Beruflich Dokumente
Kultur Dokumente
DECLARATION
I hereby declare that the project report entitled “The role of Depositary participant “is the
joint result of my work with SHCIL & personal efforts. This report is genenuily prepared by
me with the help of my teacher & SHCIL management. This summer internship project
Date: Signature:
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ACKNOWLEDGEMENT
I would like to thanks my Institution (PSIT) and my teachers who provide me an opportunity
to work with stock Holding Corporation of India Limited (SHCIL) for a period of five weeks
summer training. It was a great time to work with organization, where I learnt a lot.
I would like to extend my thanks to internal guide Mrs. Shubhra Johri PSIT & Mr. Vinay
Kumar Singh, Branch Manager, SHCIL Kanpur for their support in completing my summer
training.
I would also like to thanks Mr. Satya Singh, SHCIL for his kind support & guidance which
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CERTIFICATE OF THE COMPANY
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TABLE OF CONTENTS
Chapter-1 6
Executive Summary 9
Chapter-2
• Research Methodology 10
• Primary Objective(s) 10
• Objective 11
• Scope 12
• Limitation 13
Chapter-3 15
• Company Profile 14
• Mission 15
• Vision 15
• IPO 26
• Capital Market 31
• Primary Market 35
• Secondary Market 37
• Depository System 40
• NSDL 41
• CSDL 42
SWOT Analysis 81
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Data Analysis 85
Chapter-5 97
• Conclusion 100
Chapter-6 101
Bibliography 102
Chapter-7 103
Questionnaire 104
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CHAPTER-1
EXECUTIVE SUMMARY
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EXECUTIVE SUMMARY
The objective of the study was to do the competitive analysis of DP service and broking
service provided by SHCIL and its major competitors in Kanpur region on the basis of 7p s of
service marketing.
The study was conducted to measure the customer satisfaction level of SHCIL. Study was
focuses on clients within Kanpur region. SHCIL provides many products and services but we
Outcome of the analysis shows that though SHCIL is on the top position as a market share in
Kanpur region, but SHCIL is still behind in many more factors and they need to improve
those factors. Some recommendations are given to improve. (Project study has been done
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CHAPTER-2
RESEARCH METHODOLOGY
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RESEARCH METHODOLOGY
• Significance of the study: Improve the goodwill and Creating potential customer
base.
• Universe: Investor
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To find out the consumer way towards depository towards SHCIL and analyze the
involved.
To understand the market sentiment affects the market and depository participant
role.
This report is prepared by marketing research carried out in Kanpur city. This can be further
utilized in other similar cities for the concentration. This can be found use full to students,
academic consultants etc. for analyzing the role of depository participant and the consumer
behavior.
This report is prepared by marketing research carried out in Kanpur. This study will be
helpful for students to know in depth about the mutual fund industry and the various channels
through which a MF company operates. I had a very good market exposure while undergoing
this project because every person came forward with a different opinion and that was very
important to know the perception of the distributors. And being my first real exposure to the
corporate environment, the training period proved to be very educating and offered me a great
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This report was prepared with the mutual effort of me and SHCIL. It can be found useful to
participant and it can also be utilize by the management student and also for the professional
IMPORTANCE OF STUDY
The research was carried out to find out the importance of various roles played by depository
participant and also role played by the various consumer behavior aspects of the customer.
Since the research was done by the primary data collected to the consumer , it was some time
difficult to manage the consumers time . some of the respondent might not want to disclose
Many constraints were involved in doing this study. Some of them are as follows.
The most signified limitation has been the individuals involved in this study had a little
experience.
The sample size selected for the survey was too small as compared to large population.
The project was carried out in major areas of Kanpur region so findings on data gathered can
The data provided by the prospects may not be 100% correct as they too have their limitations.
Finding and suggestion have been given from personal point of view.
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Due to work pressure, detailed interaction with the Relationship managers and distributors
CHAPTER-3
COMPANY PROFILE
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COMPANY PROFILE
The SHCIL is a result of Government of India’s initiative as a one stop solution provider in
the financial service sector. It is one of the India’s premier custodian and depository
participant. It was jointly promoted by IDBI, ICICI, IFCI, IIBI, UTI, LIC, and GIC and its
subsidiaries.
distribution of mutual funds and other capital market instruments besides distribution of life
It is headed by luminaries from its promoter institutions who constitute its Board of Directors
and take policy decisions pertinent to the affairs of the corporation. A senior management
team that reports to the Managing Director and the CEO aids, assists and strategies business
The primary focus of the corporation was specific – to set up custodial services of
international standards in India and in the process to manage the entire array of post trade
activities of Financial Institutions and Foreign Institutional Investors with dedicated client
relationship teams and state-of the-art reporting systems. The corporation quickly garnered
nearly 70% market share of the domestic custodial business and the financial figures shot up
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With sustained market leadership, the biggest investing body of the country in its client list,
SHCIL ensures that its technology support not only holds Enormous databases together but
“To become one stop shop for all financial services”. This vision of the company is slowly
being achieved with the foray of the company into new financial services and products into its
portfolio the latest to be the Insurance product, which would be soon distributed.
