Stock Market Analysis of Steel City Securities Ltd

STEEL CITY SECURITIES LIMITED, VISAKHAPATNAM
CONTENTS:
CHAPTER - I
THE PPESEMTATIOM OF THE STUDY
IMTPODUCTIOM
O8JECTIVES
ETHODOLO0Y
LIITATIOMS
CHAPTER - II
THEOPETICAL FPAEWOPI
STOCI APIET
8O8AY STOCI EXCHAM0E
MATIOMAL STOCI EXCHAM0E
CHAPTER - III
OP0AMISATIOM PPOFILE
PPOFILE OF SCSL
4 HISTOPICAL 8ACI0POUMD OF SCSL
4 OP0AMIZATIOM STPUCTUPE
4 FUMCTIOMS OF SCSL
4 DEPAPTEMTS IM SCSL

CHAPTER - IV :
AMALYSIS OF THE STUDY
THEOPETICAL FPAEWOPI OF CAPITAL APIET.


CHAPTER - V
SUAPY AMD SU00ESTIOMS
SUAPY
FIMDIM0S
SU00ESTIOMS
8I8LIO0PAPHY
0LOSSAPY


INTRODUCTION

The project is mainly to study the activities and prospects oI stock markets. The
past decade has been a golden age Ior stock exchange in India. It is poised to dominate
the Iuture oI corporate Iinance in India, thanks to reIorms in stock market. Earlier in the
initial days oI secondary market, trading on Stock Exchanges in India used to take place
through open outcry without use oI inIormation technology Ior immediate matching or
recording oI trades. With the advent oI technology, the trading in securities is done on-
line with the help oI VSAT terminals. Since 1995, trading in securities is screen based
(on-line) trading which eliminated the need Ior trading Iloor. Since 2000, internet-based
trading has also made an appearance in India.
The secondary market consists oI 23 stock exchanges including the
National Stock Exchange and the over-the-counter Exchange oI India (OTCEI) and inters
Connected Stock Exchange oI India Ltd. The secondary market provides a trading place
Ior the securities already issued to be bought and sold. It also provides liquidity to the
initial buyers in the primary market to re-oIIer the securities to any interested buyer at
any price, iI mutually accepted. An active secondary market actually promotes the growth
oI the primary market and capital Iormation because investors in the primary market are
assured oI a continuous market and they can liquidate their investments in the stock
exchange.


With the emergence oI on-line trading in India stock Exchanges, the volume oI
the securities traded, the market capitalization, the size oI market and the market turnover
has increased. The scope oI study in on-line trading is very vast.

It is important to ensure a smooth working oI this market, as it is the arena where
the players in the economic growth oI a country interact. Various laws have been passed
Irom time to time to meet this objective. The Iinancial market in India was highly
segmented until the initiation oI reIorms in 1992-93 on account oI a variety oI regulations
and administered prices including barriers to entry. The reIorm process was initiated
with the establishment oI Securities and Exchange Board oI India (SEBI).
The Steel City Securities Ltd. is incorporated on February 1995 as Member oI
National Stock Exchange oI India Limited and a member oI Bombay Stock Exchange. It
Iunctions according to the Rules and Regulations oI Securities and Exchange Board oI
India (SEBI). SCSL covers in 4 States in India. Its regional oIIice is in Visakhapatnam. It
has 60 VSAT`s and 20 Branches.
The actual process oI on-line trading through which immediate access on
the market watch available to the client in placing orders Ior buying or selling oI shares is
to be known.


OB1ECTIVES

1. To understand the on-line trading process in Steel City Securities Limited,
Visakhapatnam.
2. To understand the process involved like dematerialization.
3. To know the various scrip`s that are traded regularly in the stock market.
4. To understand the technology process used in online trading.
5. To understand the process oI online trading, derivatives, commodities in
market oI NSE.

METHODOLOGY

The methodology implemented Ior the on-line trading process is logging on
to the NEAT screen by Iilling the User ID, Trading Member ID, Password and New
Password. AIter logging on the Title bar, Ticker Window, Tool Bar, Market Watch,
Inquiry Window, Order/Trade Window and Message Window is displayed. Using these
windows, the user can buy or sell the shares by placing the orders, quoting the price and
the quantity oI the shares. For example, Fig.1 represents NEAT Login Screen and the
Fig.2 NEAT Market Watch Screen.


Primary Data:-
Primary data was Ior diIIerent scrip were taken Irom three diIIerent sectors
and studied the Iactors that are aIIecting the scrip movement. The primary data was
collected by watching the daily trade.
The inIormation regarding the online trading is collected Irom
Watching the on-line trading live.
Collecting inIormation Irom the head oI each department and Irom the
staII working in those departments.
Participating in mock trading conducted by National Stock Exchange
(NSE) oI India Limited.
Secondary data:-
Secondary data is already published data collected Ior some purposes
other than the one conIronting the researcher at a given point oI time. The secondary data
can be gathered Irom various sources like books, journals, research agencies etc.

For this project the secondary inIormation is collected Irom the various sources
like 'Business Line & 'Economic Times (news papers); and the NSE and BSE
websites in the internet.
The inIormation regarding the online trading is collected Irom

ReIerring the Capital Market (dealer`s) module workbook published by
National Stock Exchange oI India Limited.
Interacting with the operators at the computer terminals and the clients
trading in Steel City Securities Limited.

LIMITATIONS
The online trading process is unaware by the public the intrinsic value oI share cannot be
Iound out..
The ease oI online trading can give the investor a Ialse sense
oI capital market.
The chat rooms may provide misleading inIormation
The Iailure oI these systems create problem in collecting Primary data.
As the investors are not completely unaware oI the proceedings oI
procedure in online trading.
The process is complicated in nature oI online trading.

INTRODUCTION TO FINANCIAL MARKETS:
Finance is the integral part oI modern business. Financial markets reIer to
the institutional arrangements Ior dealing in Iinancial assets and credit instruments oI
diIIerent types, such as currency cheques, bank deposits bills, etc.

The main Iunctions oI the Iinancial markets are:
(i) To Iacilitate creation and allocation oI credit and liquidity;
(ii) To serve as intermediaries Ior mobilization oI savings;
(iii) To assist the process oI balanced economic growth;
(iv) To provide Iinancial convenience;
(v) To cater to the various credits needs oI the business houses.

TYPES OF FINANCIAL MARKETS:
Based on credit requirement Ior short-term and long-term purposes,
Iinancial markets are divided into two categories:

1. Money Market
2. Capital Market

Financial nstitutions Financial Markets Financial nstruments Financial Services
Money Market

Capital Market

Organized

Unorganized

Stock Market

Term Lending
nstitutions

Gift edged Securities
market

ndustrial
securities market

Primary market Secondary market
F!NANC!AL NANACENENT


MEANING OF CAPITAL MARKET:
The term `capital market` reIers to the institutional arrangements Ior
Iacilitating the borrowing and the lending oI long-term Iunds. It is concerned with those
private savings, individuals as well as corporate, that are turned into investments through
new capital issues and new public loans Iloated by government and semi-government
bodies.

SE

BSE

OTCE

OTHERS

Stock exchange

Wholesale debt market
segment
Capital market
segment
Cash Segment

Derivative segment

Future

Options

nterest Rate

Stock

ndex Call

Put


FUNCTION OF CAPITAL MARKET:
The major Iunctions perIormed by a capital market are:
(i) Mobilization oI Iinancial resources on a nation-wide scale.
(ii) Securing the Ioreign capital and know how to Iill up the deIicit in the
required resources Ior economic growth at a Iaster rate.
(iii) EIIective allocation oI the mobilized Iinancial resources, by
directing the same to projects yielding highest yield or to the
projects needed to promote balanced economic development.

STRUCTURE OF THE INDIAN CAPITAL MARKET:
The capital market in India may be classiIied into two categories, viz;
organized and unorganized. In the organized sector oI capital market demand Ior long-
term capital comes Irom corpora enterprises, public sector enterprises, government and
semi-government institutions. The sources oI supply oI Iunds comprise individual
investor corporate and institutional investors, investment-intermediaries, Iinancial
institutions, commercial banks and government.

In India, even the organized sector oI capital market was ill developed till
recently because oI the Iollowing reasons:
(i) Agriculture was the main occupation, which did not lend itselI to
the Iloatation oI securities.
(ii) The Ioreign business houses hampered the growth oI securities
market

(iii) Managing agency system also accounted Ior ill development oI
capital market as managing agents perIormed both activities oI promotion and marketing
oI securities.
(iv) The investment habit oI individuals.
(v) Restrictions imposed on the investment pattern oI various Iinancial
institutions.
The unorganized sector oI the capital market consists oI indigenous
banker; and private moneylenders. The main demand in the unorganized capital market
comes Irom the agriculturists, private individuals Ior consumption rather than production
and even small traders. The supply oI money-capital comes, usually Irom own resources
oI moneylenders and Ialls short oI the requirements made on them.

MARKETS FOR CORPORATE SECURITIES:
The corporate securities, viz; bonds or debentures, preIerred stock
commonly called preIerence shares and common stock or equity shares, are traded in
careIully regulated money markets. The markets Ior the three types oI corporate
securities include:
1. The Primary or New Issue Markets
2. The Secondary Markets
3. over-The Counter Markets
4. On-Line Scrip less Trading Market.
The primary or the new issue market deals with the oIIer and exchange oI
stocks or bonds that have never been previously issued. The securities that have been
previously issued are traded in the secondary markets, which include the organized stock

exchanges and over the counter market. The Over-the Counter Exchange oI India
(OTCEI) began its operations in the year 1992 as a second-tier bourse, which permits
smaller companies to raise Iunds. In addition to the markets, the National Stock
Exchange has also started on-line scrip less trading in India in the year 1994.

COMPONENTS OF CAPITAL MARKET:

Supply of
Money Capital
ndividuals
Corporations
nstitutions
Banks
Government
nvestors
Lenders
Sellers of
Money Capital
Components of Capital
Market
1. ew ssue
Market
2. Stock
Exchange
3. Financial
nstitutions
Clearing house for Long-
term Capital
Capital Market Mechanism
ndividuals
Corporations
nstitutions
Entrepreneurs
Government
Borrowers
Buyers of Money-
Capital

THE NEW ISSUE MARKET OR PRIMARY MARKET:
The new issue market represents the primary market where new securities,
i.e., shares or bonds that have, never been previously issued, are oIIered. Both the new
companies and the existing ones can raise capital on the new issue market.
The two Iaces oI this market, i.e. supply and demand, are represented by
the issuing companies and the investors respectively. But then the organization oI the
new issue market is not complete without the specialized agencies, intermediaries and
institutions, etc., which promote issues oI new securities and help in selling, transIerring,
underwriting etc. These agencies include Iinancial institutions, underwriters, brokers,
merchant bankers, etc.
The sentiment in the stock market inIluences the activity in the new issue
market. The stock market is more sensitive and reacts Iast to the changes in the
economic, political and business conditions oI a country. Then this aIIects the new issue
market also.

.STOCK MARKET OR SECONDARY MARKET:
Stock market represents the secondary market where existing securities (shares
and debentures) are traded. Stock exchange provides an organized mechanism Ior
purchase and sale oI existing securities. By now, we have 23 stock exchanges in our
country.
Stock exchanges are organized and regulated markets Ior various
securities issued by corporate sector and other institutions. The stock exchanges enable
Iree purchase and sale oI securities as commodity exchange allow trading in
commodities.

