Copy of Securities and Exchange Board of India

8/8/2019 Copy of Securities and Exchange Board of India

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SECURITIES AND EXCHANGE BOARD

OF INDIA

As a part of III

semester I unit ofFIMS

forDepartment of Management Studies

Nigama Engineering College


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DISCUSSION CONTAINS

SEBI INTRODUCTION

SEBI ORGANISATION

SEBI OBJECTIVES

SEBI FUNCTIONS

SEBI GUIDELINES


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SEBI - INTRODUCTION

PRIOR TO SEBI:

During II World War : Defence Rules of India, 1943

After II World War : Capital Issues (control) Act, 1947

Objectives:

Growth of companies with sound structure.

To avoid overcrowding of public issues.

Ensuring investment in conformity withfive year plan objectives.

To ensure healthy growth of capital markets.

SECURITIESCONTRACTS (REGULATIONS)ACT, 1956


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Malpractices in Securities Market

Manipulation of securities prices.

Price rigging.

Insider trading.

Delay in settlement.

SEBI - INTRODUCTION


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Deficiencies in Market

Lack of diversity in Financial Instruments.

Disclosure of Financial Information.

Prepondence of Speculative Trading.

Poor liquidity.

Lack of control over brokers.

SEBI - INTRODUCTION


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Securities and Exchange Board of India was originally founded

on 12th April, 1988 but it was replaced by passing a separate

act, in parliament on 4th April, 1922.

Jurisdiction: Government of India.

Employees: 525

SEBI - INTRODUCTION


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SEBI ORGANISATION

SEBI ACTprovidesSIX members asstatutory board:

3 Members central government.

1 Member RBI

2 Members experienced

Primary market department.

Issue management & intermediaries department.

Secondary market department.

Institutional investment department.


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SEBI - OBJECTIVES

Toprotectthe interest ofinvestor.

To regulatethesecurities market

Topromoteefficientservices by brokers.


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SEBI - FUNCTIONS

Regulatory Functions:

Regulatesstockexchange.

Regulatesstock brokers and others

Registration ofinvestmentschemes.Developmental Functions:

Promotes investorseducation

Training.

Research and publish ofinformation. Promoting code ofconduct.


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SEBI - GUIDELINES

For Primary Market:

New company.

New company started by existing company: 5year track is to be

maintained and its contribution is 50% in equity i n new company.

Private and closely held companies.

Existing listed companies: 50% on first Rs. 100 crores, 40% on Rs.

200 crores and 30% on 300 crores and 15% on remaining.

Public issue


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SEBI - GUIDELINES

For Secondary Market:

StockExchange:

Board ofDirectors ofStockexchange has to constituted.

Working hours forstockexchanges havebeen fixed uniformly.

All stockexchanges have to inform about transaction with in 24 hrs.

Brokers:

3Registration is compulsory

3Compulsory audit of brokers book.

3No broker is allowed to underwrite more than 5%


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SEBI - GUIDELINES

For Foreign Institutional Investors:

Allowed to invest in primary and secondary markets..

The holding in single FII in a company will not exceed the ceiling

of5% of the equity capital of the company.

FII has to pay concessional tax of 10% on LTCG and 20% on

STCG.


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For Debentures

Amount of working capital debenture should not exceed 20% 0f

gross current assets.

DebtEquity ratio should not exceed 2:1.

Normally debentures above seven years should notbe issued

Debenture trust deed must be completed within six months from

public issue.

SEBI - GUIDELINES


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Copy of Securities and Exchange Board of India

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