To retain the No. 1 position in the DP industry by being ahead of all other DP service
To channel technology to make convenient products for financial markets that give
To reach 37 million Internet users in the years to come with ecommerce Projection
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To move with speed and ease, diversifying into new areas, considerably on others and
years to come.
To find ways to make information and reporting system more effective for the
institutional clients.
SHCIL has around 20% market share i.e. over 8 lakhs demat accounts.
SHCIL has approx, 50% market share of delivery- based transaction which amount to
2. Definitions
3. Board of directors
4. Executive committee
5. Business rules
6. Participates
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8. Securities
CREDENTIALS
SHCIL began by offering custodial and post trading services, adding depository services and
SHCIL has established itself in India as a one-stop solution provider in the Financial Services
domain.
SHCIL. Apart from being the country’s premier custodian and Depository participant,
SHCIL is also the largest professional clearing Member; backed by an immense capacity to
process volumes with precision. To give an idea of our capability, every year we process
around…….
SHCIL also provides Derivatives clearing, PF fund accounting, SGL constituent account
services, distribution of mutual funds and other capital market instruments, besides
distribution of life and non-life insurance policies.
Other offerings added to the bouquet are online net trading, loan against shares, Western
Union Money Transfer & E-stamping. In the pipeline are a host of services that will
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THEIR TECHNOLOGIES
Comprehensive business solutions adept in handling high volume time critical transactions
Oracle database currently of 1.2 Terabytes size (and growing) managed by competent
Data mirroring using cluster technology and fibre optic connection as part of Disaster
Management Plan.
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Citation and Medal from Smithsonian Institute, Washington D.C, U.S.A. for
"Visionary and Innovative use of Technology in Finance, Insurance and Real Estate".
BROKING
SHCIL in the capacity of Sub-broker has been providing Share Broking Services in
association with SHCIL SERVICES LTD. (SSL), the member Broker on BSE. Broking
Account can be opened from any of the SHCIL Branches. ONLINE trading facility may be
CLEARING MEMBER
SHCIL's long-standing association with Clearing Members has enabled it to develop services
based on an understanding of their working and their requirement for timely and accurate
information. We accept deposits of base capital and Additional base capital requirements
stipulated by NSE for clearing members trading on its capital market segment.
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Besides, our new products with a broker empanelment clause ensure a mutually beneficial tie-
up. Clearing members stand to earn a steady income from our product transactions and new
adds to their client-base, while we capitalize on their rapport with the market.
ADVANTAGES OF CM
For institutional & retail clearing members we have customized tariff for clearing members
benefiting
CM Principal Accounts
NSCCL CM Accounts
Company’s Customer Care help lines give timely and accurate information to CMs. The
Interactive Voice Response (IVR) system at SHCIL gives round the clock information on
holdings & transactions, Pay in / Pay out details, overdue cum holding details, etc.
Updated Transaction Statements are available on the website FREE of any charge
whatsoever. Members have a choice of accessing their statements date-wise for the last
one month or settlement-wise for the same period. Current trading day transactions are
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Besides the transaction statements, the Delivery-Out report, which is an extremely
critical report for Clearing Members, is also made available on the website, updated to
the hour.
Company deposits of Base Minimum Capital (Base Capital) and Additional Base Capital
as stipulated by NSE for clearing members to be able to trade on its capital market
segment.
The securities being deposited shall be subject to legal and beneficial ownership of:
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The following securities can be deposited :
Equity shares of approved companies in demat form subject to 15% margin (Nifty
scrips) and 25% margin (30 other scrips pertaining to junior Nifty group)
Unlisted units of mutual funds subject to 15% margin of the NAV of the units
Other debts securities admitted for trading on Wholesale debt market segment of
Units under scheme 1964 of UTI to be valued at the lowest of the repurchase prices
Original FDR issued by any approved Bank and drawn on specified cities
National Savings Certificate and Kisan Vikas Patra issued by Post office,
SGL Securities,
NSE members may also pledge dematerialized shares in favour of NSCCL for
security Base Capital and additional base capital requirements. The demat shares
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pledged by a member as additional base capital will be considered for the purpose of
gross exposure computation. In case of demat scrips, the following conditions apply:
The member has to open a separate beneficiary account for Base Capital and Additional
Base Capital
clearing members.
2. Pledge Instruction along with pledge deed in specified format to be given to SHCIL.
DERIVATIVES
Stock Exchange and at the Futures & Options Segment of the NSEIL respectively.
We have developed in-house Back Office systems and procedures to cater to the needs of
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Clearing - Computing obligations of all his TM’s i.e. determining Positions to settle.
CUSTODIAL
Since its commencement in 1988 as the first dedicated Custodian in the country, SHCIL has
With almost 70% of the Institutional business in its fold, SHCIL has evolved over the times to
A dedicated pool of trained and highly experienced professionals work literally round the
clock on state of the art computer systems, dedicated communication channels, well
connected to Client institutions, Stock Exchanges, Clearing houses, Depositories and leading
Institutional brokers.
In terms of collective man-years, SHCIL has the most experienced team in the Entire
Industry.