FUNCTIONS OF STOCK EXCHANGE:
The stock exchanges play an important role in the economic development
oI a country. The importance oI stock exchange will be clear Irom the Iunctions they
perIorm and discussed as Iollows:
1. Ensure Liquidity oI Capital
2. Continuous Market Ior Securities
3. Evaluation oI Securities
4. Mobilizing Surplus Savings
5. HelpIul in Raising New Capital
6. SaIety in Dealings
7. Listing oI Securities
8. PlatIorm Ior Public Debt
9. Clearing House oI Business InIormation

LISTING OF SECURITIES:
Listing oI securities means permission to quote shares and debentures
oIIicially on the trading Iloor oI the stock exchange. Not every security issued by
companies can be traded at a stock exchange. The stock exchanges Iix certain standards,
which the company must IulIill beIore getting the securities listed.

Requirements for Listing:
Any company intending to get its securities listed at an exchange has to IulIill
certain conditions. The Iollowing inIormation`s must be Iiled with exchange Ior getting a
security listed:
(i) Memorandum and Articles oI Association.

(ii) Copies oI all prospectuses or statements in lieu oI prospectuses.
(iii) Copies oI Balance Sheets, audited accounts, agreements with promoters,
underwriters, brokers, etc.
(iv) Letters oI consent Irom Controller oI Capital issues now replaced with SEBI.
(v) Details oI share and debentures issued and shares IorIeited
(vi) Details oI issue oI bonuses and dividends declared.
(vii) History oI the company in brieI.
(viii) Agreement with managing director, etc.
(ix) An undertaking regarding compliance with the provisions oI the Companies Act,
1956 and Securities Contracts (Regulation) Act, 1956 as well as rules made
therein.
(x) A list oI the highest ten holders oI each class or kind oI securities oI the company.

The stock exchanges are empowered to withdraw or suspend the admission
granted Ior trading Iollowing any breach oI conditions.

Advantages of Listing:
Following are some oI the advantages oI listing securities:
1. Publicity oI Securities
2. Protection oI Investors` Interest
3. Ensures Liquidity
4. Better Goodwill


PROCEDURE FOR DEALING AT STOCK EXCHANGES:
The buying and selling at stock exchanges is not allowed to outsiders.
They have to approach brokers who are members oI the exchange and the dealings can
only be through them. The Iollowing procedure is Iollowed Ior dealings at exchanges.

1. Selection of a Broker: The intending investor or seller may approach his bank
Ior this purchase. The banks have appointed their own brokers at exchanges and they
contact Ior dealings on behalI oI their customers. On a recommendation Irom there bank
the client`s account is opened by the broker. The bank assures the Iinancial condition oI
the client.

2. Placing an Order: AIter selecting the broker the client places an order Ior
purchase or sale oI securities. The broker also guides the client about the type oI
securities to be purchased and the proper time Ior it.

3. Making the Contract: The trading Iloor oI the stock exchange is divided into
diIIerent parts known as trading posts. DiIIerent posts deal in diIIerent types oI securities.
The authorized clerk oI the broker goes to the concerned post and expresses his intention
to buy and sell the securities. A deal is struck when the other party also agrees. The
bargain is struck by an outcry mentioning the price and number oI securities contracted
by both the clerks. The bargain is noted by both the parties in their notebooks. The slip
giving brieI details oI the bargain is put in a box Ior making announcement in the oIIicial
price list Ior publicity.


. Contact Note: The buying and selling brokers prepare notes aIter their mutual
consent next day. The seller is sent a selling note and the buyer is sent a buying note. The
details oI securities traded are given mentioning their number price, etc.

5. Settlement: The spot dealings are settled there in Iull. The selling broker hands
over the transIer Iorm and share certiIicates to the buying broker aIter receiving the price.
The settlement Ior ready delivery and Iorward contracts is done with a diIIerent
procedure.
(i) Settlement of Ready Delivery Contracts. The settlement in diIIerent
stock exchanges is done between 3 to 7 days oI the transaction. II the settlement is done
by giving actual delivery oI securities on receiving the price, it is called liquidation in
Iull. In another method the dealings are squared by adjusting price diIIerences only.
(ii) Settlement of Forward Delivery Contracts. The Iorward delivery
contracts are done Ior speculative purposes. Only the active and broad market securities
are traded in Iorward contracts. The settlement oI Iorward contracts can be done in any oI
the three ways:
(a) Liquidation in Iall.
(b) Liquidation by payment oI diIIerences
(c) Carry over to the next settlement.

6. Rolling Settlement: Rolling settlement is an important measure to enhance the
eIIiciency and integrity oI the security market. The shiIt Irom the traditional account
period settlement marks an important change in the market design and age old practices.
In January, 1998, SEBI had introduced rolling settlement on a voluntary basis on the
stock exchanges Ior securities, which were eligible Ior dematerialized trading. However,

as there was hardly any response to the voluntary scheme, SEBI introduced compulsory
rolling settlement initially Ior 10 scrips in January 2000 and then increased the number oI
scrip`s in a phased manner to 163 by May 2000 and Iurther to 414 scrip`s Irom July
2,2001.
LEGAL FRAMEWORK:

In India, stock exchanges were almost selI regulatory till 1988, supervised by
Ministry oI Finance under the Securities Contracts Regulation Act (SCRA). However, the
stock exchanges were not discharging their selI-regulatory role as well as a result oI
which malpractices crept into trading, adversely aIIecting investor`s interests. SEBI has
been setup to ensure that the stock exchanges discharge their selI-regulatory role
properly. Ever since SEBI began to monitor brokers, stock broking is emerging as a
proIessional advisory service, in tune with the requirements oI a mature, sophisticated,
screen based, ring-less.

Automated stock exchanges in the country in sharp contrast to traditional closed
character as inherited Iamily business. So we will discuss, the Indian Stock Broking
system here. The stock broking activity consists oI various intermediaries. Let us discuss
them one by one.

Stock Brokers: Stockbroker is a member oI a recognized stock exchange who
buys, sells or deals in securities. To work as a stockbroker registration with SEBI is
mandatory. SEBI is empowered to impose conditions while granting the certiIicate oI
registration.

Registration: A broker seeking registration with SEBI has to apply through the
stock exchange oI which he is member. For registering SEBI checks - eligibility oI the
applicant to become the member oI stock exchange, has the necessary inIrastructure to
eIIectively discharge his duties, past experience etc. Every registered stockbroker is
required to pay annual Iee Rs. 5,000 Ior turn over up to Rs. 1 crore and 0.01 oI
turnover exceeding Rs. 1 crore. For calculating turnover underwriting and collection oI
deposits are not taken into account Ior the purpose oI calculating the turnover. The
authenticity oI the annual turnover is to be certiIied by the stock exchange concerned.

Capital adequacy norms Ior brokers: An absolute minimum oI Rs. 5 lakh as a
deposit with the exchange is to be maintained by the members oI the BSE & CSE and Rs.
3.5 lakh Ior DSE and ASE irrespective oI volume oI business. In case oI other SE the
minimum requirement is Rs. 2 lakhs. The security deposit kept by the members in the SE
Iorms part oI the base minimum capital; 25 oI the base minimum capital is to be
maintained in case with the exchange. Another 25 remains in the Iorm oI a long term
Iixed deposit with a bank on which the SE is given Iree lien. The remaining requirement
is being maintained in the Iorm oI securities with a 30 margin. The securities should be
in the name oI the member and are pledged in Iavor oI SE.

Additional capital related to Volume oI Business: The additional or optional
capital required Irom a member should, at any point oI time, be such that together with
the base minimum capital it is not less than 8 oI the gross outstanding business in the
exchange deIined as the aggregate oI up-to-date sales and purchases by a member broker
in all the securities put together.

Duties of stock broker to the Investor:
He should be IaithIul to the clients in his dealings with them and execute orders
as per the instructions.
ii. He should issue to his clients a contract note without any delay Ior all
transactions in the Iorm speciIied by the SE.
iii. To avoid breach oI trust, he should not disclose or discuss with any other
person details oI investment and transaction oI clients.
iv. He should not mislead clients merely to generate business.
v. He should avoid dealing with a client who is a deIaulter in his dealings with
other brokers.
vi. When dealing with a client, he is required to disclose whether he is acting as a
principal or as an agent.
vii. He should not give investment advice to any client unless sought by him.
viii. A stockbroker should have adequately trained staII and arrangements to
render Iair, prompt and competent services to his clients.
ix. He should extend Iull cooperation to other brokers in protecting the interest oI
his clients regarding their rights to dividends, bonus shares, rights issues and any other
rights related to such securities.

It deals with legislative and regulatory provisions relevant Irom the viewpoint oI a
dealer. The legality oI trading is through the various acts and regulators oI stock
exchange. BeIore 1992, the three principal acts governing the securities market were:


A. Acts related to stock trading are:
a. The Capital Issues (control) Act, 1947, which restricted the issuers` access
to the securities market and controlled the pricing oI issues.
b. The Companies Act, 1956, which sets out the code oI conduct Ior the
corporate, sector in relation to issue, allotment and transIer oI securities, and disclosures
to be made in public issues.
c. The Securities Contract (Regulation) Act, 1956 that provides Ior
regulation oI transactions in securities through control over stock exchanges.
d. SEBI Act, 1992: To ensure eIIective regulation oI the market, SEBI
Act, 1992 was enacted to empower SEBI with statutory powers Ior
i. Protecting the interests oI investors in securities;
ii. Protecting the development oI the securities market and
iii. Regulating the securities market.

d. The Depositories Act, 1996 was passed to provide Ior the establishment oI
depositories in securities with the objective oI ensuring Iree transIerability
oI securities by dematerializing the securities. In addition, a number oI
acts like the Public Debt Act, 1942 the Income Tax Act, 1961 etc., have
substantial bearing on the working oI the securities market.
B. Regulators:
The responsibility Ior regulating the securities market is shared by
Department oI Economic AIIairs (DEA), Department oI Company AIIairs (DCA), RBI;
Securities Exchange Board oI India (SEBI) and Securities Appellate Tribunal (SAT).


HISTORICAL BACKGROUND OF THE COMPANY:

Steel City Securities Limited was incorporated on 22
nd
February 1995 and
raised equity oI Rs.105 lakh on 24
th
June 1995 and obtained the membership oI the
largest and prestigious National Stock Exchange oI H-Limited (NSE) and Bombay Stock
Exchange (BSE) in 2000, in its capital market segment. The 1
st
VSAT Ior its trading
workstation (TWS) at Hyderabad was installed in 1995 and the 2
nd
at Visakhapatnam in
April 1996.

Presently, there are 64 VSATS installed at more than 50 centers in Andhra
Pradesh, Orissa, Tamilnadu and Karnataka. There are 219 computer trading terminals
put together connected to their VSAT at the centers (each VSAT can have 5 TWS
connected). Since its inception the service oI this organization is prompt and there is not
a single instance oI payout oI Iunds / deliveries delay to any client, Irom the beginning
the Iirm is committed to continue the same service in Iuture also. Companies` basic
principle is total commitment in service to all clients with all transparency and ensures
that is it their sacred policy not to indulge in own trading, there are no selI-motives or
necessity to cancel or delay anything. Every branch is Iully equipped and independently
connected to the NSE Hub at Mumbai, every branch is having 2 to 5 trading terminals
connected to VSAT. The company perIormance has not parallel on NSE.

Steel City Securities Ltd. Iollows a Iunctional organization system. It provides various
services which are provided through diIIerent departments. They are:

Trading (System):
Deals with online trading Iacility through the VSAT
Registration oI clients and interaction with clients
Dealing with new sub brokers and making them conversant with the system
Provides updated inIormation oI a day`s trading activities.

Data Processing:
Opening oI the account aIter the IulIillment oI various Iormalities.
Shares are credited to the De-Mat account by dematerializing the physical
shares and those brought Irom the secondary market.
The process oI settling the selling and buying obligations takes places
through the delivery instruction slip to their respective clients.

