fee and Rs 3 per certificate as the variable fee. However, SBI charges only
the variable fee, which is Rs 3 per certificate. Remat requests also have
charges akin to that of demat. However, variable charges for remat are
generally higher than demat. Some of the additional features (usually offered
by banks) are as follows.Some DPs offer a frequent trader account, where
they charge frequent traders at lower rates than the standard charges.Demat
account holders are generally required to pay the DP an advance fee for each
account which will be adjusted against the various service charges. The
account holder needs to raise the balance when it falls below a certain
amount prescribed by the DP. However, if you also hold a savings account
with the DP you can provide a debit authorisation to the DP for paying this
charge.Finally, once you choose your DP, it will be prudent to keep all your
accounts with that DP, so that tracking your capital gains liability is easier.
This is because, for calculating capital gains tax, the period of holding will
be determined by the DP and different DPs follow different methods. For
instance, ICICI Bank uses the first in first out (FIFO) method to compute the
period of holding. The proof of the cost of acquisition will be the contract
note. The computation of capital gains is done account-wise.
Opening an account
Steps involved in opening a demat account First an investor has to
approach a DP and fill up an account opening form.
The account opening form must be supported by copies of any one of
the approved documents to serve as proof of identity (POI) and proof
of address (POA) as specified by SEBI.
Besides, production of PAN card in original at the time of opening of
account has been made mandatory effective from April 1, 2006.
All applicants should carry original documents for verification by an
authorized official of the depository participant, under his signature.
Further, the investor has to sign an agreement with DP in a depository
prescribed standard format, which details rights and duties of investor
and DP.
DP should provide the investor with a copy of the agreement and
schedule of charges for their future reference.
The DP will open the account in the system and give an account
number, which is also called BO ID (Beneficiary Owner Identification
number).
The DP may revise the charges by giving 30 days notice in advance.
SEBI has rationalised the cost structure for dematerialisation by
removing account opening charges, transaction charges for credit of
securities, and custody charges vide circular dated January 28, 2005.
Further, SEBI has vide circular dated November 9, 2005 advised that
with effect from January 9, 2006, no charges shall be levied by a
depository on DP and consequently, by a DP on a Beneficiary Owner
(BO) when a BO transfers all the securities lying in his account to
another branch of the same DP or to another DP of the same
depository or another depository, provided the BO Account/s at
transferee DP and at transferor DP are one and the same, i.e. identical
in all respects.
In case the BO Account at transferor DP is a joint account, the BO
Account at transferee DP should also be a joint account in the same
sequence of ownership.
Transfer of Shares between DPs
To transfer shares, we need to fill the Depository Instruction Slip Book
(DIS). Firstly we need to check, whether both Demat account's Depository
Participant is same or not(CDSL or NSDL) If both of them are different,
then we need an INTER Depository Slip (Inter DIS). If they are same, then
we need INTRA Depository Slip (Intra DIS).
For example: If we have one Demat account with CDSL and other Demat
account with NSDL, then we need an Inter DIS.
Generally, brokers issue Intra DIS, so do check with broker.
Once we identify the correct DIS, fill the relevant information
WHAT IS NSDL?
NSDL(NATIONAL STOCK DEPOSITORY LIMITED) Although India
had a vibrant capital market which is more than a century old, the paper-
based settlement of trades caused substantial problems like bad delivery and
delayed transfer of title till recently. The enactment of Depositories Act in
August 1996 paved the way for establishment of NSDL, the first depository
in India. This depository promoted by institutions of national stature
responsible for economic development of the country has since established
a national infrastructure of international standards that handles most of the
securities held and settled in dematerialized form in the Indian capital
market.
Using innovative and flexible technology systems, NSDL works to support
the investors and brokers in the capital market of the country. NSDL aims at
ensuring the safety and soundness of Indian marketplaces by developing
settlement solutions that increase efficiency, minimize risk and reduce costs.
At NSDL, we play a quiet but central role in developing products and
services that will continue to nurture the growing needs of the financial
services industry.
In the depository system, securities are held in depository accounts, which is
more or less similar to holding funds in bank accounts. Transfer of
ownership of securities is done through simple account transfers. This
method does away with all the risks and hassles normally associated with
paperwork. Consequently, the cost of transacting in a depository
environment is considerably lower as compared to transacting in
certificates.
Benefits of Depository System
1. Elimination of bad deliveries In the depository environment, once
holdings of an investor are dematerialized, the question of bad delivery
does not arise i.e. they cannot be held "under objection". In the physical
environment, buyer was required to take the risk of transfer and face
uncertainty of the quality of assets purchased. In a depository
environment good money certainly begets good quality of assets.
2. Elimination of all risks associated with physical certificates- Dealing
in physical securities have associated security risks of theft of stocks,
mutilation of certificates, loss of certificates during movements through
and from the registrars, thus exposing the investor to the cost of
obtaining duplicate certificates etc. This problem does not arise in the
depository environment.
3. No stamp duty for transfer of any kind of securities in the depository.
This waiver extends to equity shares, debt instruments and units of
mutual funds.
4. Immediate transfer and registration of securities - In the depository
environment, once the securities are credited to the investors account on
pay out, he becomes the legal owner of the securities. There is no
further need to send it to the company's registrar for registration.
