COMSATS Institute of Information Technology

Entrepreneurship Presentation
Submitted to:Sir Mohsin-ul-mulk

Submitted by:Babar Ali Shazib Feroze Iram Batool Arooj Fatima 039 025 057 099

Types of Business
Before going directly to the types of business, it is necessary to define business at very start. Business: Business can be defined as any legal activity which is made to earn profit is known as the business. There are two basic things in the above mentioned definition; 1. Legal activity 2. Purpose is to earn the profit Types of Business: Basically there are three main types of business; 1. Sole proprietorship 2. Partnership 3. Joint Stock Company OR Corporate The detail of the above mentioned types is as follows

1) Sole Proprietorship
Sole proprietorship is the oldest form of the business organization. It is also known as the ONE MAN SHOW. We can define the sole proprietorship in the following way; Definition: Sole proprietorship is a form of business organization which is owned, managed and controlled by a single individual. He has the sole authority to take the decisions regarding the business matters and he alone enjoys all the profits and suffers all losses Sources of Finance: Following are the main resources of the capital for the sole proprietorship business; Capital by the owner himself. Can be through reserves and savings Loans from outside peoples, friends, relatives, financial institutions etc.

Unlimited Liability The liability of the sole owner is considered to be unlimited, it means that if, the business property is insufficient to pay the loans of the business then owners personal property can be soled out also. One man show is beat in the world if that one man is big enough to manage everything seams to be feasible.

2) Partnership
Partnership is the second major legal form of the business organization. Definition: According to Partnership Act 1932; Partnership is an association between two or more than two persons who have agreed to share the profit of the business carried on by all or anyone of them acting for all Number of Partners: According to Partnership Act 1932, the minimum number of partners can be two (2) and maximum ten (10) in banking business and twenty (20) in an ordinary business. Partnership Deed: The document which is made at the time of agreement between the partners before starting the business is known as the partnership deed. Distribution of Profit and Loss: In partnership business the profit is distributed according to the agreed ratio and the loss is distributed according to the investment ratio. If a partner is providing his or her skills then for him the loss will be distributed according to the agreed ratio. Do all Partners Provide Capital? Partnership Act does not make it compulsory to invest the capital in the business for becoming a partner. Some partners may provide the capital and some can become the partner buy providing their skills. Registration of Partnership Firm Law does not make it compulsory for the partnership firms to be registered. But, if any partnership firm wants to be registered then it is registered under Partnership Act 1932.

Sources of Finance: Following are the resources of capital for the partnership business: Capital by all the partners Loan from the outside parties as financial institutions etc.

Unlimited Liability of Partners The liability of the partners is unlimited. It means that if the property of the business is insufficient to pay its debts then partners personal property can be sold out also.

3) Joint Stock Company:

Joint Stock Company is the third major and the dynamic form of the business organization. Definition: A joint stock company is an artificial person created by law, with a distinctive name, a common seal, a common capital comprising transferable shares, carrying limited liability of its shareholders and having a perpetual succession.

Kinds of Company
The company has been divided into various kinds on the basis of: 1. Incorporation 2. Liability 3. Ownership 4. Nationality 5. Others 1. Incorporation Basis On the basis of incorporation the company has been divided into following types: a) Chartered Company A company created by the grant of royal charter is called a chartered company. Examples: Chartered bank of England East India Company Charter Mercantile Bank etc.

After passing the companies ordinance 1984, no new company is formed bay royal charter in Pakistan.

b) Statutory Company The companies that are incorporated by the special ordinance of parliament are known as the Statutory Company. Examples: State Bank of Pakistan National Bank of Pakistan WAPDA PICIC

c) Registered Companies A company which is incorporated by the Companies ordinance 1984 is known as the registered companies. The law provides special rules for formation, management and winding up of these companies. 2. Liability Basis On the basis of liability the company has been divided into the following kinds: a) Company Limited by Shares: It is a company which keeps the liability of its members up to the value of shares purchased by them. It is essential for these companies to use the word limited at the end of their names, so that the dealing person can know that the liability of its members is limited. b) Company Limited by Guarantee: It is a company which keeps the liability of its members up to the value of guarantee. Examples: Mutual Insurance Trade Association Chamber of Commerce Stock Exchange etc.

The word guarantee limited is written at the end of the names of these companies. c) Unlimited Companies It is a company which keeps the liability of its members unlimited. It means personal assets of the members can be disposed of to meet the debt of the company. Note: Unlimited companies due to great risk do not exist in Pakistan.