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SHCIL has specially trained personnel handling thousands of trade instructions involving
large values on sophisticated systems using digital signature on STP (Straight Through
Processing) systems, ensuring smooth trade confirmations to Stock Exchanges, reporting and
DISTRIBUTION
Stock Holding Corporation of India limited is promoted by all Indian financial institutions
FUND INVESTMENT
Fund Invest is basket of financial products ranging from fixed income investments like FDs,
Bonds, Debentures and Capital Gain Bonds to variable income products like IPOs of equities
INSURANCE
facilitates Life Insurance cover to its esteemed clients through LIC of India.
New IPO is issued almost every day in the capital markets of India. Initial Public Offering
(IPO) in India means to offer shares by a company that was not previously listed. New IPO in
India is launched through different methods like book building method, fixed price method or
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a combination of both. New IPOs in India normally have a registrar and also lead managers.
Initial Public Offering (IPO) in India is defined the selling of the shares of a company, for the
first time, to the public in the country's capital markets. This is done by giving to the public
and shares, which are either owned by the promoters of the company or by issuing new
shares. IPO in India is done through different methods like fixed price method, book building
method, or a mixture of both. The method of book building has been introduced in the country
in 1999 and it helps the company to find out the demand and price of its shares. The company
that is issuing the Initial Public Offering (IPO) decides the number of shares that it will issue
During the company's Initial Public Offering (IPO) in India, an electronic book is opened for
at least five days. During this period of time, bidding takes place that means people who are
interested in buying the shares of the company make an offer within the fixed price band.
Once the book building is closed then the issuer as well as the book runner of the Initial
Public Offering (IPO) evaluate the offers and then determine a fixed price. The main
objectives of New Initial Public Offer in India are to use the proceeds from the issue to fund
the company's plans for the expansion of operations and to meet the expenses of the issue.
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• Future Capital Holding Ltd IPO
An Initial Public Offer (IPO) is the selling of securities to the public in the primary market.
SHCIL is associated with all the leading BRLMs as a Sub Syndicate Member.
SHCIL arranges loan against securities including FD, insurance etc. It has tie-ups with
reputed banks that offer the most competitive interest rates in the market
GOI BONDS
E-STAMPING
to act as central record keeping agency (CRA). Central Record Keeping Agency is
responsible for user Registration, imprest Balance Administration and overall e-stamping
Application Operations and Maintenance. CRA will appoint ACC’s who will issue
documents. The prevailing system of physical stamp paper / franking is being replaced by E-
stamping system.
SHCIL is the only CRA appointed by the government of India Central Record Keeping
Agency is responsible for User Registration, imprest Balance Administration and overall E-
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stamping Application Operations and maintenance. CRA will appoint ACC’s who will issue
Before knowing about e-stamping one should have knowledge of stamping or stamp duty.
• It must be paid in full and on time to the government. In case of delay in payment of
• Stamp duty is paid on various instruments and some instruments are agreements,
conveyances, exchange, gift, certificate of sale, deed of partition, power of attorney to sell
immovable property when given for consideration, deed of settlement and transfer at lease by
way of assignment, bill of exchange, bill of lading, debenture, letter of credit, policy of
Stamp papers are to be purchased in the name of one of the parties to the instruments /
document. It must be purchased in the name of one of the parties involved in the transaction
SHCIL is appointed as Central Record Keeping Agency (CRA) and associated with stamp
Duty collection and not valuation. For valuation of stamp duty you need to contact your legal
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• E-stamp Certificate generated has unique Identification number (UIN). Specific
• Security
• Cost savings
• User friendly
Client can pay stamp duty amount through the following modes:
• Cash
• Cheque
• Demand draft
• Pay order
• RTGS
• NEFT
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Why SHCIL ?
• Well integrated front and back office, paper and electronic systems. A focussed Client
Relation Team to manage your needs & queries. A single point contact for your
comfort.
• Regular Audits internal and external, by SEBI, Depositories, Clients and compliance
practices
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CAPITAL MARKETS
The capital market consists of primary market and secondary market segments. The primary
market deals with the issue of new instruments by the corporate sector such as equity shares,
preference shares and debentures. The public sector consisting of central and state
governments, various public sector industrial units (PSUs), statutory and other authorities
such as state electricity boards and port trust also issue bonds. The primary market in which
public issue of securities is made through a prospectus is a retail market and there is no
physical location. Direct mailing, advertisements and brokers reach the investors. Screen
The secondary market or stock exchange where existing securities are traded is an auction
arena. Since 1995, trading in securities is screen based. Screen based trading has also made an
appearance in India. The secondary markets consist of 23 stock exchanges including the NSE
and OTCE and Interconnected Stock Exchanges of India ltd. The secondary market provides a
trading place for the securities already issued to be bought and sold. It also provides liquidity
to the initial buyers in the primary market to re-offer the securities to any interested buyer at a
price, if mutually accepted. An active secondary market actually promotes the growth of the
primary market and capital formation because investors in the primary market are assured of a
continuous market and they can liquidate their investments in the stock exchange.