Having purchased securities in the physical environment, the investor
has to send it to the company's registrar so that the change of ownership
can be registered. This process usually takes around three to four
months and is rarely completed within the statutory framework of two
months thus exposing the investor to opportunity cost of delay in
transfer and to risk of loss in transit. To overcome this, the normally
accepted practice is to hold the securities in street names i.e. not to
register the change of ownership. However, if the investors miss a book
closure the securities are not good for delivery and the investor would
also stand to loose his corporate entitlements.
5. Faster settlement cycle - The settlement cycle follow rolling
settlement on T+2 basis i.e. the settlement of trades will be on the 2nd
working day from the trade day. This will enable faster turnover of
stock and more liquidity with the investor.
6. Faster disbursement of non cash corporate benefits like rights,
bonus, etc. - NSDL provides for direct credit of non cash corporate
entitlements to an investors account, thereby ensuring faster
disbursement and avoiding risk of loss of certificates in transit.
7. Reduction in brokerage by many brokers for trading in
dematerialized securities Brokers provide this benefit to investors as
dealing in dematerialized securities reduces their back office cost of
handling paper and also eliminates the risk of being the introducing
broker.
8. Reduction in handling of huge volumes of paper
9. periodic status reports to investors on their holdings and transactions,
leading to better controls.
10. Elimination of problems related to change of address of investor -
In case of change of address, investors are saved from undergoing the
entire change procedure with each company or registrar. Investors have
to only inform their DP with all relevant documents and the required
changes are effected in the database of all the companies, where the
investor is a registered holder of securities.
11. Elimination of problems related to transmission of demat shares -
In case of dematerialized holdings, the process of transmission is more
convenient as the transmission formalities for all securities held in a
demat account can be completed by submitting documents to the DP
whereas, in case of physical securities the surviving joint holder(s)/legal
heirs/nominee has to correspond independently with each company in
which shares are held.
12. Elimination of problems related to selling securities on behalf of a
minor - A natural guardian is not required to take court approval for
selling demat securities on behalf of a minor.
13. Ease in portfolio monitoring since statement of account gives a
consolidated position of investments in all instruments.
SAFETY
1. A DP can be operational only after registration by SEBI, which is
based on the recommendation from NSDL and their own independent
evaluation. SEBI has prescribed criteria for becoming a DP in the
regulations.
2. DPs are allowed to affect any debit and credit to an account only on
the basis of valid instruction from the client.
3. Every day, there is a system driven mandatory reconciliation between
DP and NSDL.
4. All transactions are recorded at NSDL Central System and in the
databases maintained by business partners.
5. There are periodic inspections into the activities of both DP and R&T
agent by NSDL. This also includes records based on which the
debit/credit is affected.
6. All investors have a right to receive their statement of accounts
periodically from the DP.
7. Every month NSDL forwards statement of account to a random
sample of investors as a counter check.
8. In the depository, the depository holds the investor accounts on trust.
Therefore, if the DP goes bankrupt the creditors of the DP will have
no access to the holdings in the name of the clients of the DP. These
investors can transfer their holdings to an account held with another
DP.
9. The data interchange between NSDL and its business partners is
protected by protection measures of international standards such as
encryption hardware lock. The protection measures adopted by NSDL
are more than what is prescribed in the SEBI Regulations.
10.Freeze Facility: A depository account holder (beneficiary account)
may freeze securities lying in the account for as long as the account
holder wants it. By freezing the account, account holder can prevent
unexpected debits or credits or both, creeping into its account. The
following types of freeze facility available in the NSDL system may
be availed of by submitting freeze instruction to the DP in the
prescribed form.
a. Freeze for debits only
b. Freeze for debits as well as credits
c. Freeze a particular ISIN in the account
d. Freeze a specific number of securities held under an ISIN in an
account
11.Certification in Depository Operations: NSDL has introduced a
Certification Programmed in Depository Operations (popularly known
as NCFM certification), and it has been made compulsory for all DPs
to appoint a person qualified in this certification in each of its
branches. This way, NSDL wants to ensure that each branch of a DP
that services investors has at least one person who has thorough
knowledge about depository system.
12.Investor grievance: All grievances of the investors are to be resolved
by the concerned business partner. If they fail to do so, the investor
has the right to approach NSDL at the following the investor
relationship cell of NSDL would work towards resolution of the
grievance.
13.Insurance Cover: NSDL has taken a comprehensive insurance policy
to help DP to indemnifying investors for the loss accrued to them due
to errors, omissions, commission or negligence of DP.
14.Computer and communication infrastructure: NSDL and its
business partners use hardware, software and communication systems,
which conform to industry standards. Further, the systems are
accepted by NSDL only after a rigorous testing procedure. NSDL's
central system comprises an IBM mainframe system with a back-up
facility and a remote disaster back-up site.
15.Machine level back-up: The IBM mainframe in which the data is
processed has adequate redundancy built into its configuration. There
is a standby central processing unit (CPU) to which processing can be
switched over to in case of main system CPU failure. The disk has
RAID implementation, which ensures that a failure of hard disk will
not lead to loss in data. System has spare disk configuration where
data is automatically copied from the main disk upon encountering the
first failure (due to RAID implementation - first failure does not result
in loss of data).
All network components like router, communication controllers etc.,
have on-line redundancy and thus a failure does not result in loss of
transaction.
Disaster back up site: A disaster back up site equipped with a
computer identical to the mainframe computer & computing resources
has been set up at a distant location about 175 km away from
Mumbai. The depository operations are often switched between the
computing resources at Mumbai office and disaster back up site to
ensure that the disaster site is always-operational.
