DEMAT OF SHARES

Introduction:

Indian investor community has undergone sea changes in the past few

years. India now has a very large investor population and ever increasing

volumes of trades. However, this continuous growth in activities has also

increased problems associated with stock trading. Most of these problems

arise due to the intrinsic nature of paper based trading and settlement, like

theft or loss of share certificates. This system requires handling of huge

volumes of paper leading to increased costs and inefficiencies. Risk

exposure of the investor also increases due to this trading in paper.

Some of these risks are:

Delay in transfer of shares.

Possibility of forgery on various documents leading to bad deliveries,

legal disputes etc.

Possibility of theft of share certificates.

Prevalence of fake certificates in the market.

Mutilation or loss of share certificates in transit.

This has made the investors as well as broker wary of Indian capital

market. In this scenario dematerialized trading is certainly a welcome

move.

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What is Dematerialization?

Dematerialization or “Demat” is a process whereby your securities like

shares, debentures etc, are converted into electronic data and stored in

computers by a Depository.

What is a Depository?

Depository functions like a securities bank, where the dematerialized

physical securities are traded and held in custody. This facilitates faster

and low cost settlement. Depository is much like a bank and performs

many activities that are similar to a bank. Following table compares the

two.

Bank Depository

Holds funds in accounts Holds securities in account

Transfers funds between accounts Transfers securities between accounts

Transfers without handling money Transfers without handling securities

Safekeeping of money Safekeeping of securities

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Dematerialisation or demat is a process to convert the securities held in

physical form into an electronic record form or to directly allot securities in

electronic record form. These electronic records of securities are shown as

"electronic balances" in the demat account of investors. Any investor

(Beneficial Owner or BO) can open a demat account through a depository

participant (DP). DP provides a link on one hand between the BO, Company

and CDSL and on the other hand between the BO, the BO's broker and the

Stock Exchange. CDSL publishes from time to time an updated list of DP's

registered with it.

NSDL and CDSL

At present there are two depositories in India, National Securities

Depository Limited (NSDL) and Central Depository Services Limited

(CDSL). NSDL is the first Indian depository; it was inaugurated in

November 1996. NSDL was set up with an initial capital of US$28mn,

promoted by Industrial Development Bank of India (IDBI), Unit Trust of

India (UTI) and National Stock Exchange of India Ltd. (NSEIL). Later,

State Bank of India (SBI) also became a shareholder.

The other depository is Central Depository Services (CDS). It is still

in the process of linking with the stock exchanges. It has registered around

20 DPs and has signed up with 40 companies. It had received a certificate

of commencement of business from SEBI on February 8, 1999. In order to

facilitate transfers between investors having accounts in the two existing

depositories in the country the Securities and Exchange Board of India has

asked all stock exchanges to link up with the depositories. The NSDL and

CDS have signed an agreement for inter-depository connectivity.

What is a DP?

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NSDL carries out its activities through various functionaries called

business partners who include Depository Participants (DPs)

Who can be a DP?

Public Financial Institutions.

Scheduled banks.

RBI Approved Foreign banks operating in India.

State financial corporations.

Institutions engaged in providing financial services, promoted by any

of the institutions mentioned above either jointly or severally.

Custodians of securities who are registered with SEBI.

Clearing Corporations or Clearing Houses of Stock Exchanges.

Stock Brokers registered with SEBI.

Non Banking Finance Companies.

1. Investors surrenders defaced certificate along with Dematerialization

Request Form (DRF) to his DP.

2. DP intimates Depository of the request through the system.

3. DP submits the certificate with DRF to registrar.

4. Registrar confirms the Demat from Depository.

5. Registrar validates the request, updates records & informs the

Depository.

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6. Depository credits the DP a/c & informs DP.

7. DP updates the investor’s a/c & informs the investor.

Trading in dematerialized shares results in substantial savings for the

investors.

Following tables gives an idea about these savings.

Savings for a person who buy shares for long term investment

(On a purchase of Rs10000)

Item Physical

(Rs)

Depository (demat)

(RS)

Savings

(Rs)

Brokerage 75-100 50-75 25-50

*Stamp Duty 50 - 50

Postal Charges 10-30 - 10-30

Company Objection

(Courier etc.)

10-30 - 10-30

Settlement charges - 5-10 -(5-10)

#Custody (5 years) - 10-50 -(10-50)

Total 35-100

Stamp duty of 0.5%

Custody charge of 0.05%- 0.1%

Savings for an investor who sells dematerialized shares

(For a sale of Rs10000)

Item Physical

(Rs)

Depository (demat)

(Rs)

Savings

(Rs)

5

*Brokerage 75-100 50-75 25-50

Company Objection

(courier, etc.)

10-30 - 10-30

Settlement charges - -(5-10) -(5-10)

Total 25-75

Sub-Brokers:

Sub-Brokers have two options:

1. Arrange to deliver the securities directly from the pool account of main

broker to the beneficial owner account of the buying clients.