3. Ownership Basis On the basis of ownership a company has been divided into the following kinds: a) Private Company: A private limited company is an association which possesses the following features: Minimum numbers of members are two (2) while the maximum are fifty (50) Can not raise its capital from the general public There is prohibition to issue the prospectus fro invitation to the public The word private limited is written at the end of the name of these companies Shares can not be transferred by members Private company suits the needs of those persons who wish to take advantage of limited liability and at the same time want to keep the business as private as possible. b) Public Company A public company is an association which possesses the following features: Minimum numbers of members are seven (7); there is no limit for the maximum Members have the right to transfer the shares Can issue prospectus to invite the public for shares Word limited is written at the end of the name of these companies

c) Government Company The companies which are owned by federal, provincial or local Govt. are known as the government companies. d) Holding Company A company is said to be a holding company of the other company when one of the following conditions are fulfilled: Holds more the 50% directors of the other company Holds more than 50% voting rights of the other company Holds more than 50% share capital of the other company

e) Subsidiary Company A company is said to be the subsidiary company of the other company when any one of the following conditions are fulfilled:

More than 50% directors are held by the other company More than 50% of voting rights are controlled by the other company More than 50% of share capital is held by the other company

4. Nationality Basis: On the basis of nationality a company has been divided into the following kinds: a) Foreign company: A foreign company is formed and registered outside Pakistan. Head office of the company is also situated outside of Pakistan. b) Pakistani Companies: A Pakistani company is formed and registered inside the Pakistan. Head office is also situated in Pakistan. 5. Others: Following are the many other types of the companies: a) Association Not for Profit: Association not for profit is registered under section 42 of the Companies ordinance 1984 without the addition of the word limited at the end of its name. It is registered with limited liability and enjoys all the privileges of limited company. The association not for profit is formed for promoting commerce, art, science, religion. Federal government grants the license. b) Modarba Company: Modarba Company is a company in which some members provide capital and other provide the skills.

Formation of a Company
Whole procedure of formation of a company has been divided into four stages 1. Promotion 2. Incorporation 3. Raising capital 4. Certificate of commencement A public company needs two certificates from the registrar: Certificate of registration Certificate of commencement

But a private company can start business after receiving incorporation certificate because private company cant raise capital from general public. So a private limited company has two stages for its formation Promotion Incorporation

1. Promotion Stage of a Company:

Promotion starts with the conception of idea for a business and continues down to the point at which the business is fully ready to begin operations as a going concern. The important steps in the promotion of a company are as follow: a. Discovery of business Idea Before starting a business the promoters develop an idea for a business and think about the existing and future demand of the product. b. Detailed Investigation Promoters make a detailed investigation about the business such as How the capital to be raised Place from where the material to be collected Market for the goods Size of business Expected profit

c. Assembling various business elements After carrying about detailed investigation the promoters start assembling various business elements such as License Copyrights Appointment of necessary employees Estimation of financial needs Estimation of sales

d. Capitalization Promoter estimates the total amount of capital and sources of raising capital. They contact banks & under writers for issuance of shares and debentures. e. Preparation of essential documents Promoters prepare all the essential documents like:

Memorandum of association Article of association Prospectus

f. Name of the company Promoters suggest the name of the company. But it must not be identical with the name of other company which is registered with the registrar. The word Limited must be written at the end of the name of public company and the world private limited must be written at the end of the name of private limited company.

2. Incorporation stage:
After carrying out various activities give the company its physical form. However a company cannot start its business at this stage. It required legal entity. For this the company has to be registered. The process of registration is called incorporation stage The company has to file a number of documents with the registrar for the incorporation of company. These documents are: Memorandum of association Article of association Prospectus or statement in lieu List of directors Place of registered office Recipted challan for the payment of duty on shares & filing fees A statutory declaration by the secretary Qualification of shares

Along with these documents the company has to submit

On receipt of documents registrar will scrutinize them if he will satisfied that the requirements of law have been fully met then he will issue the CERTIFICATE OF INCORPORATION. Now a company has legal entity. A public company cant start business here but private company can start the business now.