16.Back-up in case of power failure: Continuity in power supply to the
main systems is assured by providing for;
i. Dual uninterrupted power supply (UPS) for IBM-
Mainframe and related components wherein the two
UPSs are connected in tandem. In case of failure of
primary UPS, the secondary UPS takes over
instantaneously and thus, there is no interruption in
operation, and
ii. Back-up diesel generator sets.
Settlement fee:
i. A settlement fee at the rate of Rs. 5 per debit instruction in a Client's
account shall be charged to the Participant of the Client.
ii. A settlement fee at the rate of Re.1.00 per instruction in respect of
securities received from the Clearing Corporation into the Pool
account of each Clearing Member maintained with the Participant
subject to a minimum of Rs. 1,000 and a maximum of Rs. 5,000 per
quarter per CM Account shall be charged to the Participant.
iii. A settlement fee at the rate of Rs.5 per debit instruction for transfer of
securities by way of inter-settlement transfers in the CM Account(s)
shall be charged to the Participant.
iv. A settlement fee at the rate of Rs.5 per debit instruction for transfer of
securities from the CM account of a Clearing Member to the CM
account of another Clearing Member shall be charged to the
Participant of the delivering Clearing Member.
Provided further that no settlement fee shall be charged :
a. in respect of commercial papers and short term debt instruments such
as certificate of deposits, MIBOR linked papers etc.; and
b. in case of :
i. transfers necessitated by transmission on death of the Client;
and
ii. transfer of the accounts of Clients from one Participant to
another as a consequence of expulsion or suspension of such
Participant.
Pledge fee
A fee at the rate of Rs.25 per instruction for creation of pledge /
hypothecation shall be charged to the Participant of the pledge/
hypothecator. No fee shall be charged when a pledge / hypothecation is
closed or invoked.
CUSTODY FEES
Nil
FEE FOR DEMATERIALISATION & REMATERIALISATION
No fee shall be charged by the depository for dematerialization of securities.
Participant shall be charged the following fee for dematerialization of
securities:
a. a fee of Rs.10 for every hundred securities or part thereof ; or
b. a flat fee of Rs.10 per certificate,
Whichever is higher.
No rematerialisation fee shall be charged for Government Securities.
MINIMUM FEE
In case the total fee billed to the Participants in a financial year is less than
the minimum fee of Rs.1,00,000 then the Participant shall be charged the
difference thereof.
SECURITY DEPOSIT
Every Participant shall pay to the Depository Rs.10 lakh by way of interest
free refundable security deposit. However, a Clearing Corporation or a
Clearing House of a Stock Exchange will be exempt from payment of
security deposit.
FEE PAYABLE BY ISSUERS
ANNUAL CUSTODY FEE
Nominal Value of Securities
admitted (Rs)
Amount (Rs.)
Up to 5 crore 6,000
Above 5 crore and up to 10 crore 15,000
Above 10 crore and up to 20 crore 30,000
Above 20 crore 50,000
i. With effect from April 1, 2009, an Issuer of listed securities shall pay
an annual custody fee at the rate of Rs. 8 per folio (ISIN position) in
NSDL, subject to a minimum amount as mentioned below, plus taxes
as applicable:
ii. The above fee would be applicable on all securities i.e. equity, debt,
Units of mutual funds, pass through certificates, certificates of
deposit, commercial papers, preference shares etc., except
Government securities.
iii. The fee will be based on the total ISIN positions (folios) as on March
31, of the previous financial year.
Provided however that, in case the issued capital or ISIN positions
increase during the financial year due to issue of further shares, by
way of public offer, the annual custody fee would be charged on a
pro-rata basis, at the time of such issue.
iv. The fee will be charged every year on a financial year basis and shall
be payable by April 30 of that financial year.
If an Issuer fails to pay the fees mentioned under "Annual Custody
Fee" by the due date, the Depository may charge interest @ 12% p.a.
on the amount, from the due date of payment till the payment is
received by the Depository. Provided further that the Depository may
stop providing details of clients / clearing members / clearing
corporation / intermediary to the Issuer and / or its Registrar and
Transfer Agent as mentioned in the Bye Laws and Business Rules.
Provided further that the Depository may not permit the Issuer to use
its infrastructure including for issue of further securities in electronic
form.
FEE FOR DISTRIBUTION OF NON-CASH CORPORATE
BENEFITS
i. In case of offers for sale by an offered or disinvestment by GOI,
bonus, rights, public issue, preferential issue, split, merger, demerger,
capital reduction, redemption, etc., a fee at the rate of Rs. 10 per
record for debits or credits to accounts as the case may be, shall be
charged to the Issuer, subject to a minimum fee of Rs.1000 per
corporate action.
ii. In case of issue of Commercial Papers, a fee of Rs.10,000/- (plus
taxes) shall be levied on the Issuer for five issues of Commercial
Papers during the financial year. Provided however that an additional
fee of Rs. 10,000/- (plus taxes) shall be levied on the Issuer for every
additional five issues.
iii. In case of issue of short term debt instruments viz; certificate of
deposits, MIBOR linked papers etc., a fee of Rs. 10,000/- (plus taxes)
shall be levied on the Issuer for five such issues made in a financial
year. Provided however an additional fee of Rs.10,000/- (plus taxes)
shall be levied on the Issuer for every additional five issues.