Accounts:
The Iunction oI accounts departments is to maintain a record oI all the
pay-in, pay-out cash received Ior De-Mat account opening, account closing, transaction
charges Ior operating the account. Records oI expenses incurred and incomes earned
Irom business are also maintained basing on which year aIter year an annual report is
prepared to which the latest data is annexed in its 1
st
chapter.


Deliveries:
This department acts as an intermediary between stock exchange and
clients. Hence proper knowledge is very essential. Proper records oI all inward and
outward stocks should be maintained Iailing which there may be improper deliveries
leading to penalties and disagreements with clients. NSCCL is extended the
responsibility oI settling the delivery obligations oI sellers and buyers dealt in a given
settlement period.
BOARD OF DIRECTORS OF STEEL CITY SECURITIES LIMITED
Sri G.Sree Rama Murthy Chairman and Managing Director
Sri G.Raja Gopal Reddy Executive Director
Sri K.Satyanarayana Executive Director (S)
Sri Satish Kumar Arya Director Operations
Sri G.Satya Rama Prasad Director

The various service departments in SCSL are:
Systems Departments
Inspection Department
Personal Department
Accounts
Deliveries
Depository Participant
Research and Development


ACTIVITIES OF STEEL CITY
&TEEL C!TY &ECUR!T!E& L!N!TED
TRAD!NC FAC!L!T!E& &ETTLENENT OF TRADE&
&ECUR!T!E& FUND&
PAY !N PAY OUT
PAY !N PAY OUT
&ECUR!T!E& BOUCHT BY
CL!ENT&
LO&&
FUND&
!NTERNAL FUND& N&E
PAY OUT TO CL!ENT&

STRUCTURE OF THE ORGANISATION:
The total control oI the organisation is under the Chairman who is also the
Managing Director. Under him there are three Executive Directors Ior surveillance &
operations and also a Sleeping Director.
Mr.G.Sree Ram Murthy is the Chairman cum Managing Director,
Mr.G.Raja Gopal Reddy the Executive Director looks aIter the market development and
opening oI new Iranchisees. He also looks aIter requirements oI new and existing
branches. Mr.K.Satyanarayana the Executive Director, surveillance has an inspection
team under him Ior the purpose oI vigilance in all branches and Iranchisees.
Mr.Satish Kumar Arya is the Director Operations. He controls the trading
limits, margins etc. All oIIice related matters are dealt by him. He is also responsible Ior
meeting the requirements and Iollowing the rules set by the stock exchanges.
Mr.G.S.R.Prasad is the Iourth Director who does not play any role in the day to day
working oI the company.
Genera Manager (Operations) is Mr.Murali is responsible Ior De-Mat with
NSDL / CDSL. General Manager (Systems) is Mr.V.Srinivas who looks aIter the
Networking, SoItware, Hardware and trading related requirements and VSAT
connectivity. Finance and accounts were looked aIter by Mr.Ramu who is a Chartered
Accountant.
Mr. Samba Murthy is responsible Ior the trading and registration oI new
clients. He is the Trading Manager. Mr. Krishna Naga Bhushan is the Marketing
Manager. He is also responsible Ior conduction various awareness seminars. The legal
section deals with the investor`s problems and legal issues with the company. Even
without relation to the company they render legal services.

ORGANISATIONAL STRUCTURE

Managing Director (MD)
Executive Director Executive Director
(Surveillance)
Director
(Operations)
Sr. Manager
(Operations)
Sr. Manager
(Finance & Accounts)
Sr. Manager
(Systems)
Manager
(SoItware)
Manager
(Systems)
Manager
(Operation)
Manager
1 Executive
2 Executive
3 Executive
4 Executive
and so on
1 Accountant
2 Accountant
3 Accountant
4 Accountant
and so on
1 Programmer
2 Programmer
3 Programmer
4 DBA`s
and so on
1 Hardware
2 Hardware
3 Hardware
4 Hardware
and so on
Gn. Manager
(Operations)
Gn. Manager
Gn. Manager
(Systems)

The diIIerent branches and Iranchisees oI the company report directly to the Head
OIIice in Visakhapatnam and any activity taken up by these should be brought to the
notice oI the Head OIIice. Every branch has a Branch Manager, Accountant, Trading
Manager and Trading Operator. The company has various Iunctional departments Ior its
smooth Iunctioning.

COMPANY POLICY

The basic policy oI SCSL, is not to indulge in own trading. The basic
principle oI SCSL is total commitment in service to all clients. The service oI SCSL is
prompt and hence there are not delays in payout oI Iunds or deliveries to any client.
SCSL collects pay in T1 and its payout in T3 days. Through SCSL, trade in NSE per
day is 200 crores whereas, trade in BSE per day is 4 crores.

Capital:
The base capital is set up a trade center is 1 crore, SCSL raised equity oI
Rs.105 lakhs during its incorporation. Earlier, SCSL paid Rs.75 lakhs as base capital to
NSE when it was set up. Every trade corporation has to maintain a reserve oI some
amount with NSE. At present, SCSL has 7.5 crores as margin with NSE.


Working Staff:
There is 100 to 150 staII employed in SCSL. The staII draws a salary
basing on the cadre they are employed. The salaries in SCSL vary Irom Rs.2000 to
Rs.20000 per month basing on the cadre oI the employee.

Employee Recruitment:
In SCSL, the top managements select the candidate and the letter oI
appointment or rejection is sent to the Board oI Directors. The Directors do the
placement in SCSL. The placement can either be in the Head OIIice or in any other
branches oI SCSL.
Planning:
It involves planning oI Human Resource Department i.e. recruitment,
selection, training etc. it also involves Iorecasting oI personnel changing values, attitudes
and behavior oI employees.

Directing:
In this company, the personnel manager co-ordinates various managers at
diIIerent levels as the personnel Iunctions are concerned. The wilting and eIIective co-
operation oI employees Ior the attainment oI organization goals is possible through
proper direction.


Controlling:
In SCSL, the top management does the controlling. In this aspect, they do
auditing training programmers; directing moral surveys are some oI the Iunctions oI the
top management.

Recruitment:
It is the process oI searching Ior prospective employees and simulating
them to apply Ior jobs in the organization. In SCSL, iI they want any person, they will
give notiIication in newspaper in order to simulate eligible persons to apply Ior that job.

Employee Relation:
The employee relations at all levels remains cordial. Training, Promotion
and TransIers are done in SCSL to motivate and increase the morale oI the staII. All the
employees in SCSL Irom top to bottom perIorm their services with sincerity, hard work,
dedication and with team spirit due to which SCSL is considered as one oI the best stock
trading Iirm in India.

Selection, Placement and Training:
The top management shall do the selections. Placement is in the head
oIIice and in the branches oI SCSL, which are in diIIerent places. Selected candidates
are placed in one oI the branches oI SCSL and gives proper training.


Functions of the SCSL:
SCSL provides mock trading to its clients and members.
SCSL provides complete automated system both in trading and settlement
process.
SCSL enables clients to trade in both NSE and BSE.
SCSL converts the paper shares into electronic shares through DMAT
process.
SCSL provides market inIormation.
SCSL acts as clearing member Ior trades taking place through SCSL.
SCSL is a depository participant oI NSDL & CDSL and it is a trading and
clearing member oI NSE & BSE.

Facilities provided to Client in SCSL:
Gross exposure Iacility given in SCSL is 5 times. But, up to 10 times, it is
relaxed to clients. Turnover Iacility given in SCSL to clients is 33.33 times. But, the
restrictions are not considered. Minimum oI Rs.20,000 margin money is collected Irom
proIessional clients who trade Ior speculation purpose. For deliver purpose, no margin
money is collected. Due to the total commitment in service to its clients, SCSL is
considered one oI the best Stock Broking Companies in India.
SECURITIES TRADED IN SCSL:
In SCSL all the shares, scrip`s, stocks, bonds, debentures,
derivatives, government securities, debt instruments etc. can be traded. But generally,
trading is mostly done in scrip`s listed in BSE & NSE.


The government securities and the corporate securities can be
traded through NEAT system in NSE. Only trading mechanism available in the debt
market was the telephone market beIore June 1994 when NSE launched wholesale debt
market (WDM) segment. This provides the only Iormal platIorm Ior trading oI a wide
range oI debt securities. Though many trades in the gilt`s takes place through telephone,
a longer chunk oI trades get rented through NSE brokers.

Trading in derivatives oI securities commenced in June 2002 with
the enactment oI enabling legislation in early 2000.

THE TRADING PROCESS:
Steel City Securities Limited provides stock trading services to its
clients and members. It enables the clients to trade in both NSE & BSE. Through the
computer trading terminals in SCSL, the client places an order to buy or sell the shares.
AIter the trade is conIirmed, the client receives the settlement net positions. SCSL
collects the margin, brokerage, service tax & commission Irom the clients Ior the trades
taking place in SCSL.

SCSL converts the physical shares into the electronic shares
through D-MAT process. Clearing and settlement oI trades, dematerialization oI shares,
providing market inIormation to the clients are daily chores in SCSL, apart Iorm trading.


1. DOCUMENTATION:
The trading member or stockbroker shall enter into an agreement
in the speciIied Iormat provided by NSE with the client beIore accepting orders on
latter`s behalI. The said agreement shall be executed on non-judicial stamp paper oI
adequate value, duly signed by both the parties on all the pages. This agreement is
known as Member Constraint Agreement`. Copy oI this agreement is to be kept with the
trading member permanently.

In addition to the agreement, the stock broker/trading member shall
seek inIormation Irom the client in the Client Registration Application Form` obtaining
inIormation like investor risk proIile, Iinancial proIile, social proIile, investor
identiIication details, Iamily, income, PAN, employment, age, investments, other assets,
Iinancial liabilities etc.

A stockbroker shall not deal knowingly, directly or indirectly, with
a client who deIaults to another stockbroker.

Similarly, the sub-broker shall enter into an agreement with the
client beIore placing orders, with shall be executed on non-judicial stamp paper. The
client should provide inIormation to the sub-brokers in the client registration application
Iorm`.


2.ON-LINE TRADING:
NEAT System:
The NEAT system supports an order driven market, wherein orders
match on basis oI time and price priority. All quantity Iields are in units and prices are
quoted in Indian Rupees. The regular lot size and tick size Ior various securities traded is
notiIied by the exchange Irom time to time.

To bring in eIIiciency, transparency and depth in the market, NSE
provides a Iully automated screen based trading system known as NEAT. Its trading
members use NEAT system Ior trading in the capital market segment in NSE.

a. Logging on to the NEAT system:
User ID
Trading Member ID
Password
New Password

b. Market Phase:
The system is normally made available Ior trading on all days except
Saturdays, Sunday & other holidays.
i. Pre-open phase:
The pre-open period is relevant only in the normal market. Order
matching takes place at the end oI the session, based on which an opening price is
computed & assigned to all trades oI pre-open.
ii. Opening:
In this period, all orders that have been entered in the pre-open phase are
matched. During this phase, the trading member cannot login to the system. II the
member is already logged in the cannot perIorm trading activities till market is opened.


iii. Open Phase:
The open period indicates the commencement oI trading activity. To
signiIy the start oI a trading, a message is sent to all the trade workstation. Order entry is
allowed when all the securities have been opened. During this phase, orders are matched
on a continuous basis.

Trading in all the instruments is allowed unless they are
speciIically prohibited by the exchange. The activities that are allowed at this stage are:

Inquiry: Inquiry about the market status, the shares and their prices.
Order entry: Placing an order to buy or sell the scrip`s by quoting the price
and the quantity oI the share.
Order modiIication: ModiIying the order that has been already placed. The
modiIication may be with respect to price or quantity.
Order cancellation: The order placed already can also be cancelled iI the price
or the quantity oI scrip is not satisIactory. Order cancellation also includes quick order
cancellation.

iv. Market close:
Where the market closes, trading in all instruments Ior that market comes
to an end. No Iurther orders are accepted, but the user is permitted to perIorm activities
like inquiries.


v. SURCON:
Surveillance and control (SURCON) is that period aIter market close
during which, the users have inquiry access only. AIter the end oI SURCON period, the
system processes the data Ior making the system available Ior the next trading day.
When the system starts processing data, the interactive connection with the NEAT system
is lost and the message to that eIIect is displayed at the trader workstation.

