AN INTRODUCTION TO INDIAN STOCK MARKET

THE MARKET 

The stock market in India is one of the oldest and most developed in Asia. The Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) are the two main stock exchanges in India. The market capitalization of the Indian stock market is about $2 trillion as of March 2018.

The Indian stock market has been open to foreign investors since 1992. Foreign investors can invest in Indian stocks through two ways: the primary market and the secondary market. In the primary market, foreign investors can invest in Indian stocks by buying shares in an initial public offering (IPO). In the secondary market, foreign investors can buy Indian stocks from other investors in the stock market.

The Indian stock market is regulated by the Securities and Exchange Board of India (SEBI). SEBI is responsible for protecting the interests of investors in the stock market and regulating the functioning of the stock exchanges and the securities industry in India.

The Bombay Stock Exchange (BSE) is the oldest stock exchange in Asia and the first stock exchange in India. Established in 1875, it is located in Mumbai, India and has a market capitalization of over $2 trillion. The BSE is a popular destination for investors and traders from all over the world, with over 5,500 listed companies, making it one of the largest stock exchanges in the world.

BOMBAY STOCK EXCHANGE (BSE)

The Bombay Stock Exchange was founded in 1875 as the Native Share and Stock Brokers' Association. In 1956, the BSE became the first stock exchange in India to be recognized by the Indian government under the Securities Contracts (Regulation) Act. Since then, the BSE has grown to become the leading stock exchange in India, with a number of high-profile companies listed on its platform.

Trading at the BSE

The BSE offers a number of different trading platforms, including a web-based trading platform, a mobile app, and a desktop trading application. The exchange operates on a fully electronic trading platform, allowing investors to buy and sell securities quickly and easily. The BSE also offers a range of derivatives products, including futures and options on equities, currencies, and commodities.

Listing at the BSE

The BSE has strict listing requirements, which companies must meet in order to be listed on the exchange. In order to list on the BSE, a company must have a minimum paid-up capital of Rs. 1 crore and a track record of profitability for at least three years. Additionally, companies must comply with all of the regulations set out by the Securities and Exchange Board of India (SEBI).

The BSE Sensex

The BSE Sensex is an index of the top 30 companies listed on the BSE, based on market capitalization. The index is widely followed by investors and traders in India, as well as around the world, as an indicator of the health of the Indian stock market. The BSE Sensex is updated in real-time, allowing investors to stay up-to-date on the performance of the Indian stock market.

Conclusion

The Bombay Stock Exchange is a historic and important stock exchange in India and one of the largest stock exchanges in the world. With over 5,500 listed companies and a market capitalization of over $2 trillion, the BSE is a popular destination for investors and traders from all over the world. The BSE's strict listing requirements, fully electronic trading platform, and popular BSE Sensex index make it a vital component of the Indian financial system.

NATIONAL STOCK EXCHANGE (NSE)

The National Stock Exchange of India, or NSE, is one of the leading stock exchanges in India. Founded in 1992, it has become the preferred platform for trading securities and derivatives. It is headquartered in Mumbai, the financial capital of India, and has a market capitalization of over $2.3 trillion.

NSE offers a wide range of financial instruments such as equities, futures, options, mutual funds, bonds, and currency futures. It provides a transparent and efficient trading platform, making it easy for investors to buy and sell securities in the Indian stock market. The exchange has a state-of-the-art trading platform that provides real-time information and data to investors, ensuring that they have access to the latest market updates.

One of the key features of NSE is its electronic trading system, which allows for seamless trading of securities. It is one of the first stock exchanges in the world to adopt an electronic trading system, which has made it more accessible to investors from across the globe. The exchange operates on a fully automated trading platform called NEAT (National Exchange for Automated Trading), which ensures that trading is fair, efficient, and transparent.

The NSE has a unique index called the NIFTY 50, which is a benchmark index of the Indian stock market. The index comprises the top 50 companies listed on the exchange based on market capitalization. The NIFTY 50 is widely used by investors and analysts to track the performance of the Indian stock market.

The NSE has several advantages over other stock exchanges in India. Firstly, it has a robust trading platform that ensures quick and efficient trading of securities. Secondly, it is one of the most transparent and fair exchanges in India, ensuring that investors can trust the exchange. Finally, it is one of the most innovative exchanges in the world, constantly introducing new financial instruments to attract investors.

In conclusion, the NSE has revolutionized the Indian stock market by providing a transparent and efficient platform for trading securities. Its electronic trading system and innovative financial instruments have made it one of the most attractive stock exchanges in the world. With its commitment to transparency, efficiency, and innovation, the NSE is poised to remain a leading stock exchange in India for years to come.

Written by,                      

CA Soumyaranjan sahu.