2. Arrange to deliver the securities from the pool account of the main

broker to beneficial owner account of the sub-broker kept for trading

purpose and then forward the same to buying client.

CM POOL A/C

Client A A/c

Client B A/c

Client C A/c

Client D A/c

Sub Broker’s Beneficiary A/c

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Benefits of Holding Securities in the Dematerialised Form :

Elimination of all risks associated with physical certificates:

There is no risk of loss, mutilation or theft of certificates of securities.

Elimination of bad deliveries:

In the depository environment, securities cannot be returned "under

objection" for any reason and hence the question of bad delivery does

not arise nor does the investor face any uncertainty on the genuinity of

securities purchased by him.

Effects immediate transfer and registration of securities:

After the payout, once securities are credited to the investors BO

account maintained with a DP, the investor becomes the legal owner

of the securities as there is no further need to seek registration from the

company or its registrar.

Faster settlement cycles:

All stock exchanges currently follow T+2 rolling settlement cycle i.e.

settlement of trades is done on the 2nd working day from the trade

day. This has become possible because of demat which enables faster

turnover of securities and enhances liquidity.

Faster receipt of securities in case of bonus / split/ mergers etc:

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Direct credit of securities issued as bonus or on allotment of

IPO/rights, split and merger ensures faster receipt of securities and

avoids risk of loss of certificates in transit.

Waiver of stamp duty:

No stamp duty is payable by investors for transfer of any kind of

securities received in demat form.

Facilitate recording of change of address, transmission, etc.:

For all investments held in the a/c, instead of advising each company

separately about the change in address, bank account particulars,

nomination, deletion of name in case of joint holder, one single advice

to the DP takes care of all such changes.

Ease of portfolio monitoring:

The statement of account periodically sent by the DPs provides the

investor the consolidated position of all his investments in the demat

account. This makes it convenient for an investor to compare and

monitor his portfolio.

Why Should an Investor Open a Demat Account?

The CDSL system incorporates a number of distinct features which

provide BO’s a convenient, dependable and secure depository services

at affordable cost.

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Convenience:

Wide DP Network:

CDSL has over 275 DPs offering services from over 100

cities/towns across the country and thus providing investors a wide

choice for selecting a DP, depending on his locational and other

conveniences. Many more DPs are expected to get registered with

CDSL shortly.

On-line DP Services:

CDSL DPs provide on-line depository services from over 500

branches. All these branches are electronically connected to CDSL

thereby taking the depository services to the door-step of investors.

DP branches facilitate quicker execution of demat instructions.

Availability of Wide Spectrum of Securities:

The equity shares of over 5000 companies are available for

dematerialisation on CDSL. CDSL extends demat facilities

practically for all categories of securities which include bonds,

debentures, commercial papers, government securities and

certificates of deposit.

Competitive Fees Structure:

CDSL's fee is very reasonable and competitive, which makes it

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possible for DPs to offer demat services to investors at affordable

cost. CDSL DPs are not required to pay any custody or ISIN fees

to CDSL.

Internet Access:

Through CDSL's unique internet facility "electronic access to

securities information" -. "Easi", a BO by registering himself

through his DP (who in turn will have to be registered with CDSL

for use of this facility) can know and even print statements of his

demat account. The BO can also know the status of his previous 7

days transactions at any time by logging into easi. BO gets a

unique facility of knowing the daily valuation of the securities held

in their demat account, at the previous day's closing price on the

BSE.

Dependability:

On-line Information to Users:

With the CDSL's centralised database architecture; on-line

depository services are available to BO’s with up-to-the-minute

status of his BO accounts.

Safety of data:

Even if any system-related problems develop at the DPs end, it does

not affect the BO’s interest in any way as the CDSL database is

maintained centrally. The DP can also avail of the facility of

contingency terminals available at CDSL's Mumbai office for

executing instructions.

Audit and inspection:

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CDSL conducts regular audit of its DPs to ensure compliance of the

stringent operational and regulatory requirements.

Security:

Computer Systems:

CDSL has installed state-of-the-art computer system, data storage

devices, communication networks which ensure the security and

integrity of all data uninterruptedly. All data at CDSL is auto

mirrored separately and also transmitted to a Disaster Recovery

Site which is located at a different place away from the main site.

System Access:

As the system does not provide for dial-up access, only

authorised users can access CDSL system. In other words, only a

person at DP end who has been pre-authorised by CDSL can

access the CDSL system.

Unique BO Account Number:

Each BO in the CDSL system is allocated a unique account

number. This avoids wrong transfer of securities in the event the

transferor's account number is keyed-in wrongly at the DP end.

Insurance Cover:

CDSL has obtained adequate insurance cover for any unlikely

loss occurring to a BO due to the negligence at CDSL and/or its

DP.