2. Back Office:
To know the trade position oI the client , back-oIIice is done in SCSL
everyday immediately aIter the trade ends. STEEL PACK` is the package used in back
oIIice system. Steel City SoItware team was designed and maintained this
'STEELPACK Package.
The main modules oI back oIIice system are:
Trading
Finance
Importing Exporting
Margins
Clearing
Business Controls
Payin-Payout
House Keeping
In the back oIIice, Iirst the Import Export module is opened where
the trade Iile oI the days trade is collected and the text Iile was imported to the system.
There, the old closing prices are inserted by new prices Irom the Bhav copy Iile. Bhav
copy is the average oI last halI-an-hour prices oI the scrips.

To calculate the net mark to market value, Bhav copy Iile is
imported Irom NSE/BSE/NCDEX/MCX. Net mark to market value is to be known to
know the proIit or loss position oI the client, basing on which the Trading Manager oI
SCSL will decide whether the client can trade or not Ior the next day on comparing it
with the margin paid by the client.

AIter importing the Bhav copy Iile, the trading module is opened.
In trading module, the sauda status is known Irom the Sauda Manager`. Sauda manager
is the number oI trade conIirmations recorded. ConIirmation oI trading transaction with
brokerage commission is known as Sauda`.

AIter Sauda Manager, Net positions process is done. In the net
positions process, cumulative net position reports, client-wise net position reports and
other reports are made and are given to clients and to the accounts department. The bills
are prepared and sent to the respective clients.

3. REPORTS:
AIter selecting REPORTS` option Irom main menu, the member
has to speciIy the criteria Ior which the report is needed. The types oI reports that may be
generated are: Net Position Reports Client Wise and Scrip Wise; Contract Note reports;
Client Wise ConIirmation reports; Bills Summary reports; bad deliveries reports; auctions
reports; objections reports; margins reports; securities reports and miscellaneous reports.
The daily reports oI various aspects relating to the trading activities are maintained.

. CLEARING:
Settlement oI trades transacted on an exchange requires smooth,
preIerably instantaneous, movement oI securities and Iunds in accordance with the
prescribed schedule oI pay-in / pay-out. Movement oI securities has been almost
instantaneous in the dematerialized environment. Two depositories are in place to
provide electronic transIer oI securities. 10 major stock exchanges accounting Ior about
99 oI turnover have been connected to depositories. All actively traded scrips are held,
traded and settled in de-mat Iorm. NSE Iollows a diIIerent model where a clearing
corporation guarantees settlement obligations emanating Irom trades.

5 SETTLEMENT:
The trades accumulated over a trading cycle are clubbed together at the
end oI the trading cycle, positions (trades) are netted and the balance obligations are
settled.
There is one type oI settlement:

a. Rolling Settlement:
In a rolling settlement, each trading day is considered as a trading
period and trades executed during the day are settled based on the net obligations Ior the
day.
At NSE, trades in rolling settlement are settled on a T2 basis i.e. on the 2nd
working day. For arriving at the settlement day all intervening holidays, which include
bank holidays, NSE holidays, Saturdays and Sundays are excluded. Typically trades

taking place on Monday are settled on Wednesday, Tuesday's trades settled on hursday
and so on.
In order to enhance liquidity, to shorten the settlement cycle and to promote
market Ior derivatives, SEBI permitted rolling settlement in respect oI selected shares and
trades in this segment are settled by de-mat delivery only.
In the type oI settlement, Ior conIirmed trades, the settling bank
will arrange Ior payment and clearance and depository Ior eIIecting transIers by
electronic book entry system. Canara bank provides the clearinghouse Iacility.

The following table and figure represent rolling settlement process.
A tabular representation oI the settlement cycle Ior rolling settlement is given
below:
Activity Day
Trading Rolling Settlement Trading T
Clearing Custodial ConIirmation T1 working days

Delivery Generation T1 working days
Settlement Securities and Funds pay in T2 working days

Securities and Funds pay out T2 working days

Valuation Debit T2 working days
Post Settlement Auction T3 working days

Settlement Agencies
The NSCCL, with the help oI clearing members, custodians, clearing
banks and depositories settles the trades executed on exchanges. The roles oI each oI
these entities are explained bellow:
a. NSCCL
b. CLEARING MEMBERS
c. CUSTODIANS
d. CLEARING BANKS
e. DEPOSITORIES
I. PROFESSIONAL CLEARING MEMBER

Explanations:
1. Trade details Irom Exchange to NSCCL (real-time and end oI day trade
Iile).
2. NSCCL notiIies the consummated trade details to CMs/custodians who
aIIirm back. Based on the aIIirmation, NSCCL applies multilateral netting and
determines obligations.
3. Download oI obligation and pay-in advice oI Iunds/securities.
4. Instructions to clearing banks to make Iunds available by pay-in-time.
5. Instructions to depositories to make securities available by pay-in-time.
6. Pay-in oI securities (NSCCL advises depository to debit pool account oI
custodians/CMs and credit its account and depository does it).

7. Pay-in oI Iunds (NSCCL advises Clearing Banks to debit account oI
custodians/CMs and credit its account and clearing bank does it).
8. Pay-out oI securities (NSCCL advises Clearing Banks to credit account oI
custodians/CMs and debit its account and depository does it).
9. Pay-out oI Iunds (NSCCL advises Clearing Banks to credit account oI
custodians/CMs and debit its account and clearing bank does it).
10. Depository inIorms custodians/CMs through DPs.
11. Clearing Banks inIorm custodians/CMs.

6.COST OF TRADING:
The various costs involved in the process oI online trading in Steel
City Securities Limited, Visakhapatnam are as Iollows:

a. Margins:
The base capital to set up a trade center is one crore rupees. Earlier, SCSL paid
Rs.75 lakhs as base capital when it was set-up. The Trade Corporation has to maintain a
reserve oI some amount with NSE where 30 - 50 will be in the Iorm oI cash and the
remaining in the Iorm oI bank guarantees (securities), FDR`s etc. SCSL has 7.5. crores
as margin with NSE at present.

Gross intra-day turnover (buy and sell) oI a member shall not exceed 25 times the
base capital. Gross exposure oI a member at any time shall not exceed 8.5 times the Iree
base capital oI one crore rupees and not exceed 12 times over the Iree base capital oI one
crore rupees.

Minimum oI Rs.20000 is collected as margin money Irom proIessional clients in
SCSL. For delivery purpose no margin money is collected. Client margin collection is
calculated in 16 types known as Span calculation` and the maximum margin is collected
Irom the clients. SCSL collects 25 margin money in Iutures Irom clients. For trading
in index 15 margin is charged. For retail clients, the Iull amount oI the value oI shares
is calculated and collected to allow them to purchase the shares.

Gross Exposure Margin Payable ( Rs. Crore)
1 Nil
1 3 2.5 in excess oI Rs. 1 crores
3& 6 Rs. 5 lakh plus 5 in excess oI Rs. 3crores
6& 8 Rs.20 lakh plus 10 in excess oI Rs. 6 crores
& 20 Rs.40 lakh plus 15 in excess oI Rs. 8 crores
20 Rs. 220 lakh plus 20 in excess oI Rs.20


Brokerage:
Brokerage is oI two types:
i. Speculation brokerage or square up commission:
This brokerage is charged where buying and selling oI shares is done in one day
only and at the end oI the days trade, the position is zero. The speculation brokerage is
charged Irom 0.02 to 0.05.
ii. Delivery Brokerage:
This brokerage is charged where there may be buying or selling lot remaining at
the end oI the days trade. The delivery brokerage is charged Irom 0.3 to 0.5.
As per SEBI, maximum brokerage shouldn`t exceed 2.5 both in BSE and NSE.
For retail clients, the brokerage charged is 0.7. A sub-broker charge 2.5 Irom the
clients to sell or buy the shares out oI which, SCSL charges 1 Irom the sub-broker.
b. Service tax:
In SCSL, 10.2 service tax on brokerage is collected Irom the clients.
c. Stamp duty:
II the stamp duty oI 0.006 on turnover is Rs30 or more, only Rs30 is collected
in NSE. In BSE, the minimum is 1Re and the maximum stamp duty is unlimited.

d. Security Transaction Tax
This has reIerence to the Securities Transaction Tax (STT) introduced in the
Finance Act 2004.
As per the Finance Act 2004, STT on the transactions executed on the Exchange
will be as under:


SI.No. Taxable securities transaction Rate Payable by
(1) (2) (3) ()
1. Purchase oI an equity share in a company or a unit oI
an equity oriented Iund, where
(a) the transaction oI such purchase is entered into in
a recognized stock exchange; and
(b) the contract Ior the purchase oI such share or unit
is settled by the actual delivery or transIer oI such share or
unit.
0.075 . Purchaser
2. Sale oI an equity share in a company or a unit oI an
equity oriented Iund, where
(a) the transaction oI such sale is entered into in a
recognized stock exchange; and
(b) the contract Ior the sale oI such share or unit is
settled by the actual delivery or transIer oI such share or
unit.
0.075 . Seller
3. Sale oI an equity share in a company or a unit oI an
equity oriented Iund, where
(a) the transaction oI such sale is entered into in a
recognized stock exchange; and
(b) the contract Ior the sale oI such share or unit is
settled otherwise than by the actual delivery or transIer oI
such share oI unit
0.015 Seller


7. ACCOUNTS:
The Accounts/ Finance department maintains the accounts in SCSL. The
accounts are prepared in three Iorms. They are:
a. Client-wise net positions,
b. Scrip-wise net positions,
c. Pay-in and Pay-out settlement oI Iunds.

8. DEMATERIALIZATION AND ELECTRONIC TRANSFER OF
SECURITIES:
Though de-mat was introduced in 1994, it came into existence in 1996.
The depositories Act, 1996 was passed to provide Ior the establishment oI depositories in
securities with the objective oI ensuring Iree transIerability oI securities with speed,
accuracy and security by dematerializing the securities in the depository model. A
depository holds securities in dematerialized Iorm. It maintains ownership records oI
securities and eIIects transIer oI ownership through book entry.

The two depositories, National Securities Depository Limited (NSDL) and
Central Depository Services Limited (CDSL) provide services to investors and clearing
members through Depository Participants (DPs). They do not change the investors and
clearing members directly but charge their DPs, who are Iree to have their own charge
structure Ior their clients.


De-mat Process:
When a client places his physical shares Ior de-mat, SCSL aIter inputting
the inIormation in depository participants sends the physical shares to the company,
which issued the shares. The client code number and the inIormation and the clients
signature is sent to Share Holding Registrar.
There they veriIy whether the shares really belong to the client and
whether the signature is matching or not. Once they are satisIied that the inIormation
sent through the DP`s are right, the shares are cleared and the inIormation is passed on to
the client. The physical shares are then torn away as they already exist in electronic
Iorm.
When a client enters into DP Ior de-mat purpose, he is given a unique
code member. He can know his share position easily. It is known as client ID number.
Advantages of Dematerialization:
The process oI transIer oI securities became Iaster. The Iear oI
loosing the share certiIicates is not there because oI dematerialization. TheIt, Iorgery,
mutilation oI certiIicates is not Iound in dematerialization.
9. INTERMEDIARIES:
There are no intermediaries in between SCSL and NSE,
BSE,NCDEX and MCX. Similarly there are no intermediaries in between SCSL and
proIessional clients. Since SCSL is a share broker to NSE, BSE,NCDEX and MCX the
clients operating in SCSL directly, on behalI oI other clients are sub-brokers to the
ultimate clients who doesn`t operate the trade directly. So, there may be sub-brokers as
intermediaries in between SCSL and clients who do not trade directly in SCSL.