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Organized money market: Indian financial system consists of money market and capital
market. The money market has two components - the organized and the unorganized. The
organized market is dominated by commercial banks. The other major participants are the
Reserve Bank of India, Life Insurance Corporation, General Insurance Corporation, Unit
Trust of India, Securities Trading Corporation of India Ltd., Discount and Finance House of
India, other primary dealers, commercial banks and mutual funds. The core of the money
market is the inter-bank call money market whereby short-term money borrowing/lending is
effected to manage temporary liquidity mismatches. The Reserve Bank of India occupies a
government securities, access to its accommodation, cost (interest rates), availability of credit
and other monetary management tools. Normally, monetary assets of short-term nature,
Un-organized money market: Despite rapid expansion of the organized money market
through a large network of banking institutions that have extended their reach even to the
rural areas, there is still an active unorganized market. It consists of indigenous bankers and
and long-term finance and even between the purposes of finance. The unorganized sector
continues to provide finance for trade as well as personal consumption. The inability of the
poor to meet the "creditworthiness" requirements of the banking sector make them take
recourse to the institution that still remain outside the regulatory framework of banking. But
Markets exist to facilitate the purchase and sale of goods and services. The financial market
exists to facilitate sale and purchase of financial instruments and comprises of two major
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markets, namely the capital market and the money market. The distinction between capital
market and money market is that capital market mainly deals in medium and long-term
investments (maturity more than a year) while the money market deals in short term
schedules.
Investment Instruments
Investment is a deployment of funds in one or more types of assets that will be held over a
period of time. Various forms of investment are available to an investor. They cover bank
deposits, term deposits, recurring deposits, company deposits, postal savings schemes,
deposits with non-bank financial intermediaries, Government and corporate bonds, life
insurance and provident funds, equity shares, mutual funds, tangible assets like gold, silver
Capital market instruments can be broadly divided into two categories namely
2. Derivative Products like Futures, Options, Forward rate agreements and Swaps.
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Debt: Instruments that are issued by the issuers for borrowing monies from the investors with
a defined tenure and mutually agreed terms and conditions for payment of interest and
repayment of principal. Debt instruments are basically obligations undertaken by the issuer of
the instrument as regards certain future cash flows representing interest and principal, which
the issuer would pay to the legal owner of the instrument. Debt instruments are of various
types. The key terms that distinguish one debt instrument from another are as follows:
Different kinds of money market instruments, which represent debt, are commercial papers
(CP), certificates of deposit (CD), treasury bills (T-Bills), Govt. of India dated securities
(GOISECs), etc.
Equity: Instruments that grant the investor a specified share of ownership of assets of a
company and right to proportionate part of any dividend declared. Shares issued by a
company represent the equity. The shares could generally be either ordinary shares or
preference shares.
Hybrids: Instruments that include features of both debt and equity, such as bonds with equity
the underlying asset, as it has no independent value. Underlying asset can be securities,
commodities, bullion, currency, etc. The two derivative products traded on the Indian stock
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Futures (Index and Stock): Futures are the standardised contracts in terms of quantity,
delivery time and place for settlement on a pre-determined date in future. It is a legally
binding agreement between a seller and a buyer, which requires the seller to deliver to the
buyer, a specified quantity of security at a specified time in the future, at a specified price.
Options (Index and Stock): These are deferred delivery contracts that give the buyer the
right, but not the obligation to buy or sell a specified security at a specified price on or before
A) Primary Market
B) Secondary Market
Primary Market: A market where the issuers access the prospective investors directly for
funds required by them either for expansion or for meeting the working capital needs. This
process is called disintermediation where the funds flow directly from investors to issuers.
Securities
Company/issuer Investors
Funds
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The other alternative for issuers is to access the financial institutions and banks for funds.
This process is called intermediation where the money flows from investors to banks/
Primary market comprises of a market for new issues of shares and debentures, where
investors apply directly to the issuer for allotment of shares/ debentures and pay application
money to the issuer. Primary market is one where issuers contact directly to the public at large
in search of capital and is distinguished from the secondary market, where investors buy/ sell
listed shares / debentures on the stock exchange from / to new / existing investors.
Primary market helps public limited companies as well as Government organizations to issue
their securities to the new / existing shareholders by making a public issue / rights issue.
Issuers increase capital by expanding their capital base. This enables them to finance their
growth plans or meet their working capital requirements, etc. After the public issue, the
securities of the issuer are listed on a stock exchange(s) provided it complies with
requirements prescribed by the stock exchange(s) in this regard. The securities, thereafter,
become marketable. The issuers generally get their securities listed on one or more than one
stock exchange. Listing of securities on more than one stock exchange enhances liquidity of
The issuers are, thus, required to make adequate disclosures in the offer documents to enable
The companies declare dividends, interim as well as final, generally from the profits after the
tax. The dividend is declared on the face value or par value of a share, and not on its market
price.
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i. Appointment of merchant bankers
x. Record keeping
Secondary Market: In the secondary market the investors buy / sell securities through
stock exchanges. Trading of securities on stock exchange results in exchange of money and
Secondary market provides liquidity to the securities on the exchange(s) and this activity
commences subsequent to the original issue. For example, having subscribed to the securities
of a company, if one wishes to sell the same, it can be done through the secondary market.
Similarly one can also buy the securities of a company from the secondary market.
A stock exchange is the single most important institution in the secondary market for
providing a platform to the investors for buying and selling of securities through its members.