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Dematerialisation Process and Procedure:

Opening a Depository Account

Investors, both individuals and non-individuals, have a choice

to open a demat account with any CDSL DP. Individual

investors could be Indian residents or NRIs. Non-individual BO

includes Corporates, FI’s, FII’s, Mutual Funds, Trusts etc.

Under two way fungibility of ADR/GDR, non-residents can

also open a demat account with a CDSL DP.

A BO should consider fee structure, locational convenience and

the track record of the DP before selecting a DP for opening his

BO account.

More than one demat account can be opened in identical names

with the same or different DPs with the same depository and/or

with both the depositories.

A demat account can be maintained even with 'nil' balance as

there is no requirement of holding any minimum-security

balance in a demat account.

If securities are already held in joint names, the demat account

should be opened in the order of names in which the securities

are held. If the securities are held by an individual jointly with

different persons, separate demat accounts will have to be

opened for each such combinations. However, if the same

persons hold securities in different order of their names, one

single demat account in names of all these persons (not

exceeding 3 persons) would be sufficient, provided the facility

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of transposition-cum-demat is used.

At the time of opening a demat account or anytime thereafter,

individuals having a BO account in a single or joint name/s, a

nomination can be made. In the unfortunate event of demise of

one of the joint holders, the securities can be transmitted in the

names of the surviving holders. But, in the event of demise of

the sole holder or all the joint holders, the securities can be

transmitted in the name of the nominee. A resident Indian can

nominate an NRI or another resident Indian and similarly an

NRI can nominate a resident Indian or another NRI. Non-

individuals including societies, trusts, body corporates, kartas of

HUF, holders of power of attorney, cannot make nomination.

Documents required to be submitted at the time of opening a

CDSL demat account:

Individual Investors :

An application in the prescribed form duly completed.

Certified copy of an election-ID card / passport / ration card

/PAN card or in the absence of these documents, an

introduction by an existing account holder of the DP giving the

introducer's name, address, and contact number.

A certified copy of birth certificate and guardian's name, in case

of a minor.

A passport size photograph of each of the applicants with

his/their signature/s put across the photograph/s

In case of any attestation by a Magistrate / Notary Public /

Special Executive Magistrate, the name, address and telephone

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number of the Magistrate/Notary Public/Special Executive

Magistrate.

A copy of the power of attorney, if desired. And agreement in

the prescribed form duly executed.

A Depository is like a bank where securities are held in electronic

(dematerialised) form. In India, there are two Depositories -National

Securities Depositories Limited (NSDL) and Central Depository

Services Limited (CDSL).

Under the Depositories Act, investors can avail of the services of the

Depositories through Depository Participants (DP) such as ICICI Bank.

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DP’s are like bank branches wherein shares in physical form need to be

deposited for converting the same to electronic (demat) form.

ICICI Bank Demat Services boasts of an ever-growing customer base of

over 11.5 lacs account holders. In their continuous endeavor to offer best

of the class services to their customers they offer the following features:

E-Instructions:

Customers can transfer securities 24 hours a day, 7 days a week

through Internet & Interactive Voice Response (IVR) at a lower cost.

Now with “Speak to transfer”, customers can also transfer or pledge

instructions through bank’s customer care officer.

Consolidation Demat Account:

Dematerialise physical shares in various holding patterns and

consolidate all such scattered holdings into primary demat account at

reduced cost.

Digitally Signed Statement:

Receive account statement and bill by email.

Corporate Benefit Tracking:

Track dividend, interest, bonus through account statement.

Mobile Request:

Accesses demat account by sending SMS to enquire about Holdings,

Transactions, Bill & ISIN details.

Mobile Alerts:

Receive SMS alerts for all debits/credits as well as for any request

which cannot be processed.

Dedicated customer care executives specially trained at call centre,

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to handle all their queries.

Countrywide network of over 235 branches, you are never far from

an ICICI Bank Demat Services outlet.

Customers will find bank’s service charges very competitive - offering

the best value for your money

Procedure for Demat

Form

Submit a completely filled up Demat Request Form (DRF) in triplicate for each

ISIN along with defaced physical securities. We have provided you with one

blank Dematerialisation Request Form (DRF). Additional forms are available at

any of the ICICI Bank branches offering Demat Services.

Filling up the form

Ensure that security mentioned on the certificates is eligible for Demat.

For being eligible for demat, the company has to sign up with NSDL.

You can check eligibility on www.icicibank.com or ask the nearest

Branch.

Use a separate DRF for each security having a unique International

Security Identification Number (ISIN). Verify the certificates

carefully and mention the correct ISIN. In case two or more sets of

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certificates of the same security have different ISIN (this is possible

in case of partly paid up shares and non-pari passu shares), use

separate DRFs for each ISIN. However, you can dematerialise

multiple folio nos. of the same pattern of holders relating to the same

ISIN under a single DRF.

