NRI Investment with SSSIL

Disclaimer:

• This document has been prepared by Systematix Shares & Stocks (I) Ltd. This report is meant for the recipient and not for circulation. Thisdocument is not to be reported or copied or made available to other. It should not be considered or to be taken as an offer to sell or a solicitation to buy anysecurity. The information contained here in is from sources believed reliable. We don’t represent that it is accurate or complete and it should not be reliedupon as such. We may from time to time have position in or option on and buy and sell securities referred to herein. We may from time to time solicit from orperform investment banking or other services for any company mentioned this document.

Systematix Shares & Stock (I) Ltd.


NRI Investment NRI Investment

with with

Systematix Shares And Stocks (I) Ltd.



Systematix GroupSystematix Group



CompanyCompany ProfileProfile

Founded in 1995.

Founded by Mr. C.P. Khandelwal.

Systematix Group has strategically branched into different business units offering holistic finance and investment services.

350 Plus Branches and Business Associates across India.

500 plus employees. Over 60 % are professionals.



Mission: “To enhance the economic value of our client’s business by providing integrated financial & investment services and products.”

Vision: “ To figure among the top Five Financial Powerhouses in India in next five years.”

Our Mission and VisionOur Mission and Vision



GroupGroup CompaniesCompaniesSystematix Corporate Services Ltd. (Listed Company)SEBI Regd. Merchant BankerSystematix Shares & Stocks (I) Ltd.Personalized broking services to its institutional, corporate and individual clients.Systematix Commodities Services Pvt. Ltd.Commodity Broking Services on MCX and NCDEX.Systematix Capital Services Pvt. Ltd.Business consulting and Financing Solution to clients of Systematix GroupSystematix Fincorp India Ltd.NBFC -Providing Loans against Shares. SQL Star International Ltd. (Listed Company)Knowledge Services, Elearning Products, IT Management Services, Content Delivery, E-Governance products.



OurOur PhilosophyPhilosophy Focus, simplicity, discipline.

The client is always first.

Passionate about quality of service.

Win, Keep, Grow – Strategy.

Sharing of Best Business Practice across the

Country.



OurOur presencepresence inin majormajor citiescities

West Bhawanimandi Bhilwara Jaipur Kota Mumbai Udaipur Pune

South Chennai

Hyderabad

North Indore Delhi Lucknow Ujjain East

Bhuvaneshwar Kolkata



Who qualifies as a Non-Resident Who qualifies as a Non-Resident Indian (NRI)?Indian (NRI)?

A person who stays outside India for any of the following: Taking up employment. Business or vocation. Any other purpose, in such circumstances as would indicate

his intention to stay outside India for an uncertain period. Indian citizens working abroad on assignments with foreign

Governments /Government agencies or international/regional agencies like the UNO, IMF, World Bank etc.

Officials of Central and State governments and Public Sector Undertakings deputed abroad on temporary assignments or posted to a Branch/Office (including diplomatic missions) abroad.

Indians settled abroad permanently. Indians gone abroad on immigration. Crew members of Indian nationality or Indian origin

employed by foreign airlines/shipping companies, if they are based at foreign ports and reside abroad.



Who is a Person Of Indian Origin?

A person is deemed to be a person of Indian origin if he/she is a foreign citizen (other than of Pakistan or Bangladesh), and if:

That person have at any time held an Indian passport or That person or either of that person’s parents or any of

his/her grandparents was citizens of India by virtue of the Constitution of India or the Citizenship Act, 1955.

The person is the spouse of an Indian citizen or of a person of Indian origin (other than of Pakistan or Bangladesh).



What is PIS?

Portfolio Investment Scheme (PIS) is a scheme of the

Reserve Bank of India (RBI) defined in Schedule 3 of

Foreign Exchange Management Act 2000 under which the

'Non Resident Indians (NRIs)' 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.



What is a NRE account?

A NRE bank account is an external saving bank account opened for Non resident Indians.

Since it is an external account, the money lying in NRE account are fully repatriable.

This money can be converted into any foreign currency at the behest of the account holder and can be remitted outside the country.



What is a NRO account?

A NRO bank account is an ordinary saving bank account opened for Non resident Indians.

Since it is an ordinary account i.e. as good as a normal saving bank account, the money lying in NRO account are not repatriable.

This money cannot be converted into any foreign currency at the behest of the account holder.



Why Invest in India?

Series of economic reforms since 1991 like :-

liberalized foreign investment and exchange regimes,

significant reductions in tariffs and other trade barriers,

reform and modernization of the financial sector,

significant adjustments in government monetary and

fiscal policies.



How can NRI Invest in Indian Secondary Markets through us?

NRE Account PIS-for secondary market

transactions only

(repatriable basis)

Saving Account-for

transferring money to and

from PIS -NRE a/c after

purchase or sale of shares

respectively (repatriable

basis)

NRO Account PIS-for secondary market

transactions only (non repatriable basis)

Saving Account- for

transferring money to and

from PIS-NRO a/c after

purchase or sale of shares

respectively (non

repatriable basis)

The Process is exhibited below:

STEP INRI Investor can open any 4 bank accounts from

below:-



STEP – II

NRI Investor can open 2 DP (Demat)

Accounts.