As mentioned earlier, SCSL is depository participant. So, SCSL acts as an
intermediary between clients and NSDL & CDSL.

10. MARKET INFORMATION:
In SCSL, daily the research analyst collects the market inIormation and it
is analyzed. The market inIormation is used to Iorecast the index movement, price
movement oI the shares and enables the clients to make use oI the inIormation in trading
to get better results.

The research analyst in Iorecasting the market movement Iollows the
technical analysis, Iundamental analysis and eIIicient market hypothesis. The research
analyst collects the inIormation about the company, the industry and the economy
through diIIerent media to know the company`s position.

The research analyst Iollows the market closely by watching the price
movement oI the shares in the market. The technical analysis is very helpIul in making
investment decisions. The research analyst Iollows diIIerent tools oI technical analysis
like Japanese candlestick method; Elliot wave theory; Dow theory; price trends and
volume trends; volatility; Iloating stock and volume oI trade etc., to assess the market.

Technical analysis reveals the movement oI the scrip. It explains when to buy a share
and when to sell. So, the research analyst gives much important to the technical analysis
to Iorecast the price movement oI the scrip accurately.


Since, the NSE & BSE are markets with strong Iorm eIIiciency, as the
market discounts the inIormation itselI very quickly and changes as per the inIormation,
the research analyst has only Iewer jobs to do here.

The research analyst not only analyses the marketing inIormation but,
every day in SCSL an edition oI the research analyst`s, suggestions on scrips that have to
be bought and sold is also printed which helps the clients oI SCSL to invest in shares that
are proIitable. Mostly, the predictions oI the research analyst about the market
movement prove to be accurate. So market inIormation in SCSL is trust worthy.

STEPS TAKEN BEFORE THE REGISTRATION OF THE CLIENT:

1. Registration of the Client:
The customer has to Iill in the registration Iorm and provide details oI his
QualiIications, Date oI Birth etc. He has to Iurnish his photographs and prooI oI Identity
through PAN Card, Driving License or Voter Identity Card.

2. Introduction of the Client:
The customer has to be introduced by one oI the existing clients oI the company
who voucher Ior the honesty and integrity oI the Iormer.

3. Background of the Client:
A detailed background check oI the client is necessary. Only aIter a thorough
check oI his place oI origin, his business etc. the client is registered.

4. Strengths / Weaknesses of the Client:
The client`s Iinancial position is also monitored. Only customers who have a
sound Iinancial position are registered Ior trading.

5. Previous record of business:
The previous record oI the business oI the client is checked to see the Iairness in
his dealings and promptness in settling the outstanding debts.

6. Undertaking / Agreement:
An undertaking is taken Irom the client to the eIIect that the deals have been done
on behalI oI him by Steel City Securities Ltd on his instruction and is liable to the proIits
/ losses thereoI.

7. Storing previous transactions:
All transactions oI the client are stored Ior legality purpose. According to the
guidelines oI SEBI the transactions oI the past Iive year have to be maintained.


ORIGIN OF STOCK EXCHANGES IN INDIA

At the end oI the June 1989, there were 18 recognized stock exchanges in India.
Among
the 18 stock exchanges, the Iirst organized stock exchange set up at Bombay in
1857 is distinguished not only by its size but also it has been recognized permanently,
while the recognition Ior other markets is renewed every 5 years. Stock markets are
organized either as voluntary, non-proIit making associations (Bombay, Ahmedabad,
Indore) or public limited companies (Calcutta, Delhi, Bangalore) or company limited by
guarantee (Madras, Hyderabad).
In India, the growth oI stock exchanges has been linked to the growth oI
corporate sector. Though a number oI stock exchanges were set up beIore independence
but, there was no All India legislation to regulate they`re working. Every stock exchange
Iollowed its own methods oI working. To rectiIy this situation, the SECURITY
CONTRACTS (REGULATIONS) ACT was passed in 1956.
In 1965, 22 separate provincial stock exchanges were merged into 3
regional stock exchanges and in 1973 these, in turn, were combined to Iorm the National
Stock Exchange (NSE) under the title oI the stock exchange that has trading Iloors in
many Iormer provincial center. At present, there are 26
Stock exchanges in our country. The over-the counter exchange oI India began its
operations in 1992. Since 1995, trading in securities is screen based (on-line).


BOMBAY STOCK EXCHANGE (BSE):
Bombay stock exchange is the Iirst organized stock exchange set up at
Bombay in 1857. It is the premier or apex stock exchange in India as it is distinguished
by not only its size but also it has been recognized permanently while recognition oI
other stock exchanges is renewed every 5 years. It is the oldest stock market.

Earlier BSE was organized as voluntary non-proIit making association oI
brokers to regulate and protect their interest. AIter the Security Contracts (Regulation)
Act was passed in 1956, BSE was Iirst recognized on a permanent basis in 1957. Its
business is no longer conIined to Mumbai alone; at the end oI 1957, there were 100 other
cities in which it had set up business.

Bombay Stock Exchange raised the threshold limit Ior listing to Rs.10
crores, moved on to weekly settlement and quicker actions Ior each settlement.
Settlement is through the clearinghouse. 12 days carry Iorward is allowed on BSE.
Index in BSE is SENSEX`. BSE membership Iee in 1857 was just Rs 1 and now it in
about Rs. 2 crores.

The number oI companies quoted on the stock exchanges is more than 8,000 oI
which those listed in BSE are 5,000. The capital listed in Bombay stock exchange
accounted Ior about 40 oI the overall capital listed on all the stock exchanges whereas,
its share oI the market capitalization amounted to around 90. In BSE the total number
oI companies listed and total number oI stocks issued are higher than any other stock
exchange.


BSE went over to electronic trading system in Jan 1995 called Bombay
Online Trading (BOLT) system and this become Iully operational in May 1995. The
BSE has allowed expansion oI online trading system to members oI other stock
exchanges and have terminals in other cities since August 1995, to counter the move oI
the country wise network oI terminals by National Stock Exchange. The daily turnover
in BSE varies Irom Rs. 400-800 crores. Brokers trading in NSE Iollow BSE to know the
market.

NATIONAL STOCK EXCHANGE (NSE):
National Stock Exchange oI India Ltd was started in 1992 with a paid-up
equity oI Rs.25 crores. The government recognized it in the same year and NSE started
its operations in wholesale in Nov 1994. NSE is a India`s leading stock exchange
covering various cities and towns across the country. NSE was set up by leading
institutions to provide a modern, Iully automated screen based trading system with
national research. The exchange had brought about unparalled transparency, speed and
eIIiciency, saIety and market integrity. It has setup Iacilities that serve as a model Ior the
securities industry in terms oI systems, practices and procedures. NSE has played a
catalytic role in reIorming the Indian securities market in terms oI micro structure, market
practices and trading volumes.
NSE is a complete capital market prime mover. Its wholly-owned
subsidiaries, NSCCL provides clearing and settlement oI securities, India Index Services
and Products Limited (IISL) provides indices and index services with a consulting and
licensing agreement with standard and Poor`s (S&P), and NSEIT LTD Iorms the
technology strength that NSE works on.

NSE Logo

The logo oI the NSE symbolizes a single nationwide securities trading Iacility
ensuring equal and Iair access to investors, trading members and issuers all over the
country. The initials oI the Exchange viz., N, S and E have been etched on the logo and
are distinctly visible. The logo symbolises use oI state oI the art inIormation technology
and satellite connectivity to bring about the change within the securities industry. The
logo symbolizes vibrancy and unleashing oI creative energy to constantly bring about
change through innovation.

EQUITIES:
NSE started trading in the equities segment (Capital Market Segment) on 3
rd

November, 1994 and within a short span oI one year became the largest exchange in
India in terms oI volumes transacted.
The equity section provides with an insight into the equity segment oI NSE and
also provides real time quotes and statistics oI the equities market. In depth inIormation
regarding listing oI securities, trading system and processes, clearing and settlement, risk
management, trading statistics etc., are available here.


FUTURES AND OPTIONS:
NSE commenced trading in derivatives with the launch oI index Iutures on 12
th

june 2000.The Iuture contracts are based on the popular bench-mark S&P, CNX, NIFTY
INDEX. The exchange introduced trading in index options (also based on NIFTY) on 4
th

June, 2001. NSE also became the Iirst exchange to launch trading in options on
individuals securities Irom 2
nd
July, 2001. Futures on individual securities were
introduced on 9
th
November, 2001. Futures and options on individual securities are
available on 186 securities stipulated by SEBI.

National Securities Clearing Corporation Limited (NSCCL):
NSCCL is a wholly subsidiary oI NSE. It was a setup to bring and sustain
conIidence in clearing and settlement oI securities to promote and maintain, short and
consistent settlement cycles, to provide counter-party risk guarantee and to operate a tight
risk containment system. NSCCL carries out the clearing and settlement oI the trades
executed in equities and derivatives segments and operates Subsidiary General Ledger
(SGL) Ior settlement oI trades in Government securities.

Products and Services in NSCCL: -
O Clearing and settlement
O Guarantee
O Risk Management
O Direct Payout to investors
O Constituent SGL account
O Mutual Fund Service system

INITIAL PUBLIC OFFERINGS (IPO):
A corporate or company may raise capital in the primary market by way oI
an initial public oIIer, rights issue or private placement. An IPO is the selling oI securities
to the public in the primary market. It is the largest sources oI Iunds with long or
indeIinite maturity Ior the company.

Subsidiaries oI NSE:
NSCCL, IISL, NSEIT, NSDL, Dot Ex Intl. Ltd (Dot Ex).
Partners oI NSE:
O Clearing Members
O Clearing Banks
O ProIessional Clearing Members
O Depositories
O Custodians

Clearing and settlement (Equities):
NSCCL carries out clearing and settlement Iunctions as per the settlement cycles
oI diIIerent sub-segments in the equity segment.The clearing Iunction oI clearing
corporation is designed to work out.


Clearing members:
Clearing members means a member oI a corporation who clears and settles deals
through the clearing corporation.

In the F&O segment, trading member need not necessarily clear their own deals
but can select another clearing member or a proIessional clearing member to clear and
settles their dues, in capital markets its not the same.
Clearing Banks:
NSCCL oIIers settlement oI Iunds through 13 clearing banks namely Canara
Bank, HDFC Bank, Indus Indian Bank, ICICI Bank, UTI Bank, Bank oI India, IDBI
Bank, and Hong Kong and shanghai Banking Corporation Limited, Kotak Mahindra
Bank, Standard Charted Bank, Union Bank oI India, SBI and Citi Bank.
Member may open their clearing accounts with any one bank Ior the
purpose oI settlement oI exchange transactions.
Professional Clearing Members:
ProIessional Clearing Members (PCM) are clearing members who are
not trading members. They are typically Banks, custodians etc., who clears and settled
trades executed Ior their clients (individual, institutions etc,).
The Iunctions and responsibilities oI the PCM would be similar to custodian.
PCM`s may also under take clearing and settlement responsibility Ior trading members.