Submit certificates under lock-in under separate DRF. Do not mix

the same with free securities. In case of locked-in securities, fill up the

lock-in reason & lock-in release date on the DRF. Amongst lock-in

securities belonging to the same ISIN but having different lock-in

release dates or lock-in reason, make separate DRF requests.

Demat requests received from client(s) with name(s) not matching

exactly with the name(s) appearing on the certificates merely on

account of initials not being spelt out fully or put after or prior to the

surname, can be processed. However, this is possible only if the

signature(s) of the client(s) on the DRF tallies with the specimen

signature(s) available with the Issuer or its Registrar. For example,

the shareholder may have opened the depository account in the name

of Sushil Ramesh Shah but his name on the share certificate may

appear as S. R. Shah or Sushil R Shah etc.

The combination and the order of holders’ names on DRF and as

printed on the Certificates should be identical with that in the DP

account.

For example, if the shares are in the name of X, Y (X as first holder

and Y and second holder) it cannot be dematerialised in the account

of either X or Y alone. Also if the shares are in the name of X, they

cannot be dematerialised in the account of X, Y (X as first holder and

Y as second holder).

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However, where the combination of holders is the same in the

certificates and in the demat account, and the difference is only in the

order in which the name of the holders appear on the share

certificates and in the demat account, dematerialization is possible.

Here, you have to submit a Transposition Request Form along with

the DRF. The form is also available at the nearest Branch.

The DRF must be signed by all the account holder’s and should be in

the same order. The signature on the DRF should match with the

specimen signature with ICICI Bank. If the signature differs, you

should sign the DRF in the presence of the Branch Officer. If you

have a doubt that the signature on the DRF may not match with that

registered with the Registrar, you can get the signature on the DRF

attested by your banker.

The details of certificates such as the folio no., certificate no., &

distinctive no. must be filled up correctly on the DRF.

Submitting the form

You must deface the certificates by putting a stamp or by writing

“Surrendered for Dematerialization”. However defacing should be done

only after checking the eligibility of security, as defaced securities cannot

be sold in physical form. If defacing has been done by mistake then you

should send the same to registrar for replacement.

Credit in the Demat Account

The defaced shares along with the DRF are sent by ICICI Bank to the

registrar who will then credit the customer’s account. The normal time

taken for credit of shares to the account after confirmation by the

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Registrar is about 30 days. However the time taken would vary from one

registrar to another over which ICICI Bank has no control.

To check whether your account has been credited, you can refer to the

transaction statement (Refer # 12, below). The same will be reflected in

pending demat balance on receiving your request. After

dematerialization, the same will be reflected under free balance.

Alternatively you can use the web (register on www.icicibank.com),

phone us or visit the ICICI Bank branch. In case your account does not

get credited within a month of submission, you can either phone us or

send an email to customer.care@icicibank.com

In case there is a delay beyond 40 days, if you so wish, ICICI Bank can

give you the registrar’s name and telephone number as well as your

Demat Request Number (DRN).

Rejection of Demat Requests

Your request may get rejected for various reasons either at the Central

Processing Office of ICICI Bank or by the Registrar. Dematerialisation is

done by the Registrar only when it is satisfied of genuineness of securities

& ownership status.

On a rejection, the securities are sent back to you stating the reason for

the rejection.

You can resubmit the certificates for dematerialisation after resolving the

reason for the rejection. Please resubmit on a fresh DRF. Do not use the

same DRF on which the objection was made.

Transmission-cum-Demat

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In case of certificates held jointly, on the death of any one or more of the joint

holder(s) mentioned on the certificate, the surviving joint holder(s) can get the

name(s) of the deceased deleted from the physical certificate(s) and get the

securities dematerialised in the DP account of the surviving holder(s) by

submitting the following documents along with the DRF:

A copy of the death certificate duly notarized

A copy of the Succession certificate duly notarised or an order of

a court of competent jurisdiction where the deceased has not left

a Will or

A copy of the Probate or Letter of Administration duly notarised.

Sale / Delivery of Securities

Securities transactions can be settled in demat form for the transactions done on

stock exchanges connected to NSDL. At present, NSE, BSE, CSE, DSE, LSE,

BgSE, OTCEI, MSE, ISE & ASE are connected to NSDL. Trading in

dematerialised securities is done through your broker just like trading in

physical securities.

Sell dematerialised securities

You can sell your dematerialised securities in any of the stock

exchanges linked to NSDL through a broker of your choice.

You need to give a ‘delivery instruction’ to your DP for debit of

your depository account and credit of your broker’s clearing

member account.

You receive payment from the broker for the sale in the same

manner you would receive payment for a sale in the physical

mode.

Buy dematerialised securities

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You can purchase securities in any of the stock exchanges

connected to NSDL through a broker of your choice and make

payment to your broker. Make sure you tell your broker you want

only demat shares.