DP NRE a/c – for shares holding

(repatriable basis)

DP NRO a/c – for shares holding (non - repatriable

basis)



List Of Documents Required For NRIs. For DP and Trading Account

All Documents Should Be Self Attested

1. On photograph for each DP and trading account (signed accrossed).

2. DP and Trading forms duly filled and signed by client.

3. A copy of Passport and Visa duly attested by the client for each DP and Trading account (in case of Indian Passport).

4. Copy of Indian as well as Foreign Address proof for each DP and Trading account.

5. Copy of Bank Statement for each DP and Trading account.

6. Copy of PIS NRE or NRO form according to the NRE or NRO DP.

7. Copy of PAN Card for each DP and Trading account.



List Of Documents Required For NRIs Bank Accounts:

All Documents Should Be Self Attested

1. One Photograph for each account i .e. for PIS and saving account (signed across).

2. A copy of Passport and Visa duly attested by the client for each account (in case of Indian Passport).

3. The Account Opening form, duly filled in along with PIS-NRE form (repatriable basis) or PIS-NRO form (non repatriable) as the case may be.

4. Copy of Indian as well as foreign Address proof.5. Copy of Bank Statement duly attested by client for

each account.6. Copy of driving License for each account (if any).7. One copy of POI Card for each account. (In case of

POI only).8. One copy of PAN Card duly attested by client for

each account.



Systematix Sends one copy contract note to investors local address and submits one contract note at the PIS designated branch on the day of

Transaction (within 24 hrs.)Note – Systematix will e-mail a copy to the NRI/ PIO Investor

POA Authority holder/NRI/ PIO Investor and Bank (PIS) Branch verify if all transactions are in order

Bank will Debit PIS SB A/c and Credit Broker A/C

Systematix Credits the DP (PIS) a/c of the NRI/ PIO investor after receiving Pay - out from the Exchange.

Post Purchase Transaction Process



POA holder/NRI/ PIO Investor and Bank Branch verify if all transactions are in order.

Systematix sends one copy contract note to investor’s local address and submits one contract note at the PIS designated branch on the day of

Transaction (within 24 hrs.)Note – Systematix also e-mails a copy to the NRI/ PIO Investor.

PIS bank then credits NRI/ PIO Investors account net of taxes*.

Systematix will give pay-in from NRI’s DP a/c to the exchange.

POA holder/NRI/ PIO Investor receives credit from Systematix.

Post Sale Transaction Process

*Debit for Capital gain Tax Debit bank charges Debit Service tax of 12.36%


Investment Opportunities for NRIs in Indian Mutual Funds:

Investment avenues offer both repatriation and non–repatriation benefits

under various schemes. In case the NRI wants to invest in Mutual Fund

Schemes, there is no need to obtain any permission from RBI. The procedure

for MF investments is detailed below:

Purchase of Units: Investments by NRI in Mutual Funds can be made on a repatriable or on a

non-repatriable basis, as preferred by the investor: On Repatriation Basis : Payment may be made by way of inward remittance or by way of cheques

drawn on NRE / FCNR account of the NRI investor payable in the city

where the application is submitted.

Contd….


Purchase of MF Units contd…

Redemption of Units: Redemption proceeds will be remitted depending upon the

source of investment as follows: On Repatriation Basis: When the units have been purchased through the investor’s

NRE / FCNR account, the redemption proceeds can be remitted after deduction of applicable tax to the unit holder in foreign currency (any exchange rate fluctuation will be borne by the unit holder). The proceeds can also be sent to the investor’s Indian contact address for crediting to his NRE / FCNR account, if desired by the investor.

On Non-Repatriation Basis: When the units have been purchased through the investor’s

NRO account, the redemption proceeds can be credited to the same accounts after deduction of applicable tax. The proceeds can also be sent to the investor’s Indian contact address for crediting to his NRO account, if desired by the investor.

On Non-Repatriation Basis:Payment may be made by way of inward remittance or by way of cheques drawn on NRE / FCNR / NRO account of the NRI investor payable in the city where the application is submitted.


Repatriation of Dividends on MF Units:

Applications Under A Power Of Attorney (POA) Given To A Resident

Indian:

NRI applicant can apply through a POA holder who is a resident Indian. While applying for units the POA holder is required to submit the original POA or a copy thereof duly notarized. The POA must contain the signatures of both the first holder as well as the POA holder. The POA holder can transact on behalf of the NRI investor only after the POA is registered with the Fund.

The entire dividend received will qualify for full repatriation, irrespective of the mode of remittance of subscription amount, provided the investor continues to be a non-resident in terms of Schedule 5 of the Foreign Exchange Management (Transfer or issue of a security by a person resident outside India) Regulations, 2000.