3. Raising Capital.
Public company faces the important problem how to raise the capital. Company can raise capital from following ways. By issuance of shares

By issuance of debentures

In raising capital stage the company has to meet the amount of minimum subscription to get the certificate of commencement. 4. Certificate of Commencement: Certificate of commencement of business is granted on fulfilling the following few other requirements

Kinds of Company
The company has been divided into various kinds on the basis of: 6. Incorporation 7. Liability 8. Ownership 9. Nationality 10. Others 1. Incorporation Basis: On the basis of incorporation the company has been divided into following types: d) Chartered Company: A company created by the grant of royal charter is called a chartered company. Examples: Chartered bank of England East India Company Charter Mercantile Bank etc.

After passing the companies ordinance 1984, no new company is formed bay royal charter in Pakistan. e) Statutory Company: The companies that are incorporated by the special ordinance of parliament are known as the Statutory Company. Examples: State Bank of Pakistan National Bank of Pakistan WAPDA PICIC

f) Registered Companies: A company which is incorporated by the Companies ordinance 1984 is known as the registered companies. The law provides special rules for formation, management and winding up of these companies. 2. Liability Basis: On the basis of liability the company has been divided into the following kinds: d) Company Limited by Shares: It is a company which keeps the liability of its members up to the value of shares purchased by them. It is essential for these companies to use the word limited at the end of their names, so that the dealing person can know that the liability of its members is limited. e) Company Limited by Guarantee: It is a company which keeps the liability of its members up to the value of guarantee. Examples: Mutual Insurance Trade Association Chamber of Commerce Stock Exchange etc.

The word guarantee limited is written at the end of the names of these companies. f) Unlimited Companies: It is a company which keeps the liability of its members unlimited. It means personal assets of the members can be disposed of to meet the debt of the company. Note: Unlimited companies due to great risk do not exist in Pakistan. 3. Ownership Basis: On the basis of ownership a company has been divided into the following kinds: f) Private Company: A private limited company is an association which possesses the following features: Minimum numbers of members are two (2) while the maximum are fifty (50) Can not raise its capital from the general public

There is prohibition to issue the prospectus fro invitation to the public The word private limited is written at the end of the name of these companies Shares can not be transferred by members

Private company suits the needs of those persons who wish to take advantage of limited liability and at the same time want to keep the business as private as possible. g) Public Company: A public company is an association which possesses the following features: Minimum numbers of members are seven (7); there is no limit for the maximum Members have the right to transfer the shares Can issue prospectus to invite the public for shares Word limited is written at the end of the name of these companies

h) Government Company: The companies which are owned by federal, provincial or local Govt. are known as the government companies. i) Holding Company: A company is said to be a holding company of the other company when one of the following conditions are fulfilled: Holds more the 50% directors of the other company Holds more than 50% voting rights of the other company Holds more than 50% share capital of the other company

j) Subsidiary Company: A company is said to be the subsidiary company of the other company when any one of the following conditions are fulfilled: More than 50% directors are held by the other company More than 50% of voting rights are controlled by the other company More than 50% of share capital is held by the other company

4. Nationality Basis: On the basis of nationality a company has been divided into the following kinds: c) Foreign company: A foreign company is formed and registered outside Pakistan. Head office of the company is also situated outside of Pakistan.

d) Pakistani Companies: A Pakistani company is formed and registered inside the Pakistan. Head office is also situated in Pakistan. 5. Others: Following are the many other types of the companies: c) Association Not for Profit: Association not for profit is registered under section 42 of the Companies ordinance 1984 without the addition of the word limited at the end of its name. It is registered with limited liability and enjoys all the privileges of limited company. The association not for profit is formed for promoting commerce, art, science, religion. Federal government grants the license. d) Modarba Company: Modarba Company is a company in which some members provide capital and other provide the skills.

Companys winding Up
A company is a legal person, it is formed under the low and the working of a company is under the law. No doubt company has a long life but not so long that it can not die. Liquidation of a company means end of the life of the company. Definition Winding up of a company is a legal procedure in which all the affairs of a company is wound up. Its assets and liabilities are revealed, its assets are sold and claim of the creditors met out with sale proceeds. The balance is distributed among the share holders according to their share proportions.