In other words, the stock exchange is the place where already issued securities of companies
are bought and sold by investors. Thus, secondary market activity is different from the
primary market in which the issuers issue securities directly to the investors.
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Traditionally, a stock exchange has been an association of its members or stock brokers,
formed for the purpose of facilitating the buying and selling of securities by the public and
institutions at large and regulating its day to day operations. Of late however, stock exchanges
in India now operate with due recognition from Securities and Exchange Board of India
(SEBI) / the Government of India under the Securities Contracts (Regulation) Act, 1956.
The stock exchanges are either association of persons or are formed as companies. There are
24 recognized stock exchanges in India out of which one has not commenced its operations.
Out of the 23 remaining stock exchanges, currently only on four stock exchanges, the trading
volumes are recorded. Most of regional stock exchanges have formed subsidiary companies
and obtained membership of Bombay Stock Exchange, (BSE) or National Stock Exchange
(NSE) or both. Members of these stock exchanges are now working as sub-brokers of BSE /
NSE brokers.
• It enhances liquidity.
1. Trading of securities
2. Risk management
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AQs on Secondary Market
Disclaimer: These FAQs are not the interpretation of law but provide only a simplistic
explanation of terms / concepts related to Secondary market. All information has been
updated till February 28, 2009. For full particulars of laws governing the secondary market,
Framework Section.
4. What is MAPIN?
ENTITIES
SEBI (REGULATOR)
STOCK EXCHANGES
CLEARING CORPORATIONS (CC)/ CLEARING HOUSES (CH)
DEPOSITORIES AND DEPOSITORY PARTICIPANTS
CUSTODIANS
STOCK-BROKERS AND THEIR SUB-BROKERS
MUTUAL FUNDS
MERCHANT BANKERS
CREDIT RATING AGENCIES
FINANCIAL INSTITUTUIONS
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FOREIGN INSTITUTIONAL INVESTORS
NON-BANKING INSTITUTIONS
ISSUERS/ REGISTRAR AND TRANSFER AGENTS
INVESTORS
SEBI has since introduced T+2 rolling settlements from April 1, 2003. T+2 settlement cycle
means that the final settlement of transactions done on T, i.e., trade day by exchange of
monies and securities between the buyers and sellers respectively occurs on second business
day after the trade day excluding Saturdays, Sundays, bank holidays and exchange holidays.
The Depositories Act defines a depository as “a company formed and registered under the
Companies Act, 1956 and which has been granted a certificate of registration under sub-
section (1A) of section 12 of Securities and Exchange Board of India Act, 1992.” The main
entry form.
Depository is an organization where the securities of a share holder are kept in the electronic
form at the request of the shareholder through a medium of a depository participant (DP). The
To handle the securities in electronic as per the Depositories Act 1996, two depositories are
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NATIONAL SECURITY DEPOSITORY LIMITED (NSDL)
National securities depository limited is the first depository to be set up in India. It was
incorporated on December 12, 1995. The Industrial Development Bank Of India (IDBI) the
largest development bank in India, UTI the largest Indian mutual fund and the National Stock
Exchange in India sponsored the setting up of NSDL and subscribed to the initial capital.
incorporated under the companies act, 1956. NSDL had a paid up equity capital of Rs.10
crore. The paid-up capital has been reduced to Rs.80 crore since NSDL has bought back its
shares of the face value of Rs.4.2 crore in the year 2000. However, its network is above
f) CITI BANK
h) HDFC BANK
i) HSBC
j) DEUTSCHE BANK
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k) DENA BANK
l) CANARA BANK
Central depository services of India ltd were the second depository to be granted the
Both NSDL and CDSL interface with investors through their service providers known as DP.
another.
CDSL was promoted by The Stock Exchange, Mumbai (BSE) jointly with leading banks such
as State Bank of India, Bank of India, Bank of Baroda, HDFC Bank, Standard Chartered
CDSL was set up with the objective of providing convenient, dependable ‘and secure
A depository in India cannot open a demat account of an investor and / or provide services to
such a person directly. For opening a demat account or availing the services offered by the
the depository, complete the account opening formalities as per the Depositories Act, SEBI
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regulations, depository byelaws. Thereafter, the investor can receive securities in the demat
account as well as tender the securities held by him / her in physical form for
dematerialization to the DP and hold the same in book-entry form in the account.
When an investor holds securities in physical form, his / her name is recorded as registered
owner in the books of the company. As per the laws currently in force in India, when the
depository is registered in the books of the company as registered owner. However, the
investor continues to be the real owner of the securities and is entitled to receive all the
benefits such as dividend, interest, bonus shares etc. in respect of the said security and as such
Type of depository account depends on the operations to be performed. There are three types
1. BENEFICIARY ACCOUNT
This is an account opened by investors to hold their securities in dematerialised form with a
depository and to carry out the transactions of sale and purchase of such securities in book
entry form through the depository system. A beneficiary account holder is legally entitled for
all rights and liabilities attached to the securities (i.e. equity shares, debentures, government
securities, etc.) held in that account. Therefore, the account is called beneficial owner
Undivided Family (HUF), minor, bank, financial institution, trust, etc. or the broker himself
for the purpose of his personal investments in demat form. The account is opened with a DP.