Broker receives credit in his clearing account with his DP on the

day of payout. He can immediately transfer these securities to

your depository account, provided your account is already active.

Broker gives instructions to his DP to debit his clearing member

account and credit your depository account.

Following are the steps involved in Pledge/Hypothecation

1. Creation of Pledge:

The pledgor submits duly filled in Pledge Request Form to his DP for

Creation of Pledge. On execution of the instruction by the DP a pledge order

no. is generated for each ISIN.

2. Confirmation of Pledge Instruction:

The pledgee submits duly filled in Pledge Request Form quoting the Pledge

Order No. (Given by the pledgor) to his DP. On execution of the instruction

the shares are marked as pledged in the pledgor’s account. Pledge balances

cannot be transferred.

3. Closure of Pledge Instruction:

The pledgor submits duly filled in Pledge Request Form to the DP for release

of pledge. The pledgor does this after he has repaid the loan received from the

pledgee.

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4. Closure Confirmation of Pledge Instruction:

The pledgee submits duly filled in Pledge Request Form for confirmation of

release of pledge to his DP. The pledgee would do this after ensuring that the

pledgor has repaid the loan/credit facility extended to him. On execution of

instruction the shares move from pledge balance to free balance in the

Pledgor’s account.

5. Invocation of Pledge Instruction:

The Pledgee submits duly filled in Pledge Request Form quoting the pledge

order no. to his DP. On execution of instruction the shares moves from the

pledged balance of the Pledgor’s account to free balance in the Pledgee’s

account. The pledgee does this when the pledgor has failed to repay the loan

as per his obligations.

6. Confirmation of Invocation of Hypothecation Instruction:

The difference between a pledge and a hypothecation request is that whereas

invocation of pledge can be done unilaterally by the pledgee, a confirmation

of the pledgor is required in the case of invocation of hypothecation. For this

pledgor submits duly filled in Pledge/ Hypothecation Request Form to the

DP.

Form

There is a common form for all pledge requests given above. Typically, you

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would need to use it at the time of creation and at the time of closure of a pledge.

Filling up the form

There is a common pledge/hypothecation form for all types of instruction.

You must tick the appropriate box to indicate the instruction type.

You should clearly indicate whether the instruction is for Pledge or

Hypothecation.

Ensure that the Pledge form is completely filled up. Incomplete details may

lead to rejection of the pledge request.

Enter the DP ID and Account number correctly on the space provided on the

left-hand side of the form. You should enter the counter-party details

correctly on the space provided on right hand side of the form.

You must fill up the Agreement number as provided by the pledgee. This

refers to the pledge agreement signed between the pledgor and the pledgee.

You must fill up the Closure date as provided by the pledgee. This is

referred in the pledge agreement signed between the pledgor and the

pledgee.

You must fill up the ISIN & security name of the security to be pledged.

If the shares are under lock-in then you should fill up the lock-in reason and

lock-in release date in the space provided.

The number of securities should be filled up correctly in the space provided.

In case of pledge creation, you must have free balance in the ISIN

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mentioned.

The instruction must be signed by all the account holder’s and should be in

the same order. The signature on the request should match with the

specimen signature with ICICI Bank.

Enter the Pledge order number for all types of pledge instructions other than

pledge creation instruction.

Submitting the form

You can submit the pledge request at any ICICI Bank branch. The

acknowledgement portion will be stamped and handed over to you after

verification by the ICICI Bank official.

Execution of the Instruction

The instruction is executed at the Central Processing Office of ICICI Bank. On

execution date, the transaction will be executed and you can check the same in

your transaction statement.

Rejection of Pledge Requests

Your request may get rejected for various reasons either at the Central

Processing Office of ICICI Bank or by the counter-party. On a rejection at the

Central Processing Office, you will be informed about the reason for rejection of

the request.

You can submit a fresh request after resolving the reason for the rejection.

If a creation request is rejected by the counter-party the balance will get

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transferred from the pledged balance to the free balance.

Submitting Pledge instructions through “Speak to Transfer”

You have to first register for the e-Instruction facility by

filling up the prescribed form available at the branch. You

need to specify upto five target accounts to which you can

pledge your securities through our Phone Banking Officer.

Call up our Phone Banking numbers Select Demat menu from

all the options read by IVR. Get yourself authenticated by

entering DPID & Demat a/c no. with TPIN provided to you.

Select the option 5 of “Speak to Transfer” to submit Pledge

instructions from Demat menu.

Our Phone Banking Officer will attend you and will ask for the

information required for Pledging your securities.

After confirmation from your side, Phone Banking Officer will

give Pledge Reference number for your completed transaction.

Freezing /Defreezing

The client has an option to freeze his account in case he does not

intend to do any transaction in the near future. These helps in

curbing unauthorised use of demat account & prevention of

frauds. Once freezed the account can be defreezed only on the

instruction of the account holders.