Methods of Liquidation
Following are the main methods of liquidation of a company: 1. Winding up by court 2. Voluntary winding up a) voluntary winding up by members b) voluntary winding up by creditors 3. Winding up under the supervision of court

1. Winding by Court The circumstances in which a company may be the compulsory wound up by court. Statutory Meeting Not Held If a company fails to hold statutory meeting with in prescribed time period Fails to File Statutory Report If a company fails to file a statutory report to the registrar with compliance of the ordinance. Commencement of Business If a company could not commence the business within one year of the date of incorporation. Cease Its Business for whole year. If a company ceases its business for whole year then court gives the orders to wind up the company. Reduction In Membership If the number of members falls below seven in case of a public company or fall below two in case of a private company. Two Annual General Meeting If the company fails to hold two consecutive Annual General Meetings then court gives the orders to wind up the company. Unlisted Companies The company listed on stock exchange becomes unlisted then court gives the orders to wind up the company. Failure to Pay Debt The company is unable to pay its debt then it is a condition in which court gives the orders to wind up the company. Satisfaction of the court If the court is fully satisfied that the business is carried out unsatisfactory and the affair of the company is legal. 2. Voluntary Winding Up The voluntary winding up of a company is of two kinds a) Voluntary winding up by members. b) Voluntary winding up by creditors.

a) Procedure of Voluntary Winding Up by Members Declaration of Solvency If the majority of the directors in a special meeting resolves to windup the company and submits a statutory declaration verified by companys auditor to registrar that: Company has no debt Company can pay its debt with in one year commencement of liquidation Appointment of Liquidator In companies general meeting shareholder appoints the liquidator and also fixes the remuneration. Working of liquidator The working of liquidator comprises of selling of assets redeeming loan calling members meeting filing result of meeting

Dissolution When affair of a company finally wound up, the liquidator call a general meeting of the share holders and place before them accounts of the company and submits copy to registrars within one week of companys meeting. The company will be dissolved on the expiration of three months on the receipt of the copy of accounts.

b) Procedure voluntary winding up by creditors

The procedure of winding up voluntary by creditors consists of following steps: No declaration of solvency A winding up in which declaration of solvency has not been delivered to the registrar is known as creditors voluntary winding up. Creditors meeting First of all the directors of the company call a meeting of its creditors with whom the whole situation is discussed. Appointment of liquidator

In the creditors meeting creditors appoint a liquidator and appoints an inspection committee also. Work of liquidators The working of liquidator comprises of selling of assets redeeming loan calling members meeting filing result of meeting

Dissolution When affair of a company finally wound up, the liquidator call a general meeting of the share holders and place before them accounts of the company and submits copy to registrars within one week of companys meeting. The company will be dissolved on the expiration of three months on the receipt of the copy of accounts. Note: Following are the circumstances under which a company may be liquidated voluntarily by members. Expiry of period By special resolution.

3. Winding up under supervision of court After receipt of application from creditors or shareholders the winding up process may be carried out under supervision of court on the following grounds. Liquidators perform his duties in partial manners A liquidator does not strictly observe the rule of winding up. Winding up resolution obtained by fraud

Stock Exchange
Definition: It is instrument that helps to analyze the economic condition of the country. the securities and exchange ordinance 1969 stats that, Stock exchange means any person who maintains or provides a market place or facilitates for bringing together buyers and sellers of securities or for other wise performing with respect to securities the functions commonly performed by stock exchange, as that term generally under stood, and include such market places and facilities. There are three stock exchange working in country, Lahore stock exchange Islamabad stock exchange Karachi stock exchange Companies registered with Lahore stock exchange are582, with Islamabad stock exchange are 260 and with Karachi stock exchange are 701. Stock exchange is a place where buying and selling of shares are done. When companies are registered in stock exchange then it will issue share to general public general public. Feature value depends on performance of the company. How to become member of stock exchange and invest: Firsts a person opens account to the member of stock exchange. There are three types of memberships, Individual members Partner ship members Corporate members The limit of opening an account is Rs 10,000.when the process is completed the member can acquire shares, shares are mostly ordered in lots which varies from company to company.

Terms used in stock exchanges:

Shares: It is a certificate of ownership in a company in which the investor makes the investment. The companies in lots of different sizes issue shares usually. The common in the market is 500. Bull: Bull is the trend when price of most of the companys shares rise up. This trend develops when demand of shares are more then supply of shares. Bear: It is reciprocal of bullish trend. In this supply is more then demand.