Tax liability on redemptions:

Tax liability on income received from Mutual funds:

Under Section 2(42A) of the Income Tax Act, units of the fund held as a capital asset for a period of more than 12 months immediately preceding the date of transfer, will be treated as a long-term capital asset for the computation of capital gains, thus qualifying for the long-term capital gains tax rate, which is nil at this point of time. In all other cases, it would be treated as a short-term capital asset and would be taxed at the short-term capital gains tax rate, which is fixed at 10% plus surcharge (chargeable @10% in case total taxable income exceeds Rs.10 lacs) plus additional surcharge @2% as education cess. As per Section 10(35) of the Income Tax Act, 1961, income received from mutual fund units specified under Section 10(23D) is exempt from income tax in India and the mutual funds are subject to pay distribution tax in debt oriented schemes. Hence all dividends are tax-free in the hands of non-resident investors and no TDS is applicable on the same.



What if NRI / PIO Investor already holding PIS account?

The NRI/ PIO Investor needs to transfer his existing PIS account to the bank with which Systematix has tie-up.

No Objection certificate from their present Banker where NRI/ PIO Investor has presently holding their PIS a/c.

Their present Bankers will also issue the list of shares which the customer is holding in their PIS a/c as of date.

As the NRI/ PIO Investor can only open one PIS a/c with only one Bank , NRI/ PIO Investor is required to close the said account with their previous Bank immediately.



How many PIS account can a NRI open?

Can NRI invest in all products through PIS account?

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 and submit it to DP, that person can operate the account on your behalf.

NRI/PIO can open only one PIS account with any designated banks in a prescribed format for PIS account, upon which the bank can issue a PIS approval letter to the investor.

No. Any investment done in secondary market should be routed through a PIS account. For other products the investment can be done through direct subscription route.



Can NRIs invest in shares, debentures and units of Mutual Funds in India?

NRIs are permitted to make direct investments

in shares/ debentures of Indian companies/ units

of mutual fund.

They are also permitted to make portfolio

investments i.e. purchase of share / debentures

of Indian Companies through stock exchange.

These facilities are granted both on repatriation

and non-repatriation basis.



Can NRI Transact Intraday?

NO. As per the Regulations, NRI investors should take delivery of shares purchased and give delivery of shares sold which implies that for sell transaction you have to give delivery irrespective of the fact that the same shares have been bought by you in the same settlement cycle.

For buy transaction, the stock would be credited to your Demat account independently.

As long as your sell transaction is backed by actual holdings in your Demat account and the buy transaction is validated against the trading limits available.

He can do two independent buy and sell transactions in the same stock in the same settlement cycle.



Which are the shares in which NRI can trade?

NRI will be able to buy and sell any of the scrips

that are traded in the compulsory

Dematerialised form on the exchanges.

An NRI would be restricted to buy any share,

which are notified in the Restrict List/ Watch

List by RBI from time to time i.e. on

http://www.rbi.org.in/scripts/BS_FiiUSer.aspx .



Can NRI returning to India continue to hold on

securities that they had acquired during their stay broad?

Yes. NRI returning to India can hold on to

securities which are

– inherited from a person who was resident

outside India.

– acquired, held or owned by such person when

he was resident outside India.



What are the rates of tax for long term and short-term

capital gains? Rate Of Tax Deducted At Source (TDS)

Types Of Assets Long Term (mode than 12mnths)

Short Term(less than 1 yr

Securities in companies (Listed on stock Exchange and STT paid).

NIL 15.45%Buy-Sale-FO-

Unit of equity oriented mutual fund

NIL 11.33%

Unit of debt oriented mutual fund

Without indexation 11.33%With Indexation 22.66%

33.99%



What is the status of NRI/ PIO Investors for trading in derivatives segment?

NRI/ PIO Investor is allowed to trade in Indian

Derivatives Market only on non repatriable

(NRO) basis.

NRI/ PIO Investors for derivatives segment will

have to appoint a Clearing Member for clearing

and settlement of trades done on the futures

and options segment and get Custodian

Participant Code from that clearing member.



Are there any ceiling for NRI Investors in derivatives segment?

The gross open position across all the derivative contracts for a security for each specific client shall not exceed higher of:

― 1% of the free float market capitalization (in terms of number of shares)

OR― 5% of the open interest in all derivative contracts

in the same underlying stock (in terms of number of shares)



Advantages with Systematix Most competitive brokerage. 350 Plus branches and business associates across

India. Complete range of services offered in DP. Clients trade online individually by taking a self

decision in front of live terminal Time tested Research reports by email. Daily strategies on live trading system. 3-in-1 account integrates your banking, broking and

demat accounts. 128 bit encryption SSL certificate for Online trading

which makes it a fool proof system for trading. Online transfer of money from more than one bank to

your own SSSIL trading a/c. Get immediate live quotes of scripts on high speed

connectivity. Intensive research reports



INVESTMENTS RE-DEFINED

visit us atCorporate Office

J.K. Somani Building, British Hotel Lane, Fort,

Mumbai 400 001Tel: +91 22 30298000 / 66198000 Fax: +91 22 30298029 / 66198029

Email ID: [email protected]

Website: www.systematixshares.com

http://www.systematixshares.com/

NRI Investment with SSSIL

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