Following types of Freezing is possible:

Freezed for Debit: In this case any debit instruction cannot be

passed unless the account is defreezed. However the credit in

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the account will be received provided a standing instruction for

credit is given for the account.

Freezed for All: In this case no transfer to & from the account

can be done.

ISIN Freezing: In this case a specified ISIN can be freezed,

blocking the ISIN for debit.

Quantity Freezing: In this case a specified quantity of a

specified ISIN can be freezed, blocking the quantity for debit.

Defreezing of the account is required to enable the account again for transaction.

The request for freezing & defreezing must be submitted in the prescribed form.

Corporate Benefit - Dividend, Bonus or Rights Issue Merger or

acquisition:

In case the company in which a beneficial owner holds shares in demat form

announces any corporate benefits like bonus, dividend etc. the beneficial owner

will receive the same directly in his demat account or bank account depending

on the nature of the benefit.

Dividend:

The company/registrar takes a list of beneficial owners from

NSDL as on the record date/book closure date. Based on this list,

company makes payment of dividend. If the company is making

the payment through ECS, the company will directly credit the

dividend to the bank account registered by the beneficial owner

with the DP under intimation to the beneficial owner. If the

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company is making the payment through a cheque/DD, the bank

details will be printed on the dividend warrant. The mode of

payment of dividend etc is decided by the company itself.

Bonus:

The bonus securities on the eligible securities in the beneficial

owner’s demat account are automatically credited to the beneficial

owner’s demat account by the company/registrar under intimation

to the beneficial owner. This will be reflected in the transaction

statement for the period. In respect of the physical holdings, the

customer will receive bonus securities in physical form.

Rights issue:

The beneficial owner will receive an option to subscribe for the

eligible number of securities from the company/registrar. These

securities may be in physical form or in electronic form in the

customer’s demat account. The customer can exercise the same in

the normal course. While exercising the option (in respect shares

both in physical or electronic form), the customer may mention the

demat account in which the securities allotted are to be credited

provided the company is available for demat with NSDL.

Alternatively, the customer can also ask for the securities in

physical form.

Merger or acquisition:

Securities in the beneficial owner’s demat account is automatically

credited and debited by the company/registrar as per pre-declared

ration under intimation to the beneficial owner. This will be

reflected in the transaction statement for the period.

Public Issue

When subscribing for shares in a public issue, you can request for

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securities, if allotted, to be credited directly to your demat account and

quote your demat account for the purpose in the application form.

After allotment, the securities will be credited directly to your demat

account under an intimation to you from the company/registrar. Such

credit is done before the date of listing of the securities on a date

considered convenient by the company/registrar. However, if the

details of the demat account specified in the form are incorrect, the

securities will be allotted in physical form and certificates will be sent

to you.

SEBI has announced that the shares of all companies going in for

Public offer will have to be compulsorily settled in demat form by all

investors. It is therefore advantageous for an investor to prefer the

allotment in demat form, so that the shares have higher liquidity.

Nomination

You can make a nomination of your account in favour of any person by filing up

the nomination details in the account opening form. This is to enable the

nominee to receive the securities after the death of all the holder(s) of the demat

account.

Nominees can be appointed by individuals only. Non-individuals including

society, trust, body corporate, partnership firm, karta of Hindu Undivided

Family, holder of power of attorney cannot nominate. Where a minor is

appointed as a nominee, the name and address of the guardian is also required to

be obtained.

Where a nomination has not earlier been made or where an earlier nomination is

28

ought to be changed, you can submit a duly filled-in nomination form at the

nearest Branch. The account holder, nominee and two witnesses must sign this

form and the name, address and photograph of the nominee must be submitted.

In case of the death of the sole holder or all the joint holders, the nominee must

submit a duly filled-in transmission form and give the notarised copy of death

certificate and an affidavit in the prescribed format. After verifying these

documents, the securities will be transferred to the account of the nominee.

No transaction charges will be levied for transfer of shares from the

old account to the account of the claimant.

If the demat account of the claimant does not exist, a new demat

account will need to be opened. If the claimant is having a demat

account but with another DP, a proof of the same is required from

the other DP. (Client master from the DPM).

The claimant only needs to approach the DP. He need not lodge a

claim for transmission separately with each issuing company or its

R&T Agent. The following documents should be submitted with the

request:

i A copy of the death certificate duly attested by a notary or

29

) verified with the original by an authorised person of the

ICICI Bank branch.

i

i

)

An Off-market TIFD for the entire securities/ holdings for

transmitting the shares.

Registration for Internet/Phone Access & e-instructions.

To increase convenience to the customers while reducing work load at your end

in handling queries, there is a facility for the customer to directly access his

demat account 24 hours a day, 365 days a year through the internet and through

phone.

A customer who holds an ICICI Bank demat account only and does not hold a

banking account can still register for the above access. It is not mandatory to

hold a banking account to be able to register for such access.