Blue chips: Blue hips are those companies in which maximum tread is done in a day. This is for the expectation of maximum profit. Blue chips are the best performer in the market. The share of such companies is easily available. Examples: PTCL, HUBCO, PSO etc. Dividend: It is a part of profit that is given to the owner of the share. A part of profit is distributed among the shareholders. Ordinary shares: Maximum companies issue the most common shares and the dividend is paid on these shares. These dividends are depending on profitability of the company and recommendations of the directors. Preferred shares: It is type in which the profit is given to share holders on fix rate. In case of the share holder is secure that he didnt have to bear loss. Initial public offer (IPO): When company first time launches its shares, in market to general public offerings (IPO). Private placement or inside treading: In this type of treading purchase or sale is made is made by the person who has inside information about the organization that is not generally available in Pakistan. In Pakistan such type of deal is illegal. Long position: The share is purchased with intention that in future the price of shares will go up. After observing their suitable position he sale these shares and the market and earn profit. Short position: In this type of treading the investor purchase the shares of company with intention that he will sale after some time when the price of share goes up. Port folio: When the investor purchases the shares of different companies to reduce the risk from the market the whole collection is called port folio. Capital gain: This is appreciation on the price of shares, which exit in future. Capital gain= market price of share price at which shares are purchased

Investment Corporation of Pakistan

It is body, which invests in different companies and make portfolio of it. On behalf of such investment it issue units, which are called ICP units in this kind of treading investor is not directly involve in treading process. Right issue: When a company wants to issue more shares in market, it is choice for the company that it offers shares first to existing share holders. By using this option of right issue ownership will remain to existing share holder and do not divided to other people. Term finance certificates (TFCS): The term finance certificates are resembles to bonds, which are issued by companies for aim to generate funds from the general public.

Structure and index of stock exchange:

The stock exchange has different departments. The departments perform different functions according to their responsibilities. There are four main different departments, Department of companies affairs Department of investor relation Department of internal control Department of general administration.

Department of companies affair: Department of company affairs is responsible for all functions and matters related to companies, which are listed in stock exchange, or the companies who wanted to listed in stock exchange. This department sends reports to G.M, sectary and M.D for final approval on decision. They have authority to de list any company if the company does not meet requirements of law. They have authority to impose the penalties of late submission of quarterly or annually report. These are following functions of department, Receive reports: The department receives reports from companies and maintains it. If the reports are sufficient than department sent it in the brokerage houses for investors. Impose penalties: The department can impose penalties on companies according to code of corporate governance on companies for violation of rules. Loss of shares:

If the shares are lost from share holders due to any reason, after receiving the complaints from share holders the department verify about the existence of shares in stock exchange. The department sent the requests to companies for issue of duplicate shares and arranges such. Dividends: This department takes action against the companies who are failing to pay dividend. Code of corporate governance: The main document, which comes under consideration of department of companies affairs, is the code of corporate governance, which is implemented on three exchanges. Listing of companies & securities: No dealing in securities of securities of a company is allowed on exchange, either on the ready quotation board or cleared list, unless the company or the securities have been listed and permission for such dealing has been granted in accordance with the regulations. Listing requirements: An applicant company or security applying for listing shall furnish full and authentic information in respect there of and such other particulars as a board of exchange may require time to time. The security may call for all routine particulars. The following documents and particulars duly certified by the company or the company presenting the securities shell be submitted to the exchange at the time of application for listing or any time demand by the exchange: Application for listing as per form 1 Memorandum & articles of association Copy of the certificate of incorporation Copy of certificate of commencement of business Copy of feasibility report in case of new projects Copy of the permission for setting up the industrial unit Copies of the title deeds of the land Copies of all material contracts and agreements entered in to or exchanged with foreign participants, machinery, suppliers and other financial institutions. Copy of authorization for floatation of modaraba by registrar of modaraba company Name of director along with directorship of other companies listed on the exchange Draft prospectus offer for sale Auditors certificate for the amount subscribed by the promoters, directors, associates Copies of agreement relating to issue of securities for consideration other than cash Copies of under writing agreement and no objection certificates fro the under writers to publish the prospectus Statement of auditing accounts for the last five years or for shorter number of years, if the company is in operations only for such period

Statement showing the cost of project and means of finance Copies of the consent letter from bankers to the issues

Listing and annual fees: A company applying for listing on the exchange, shall pay an initial listing fee equivalent to 0.1% of the paid up capital subject to a respective minimum and maximum limit of rupees one hundred thousand or one million as the case may be. Whenever listed company increases the paid up capital of any class of its shares or securities listed on the exchange. It shall pay to exchange a fee equivalent to 0.1% of such increase. Every listed company shall pay annual listing fee which shall be payable by or before 30th September. Increase of capital and allied issues: Every listed company shall immediately advise the exchange of all decisions taken by its board of directors regarding any change in authorized, issue or paid up capital, by issue of bonus shares, right shares or refund of capital.