ONE TIME CUSTODY FEES
An Issuer may pay a one time custody fee to NSDL at the rate of 0.05% plus
taxes as applicable on the market capitalization of the company. The market
capitalization of a company will be determined on the basis of the average
market price for a period of 26 weeks preceding the date on which the
company agrees to make such payment. Consequent upon such payment,
NSDL shall not levy any custody fee on the Participants or annual custody
fee on the Issuer.
If a company opts to pay the aforesaid one time fee, it will also be required
to agree to pay on the newly issued shares, a custody fee at the rate of 0.05%
(five basis points) on the value of shares calculated on the basis of issue
price of newly issued shares. In case the company does not pay this amount,
NSDL shall charge annual custody fee or custody fee as per provision
mentioned hereunder, as the case may be. However, the Issuer shall not be
required to pay any one time custody fee on any subsequent issue of Bonus
shares by the company.
JOINING FEE BY ISSUERS
An Issuer of unlisted securities shall pay a joining fee of Rs. 20,000 plus
taxes at the applicable rate at the time of joining NSDL, for the purpose of
making its shares available for dematerialization.
Provided however that in case the Issuer gets its securities listed on any
recognized stock exchange within one year of joining NSDL, the joining fee
paid by the Issuer will get adjusted against the one time custody fee or
Annual Custody Fee, as the case may be.
If an issuer gets its securities delisted from all stock exchanges where its
securities were listed, it shall pay joining fee of Rs. 20,000 plus taxes at the
applicable rate. If an Issuer fails to pay the fees, the Depository may stop
providing details of clients/ clearing members/ clearing corporation/
intermediary to the Issuer and / or its Registrar and Transfer Agent as
mentioned in the Bye Laws and Business Rules. Provided further that the
Depository may not permit the Issuer to use its infrastructure including for
issue of further securities in electronic form.
WHAT IS CSDL?
CSDL(CENTRAL DEPOSITORY SERVICE (INDIA) LTD.) was set
up with the objective of providing convenient, dependable and secure
depository services at affordable cost to all market participants. Some of
the important milestones of CDSL system are:
CDSL received the certificate of commencement of business from SEBI
in February, 1999.
Honorable Union Finance Minister, Shri Yashwant Sinha flagged off
the operations of CDSL on July 15, 1999.
Settlement of trades in the demat mode through BOI Shareholding
Limited, the clearinghouse of BSE
All leading stock exchanges like the National Stock Exchange, Calcutta
Stock Exchange, Delhi Stock Exchange, The Stock
Exchange, Ahmedabad, etc have established connectivity with CDSL.
As at the end of Dec 2007, over 5000 issuers have admitted their
securities (equities, bonds, debentures, commercial papers)units of
mutual funds, certificate of deposits etc. into the CDSL system.
CDSL was promoted by Bombay Stock Exchange Limited
(BSE) in association with Bank of India, Bank of Baroda, State Bank of
India and HDFC Bank. BSE has been involved with this venture right from
the inception and has contributed overwhelmingly to the fruition of the
project. The initial capital of the
Company is Rs.104.50 crores. The list of shareholders with effect from 5th
April, 2010 is as under.
Sr.No Name of shareholder Value of
holding (in
Rupees Laces)
% terms to total
equiy
1 Bombay Stock Exchange
Limited
4,025.46 38.5
1
2 Bank of India 1,000.00 9.5
7
3 Bank of Baroda 1,000.00 9.5
7
4 State Bank of India 1,000.00 9.5
7
5 HDFC Bank limited 1,500.00 14.3
6
6 Standard Chartered Bank 750.00 7.1
8
7 Canara Bank 674.46 6.45
8 Union Bank of India 200.00 1.91
9 Bank of Maharashtra 200.00 1.91
10 The Calcutta Stock Exchange
Association Limited
100.00 0.96
11 Other 0.08 -
Total 10,450.0
0
100.00
BOARD OF DIRECTOR
Mr. S.S. Thahur Chairman
Mr.V.V. Raut Managing Director and Chief Exe. Officer
Mr. P.S.Reddy Executive Director
Mr. M.R.Mayya Independent Director
Mr. Madhu Kannan Sponsor Director–Bombay Stock Exchange Ltd.
Mr. Prakash R. Kacholia Sponsor Director-Bombay Stock Exchange Ltd.
Mr. Ashishk Chauhan Sponsor Director-Bombay Stock Exchange Ltd.
Mr. Anjan Barua Sponsor Director – State Bank of India.
Mr. A.D.M. Chavali Sponsor Director – Bank of Baroda
Mr. A.R.Kuppuswamy Sponsor Director – Bank of India
SECURITIES AVAILABLE FOR DEMATE
Securities available for demat
Equity 5,715
Debt instruments including debentures, bonds, Government
securities, certificates of deposits, commercial paper, pass
through certificates and Others
4582
Mutual fund units 1900
Depository Participants
Number of Depository Participants 500
Number of branches with LIVE Connectivity 265
Number of cities/ towns with LIVE connectivity 120
Number of locations with LIVE connectivity 278
Demat Custody
Number of securities in million 78,470
Value (Rs. in million) 84,40,100
Demat Settlement (April 2010)
Number of securities in million 699
Value (Rs. in million) 60,174
Investor accounts(Excluding closed accounts)
Corporate / Companies which issue any kind of security are
known as 'Issuer' in the depository system. Only those securities, which
are admitted into the CDSL system are available for dematerialization
to the holders of such securities or can be allotted in electronic record
form by the issuer. Securities include shares, debentures, bonds,
commercial paper (C.P.), and certificate of deposits (C.D.), pass
through certificates (PTCs), government securities and mutual fund
units. Both listed and unlisted securities can be admitted into the CDSL
system. CDSL functions as the central accounting and record keeping
office in respect of the securities admitted by issuer companies.