Depositaries:
In order to promote dematerialization oI securities, NSE joined hand with leading
Iinancial institutions to establish National Securities Depository Ltd. (NSDL), the Iirst
depository in the country with the objective oI enhancing the eIIiciency in settlement
systems as also to reduce the manace oI the Iake/Iorged and stolen securities. The second
depository in the country, CDSL, promoted by the BSE and Iew commercial banks, was
graded certiIicate oI commencement oI business.
NSCCL has established connectivity with both the depositories Ior
electronic settlement oI securities.
Custodians:
Custodians are clearing members but not trading members. They
settle trades on behalI oI their clients that are executed through other trading members. A
trading member may assign a particular trade to a custodian Ior settlement.
The Iollowing Custodians are emparelled with NSCCL:
O ABN Amro Bank N.V.
O Citi Bank N.V.
O Deutsche Bank A.G.
O HDFC Bank
O Hong Kong and Shanghai Banking Corporation Ltd
O ICICI Ltd
O Indus Ind Bank
O InIrastructure Leasing and Financial Services Ltd
O Standard Charted Bank
O State Bank oI India

O Stock Holding Corporation oI India Ltd

NSE`s MISSION:
NSE's mission is setting the agenda Ior change in the securities markets in India.
The NSE was set-up with the main objectives oI:

O establishing a nation-wide trading Iacility Ior equities, debt instruments and
hybrids,
O ensuring equal access to investors all over the country through an appropriate
communication network,
O providing a Iair, eIIicient and transparent securities market to investors using
electronic trading systems,
O enabling shorter settlement cycles and book entry settlements systems, and
O meeting the current international standards oI securities markets.
The standards set by NSE in terms oI market practices and technology has
Become industry benchmarks and are being emulated by other market Participants. NSE
is more than a mere market Iacilitator. It's that Iorce which is Guiding the industry
towards new horizons and greater opportunities.


CORPORATE STRUCTURE OF NSE:
NSE is one oI the Iirst de-mutualised stock exchanges in the country, where the
Ownership and management oI the Exchange is completely divorced Irom the right to
trade on it. Though the impetus Ior its establishment came Irom policy Makers in the
country, it has been set up as a public limited company, owned by the leading
institutional investors in the country.

ProIessionals, who do not directly or indirectly trade on the Exchange, manage
NSE. This has eliminated any conIlict oI interest and helped NSE in aggressively
pursuing policies and practices within a public interest Iramework. The NSE model
accommodates involvement, support and contribution oI trading members in a variety oI
ways.

The board comprises oI senior executives Irom promoter institutions, eminent
proIessionals in the Iields oI law, economics, accountancy, Iinance, taxation, etc, public
representatives, nominees oI SEBI and one Iull time executive oI the exchange. The day-
to-day management oI the Exchange is delegated to the Managing Director who is
supported by a team oI professional staII.


NSE Technology
NSE believes that technology
1. will save competitive edge
2. ensure timeliness
3. give satisIaction in customer service.
4. change the shape oI the securities industry
5. provide innovation sustained investment in technology.

It uses participation Irom around 400 cities spread all over the country is possible
because oI satellite communication technology. Up gradation oI trading hardware, NSE
can handle up to 1 million trades per day. NSE has also put in place NIBIS (NSE's
Internet Based InIormation System) Ior on-line real-time dissemination oI trading
inIormation over the internet. In order to capitalize on in-house expertise in technology,
NSE set up a separate company, NSE.IT, in October 1999.
This is expected to provide a platIorm Ior taking up new IT assignments both
within and outside India and attaining global exposure. NEAT is a state-oI-the-art client
server based application. At the server end, all trading inIormation is stored in an in-
memory database to achieve minimum response time and maximum system availability
Ior users. The trading server soItware runs on a Iault tolerant STRATUS mainIrame
computer while the client soItware runs under Windows on PCs. The telecommunications
network uses X.25 protocol and is the backbone oI the automated trading system.


Each trading member trades on the NSE with other members through a PC
located in the trading member's oIIice, anywhere in India. The trading members on the
Wholesale Debt Market segment are linked to the central computer at the NSE through
dedicated 64Kbps leased lines and VSAT terminals. These leased lines are multiplexed
using dedicated 2 Mbps, optical-Iibre links. The WDM participants connect to the trading
system through dial-up links. The Exchange uses powerIul RISC -based UNIX servers,
procured Irom Digital and HP Ior the back oIIice processing. The latest soItware
platIorms like ORACLE 7 RDBMS, GUPTA - SQL/ORACLE FORMS 4.5 Front - Ends,
etc. have been used Ior the Exchange applications.

The Exchange currently manages its data centre operations, system and database
administration, design and development oI in-house systems and design and
implementation oI Telecommunication solutions. NSE is one oI the largest interactive
VSAT based stock exchanges in the world. Today it supports more than 3000 VSATs and
is expected to grow to more than 4000 VSATs in the next year.

NSE- network is the largest private wide area network in the country and the Iirst
extended C- Band VSAT network in the world. Currently more than 9000 users are
trading on the real time-online NSE application. There are over 15 large computer
systems, which include non-stop Iault-tolerant computers and high-end UNIX servers,

operational under one rooI to support the NSE applications. This coupled with the
nation wide VSAT network makes NSE the country's largest InIormation Technology
user.

In an ongoing eIIort to improve NSE's inIrastructure, a corporate network has
been implemented, connecting all the oIIices at Mumbai, Delhi, Calcutta and Chennai.
This corporate network enables speedy inter-oIIice communications, data, and voice
connectivity between oIIices. In keeping with the current trend, NSE has gone online on
the Internet. Apart Irom having a 2mbps link to VSNL and our own domain Ior internal
browsing and e-mail purposes, we have also set up our own Web site. Currently, NSE is
displaying its live stock quotes on the web site (www.nseindia.com) which are updated
online.
Circuit Breakers:
The Exchange has implemented index-based market-wide circuit breakers in
compulsory rolling settlement with eIIect Irom July 02, 2001. In addition to the circuit
breakers, price bands are also applicable on individual securities.

Index-based Market-wide Circuit Breakers:
The index-based market-wide circuit breaker system applies at 3 stages oI the
index movement, either way viz. at 10, 15 and 20. These circuit breakers when
triggered bring about a coordinated trading halt in all equity and equity derivative
markets nationwide. Movement oI either the BSE Sensex or the NSE S&P CNX NiIty,
whichever is breached earlier, triggers the market-wide circuit breakers.
O In case oI a 10 movement oI either oI these indices, there would be a one-
hour market halt iI the movement takes place beIore 1:00 p.m. In case the movement
takes place at or aIter 1:00 p.m. but beIore 2:30 p.m. there would be trading halt Ior
hour. In case movement takes place at or aIter 2:30 p.m. there will be no trading halt at
the 10 level and market shall continue trading.

O In case oI a 15 movement oI either index, there shall be a two-hour halt iI
the movement takes place beIore 1 p.m. II the 15 trigger is reached on or aIter 1:00p.m.
but beIore 2:00 p.m., there shall be a one-hour halt. II the 15 trigger is reached on or
aIter 2:00 p.m., the trading shall halt Ior remainder oI the day.
O In case oI a 20 movement oI the index, trading shall be halted Ior the
remainder oI the day. These percentages are translated into absolute points oI index
variations on a quarterly basis. At the end oI each quarter, these absolute points oI index
variations are revised Ior the applicability Ior the next quarter. The absolute points are
calculated based on closing level oI index on the last day oI the trading in a quarter and
rounded oII to the nearest 10 points in case oI S&P CNX NiIty.

Internet Trading at NSE
NSE became the Iirst exchange to grant approval to its members Ior providing
Internet based trading services. In line with SEBI directives, NSE has issued circulars
detailing the requirements and procedures to be complied with by members desirous oI
providing Internet based trading and services.

The volume oI daily trade in NSE is around Rs.5000 to Rs.8000 crores. The
market capitalization oI listed companies is Rs.2.52 lakh crores. There are more than
2000 permitted securities Ior trading but the daily turnover was done around 800
securities in NSE.


Operations oI the National stock market system:
Trading operations
Post trading operations
National clearing and settlement Iacilities

National stock exchange will operate two segments, debt market and equity
market and operations in both are separately maintained. All medium and large sized
companies with paid-up equity oI Rs.10 crores and above eligible to be listed on regular
stock exchanges can be listed on NSE. The index in NSE is NIFTY`.

NSE started Online Scripless Trading in India in the year 1994. Trading system
used in NSE online trade in National Exchange Ior Automated Trading` (NEAT) system.
Trading network can be spread all over the country depending on the electronic link
through the satellite. A rolling settlement system operates in NSE with settlement period
oI T1. Funds and securities are exchanged by passing electronically proper debit and
credit entries. Volume oI NSE is more and access is Iaster in NSE. NSE is the market
leader with over 40 oI total turnover in 1999-2000.
NIFTY:
It stands Ior National Index 50, which gives the stock market trends oI NSE by
selecting top 50 companies based on capitalization.

Benefits of Stock Exchange:
The beneIits oI stock Exchanges can be studied under the Iollowing
headings:

1. Advantages to the companies:
O Ready markets Ior securities
O Increase in price.
O Increase in goodwill.
O Agent between companies and the investors.
2. Advantages to the investors:
O SaIety oI investment
O Best use oI capital
O More collateral value.
O Publication oI price list oI securities
O PowerIul hedge against inIlation.
3. Advantages to the society:
O HelpIul in industrialization
O Increase in rater oI capital Iormation.
O Savings are encouraged.
O Incentive Ior eIIiciency.
O Government can raised Iunds Ior imports projects. Provides a mirror to reIlect
general economic conditions.


NATIONAL STOCK EXCHANGE:
Organization:
The oIIicial name oI National Stock Exchange (NSE) is The National
Stock Exchange OI India Limited, a public limited company incorporated under the
companies act, 1956. It is located in Worli in the near oI Mumbai.

The NSE was incorporated in November 1992 on the initiative oI the
Indian government. It promoters include the Industrial Development Bank oI India, LiIe
Insurance Corporation oI India, General Insurance Corporation oI India, Industrial
Finance Corporation oI India Ltd., the State Bank oI India and several other highly
reputed Iinancial institutions in India. They represent major and important participants in
the Indian Iixed income and equity markets.

The NSE primarily operates two market segments.
1) The wholesale debt market segment
2) The capital market segment

The ownership and management oI the NSE is completely separate Irom
its members` right to trade on the exchange. It is owned by the promoters and other
Iinancial institutions and not by its trading members. Hence, the management has no
trading interest. It managed by a board oI directors which delegated decisions on market
operations to the executive committee.


The board oI directors oI the exchange has 15 directors: no elected
member brokers, no public representatives, and 3 nominee oI the SEBI, no nominee oI
the RBI, 2 eminent persons, 2 directors Irom the NSE management, and 8 nominees oI
the shareholder institutions. It is worth nothing that the composition oI the NSE`s board
is signiIicantly diIIerent Irom that oI the BSE`s board. The majority oI the NSE`s board is
represented by institutions aIIiliated to or under material inIluence oI the central
government, while that oI the BSE board is comprised by non-governmental members.

SEBI`S ROLE IN A STOCK EXCHANGE:
Securities and Exchange Board oI India has been set up under the SEBI
Act, 1992 to protect the interest oI investors in securities and to promote the development
oI and regulate the securities market and Ior matters connected there with or incidental
thereto.

SEBI`S Power in Relation to Stock Exchange:
The SEBI ordinance has given it the Iollowing powers:
(i) It may call periodical return Irom stock exchanges.
(ii) It has the power to prescribe maintenance oI certain documents by the
stock exchange.
(iii) SEBI may call upon the exchange or any member to Iurnish explanation or
inIormation relating to the aIIairs oI the stock exchange or any members.
(iv) It has power to approve Bye-Laws oI the stock exchange Ior regulation
and control oI the contracts.


(v) It can amend bye-laws oI stock exchange.
(vi) In certain areas, it can license the dealers in securities.
(vii) It can compel a public company to list its shares.

II Central Government is oI the opinion that the governing body oI any
recognized stock exchange should be superceded then it may give a written notice
speciIying the reasons Ior such action. AIter giving opportunity to the governing body it
may supercede it and appoint person or persons to exercise and perIorm all the powers
and duties oI governing body.