Internet Facilities available on www.icicibank.com

View transaction statement

View holdings

View status of requests submitted - TIFD/IDT, Demat, Pledge,

Remat

View account details

Get the ISIN for a Security

Get Settlement Details

Request for a TIFD booklet

View Customer Ledger - his receivable account

View Bill Details

Pay his Demat bill online

e- Instructions- facility to transfer securities

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Phone - Interactive Voice Response (IVR)

Details of last few transactions

Details of holdings

Request for a TIFD booklet

Get ISIN for a security

Get status of requests submitted - TIFD/IDT, Demat, Pledge,

Remat

e- Instructions- facility to transfer securities

Further, the Call centre is also equipped to handle specific queries on the demat

accounts. For accessing the above facilities, the customer needs to register for

thesame.

For accessing the above facilities, the application for registration should be done

in the prescribed form. The form can be submitted at any ICICI Bank branch

offering demat services.

ICICI Demat Services allows customer to access his demat account through the

following channels also

www.icicibank.com

IVR (Interactive Voice Response) at Call

Center .

Both these channel require authentication before providing the access on

www.icicibank.com is allowed after the customer provides the User ID and the

password on the site access on the IVR is allowed after the customer provides

the Telephone Personal Identification Number (TPIN).

TPIN is sent to the customer by post on submitting a Channel Registration

request at any branch offering demat services.

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On submission of the request, the customer is sent the following 3 envelopes:

TPIN (To be used for Phone Banking)

Infinity User ID (To be used for Internet

Banking)

Password (To be used for Internet Banking)

In some cases, client may already have an User ID for his existing relationship

with ICICI Bank (could be a Bank account or a credit card...) and he may request

for his Demat account to be linked to the same User ID (which he is the first

holder). In such cases, after the linking, he will not be sent any communication.

He will start seeing his demat account also through the same User ID.

Revised Depository Service Charges

Charge Head Standard

Charges

Sub broker

Charges

A/c Opening Nil Nil

Annual Service Charges Rs. 500/-

(Rs 450/- :

email)

Rs. 1250/-

(1200/- :e-mail)

Agreement Stamp Paper Rs. 100/- Rs. 100/-

Buy - Market and Off-

Market

Nil Nil

Sell - Market and Off-

Market (% of transaction

value) – Max. Rs. 500 for

debt instruments :

   For trade done on

icici.com

Nil Nil

   For instruction submitted 0.04% 0.02%

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through Internet (e-

instructions)

(Min. 10/-) (Min. 5/-)

    For instruction

submitted through Call

Centre

0.04%

(Min.15/-)

0.02%

(Min. 10/-)

   For instruction

submitted through Branches

0.04%

(Min. 30/-)

0.02%

(Min. 15/-)

Rejection/fails Rs. 30 /- Rs. 15/-

Extra charges for

processing of instructions

submitted on the execution

date late:

  For instruction submitted

through Internet

Nil Nil

  For instruction submitted

through phone

Nil Nil

   For instruction submitted

through Branches

Rs. 10/-

per ISIN

Rs. 10/-

per ISIN

Dematerialisation :

  For each request form Rs. 35/- Rs. 35/-

  Extra for each certificate Rs. 2/- Rs. 2/-

Rematerialisation (For each

request form)

Rs. 20/- Rs. 20/-

Closure of Account Nil Nil

Pledge Creation

/Closure/Confirmation

  If ICICI Bank is the

counter party

0.02%

(Min.15/-)

0.02%

(Min.15/)

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  If ICICI Bank is not the

counter party

0.04%

(Min.30/-)

0.04%

(Min.30/)

Additional Account

Statements

Rs. 20/- Rs. 20/-

Frequently Asked Questions

Account Opening & Operations :

1. Can I open more than one account with ICICI Bank Demat?

Yes, you can open more than one account with ICICI Bank Demat. There is

no restriction on the number of accounts you can open with the same

Depository Participant (DP).

2. Do I have to keep any minimum balance of securities in my account?

No, there is no prescribed minimum balance. You can have a zero balance

in your account.

3. Can someone else operate my account on my behalf on the basis of a

power of attorney?

Yes, if you authorize any person to operate your account by executing a

power of attorney (POA) and submit it to us, that person can operate the

account on your behalf. If you have given POA earlier and now wish to

operate the account yourself, the POA has to be revoked by you in writing.

4. How do I register a change in my signature with ICICI Bank Demat?

You would have to make a request in writing. You would also have to get

your signature duly attested by your banker, with whom you hold the bank

account that has been specified for receipt of dividend.

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Dematerialisation:

1. Can I dematerialise all my depository eligible securities through the

same account?

Yes. You can choose to have all your securities deposited in a single

account provided that the securities have the same holders.

2. Can I dematerialise shares, which are pledged with a bank, which is a

DP as well?