It is mandatory for all listed companies to have their securities
admitted for dematerialization with both the depositories viz CDSL &
NSDL. It is however desirable that all securities are admitted on both
the depositories so that investors having account with any of the
depositories can acquire that security.
Before the admission of any security into the CDSL system, it
is necessary for the issuer to establish an electronic connectivity with
CDSL either directly or through a registrar and transfer agent (RTA),
who has already established connectivity with CDSL. All leading RTAs
have already established electronic connectivity with CDSL. The
procedure and CDSL charges to obtain direct connectivity by an issuer
are similar to that as for a RTA. It may please be noted that SEBI, vide
its circular dated 27-12-2002, has advised issuers that "all the work
related to share registry in terms of both physical and electronic should
be maintained at a single point i.e either in-house by the company or by
a SEBI registered R & T Agent".
At CDSL, data is centrally stored with state-of-the-art systems
and having a 'Disaster Recovery Site' facility as back up. The
centralized database architecture of CDSL places it in a unique position
to provide issuers up-to-the-moment details of holdings of the security.
HDFC BANK
Housing Development Finance Corporation Limited, more popularly
known as HDFC Bank Ltd, was established in the year 1994, as a part of the
liberalization of the Indian Banking Industry by Reserve Bank of India
(RBI). It was one of the first banks to receive an 'in principle' approval from
RBI, for setting up a bank in the private sector. The bank was incorporated
with the name 'HDFC Bank Limited', with its registered office in Mumbai.
The following year, it started its operations as a Scheduled Commercial
Bank. Today, the bank boasts of as many as 1412 branches and over 3275
ATMs across India.
HDFC Bank Ltd. is a commercial bank of India, incorporated in August
1994, after the Reserve Bank of India allowed establishing private sector
banks. The Bank was promoted by the Housing Development Finance
Corporation, a premier housing finance company (set up in 1977) of India.
HDFC Bank has 1,412 branches and over 3,295 ATMs, in 528 cities in
India, and all branches of the bank are linked on an online real-time basis.
As of September 30, 2008 the bank had total assets of INR 1006.82 billion.
For the fiscal year 2008-09, the bank has reported net profit of Rs.2,244.9
crore, up 41% from the previous fiscal. Total annual earnings of the bank
increased by 58% reaching at Rs.19,622.8 crore in 2008-09
History
HDFC Bank was incorporated in the year of 1994 by Housing
Development Finance Corporation Limited (HDFC), India's premier housing
finance company. It was among the first companies to receive an 'in
principle' approval from the Reserve Bank of India (RBI) to set up a bank in
the private sector. The Bank commenced its operations as a Scheduled
Commercial Bank in January 1995 with the help of RBI's liberalization
policies.
In a milestone transaction in the Indian banking industry, Times Bank
Limited (promoted by Bennett, Coleman & Co. / Times Group) was merged
with HDFC Bank Ltd., in 2000. This was the first merger of two private
banks in India. As per the scheme of amalgamation approved by the
shareholders of both banks and the Reserve Bank of India, shareholders of
Times Bank received 1 share of HDFC Bank for every 5.75 shares of Times
Bank.
In 2008 HDFC Bank acquired Centurion Bank of Punjab taking its
total branches to more than 1,000. The amalgamated bank emerged with a
strong deposit base of around Rs. 1,22,000 crore and net advances of around
Rs. 89,000 crore. The balance sheet size of the combined entity is over Rs.
1,63,000 crore. The amalgamation added significant value to HDFC Bank in
terms of increased branch network, geographic reach, and customer base,
and a bigger pool of skilled manpower.
Business Focus
HDFC Bank deals with three key business segments - Wholesale
Banking Services, Retail Banking Services, Treasury. It has entered the
banking consortia of over 50 corporate for providing working capital
finance, trade services, corporate finance and merchant banking. It is also
providing sophisticated product structures in areas of foreign exchange and
derivatives, money markets and debt trading and equity research.
Wholesale Banking Services
The Bank's target market ranges from large, blue-chip manufacturing
companies in the Indian corp. to small & mid-sized corporate and agric-
based businesses. For these customers, the Bank provides a wide range of
commercial and transactional banking services, including working capital
finance, trade services, transactional services, cash management, etc. The
bank is also a leading provider of structured solutions, which combine cash
management services with vendor and distributor finance for facilitating
superior supply chain management for its corporate customers. HDFC Bank
has made significant inroads into the banking consortia of a number of
leading Indian corporate including multinationals, companies from the
domestic business houses and prime public sector companies. It is
recognized as a leading provider of cash management and transactional
banking solutions to corporate customers, mutual funds, stock exchange
members and banks.
Retail Banking Services
The objective of the Retail Bank is to provide its target market
customers a full range of financial products and banking services, giving the
customer a one-stop window for all his/her banking requirements. The
products are backed by world-class service and delivered to customers
through the growing branch network, as well as through alternative
delivery channels like ATMs, Phone Banking, Net Banking and
Mobile Banking.