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2. CLEARING MEMBER ACCOUNT
The entities that are authorized to pay in and receive the pay out from a Clearing Corporation
(CC)/ Clearing House against trades done by them or their clients are known as clearing
members (CM). CMs are identified in the system through their CM-BP-ID. All pay-in and
1. All members of a stock exchange popularly known as brokers, are clearing members;
2. Custodians who are permitted by the stock exchange to act as a clearing member.
3. INTERMEDIARY ACCOUNT
Any person choosing to act as approved ‘intermediary’ for stock lending and borrowing needs
to open an intermediary account with any depository participants (DP) of his choice. An
intermediary account may be opened with the DP only after the intermediary has obtained
registration from the SEBI and with the prior approval of depositories. This account is meant
only to deposit the securities received from the lender and lend them to the borrower under
stock lending and borrowing scheme. The intermediary does not have an ownership
DEMATERIALIZATION
One of the methods for preventing all the problems that occur with physical securities is
through dematerialisation (demat). India has adopted the demat route in which the book entry
is made electronically against securities that are cancelled. The share certificates are shredded
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(i.e., its paper form is destroyed) and a corresponding credit entry of the number of securities
(written on the certificates) is made in the account opened with the Depository Participant
(DP).
( Fig. Dematerialisation)
Once the shares are dematerialised, they lose their identification features in terms of share
certificate distinctive numbers and folio numbers. Title to the securities owned is in terms of
number of securities and not in terms of distinctive numbers, certificate numbers etc.
Identification Number (ISIN) and a short name. For example, a person owning 100 shares in
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Company Name: ABC Ltd.
(ISIN)
identification number for each security issued in any of the International Standards
Organization (ISO) member countries in accordance with the ISIN Standard (ISO 6166).
ISIN is a 12-character long identification mark. It has three components - a pre-fix, a basic
number and a check digit. The pre-fix is a two-letter country code as stated under ISO 3166
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The basic number comprises of nine alphanumeric characters (letter and/or digits). The check
digit at the end of the ISIN is computed according to the modulus 10 "Double-Add-Double".
To illustrate, ISIN INE 475C 01 012 has the following break up:
IN - India
E - Company
The third digit (E in the above example) may be E, F, A, B or 9. Each one carries the
following meaning:
E - Company
F - Mutual fund unit
A - Central Government Security
B - State Government Security
9 - Equity shares with rights which are different from equity shares bearing INE number.
Whenever dealing with ISIN number, it is important to pay special attention to the third digit.
PROCEDURE
Client/ Investor submit the DRF (Demat Request Form) and physical certificates to DP.
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DP checks whether the securities are available for demat. Client defaces the certificate by
stamping ' Surrendered for Dematerialization'. DP punches two holes on the name of the
company and draws two parallel lines across the face of the certificate.
2A. DP dispatches the physical certificates along with the DRF to the R&T Agent.
3. NSDL records the details of the electronic request in the system and forwards the request to
4. R&T Agent, on receiving the physical documents and the electronic request, verifies and
checks them. Once the R&T Agent is satisfied, dematerialization of the concerned securities
5. NSDL credits the dematerialized securities to the beneficiary account of the investor and
On submitting the complete set of documents the agent will complete the other formalities
with the depository and facilitates the opening of the account. Investors will be given a unique
49
account number (BO-ID) which will serve as a reference number for all the further
transactions.
After that you must also collect Delivery Instruction (DI) slip from the DP. A Delivery
instruction Slip has to be filled and sent to the DP on every Delivery (sale of share) you make
Delivery Instruction Slip is an instruction the DP to debit your account and credit the brokers
It is very important that the DI should reach the DP the very next day after the sale, failing
which the securities won’t reach the broker and hence the exchange. This could result in
auction of security.
REMATERIALIZATION
electronic form) to physical form. A BO intending to convert the securities into physical form
submits a remat request to the DP in a Rematerialisation Request Form (RRF). DP verifies the
information on the RRF and enters the details in the system to setup a request electronically.
The system
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Generates a unique serial number called as Rematerialisation Request Number (RRN), which
PROCEDURE
• Client will submit the request to the DP for rematerialization of holdings in the
account.
• On receipt of the request of the form, the DP will verify that the form is duly filled in
• The DP will verify the signature of the client as on the form with the specimen
• If the signature are different the DP will ensure the identity of the client.
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• The DP will intimate the client that the request cannot be entertained since the client
1. If there is sufficient balance in the client’s account, the DP will enter the request in the
DPM and the DPM will generate the rematerialization Request Number (RRN).
2. The RRN so generated is entered in the space provided for the purpose in the
3. Details recorded for the RRN should be verified by a person other than the person who
entered the data, the request is then released to the DM by the DP.
6. The DP will then despatch the request form to the issuer / R&T agent.
7. While processing the request the issuer/R&T agent may report some objections
depending on the nature of the objections, the issuer / R&T may request or process it
partially seeking rectification for the remaining and send an objection memo to the
DP.
8. The issuer accepts the request for rematerialization prints and despatches the
certificates to the client and sends the electronic confirmation to the DM.