Yes, you can, with the permission of the bank with whom such shares are

pledged.

3. Can odd lot shares be dematerialised?

Yes, Odd lot share certificates can also be dematerialised.

4. How do I demat shares with Pre-Marital / Maiden names?

In such cases you need to submit a certified true copy of the marriage

certificate along with the Demat Request Form (DRF), when you give your

shares for dematting. Also provide an attested new specimen signature.

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Trading /Settlement :

1. Can I buy and sell shares through ICICI Bank Demat?

No, shares can be bought and sold only through a stockbroker.

ICICI Bank Demat helps in delivering the shares against a sell

transaction or receiving the shares for a buy transaction. You can open

an account with icicidirect.com to avail of seamless trading and

settlement.

2. Can I deliver dematerialised securities against an obligation in physical

segment, in all stock exchanges?

Yes, SEBI has permitted dematerialised securities to be delivered against

obligations in the physical segment at the stock exchanges connected to the

depository.

1. 3. Is the facility of delivering dematerialised securities in the physical

segments of the stock exchanges, available only for those securities that

are to be compulsorily sold in the demat segment of stock exchanges by

institutions?

No, dematerialised securities of all the companies that are eligible for

dematerialisation can be delivered against obligations in the physical

segment.

36

NAME: ________________________________________________

DESIGNATION:

________________________________________________

CONTACT NO.:

________________________________________________

SIGNATURE:

________________________________________________

SURVEY FOR PROJECT ON DEMAT SERVICES (ICICI BANK)

Are you aware about Demat services provided by

Banks?

Yes No

Do you have a demat account for your share

trading?

Yes No

Ifyes, which bank_____________________________________

Are you planning to have a demat account in any

bank for your share trading in future?

Yes No

Which type of bank would you like to prefer for

pursuing demat services?

Private Public Foreign

37

If private, then will you like to experience ICICI

Bank demat services?

Yes No

What do you think the procedure for getting demat

services is_

Convenient Lengthy

Will you like to get demat services with

convenience, security and cost saving from ICICI

Bank?

Yes No

Suggestion:

_______________________________________________________________

_______________________________________________________________

_______________________________________________________________

___________________________.

Signature:

38

Survey Report

According to survey results done on the demat services from the 1st December,

2012 to 31st January, 2013 consumers are more prefer to have demat account

for convenience in trading with shares.

In survey I have asked few questions to customers and their response was as

follows:

Aware Unaware Account holders

Private Public0

102030405060

Customer Survey

Aware unaware Account Holders Private Public

Demat Services

This chart shows that there is approximately 60% aware about demat services

among the people and still aprox 40% people are unaware about it.

39

There are 35% demat account holders among 60% people who are aware with

this concept.

25% people prefer private banks to experience the demat services and 10% are

with public banks for the same.

Interview of ICICI Bank

I had visited ICICI Bank, Andheri (West) branch to Mr. Sanjeev Panday

(Branch Operations Manager) and Ms. Abha Gupta (Officer- Customer

Relations) and asked them a few question for gathering information related to

their demat services;

1. What is the importance of converting shares into demat form?

Because, it is more convenient to trade with E-shares than physical form of

shares.

2. How ICICI Bank operates demat services?

ICICI Bank holds securities in account safely and transfers without

handling them between accounts.

3. Is the bank providing any additional benefits to the regular account

holder?

Yes, we provide many additional benefits to our regular customer like they

need not to present more documents to have an account, no account opening

charges, etc.

4. Through the demat services in your bank, is the customers of your

40

bank are increasing?

Yes, customers of the bank are increasing after we have started to provide

demat services.

5. Is ICICI providing any other service related to financial market?

Yes, ICICI providing wide choice of products for investing in the stock

market like Derivatives, Mutual Funds, IPO’s, Life and General Insurance,

Commodities through ICICI direct. Com

Conclusion

And as I conclude it is clear that DEMAT SERVICES are a boon for

mankind who trades in share market as it is a paperless, time saving, cost

saving and secure.

For many customers, demat services are becoming the only way to trade

conveniently with the share market Having the look at the increasing number

of demat account holders it is clear that in future there won’t be any problem

of trading in shares.

Due to all these features of demat services the customer is more likely to

prefer the E-shares than holding papers and this may also lead to alienation of

the customers.

In addition, demat services are also becoming a competitive mark for many

banks.

Therefore, it is imperative to ensure that the customers experience with the

demat account safe and secure.

41

BIBLIOGRAPHY

WEBSITES:

www.icicibank.com

www.cdsl.com

www.nsdl.co.in

www.yahoo.com

www.google.com

www.sify.com

www.surfindia.com

www.gmail.com

www.rediffmail.com

www.wikipedia.com

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OTHER SOURCES:

Membership Guide of ICICI Bank Demat Services.

Visit to ICICI Bank branch offering Demat Services.

43