HDFC Bank was the first bank in India to launch an International
Debit Card in association with VISA (VISA Electron) and issues the
MasterCard Maestro debit card as well. The Bank launched its credit card
business in late 2001. By March 2009, the bank had a total card base (debit
and credit cards) of over 13 million. The Bank is also one of the leading
players in the “merchant acquiring” business with over 70,000 Point-of-sale
(POS) terminals for debit / credit cards acceptance at merchant
establishments. The Bank is well positioned as a leader in various net based
B2C opportunities including a wide range of internet banking services for
Fixed Deposits, Loans, Bill Payments, etc.
Treasury
Within this business, the bank has three main product areas - Foreign
Exchange and Derivatives, Local Currency Money Market & Debt
Securities, and Equities. These services are provided through the bank's
Treasury team. To comply with statutory reserve requirements, the bank is
required to hold 25% of its deposits in government securities. The Treasury
business is responsible for managing the returns and market risk on this
investment portfolio.
Distribution Network
An HDFC Bank Branch
HDFC Bank is headquartered in Mumbai. The Bank has an network
of 1,725 branches spread in 771 cities across India. All branches are linked
on an online real-time basis. Customers in over 500 locations are also
serviced through Telephone Banking. The Bank has a presence in all major
industrial and commercial centers across the country. Being a
clearing/settlement bank to various leading stock exchanges, the Bank has
branches in the centers where the NSE/BSE have a strong and active
member base.
The Bank also has 3,898 networked ATMs across these cities.
Moreover, HDFC Bank's ATM network can be accessed by all domestic and
international Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and
American Express Credit/Charge cardholders.
Capital Structure
At present, HDFC Bank boasts of an authorized capital of Rs 550 crore
(Rs5.5 billion), of this the paid-up amount is Rs 424.6 crore (Rs.4.2 billion).
In terms of equity share, the HDFC Group holds 19.4%. Foreign
Institutional Investors (FIIs) have around 28% of the equity and about 17.6%
is held by the ADS Depository (in respect of the bank's American
Depository Shares (ADS) Issue). The bank has about 570,000 shareholders.
Its shares find a listing on the Stock Exchange, Mumbai and National Stock
Exchange, while its American Depository Shares are listed on the New York
Stock Exchange (NYSE), under the symbol 'HDB'.
HSBC Demat Accounts are especially designed to give you the edge in
the stock markets today
You can purchase, hold and sell shares in electronic form
Get your Holding statement every 3 months, showing current
portfolio of shares
Avail of an Overdraft up to Rs.20 lakhs available against Demat
shares through Asset Link#
As an NRI, you can easily dematerialize your portfolio of shares in
India with us*
If you already hold an HSBC Current/Savings account, there be no
account opening charges and no minimum balance requirements for
your Demat Account
You can save on transaction costs with quick transfers
Say goodbye to risk of loss, theft or mutilation of shares
Now, stop worrying about bad deliveries, forgeries and duplicate
share certificates
Products & Services
Personal Banking
Savings Accounts
Salary Accounts
Current Accounts
Fixed Deposits
Demat Account
Safe Deposit Lockers
Loans
Credit Cards
Debit Cards
Prepaid Cards
Investments & Insurance
Forex Services
Payment Services
Net Banking
InstaAlerts
Mobile Banking
InstaQuery
ATM
Phone Banking
NRI Banking
Rupee Savings Accounts
Rupee Current Accounts
Rupee Fixed Deposits
Foreign Currency Deposits
Accounts for Returning Indians
Quick remit (North America, UK, Europe, Southeast Asia)
India Link (Middle East, Africa)
Cheque Lockbox
Telegraphic / Wire Transfer
Funds Transfer through Cheques / DDs / TCs
Mutual Funds
Private Banking
Portfolio Investment Schemes
Loans
Payment Services
Net Banking
InstaAlerts
Mobile Banking
InstaQuery
ATM
Phone Banking
FEE AND CHARGES
HDFC Minimum
1 Account Opening NIL --
2 Account Maintenance Rs. 500/- per anum Rs. 500/-
3 DematerializationsRs. 3 per certificate, plus
Rs. 35/- per requestRs. 38.00
4 Rematerialisation
At actual, as levied by the
Depository Currently Rs.
10/- per certificate
--
5 SELL0.04 % of the value of the
transaction
**
Minimum
Rs.20.00
6 BUY NIL --
7 Pledge Services *0.04% of the value of the
sharesRs. 25.00
8 Asset Holding NIL --
9 Debt Transactions – Sell
0.04 % of the value of the
transaction. Minimum Rs
500/- and Maximum Rs
5000/- per Txn
Rs. 500.00
per txn.
10 Debt Transactions – Buy NIL --
11
Mailing Charges for non
periodic statements and
other communication
Rs. 25/- per request for
inland address Rs. 500/-
per request for foreign
address
HOW TO OPEN A DEMATE ACCOUNT ?
There are two options available to open a demat account with our bank:
1. Customers could have/can open a savings/current account with
HDFC Bank. OR
2. Customers could pay an advance fee of Rs.2500/- for each demat
account which will be adjusted against service charges.
Requirements:-
1. Account opening form duly completed in all respects.
2. Photographs of all the authorized signatories duly signed across
to be affixed on the reverse of the specimen signature card.
3. Copy of Memorandum and Articles of Association duly attested
by the Company Secretary / Director of the company.
4. Board Resolution along with the name of the authorized
signatories & their specimen signature on the company's
letterhead stating that the company desires to open a demat
account with HDFC bank and that the authorized signatories will
be operating the said account as per the mode of operation given
in the board resolution.