9. The DM downloads this information to the DPM and the status of the
10. The DP must inform the client about the charges in the client’s account following the
11. If the form is in order the DP will enter the request details in its DPM. While
enteringthe details if it is found that the client’s account does not have enough
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A rematerialization request may be rejected for reasons such as:
The details given in RRF do not match with the electronic intimation received
For all accepted remat requests, the Issuer / RTA takes the following particulars on record
based on RRF:
• Address
• PAN
• Tax Status
• Age
• Whether the securities are under lock-in. If yes, then the period up to which such securities
• If POA holder operates the BO’s account, the true copy of the POA also will be taken on
record.
The Issuer / RTA records the name of the BO as the Registered Owner(s) of the
The details given in RRF do not match with the electronic intimation received
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• The RRF is incomplete
For all accepted remat requests, the Issuer / RTA takes the following particulars on record
based on RRF:
• Address
• PAN
• Tax Status
• Age
• Whether the securities are under lock-in. If yes, then the period up to which such securities
• If POA holder operates the BO’s account, the true copy of the POA also will be taken on
record.
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The Issuer / RTA records the name of the BO as the Registered Owner(s) of the
rematerialised securities. The Issuer / RTA prints the certificates in the name of Registered
The Issuer / RTA informs all the stock exchanges, where the securities are listed, about the
new certificate numbers, distinctive numbers of the rematerialised securities (as per the
requirements of the various stock exchanges). Such a certificate should also be issued to
MARKET TRANSFER
One of the basic services provided by NSDL is to facilitate transfer of securities from one
account to another at the instruction of the account holder. In NSDL depository system both
transferor and transferee have to give instructions to its depository participants [DPs] for
delivering [transferring out] and receiving of securities. However, transferee can give
'Standing Instructions' [SI] to its DP for receiving in securities. If SI is not given, transferee
has to give separate instructions each time securities have to be received. Transfer of
securities from one account to another may be done for any of the following purposes:
Transfer due to a transaction done on a person to person basis is called 'off- market'
transaction.
A beneficiary account can be debited only if the beneficial owner has given 'Delivery
Instructio3n' [DI] in the prescribed form. Separate forms have to be used for transferring
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Settlement of Off-Market Transactions:
Any trade3 that is cleared and settled without the participation of a clearing corporation is
called off-market trade, i.e., transfer from one beneficiary account to another due to a trade
between them. Large deals between institution, trades among private parties, transfer of
securities between a client and a sub-broker, large trades in debt instruments are normally
PROCEDURE
Seller gives delivery instructions to his DP to move securities from his account to the
buyer's account.
Buyer automatically receives the credit of the securities into his account on the basis
Buyer receives credit of securities into his account only if he gives receipt instructions,
DP needs to be extra careful in verifying the signature of the client if large quantities
A market trade is one that is settled through participation of a Clearing Corporation. In the
depository environment, the securities move through account transfer. Once the trade is
executed by the broker on the stock exchange, the seller gives a delivery instruction to his DP
The broker has to then complete the pay-in before the deadline prescribed by the stock
exchange. The broker removes securities from his account to CC/CH of the stock exchange
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The CC/CH gives pay-out and securities are transferred to the buying broker's account. The
broker then gives delivery instructions to his DP to transfer securities to the buyer's account.
PROCEDURE
Seller gives delivery instructions to his DP to move securities from his account to his
broker's account.
Securities are transferred from broker's account to CC on the basis of a delivery out
Buying broker gives instructions and securities move to the buyer's account.The
MARKET TYPE
Stock exchanges offer different market segments in which trades can be done. The
segmentation is done by the type of settlement or type of trade. Each of the segments is
denoted as 'market type' in NSDL depository system. The stock exchange which offers these
market types, generally, recognizes these settlements with a two character code. The DI slip
should contain the market type for which securities are being transferred to the clearing
member. The contract note/trade confirmation slip given by the broker/sub-broker will
SETTLEMENT NUMBER
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Trading periods of each of the market segments is identified by a settlement number. Every
settlement number has a trade beginning day, trade-ending day, settlement pay-in day and
settlement pay-out day. Stock exchanges divide a period of one year [generally calendar year]
into several settlement periods and allocate settlement number for each settlement-period. All
these days collectively are called 'settlement calendar'. DPM system will give complete details
of settlement calendar for each stock exchange. The DI slip should contain the settlement
number for which the securities are being transferred to the clearing member.
CLEARING MEMBER
Every broker in a stock exchange offering settlement in dematerialised securities will have to
open a distinct account called 'clearing member account'. It is identified with a number called
'CM-BP-ID'. If a broker deals in more than one stock exchange, he will be allotted one CM-
BPID per stock exchange. The DI slip should contain the CM-BP-ID relevant to the stock
DELIVERY DEADLINE
Stock exchanges set a deadline time by which clearing member are expected to deliver
securities. Clearing member can deliver securities within the deadline time only if they have
received securities from their clients. In order to ensure that clients give securities in time to
the clearing member, SEBI has prescribed deadline time by which clients have to give
securities to clearing members. SEBI has advised DPs to instruct their clients to submit the
settlement instructions on T+1 (in physical form upto 4 p.m. and 6 p.m. in case of electronic
instructions) for pay-in of securities, viz.; instructions to transfer securities from Client
INTER-SETTLEMENT TRANSFER
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In a clearing member account, the securities are always kept in a bucket of specific market
type and settlement number. The clearing member may have to move securities from one
bucket with a different market type-settlement number combination to another bucket from
where pay in is to be effected. To effect this movement a clearing member can give an
instruction to move Securities from one settlement to another settlement which is called 'inter-
settlement'.