ORGANISATION AND GROWTH OF STOCK EXCHANGES:
Stock Exchanges in India are organized in any oI the Iollowing Iorms:
(a) Voluntary, non-proIit making associations, e.g., Bombay. Ahmedabad and
Indore;
(b) Public Limited Companies such as Calcutta, Delhi and Bangalore stock
exchanges; and
(c) Company Limited by guarantee, e.g.; Hyderabad and Madras stock
exchanges.


WEAKNESS OF STOCK EXCHANGES:

The stock exchanges in India suIIer Irom a number oI weaknesses.
Principal weaknesses are discussed as Iollows:
1. Lack oI ProIessionalism
2. Domination oI Financial Institutions
3. Poor Liquidity
4. Domination by Big Operators
5. Less Floating Stocks
6. Speculative Tradingig.1
Fig.2


Historical Data for S&P CNX NIFTY
For the period 01-06-2011 to 30-06-2011
Date Open High Low CIose Shares Traded
Turnover
( Cr)
01-Jun-2011 5561.05 5597.35 5559.45 5592.00 98629277 4670.86
02-Jun-2011 5529.90 5568.20 5521.95 5550.35 110949186 4709.42
03-Jun-2011 5565.70 5604.95 5507.20 5516.75 101017578 4757.10
06-Jun-2011 5504.30 5542.65 5479.85 5532.05 77137320 3486.68
07-Jun-2011 5509.15 5570.10 5507.80 5556.15 81858402 3830.70
08-Jun-2011 5535.25 5556.60 5514.90 5526.85 92928675 3869.33
09-Jun-2011 5523.55 5540.10 5502.05 5521.05 87033655 3859.17
10-Jun-2011 5518.05 5521.45 5457.45 5485.80 84190282 3995.15
13-Jun-2011 5469.85 5496.70 5436.95 5482.80 80104906 3807.22
14-Jun-2011 5485.60 5520.15 5484.20 5500.50 97840485 4714.26
15-Jun-2011 5494.45 5499.35 5438.95 5447.50 95878889 4562.47
16-Jun-2011 5419.65 5447.50 5389.80 5396.75 128063494 5341.03
17-Jun-2011 5412.50 5421.15 5355.85 5366.40 97876272 4480.59
20-Jun-2011 5372.20 5377.40 5195.90 5257.90 135334880 5956.17
21-Jun-2011 5280.80 5322.45 5257.00 5275.85 107191673 4765.02
22-Jun-2011 5304.65 5310.50 5262.50 5278.30 95769497 4151.39
23-Jun-2011 5269.10 5330.60 5252.25 5320.00 89001344 3756.75
24-Jun-2011 5343.40 5477.85 5343.40 5471.25 140100077 6791.80
27-Jun-2011 5441.20 5552.65 5434.25 5526.60 143402407 6707.54
28-Jun-2011 5548.85 5558.30 5496.35 5545.30 114413706 5127.85
29-Jun-2011 5566.50 5608.65 5566.50 5600.45 124593981 5463.96
30-Jun-2011 5614.50 5657.90 5606.10 5647.40 179224275 8133.27


Interpretation:
The NIFTY graph shows we can observe that they are lot oI Iluctuations in the
movement oI NIFTY. Where it is maximum price on the Iirst day and got down in the
middle oI the month. In this month market Ialls down upto 29 th june it raising and get
back to the positive trends in the market, and it raises aIter at end oI the month at
5614Rs. their share .


Historical Security-wise Price Volume Data
Data for WIPRO - EQ from 01-06-2011 to 30-06-2011

SymboI Series Date Prev CIose Open Price High Price Low Price Last Price CIose Price
Average
Price
TotaI Traded
Quantity
Turnover
in Lacs
WIPRO EQ 01-Jun-2011 446.40 445.10 450.90 445.10 448.40 448.30 448.07 446583 2001.00
WIPRO EQ 02-Jun-2011 448.30 445.00 447.45 441.30 442.00 442.95 443.49 619349 2746.72
WIPRO EQ 03-Jun-2011 442.95 439.00 449.90 439.00 443.00 443.10 444.68 545229 2424.54
WIPRO EQ 06-Jun-2011 443.10 442.00 446.95 438.00 444.25 445.05 442.88 390150 1727.91
WIPRO EQ 07-Jun-2011 445.05 442.50 444.50 439.55 441.00 440.60 441.88 941417 4159.95
WIPRO EQ 08-Jun-2011 440.60 441.80 443.30 437.60 442.00 441.20 440.86 440868 1943.59
WIPRO EQ 09-Jun-2011 441.20 440.50 442.55 435.50 439.00 438.80 437.90 922040 4037.65
WIPRO EQ 10-Jun-2011 438.80 437.80 442.00 434.10 438.50 437.45 437.89 718479 3146.15
WIPRO EQ 13-Jun-2011 437.45 434.45 438.50 432.60 436.00 435.45 435.84 689026 3003.05
WIPRO EQ 14-Jun-2011 435.45 435.50 440.00 435.50 436.55 436.85 438.32 456835 2002.38
WIPRO EQ 15-Jun-2011 436.85 437.00 438.45 422.15 425.00 424.40 427.95 2074171 8876.47
WIPRO EQ 16-Jun-2011 424.40 422.65 423.00 414.75 416.00 416.05 417.26 1129049 4711.10
WIPRO EQ 17-Jun-2011 416.05 413.60 418.90 408.00 408.30 408.85 412.33 747507 3082.20
WIPRO EQ 20-Jun-2011 408.85 410.00 412.45 381.45 405.50 402.30 401.19 1829456 7339.57
WIPRO EQ 21-Jun-2011 402.30 402.60 405.50 395.50 402.00 402.40 400.94 1005952 4033.22
WIPRO EQ 22-Jun-2011 402.40 402.60 408.95 401.50 405.00 403.80 404.72 836570 3385.77
WIPRO EQ 23-Jun-2011 403.80 402.25 412.00 402.25 409.80 409.90 409.81 808957 3315.15
WIPRO EQ 24-Jun-2011 409.90 409.60 425.80 408.10 424.35 424.20 419.83 1119691 4700.80
WIPRO EQ 27-Jun-2011 424.20 422.45 428.30 418.30 422.50 422.65 423.42 892746 3780.06
WIPRO EQ 28-Jun-2011 422.65 421.10 424.00 413.00 418.30 419.10 416.67 1311855 5466.06
WIPRO EQ 29-Jun-2011 419.10 418.70 422.70 417.75 421.00 420.55 420.53 785460 3303.12
WIPRO EQ 30-Jun-2011 420.55 422.45 424.05 411.60 417.50 417.60 416.74 1555322 6481.65


Interpretation: -
From the above graph we can see that the scrip price oI the WIPRO has Iaced lot
oI Iluctuations in its movement. Where on 2
th
june 2011. it reached max value oI
448.00 Rs but on 23
th
june it has reached to the lowest value oI 402.00 Rs. But at the end
oI the day has a rais value oI 420.00 Rs due to some external Iactors like growth oI
GDP and increasing rupee value etc..

Series Date Prev CIose Open Price High Price Low Price Last Price CIose Price
Average
Price
TotaI Traded
Quantity
Turnover
in Lacs
EROONDA EQ 01-Jun-2011 1854.75 1845.10 1875.05 1845.10 1856.00 1863.35 1860.14 238865 4443.22
EROONDA EQ 02-Jun-2011 1863.35 1851.25 1889.00 1847.45 1868.50 1871.15 1873.65 460843 8634.57
EROONDA EQ 03-Jun-2011 1871.15 1872.00 1883.90 1850.00 1855.25 1861.10 1864.41 163034 3039.63
EROONDA EQ 06-Jun-2011 1861.10 1869.95 1869.95 1836.05 1865.00 1860.50 1852.32 121572 2251.90
EROONDA EQ 07-Jun-2011 1860.50 1868.70 1868.70 1828.25 1830.00 1832.95 1841.06 225451 4150.70
EROONDA EQ 08-Jun-2011 1832.95 1829.00 1829.00 1759.05 1765.00 1763.90 1784.27 524850 9364.72
EROONDA EQ 09-Jun-2011 1763.90 1768.90 1785.90 1736.35 1738.25 1741.80 1754.54 735214 12899.60
EROONDA EQ 10-Jun-2011 1741.80 1747.25 1753.90 1713.05 1719.95 1724.40 1725.24 542605 9361.22
EROONDA EQ 13-Jun-2011 1724.40 1715.00 1747.40 1708.50 1735.20 1734.70 1730.73 360844 6245.23
EROONDA EQ 14-Jun-2011 1734.70 1735.00 1756.60 1731.15 1735.00 1736.15 1743.15 222867 3884.90
EROONDA EQ 15-Jun-2011 1736.15 1735.35 1755.00 1725.75 1747.00 1746.95 1740.30 213531 3716.08
EROONDA EQ 16-Jun-2011 1746.95 1739.00 1754.95 1731.00 1735.00 1736.85 1739.08 164588 2862.32
EROONDA EQ 17-Jun-2011 1736.85 1726.10 1745.00 1725.05 1733.50 1731.70 1734.78 287182 4981.96
EROONDA EQ 20-Jun-2011 1731.70 1726.55 1752.65 1726.55 1740.00 1740.25 1740.57 462979 8058.49
EROONDA EQ 21-Jun-2011 1740.25 1747.00 1778.40 1741.10 1756.75 1762.35 1762.54 239719 4225.13
EROONDA EQ 22-Jun-2011 1762.35 1763.00 1778.80 1727.10 1742.00 1747.95 1761.87 218404 3847.99
EROONDA EQ 23-Jun-2011 1747.95 1732.05 1768.45 1717.05 1764.90 1763.20 1754.61 353597 6204.23
EROONDA EQ 24-Jun-2011 1763.20 1768.00 1871.80 1768.00 1863.80 1864.75 1844.83 863114 15923.02
EROONDA EQ 27-Jun-2011 1864.75 1833.10 1865.50 1833.10 1852.00 1852.20 1852.51 457678 8478.52
EROONDA EQ 28-Jun-2011 1852.20 1850.05 1864.85 1835.50 1847.00 1846.95 1847.45 259402 4792.33
EROONDA EQ 29-Jun-2011 1846.95 1844.00 1878.75 1840.80 1851.00 1848.95 1860.32 447214 8319.61
EROONDA EQ 30-Jun-2011 1848.95 1847.00 1887.50 1842.00 1859.80 1877.20 1874.34 596638 11183.01

Data for HEROHONDA - EQ from 01-06-2011 to 30-06-2011


Interpretation: -
The HERO HONDA graph shows scrip movements in the month oI June
beginning oI month it has a low price at 1854 Rs and slowly it decresed and we can see
slight Iluctuations in this graph. Later on it declines scrip price on 30
th
June, at
1848.95Rs only. Because oI some internal Iactors and sentimental conditions oI
investors.