5. DP Agreement to be executed on a stamp paper (value of stamp
paper as per the place of execution of agreement)
6. Tariff Sheet duly signed by all the authorized signatories.
7. Debit Authorization signed by the bank account holders as per
the mode of operation in the board resolution for the bank
account.
8. Proof of address of the corporate: Document registered with
ROC/ acknowledged copy of Income Tax return/ Bank
statement/ Leave & License agreement/ Agreement for purchase
of office premises.
9. Introduction by existing account holder or by applicant's bank.
The Requirements for opening a trust account are:
1. Attested copy of the trust resolution.
2. Attested copy of the registration certificate (Public Trust
Account) if the trust is registered under the Society Registration
Act of 1850, Indian Public Trust Act of 1950 or Indian Trust act.
3. Photographs of the trustees signed across.
4. Income Tax Exemption Certificate (optional). However, in case
of a company retirement trust (i.e. Provident Fund Trust, Pension
Fund, Gratuity fund, Super-annotations fund) the demat account
will be opened in the name of the trust.
5. PAN copy of the Trust.
6. PAN coy of the Trustees, incase of an unregistered trust.
HDFC SECURITIES
HDFC Securities (HDFCsec) is Equity Trading Company of
HDFC Bank. HDFC Securities provide both online trading and trading on
phone. The HDFC Securities trading account has a unique 3-in-1 feature that
integrates your HDFC Securities trading account with your existing HDFC
bank savings account and existing Demat account. Funds / shares are
seamlessly moved from the linked Demat/Bank account to execute the
transactions.
HDFC sec provides Cash-n-Carry on NSE and BSE, Day trading
on both NSE and BSE, Trade on Futures & Options on the NSE and Online
IPO Investment.
Features on HDFC Securities online trading
1. Seamless Transactions - By integrating your accounts, we ensure
minimal waste of time during movement of your funds and shares.
2. Speed - Orders are placed electronically, so proceeds are available
instantly.
3. No manipulation - To prevent any mismanagement, we will send you
an email confirmation, the minute your order is executed.
4. Safety and Security - HDFC Securities offer the highest level of
security such as 128-bit encryption technology.
5. Dedicated and Separate contact numbers - for trading over the phone
as well as for customer care.
Document required to open account with HDFC sec
Any Indian resident/non resident individual NRI (except for the US NRIs) or
an Indian Corporate can register with HDFCsec. However, to become a
member, you will have to open savings/current and demat accounts with
HDFC Bank. Following documents are required to open accouunt with
HDFCsec
1. One passport size photograph.
2. Copy of PAN card.
3. Identity proof - copy of passport or PAN card or voter ID or driving
license or ration card.
4. Address proof - copy of driving license or passport or ration card or
voter card or telephone bill or electricity bill or bank statement.
Brokerage and fees:
1. Rs. 799/- (Including trading account, bank account and DP account
with HDFC)
HDFC Bank savings account required a quarterly minimum balance
of Rs. 2,500/-. If you already have saving account or DP account with
HDFC, you could link them with trading account.
ICICI DEMATE ACCOUNT
Type of Account
ICICI Direct offers 3 different online trading platforms to its customers:
1. Share Trading Account
Share Trading Account by ICICI Direct is primarily for buying and
selling of stocks in BSE and NSE.
This account allows Cash Trading, Margin Trading, Margin PLUS
Trading, Spot Trading, Buy Today Sell Tomorrow and Call and Trade
on phone.
ICICIDirect.com website is the primary trading platform for this
trading account. They also provide installable application terminal
based application for high volume trader.
2. Wise Investment Account
Along with stock trading and IPO investing in BSE and NSE, Wise
Investment account also provide options to invest in Mutual Funds
and Bonds online.Online Mutual funds investment allows investor to
invest on-line in around 19 Mutual Fund companies. ICICI Direct
offers various options while investing in Mutual Funds like Purchase
Mutual Fund, Redemption and switch between different schemes,
Systematic Investment plans, Systematic withdrawal plan and
transferring existing Mutual Funds in to electronic mode. This account
also provides facility to invest in Government of India Bonds and
ICICI Bank Tax Saving Bonds.
3. Active Trader Account
Active Trader account gives more personalized investment options to
the investors. It allows investor to use online and offline stock trading.
It also provides with independent market expertise and support
through a dedicated Relationship Manager from ICICI.
Advantages of ICICI Demate Account
1. 3-in-1 account integrates your banking, broking and demat accounts.
All accounts are from ICICI and very well integrated. This feature
makes ICICI the most interesting player in online trading facility.
There is absolutely no manual interfere require. This is truly online
trading environment.
2. Unlike most of the online trading companies in India which require
transferring money to the broker's pool or towards deposits, at ICICI
Direct you can manage your own demat and bank accounts through
ICICIdirect.com. Money from selling stock is available in ICICI bank
account as soon as the ICICI Direct receives it.
3. Investment online in IPOs, Mutual Funds, GOI Bonds, and Postal
Savings Schemes all from one website. General Insurance is also
available from ICICI Lombard.
4. Trading is available in both BSE and NSE.
Disadvantages
1. Getting access to ICICIDirect.com website during market session can
be frustrating.
2. ICICI Direct brokerage is high and not negotiable.
3. Not all stocks are available under Margin Plus
OPENING DEMATE ACCOUNT
Demat account
There is no fee for opening a DP account with ICICI Bank. However, a
nominal fee towards services is levied as per our tariff. Opt for Standard
Rate Card or Frequent Trader Rate Card depending on your trading volume.