Recording department:
This department is sub department but it is responsible for maintain the record for all matter related to stock exchange. They have different folders for individuals, for general nature and for companys affairs. This record is maintain mutually for external and internal correspondence, the department maintains two type of record a registers separately. The register contain the following columns, Reference number Month and date Receiving number Company/department name The dispatch register contain following columns, Issue number Months and date Place where to send Subject

Department of internal control:

The main functions of department are Operate with risk management To deal member of exchange To supervise the information of IT department and clearing house Send the reports regarding trading and related matters to managing directors and sectary of exchange Number: The number of members of the exchange for the purpose of registration is declaring to be 200 and individual member shall pay a membership fee of Rs.200, 000. And annual fee of Rs.1000. Department of investor relation:

Department of investor relation perform the following functions, To provide all information with respect members all requirements of investors To deal with a the complaints of investors to stock exchange To meet all legal compliance in judiciary Retain the news papers

Dispute to be referred to arbitration: All claims over Rs.0.5 million arising out of transaction made subject to rules of the exchange that are not otherwise amicably settled shall be referred to the arbitration committee of the exchange for their resolution. Responsibilities: The responsibilities of different positions are assessed on the basis of qualification, authority and experience. Chairman: Chairman is elected in the meeting of directors with subject to limit for one year. Chairman can hold this position for consecutive three years under this condition. When other person is not ready to elect as a chairman. The chairman is liable to perform the following function, To observe the policies of management and whole function of exchange To approval of any document which is sent by MD without any objection. Managing Director: He is responsible for the whole function of exchange. He is liable for the function of staff to the chairman. The board does the appointment of MD for three years. He is liable for following right and duties, To sustain the routine matters regarding to exchange He can perform all function for the betterment of management He can arrange the training of the staff according to the requirement Directors: The director elected in election. The board of director has power to give the approval for any borrowing for the purpose of future growth of exchange. the director has following rights, The director in the meeting of the board can give approval of loan whether in the form of bonds, TFCS or any other security. They can inspect account of exchange any time They can give their opinion regarding to any matter in the board meeting They can give approval regarding to any investment for exchange in future. Secretary: He is responsible to general management. He is also obligated for work which is assigned to him from chairman and managing director. He can perform the function regarding to Director finance. He responsible for completion for any formality regarding to authorities that e.g. ministry of finance.

General Manager: He is responsible for all function for all matters regarding to different departments which are working under him. He perform the following function, Provide the consultancy service to departments He perform the daily matters regarding to general management He can make any decision regarding to fine and delisting of any company with the consultation of secretary and managing director. Associate manager: He head of his department. He works according to instruction of general manager and secretary. He sends reports to managing director with the advisory of general manager. Staff: The staff is not directly responsible to all the functions but on the behalf of associate managers.

Performance evaluation:
The performance is evaluated of an employee is evaluated on the basis of every six month. Salary and packages: The level of salary is low as compare to other business. On the time of offering for first joining it start form Rs.9000. there is no other reward for employees.

CASE STUDY
Overview
Karachi Stock Exchange (KSE), the largest Unisys customer in Pakistan, began using Unisys ES7000 CMP technology to run its locally developed trading application, which was the first step in moving from a UNIX/RISC platform to an open architecture based on a Microsoft Windows and Intel platform. After running its trading application successfully, KSE decided to completely switch over to Windows and Intel, and selected Unisys ES7000 64-bit technology to run its database application based on Oracle. KSE has seen a 100-percent increase in the amount of transactions per minute (tpm) its trading application can write since implementing the Unisys, Oracle, Microsoft and Intel platform.