Data for ICICIBANK - EQ from 01-06-2011 to 30-06-2011

Average
Price
TotaI Traded
Quantity
Turnover
in Lacs
ICICIBANK EQ 01-Jun-2011 1086.10 1083.80 1088.50 1069.05 1084.80 1084.70 1078.91 2725196 29402.52
ICICIBANK EQ 02-Jun-2011 1084.70 1061.70 1062.00 1042.40 1051.10 1048.90 1053.89 2952892 31120.33
ICICIBANK EQ 03-Jun-2011 1048.90 1055.00 1068.00 1041.10 1051.05 1047.40 1056.13 2183795 23063.70
ICICIBANK EQ 06-Jun-2011 1047.40 1040.00 1064.00 1035.50 1059.45 1058.05 1048.19 1462591 15330.77
ICICIBANK EQ 07-Jun-2011 1058.05 1050.30 1063.75 1050.05 1055.95 1056.15 1058.22 1368471 14481.38
ICICIBANK EQ 08-Jun-2011 1056.15 1050.15 1062.40 1040.00 1051.00 1049.05 1052.04 1360757 14315.74
ICICIBANK EQ 09-Jun-2011 1049.05 1045.00 1056.90 1042.50 1047.40 1048.00 1049.85 2136522 22430.23
ICICIBANK EQ 10-Jun-2011 1048.00 1050.00 1050.00 1026.60 1034.50 1035.90 1036.38 2151221 22294.87
ICICIBANK EQ 13-Jun-2011 1035.90 1030.20 1046.00 1027.95 1043.10 1039.60 1037.74 1874470 19452.13
ICICIBANK EQ 14-Jun-2011 1039.60 1041.00 1057.45 1041.00 1055.55 1055.55 1051.98 2474880 26035.33
ICICIBANK EQ 15-Jun-2011 1055.55 1051.00 1053.80 1027.20 1035.05 1031.15 1039.14 1830712 19023.61
ICICIBANK EQ 16-Jun-2011 1031.15 1020.00 1043.90 1018.10 1028.50 1028.50 1032.03 3102463 32018.43
ICICIBANK EQ 17-Jun-2011 1028.50 1039.90 1039.90 1024.05 1029.00 1032.20 1030.15 1612367 16609.88
ICICIBANK EQ 20-Jun-2011 1032.20 1030.90 1041.80 1010.00 1026.00 1024.85 1028.98 3141587 32326.46
ICICIBANK EQ 21-Jun-2011 1024.85 1026.70 1038.00 1003.40 1015.55 1014.00 1023.73 4634995 47450.05
ICICIBANK EQ 22-Jun-2011 1014.00 1024.35 1027.40 1010.00 1020.60 1018.90 1019.17 2776052 28292.69
ICICIBANK EQ 23-Jun-2011 1018.90 1016.00 1035.95 1014.35 1030.00 1030.20 1029.15 2977981 30647.89
ICICIBANK EQ 24-Jun-2011 1030.20 1035.10 1068.90 1035.00 1061.70 1064.10 1057.57 5530183 58485.65
ICICIBANK EQ 27-Jun-2011 1064.10 1054.40 1084.75 1047.20 1083.00 1079.40 1072.58 5798430 62192.87
ICICIBANK EQ 28-Jun-2011 1079.40 1080.00 1092.00 1073.35 1077.15 1083.30 1084.06 3380134 36642.52
ICICIBANK EQ 29-Jun-2011 1083.30 1089.90 1094.70 1083.50 1090.00 1087.25 1087.85 4278928 46548.17
ICICIBANK EQ 30-Jun-2011 1087.25 1091.00 1099.50 1077.00 1090.75 1094.65 1092.47 5501188 60098.85


Interpretation: -
The above graph shows on 01
st
June its has at 1086.10 Rs share value. It has
diIIerent Iluctuations in the middle oI month on 15
th
June it reached at 1055.00 Rs later
on it keeps goes on down slowly and increased at end oI the month on 30
th
June at
1087.25Rs. Due to some external Iactors oI ICICI like rupee appreciation and etc. this
aIIected the market situations.


Data for TCS - ALL from 01-06-2011 to 30-06-2011
Average
Price
TotaI Traded
Quantity
Turnover
in Lacs
%CS EQ 01-Jun-2011 1157.15 1157.00 1177.00 1157.00 1174.70 1175.40 1171.25 491193 5753.11
%CS EQ 02-Jun-2011 1175.40 1158.90 1172.00 1156.65 1170.00 1167.75 1163.45 848827 9875.70
%CS EQ 03-Jun-2011 1167.75 1166.00 1175.00 1150.00 1153.00 1152.10 1157.15 683904 7913.79
%CS EQ 06-Jun-2011 1152.10 1140.00 1168.00 1140.00 1167.00 1164.35 1156.70 678537 7848.63
%CS EQ 07-Jun-2011 1164.35 1163.00 1183.15 1158.00 1180.00 1179.30 1175.19 918721 10796.73
%CS EQ 08-Jun-2011 1179.30 1171.90 1185.00 1163.50 1180.50 1181.40 1176.87 1063835 12519.92
%CS EQ 09-Jun-2011 1181.40 1175.00 1193.80 1175.00 1182.00 1186.35 1188.17 1346983 16004.48
%CS EQ 10-Jun-2011 1186.35 1186.55 1197.50 1185.10 1190.00 1189.20 1192.21 1887275 22500.23
%CS EQ 13-Jun-2011 1189.20 1189.20 1190.50 1172.55 1176.45 1175.30 1180.22 1614700 19056.97
%CS EQ 14-Jun-2011 1175.30 1178.00 1194.90 1178.00 1194.30 1191.05 1186.60 1062891 12612.32
%CS EQ 15-Jun-2011 1191.05 1186.00 1205.00 1181.25 1183.10 1184.25 1192.24 1406191 16765.20
%CS EQ 16-Jun-2011 1184.25 1183.00 1185.90 1148.25 1150.00 1151.15 1163.63 1168760 13600.09
%CS EQ 17-Jun-2011 1151.15 1155.00 1157.00 1104.00 1117.40 1109.20 1120.41 1894073 21221.41
%CS EQ 20-Jun-2011 1109.20 1115.00 1119.00 1058.00 1072.80 1069.30 1079.12 2655204 28652.84
%CS EQ 21-Jun-2011 1069.30 1075.00 1110.70 1063.20 1107.00 1106.75 1095.37 1712973 18763.47
%CS EQ 22-Jun-2011 1106.75 1116.00 1116.90 1080.00 1081.80 1083.50 1090.56 1785417 19471.07
%CS EQ 23-Jun-2011 1083.50 1081.80 1101.00 1070.10 1098.90 1097.00 1087.67 1214118 13205.55
%CS EQ 24-Jun-2011 1097.00 1100.00 1140.75 1099.00 1137.00 1137.75 1126.76 2075794 23389.13
%CS EQ 27-Jun-2011 1137.75 1122.00 1154.70 1122.00 1153.10 1150.60 1145.90 1562609 17905.95
%CS EQ 28-Jun-2011 1150.60 1160.00 1162.00 1135.65 1153.00 1154.00 1148.87 1066666 12254.63
%CS EQ 29-Jun-2011 1154.00 1154.70 1178.90 1154.70 1170.00 1169.85 1171.55 1479352 17331.40
%CS EQ 30-Jun-2011 1169.85 1169.80 1192.00 1167.00 1180.00 1184.20 1179.04 2586458 30495.25


Interpretation:

The TCS graph shows on 1
st
June, it has price oI 1157.00 Rs. And it
shows some Iluctuations during the month. It shows the price value ups and down in this
month, suddenly iI Ialls down on 17
th
June at 1151.15 Rs. and suddenly it raised on 27
th

June at 1137.75 Rs. Later, it raises slowly at the end oI on 15
th
June it has the highest
price oI month at 1191.00 Rs due to good market conditions and perIormance oI the
contributed to the raise oI scrip value.

FINDINGS
Steel City Securities Limited established in the year 1995 is a stock
broking company operating in Andhra Pradesh, Orissa, Karnataka and
TamilNadu.
In SCSL, trading in NSE, BSE, NCDEX and MCX is done on diIIerent
terminals.
Trading in NSE is done through National Exchange Ior Automated
Trading (NEAT) system.
As soon as the trade ends, the client settlement and reports oI the trading
are made by the back oIIice.
Bills are prepared and the brokerage commission, service tax, stamp duty
and security transaction tax are charged to the clients in this process.
In SCSL, rolling settlement is used to settle the accounts oI the clients.
Apart Irom online trading, de-mat oI securities is done in the DP block oI
SCSL.
Daily market inIormation is collected and updated to enable the investors
to invest in proIitable shares.
In this month market Iall down up to 7
th
April and Irom 8
th
April, it rising
and get, back to the positive trends in the market. The reason Ior the NiIty
down Iall and rise aIter 9
th
April was due to the weak currency and the
banking shares perIormed well.

In this month market Iall down up to 8
th
June and Irom 11
th
June, it is rising
and get back to the positive trends in the market. Bank shares and cement
shares helped the NiIty to move in positive trends.

SUGGESITIONS

Theoretical knowledge about the stocks and markets is essential Ior the
staII in trading section.
Periodically they should review the brokerage charges.
Well experienced computer operators should operate to reduce errors in
trading, as a small error may tie-up the whole trading Ior the day.
Provide training program`s to the employees in order to get them adjusted
to the changes in the stock market.
SCSL can expand its branches to cities having potential markets.
Provide newsletters Ior investors and employees to know about the capital
market and commodities market.


SUMMARY
The Iocus oI the study was on Online Trading in Steel City Securities
Limited, Visakhapatnam with an objective to study and understand the real process oI
stock trading.
The on-line trading in NSE is done through National Exchange Ior
Automated Trading (NEAT) system. Trading is done in the 2 types oI markets oI the
NEAT system namely capital market and derivatives market.
SCSL, which was set up in November 1995, is a stock broking company.
It is a trading member oI NSE, BSE, MCX and NCDEX.
Screen based trading system electronically matches the buyer and seller in
an order-driven system or Iinds the customer the best price available in quote driven
system.
Today, in India almost 100 trading takes place through electronic order
matching.
In online trading Back OIIice provide the clients with all the trading
related services in the post market session.
Depository participant has attained signiIicance aIter the implementation
oI de-matting oI shares. The DP will maintain the securities account balances and
transIer the shares electronically.
Trading activities in stock market include delivery or payment, settlement
procedure, auctions and clearing procedure.

BIBLIOGRAPHY
ReIerence Books:

SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT
- PUNITHAVATHY PANDIAN
SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT
- RONALD J.JORDAN & DONALD E.FISHER
- (Prentice Hall OI India)
INVESTMENT MANAGEMENT
- V.K.BHALLA
FINANCIAL MANAGEMENT
- KHAN & JAIN
FINANCIAL INSTITUTIONS AND MARKETS
- L.M.BHOLE
JOURNALS:
THE HINDU BUSINESS LINE
ECONOMIC TIMES
BUSINESS WORLD
CAPITAL MARKET (DEALERS) WORKBOOK
MONEY LIFE


WEBSITES:
www.nseindia.com
www.bseindia.com
www.steelcitynettrade.com
www.sebiindia.com
www.moneycontrol.com
www.yahooIinance.com
www.google.com

ABRIVATIONS
ALBM Automated Lending & Borrowing Mechanism
BSE Bombay Stock Exchange
CDSL Central Depositary Services Limited
CM`s Clearing Members
CM-BP-ID Clearing Member Business Partner IdentiIication Number
DIS Delivery Instructions Slip
DP Depository Participant
DRF Dematerialization Request Form
FII`s Foreign Institutional Investors
ISIN International Securities IdentiIication Number
IPO Initial Public OIIer
LAN Local Area Network
NBFC`s Non - Banking Finance Companies
NCFM National CertiIication in Financial Market
NEAT National Exchange Ior Automated Trading
NSCCL National Securities Clearing Corporation Limited
NSDL National Securities Depository Limited
NSE National Stock Exchange
RAS Remote Access Service
SCSL Steel City Securities Limited
SCCSPL Steel City Capital Services Private Limited
SCCPL Steel City Commodities Private Limited
SEBI Securities and Exchange Board oI India

SEBI Act Securities and Exchange Board oI India Act
SHCIL Stock Holding Corporation oI India Limited
TWS Trading Work Station
VSAT Very Small Aperture Terminal
WAN Wide Area Network

Stock Market Analysis of Steel City Securities Ltd

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STEEL CITY SECURITIES LIMITED, VISAKHAPATNAM

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