Or, if you wish to hold your Bonds in Demat form you can choose Bond
Rate Card.
Account Opening Form to Open Securities Account
Resident Non Corporate Account Opening Form
Resident Corporate Account Opening Form
Reparability
A. Reparable Demat Account
Reparable funds (i.e. those which can be taken abroad) need to be kept in a
separate bank account, i.e. NRE Bank account. Typically, funds brought in
from abroad are permitted in such an account. Investments made from such
funds can be repatriated, i.e. proceeds from sale or otherwise from such
investments can be taken abroad. Such investments are maintained in a
Reparable Demat account.
B. Non-reparable Demat Account
Non-reparable funds (i.e. those which cannot be taken abroad) must be kept
separate from repairable funds in a separate bank account i.e. NRO Bank
account. Investments made from such funds cannot be repatriated, i.e.
proceeds from sale or otherwise from such investments cannot be taken
abroad. Such investments are maintained in a Non-Reparable Demat
account. Money once transferred from NRE account to NRO account loses
its reparability and hence, cannot be transferred back to NRE account.
Mode of Investment
A. Portfolio Investment Scheme (PINS)
Portfolio Investment Scheme (PINS) is a scheme of the Reserve Bank of
India (RBI) under which the 'Non Resident Indians (NRI's)' and 'Person of
Indian Origin (PIOs)' can purchase and sell shares and convertible
debentures of Indian Companies on a recognized stock exchange in India
by routing all such purchase/ sale transactions through their account held
with a designated Bank Branch. The designated Bank maintains a record of
all investments done under PINS (PINS portfolio).
B. Non - PINS
Any investment other than under PINS is Typically, this includes:
1. Subscription to Primary market offerings (IPOs)
2. Investments made when resident in India.
3. Investments in Mutual funds
4. Investments in derivatives
5. Gifts and Inheritance
Deciding Combination
You may have to open demat accounts of a specific combination if you
already hold physical shares in that combination. Physical shares can be
converted into electronic form in your demat account by submitting the
certificates along with a demat request form. You should also open the
required combination under the correct type of demat account:
PINS NRE - For shares acquired earlier under PINS on repatriation basis
PINS NRO - For shares acquired earlier under PINS on non-repatriation
basis
Non-PINS NRE - For shares acquired earlier other than under PINS on
repatriation basis
Non-PINS NRO - For shares acquired earlier other than under PINS on
non-repatriation basis and also when 'Resident' in India
Charges of ICICI demate account
Particular Amt.
Opening account 975/-
Margin trade 0.3 to 0.1%
Squared off trade 0.2% to 0.425%
Delivery bases trade 0.25% to 0.75%.
Average trading volume 65000/-
Annual maintenance fee 500/- (actual 450/- ,50for including
e-mail or post statement.
Average balance 5000/-
Demat transaction rate 0.75% brokerage
Trading volume rate 0.05% brokerage
Transaction value 10000/-
Brokerage rate 85/-
Services (0.05% of the brokerage) nil
Demate charges nil
Annual services 500/-
Agreement stamp charge 100/-
Buying and selling share Nil
• No amount is required for opening the demat account.
These are applicable as both standard charges and frequent/sub broker
charges.
The ICICI demat account charge for annual service is Rs 500 and for
frequent/sub brokers is Rs 1200.
An agreement is required to make in a stamp paper of Rs 100.
The ICICI demat account charges are nil for buying shares.
The selling charges applicable are – Nil for trade on icicidirect.com
For internet submitted instructions – 0.02% (frequent/sub broker) and
0.04% (standard charges).
For instructions submitted through call centers – 0.02% (frequent/sub
broker) and 0.04% (standard charges).
For instructions submitted through branches – 0.02% (frequent/sub
broker) and 0.04% (standard charges).
If rejection fails Rs 30 are the standard applicable charges and Rs 15
are the applicable charges for frequent/sub brokers.
Dematerialization charges for each request form Rs 35 and Rs 2 for
each extra certificate.
Rematerialisation charges are Rs 20 for every 100 securities
ICICI demat account charges are nil for the closure of the account.
Rs 10 per ISIN are applicable for instruction submitted through
branches.
Additional account statements charge Rs 20 both standard rates and
for frequent and sub brokers.
Brokerage and fees
1. Account opening fees : Rs 750/- (One time non-refundable)
2. Brokerage : ICICIDirect.com brokerage varies on volume of trade
and inclusive of demat transaction charges, service taxes and courier
charges for contract notes. It ranges from 0.1% to 0.15% for margin
trades, 0.2% to 0.425% for squared off trades and 0.4% to 0.85%
on delivery based trades.
CONCLUSION
Comparison of two companies with fees and brokerage chares.
Particular HDFC ICICI
Account opening Nill 975/-
Annual maintenance Fee 500/- 500/-
Dematerialization 3/- per certificate ,
35/- per request.
2/- for each extra
certificate and 35/- per
request.
Rematerialisation 10/- per certificate, 20/- for every 100
securities.
Sell 0.04% of the value. Nil
Minimum 20/-.
Buy Nil Nil
Pledge services 0.04% value of per
transaction or minimum
25/-
Nil
Data transaction 1000/- 1000/-
Communication 20 rs per request and
500 per foreign address.
Call centre 0.02% to
0.04% of value.
Data Transaction on
Buy a share
Nil Nil
Conclusion: By studying comparative analysis of both
hdfc and icici bank demat account we should promote more
hdfc bank demat accounts since charges are minimum and sell
are more.