Situation
Named the worlds best-performing stock exchange in 2002, the Karachi Stock Exchange (KSE) manages trading in 685 listed companies with a capitalization of more than $25 billion. Founded in 1947, this successful stock exchange has grown rapidly and adopted a technology-centered approach to support its businesses. Its management places an emphasis on the continual development and improvement of its automated trading environment to maintain smooth and reliable operations. After experiencing tracking issues and poor response times in terms of inquiries for outstanding orders and the writing of confirmed orders onto database servers, IT executives at KSE saw a need to implement a more reliable and scalable solution. Its previously deployed IBM RS6000 servers could neither handle the 500,000 orders that KSE was taking daily nor support KSEs requirement of connecting more than 2,000 terminals. Solution KSEs main business objective was to synchronize its database with its newly developed trading application, which can match more than 400 trades per second. KSE developed its own trading application and database based on Oracle and the Microsoft Windows Server 2003 operating system. After a successful implementation of the initial system, KSE deployed two Unisys ES7000 servers employing 64-bit Intel Itanium 2 processors. One server is used as the production server and the other provides failover capabilities.

KSEs previous infrastructure had six to seven IBM RS6000 servers, which did not feature partitioning capabilities. Thus, workloads could not be distributed to take advantage of processor capacity, leaving most of the processors lying idle. KSE resolved that problem with the implementation of 64-bit ES7000 servers. As to why KSE IT executives chose the Windows Server 2003 operating system, there were several reasons. First, they wanted to develop an open-platform based trading application. Second, the resources required to develop a new trading application were very expensive. The ES7000 servers provided us with a platform that can run Microsoft Windows Server 2003, says Abdullah Jan Farooqui, Chief Information Technology Officer. If we ran our applications on a UNIX platform, the cost of that system would be at least 10 times more expensive. Another key component of this deal was the implementation of Oracle 9.20 and Oracle RAC database software. Due to the mission-critical nature of the trading application, KSE deployed Oracles RAC clustering software to achieve transparent failover capability and uninterrupted availability. Benefits Since implementing the Unisys and Microsoft solution for 64-bit computing to support its Oracle environment, KSE has seen major benefitsincluding better response times, more efficient utilization of computing resources and a more costeffective solution. For example, KSE is committed to delivering a sub second response time to its customers, regardless of stock market conditions. Previously, depending on the order flow, users would wait between one to three minutes. Now with Unisys ES7000 servers at the heart of our infrastructure, we achieve the required response time without a glitch, says Farooqui. Since implementation our staff has greatly benefited. They used to have to stay back in the office just to wait for the queues to appear in order to run a report. Now they can run reports right after the closing of the market. Additionally, KSEs previous infrastructure could not write the number of transactions per minute (tpm) needed for its newly developed trading application. The IBM servers were lagging behindproducing only 600 to 700 transactions per minute. With the new trading system running on Unisys ES7000 servers, we are now writing between 12,000 to 15,000 transactions per minute, says Farooqui. According to Farooqui, KSE has also been able to support twice as many concurrent users as previously supported under UNIX, but without increased cost. And KSE can now

support 2000 direct-attached trading workstations. IT executives at KSE are also focused on improving storage support. In order to free its servers from additional workloads, the company has installed an EMC CLARiiON CX400 disk. EMC, partnered with Unisys, offered scalability, availability and performance, says Farooqui. In the future, KSE is interested in working with Unisys to implement a Disaster Recovery (DR) site. Additionally, KSE is considering implementing a SAN because it could enable the company to replicate and synchronize data to a DR site. Unisys provided a complete solution for KSEs demanding IT environmenteasily winning over competitors IBM and HP/Compaq in this deal. The Unisys ES7000 server is a product that comes from people who have expertise in services and mainframes that support mission-critical environments, says Farooqui. It is the only platform that can provide KSE with a scalable, highly available infrastructure that is needed to gain a competitive edge in this business. Challenge Implement a clustered Oracle database to run mission-critical database based on Oracle Real Applications Cluster (RAC) technology and the Microsoft Windows Server 2003 operating system. Solution Components Unisys Components Unisys ES7000 servers Oracle Components Oracle Real Application Cluster (RAC) Oracle 9.20 Microsoft Components Microsoft Windows Server 2003, Enterprise Edition Storage Components EMC CLARiiON CX400 disk Other Components Intel Itanium 2 processors Benefits 100-percent increase in produced transactions per minute (tpm) Reduced response time from more than two minutes to one second

 Increased number of concurrent users that can be supported from 300 to 1000 and still have room for more users Platform Highlights Unisys ES7000 servers employing Intel Itanium 2 processors and running Microsoft Windows Server 2003, Oracle 9.20 database and Oracle RAC software are supporting 64-bit computing for Karachi Stock Exchanges (KSE) database application. As a result of implementing cost-effective ES7000 servers, KSE has experienced better response times and more efficient utilization of its applications.