CM POOL TO CM TRANSFER
.The CM may give instructions to its participant to debit its settlement account and credit the
instructions to its participants for crediting its settlement account from settlement account of
another CM in the format laid down. Alternatively, a CM may give standing instruction to its
participant to credit its settlement account. The participant shall ensure that the instruction
form is complete and the signature of the CM is valid. The participant shall execute the
INTER-DEPOSITORY TRANSFER
termed as an inter-depository transfer. This facility is quite similar to account transfers within
NSDL.
• As per SEBI (Depositories and Participants) Regulations, 1996, both the depositories must
• It can be done only for securities that are available for dematerialisation on both the
depositories
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• For debiting the clearing account or the beneficiary account with NSDL, the form for "Inter-
• For crediting the clearing account or the beneficiary account, the standing instruction given
for automatically crediting the account is applicable. In case the standing instructions are not
given, then the form for "Inter-Depository Receipt Instruction" is required to be submitted by
• Inter Depository Transfer instructions for the day is exchanged online between the two
depositories.
• The deadline time for DPs to verify & release Inter Depository Transfer delivery/ receipt
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TRANSMISSION –
One of the lesser-known but widely experienced problems of dealing in securities is with
regard to their transmission. The Companies Act, 1956, distinguishes transmission of shares
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from transfer of shares. While transfer of shares relates to a voluntary act of the shareholder,
The word "transmission" means devolution of title to shares, for example, devolution by
If the securities are held in physical form, the documents have to be sent to the company for
effect transmission of securities, the relevant documents must be sent to each of the
companies, along with the securities. the relevant documents must be sent to each of the
companies, along with the securities. Survivors have to follow-up with each of the companies
in order to get the transmission effected before the book closure, if they wish to avail of the
benefits accruing through such shares. In the depository system, such problems are mitigated
as the securities are held as account balances in the electronic form. The process of
transmission through NSDL is simple as well as quicker because the successor to the title
interacts only with one entity i.e., his DP. Transactions can be for sole holding cases as well
The Client(s) may make a nomination of his/their account in favour of any person by filing
authority.
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e) Signature of the Client(s) tally with the specimen signature records
f) The details of the securities entered in the nomination forms match those in the
h) The Nominee has signed the nomination form and guardian in case of the nominee
being a minor
Upon the death of the sole Client or the death of all the Clients, as the case may be, the
nominee shall request the Participant in writing along with a certified true copy of the death
certificate (or a duplicate copy of the death certificate if original lost or misplaced) issued by
the competent authority to transmit the securities covered by the nomination to the account of
the Nominee, held with any Depository. If the Nominee does not have an account with the
Depository, the Nominee shall be required to open an account with any Depository
nomination.
The legal heir(s) or legal representative(s) of the deceased have to make a request, in the
prescribed form to the DP for transmitting the balances lying in the account of the deceased to
their account.
The following documents have to be submitted with the request for transmission:
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Where the market value of the securities held in each of the accounts of the deceased on the
date of application-for transmission does not exceed Rs. One lakh, DP may admit the request
for transmission.
2. Copy of the death certificate duly attested by a Notary Public or by a Gazetted Officer;
5. No Objection Certificate(s) from all the legal heir(s) who do not object to such
transmission.
6. As an alternate to No Objection Certificate from all legal heir(s) who do not object to
such transmission specified at 12.6.2.3 (v), a copy of Family Settlement Deed duly
Settlement Deed clearly vest the securities in favour of the person seeking
transmission in his/her name and vesting of securities in his/her name is not contingent
Before effecting the transmission of securities, the DP ensures the validity of the documents
submitted by the legal heir(s) or the legal representatives of the deceased. After effecting the
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Transmission of Securities held jointly in the Depository
In case of death of one of the Clients in a joint account, the surviving Client(s) shall request
the Participant to transmit the balances lying in the Client account to the account of the
surviving Client(s). The surviving Client(s) shall make an application to the Participant in the
form specified in Annexure ‘O’ along with a copy of the death certificate duly notarized. The
surviving joint holder(s) will have to open a new account with the DP in their name(s). If the
surviving client(s) wish to open a new account with the same Participant, then the Participant
will open the new account in the name(s) of the surviving member(s), in the same order as in
the original account, on the basis of the existing documents already in the possession of the
Participant, provided that the said documents meet the prevailing requirements for opening an
certificate.
• Verify signature.
PLEDGE / HYPOTHENATION
As per section 12 of the Depositories Act, 1996, securities in demat mode can be pledged.
to be created.
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When securities are to be pledged for advance / loan, two entities are involved in this
transaction viz. the pledgor and the pledgee. The entity-taking loan against securities is called
‘pledgor’ and the entity that gives the loan is called pledgee. Pledgee may be a financial
institution or any other entity providing advance / loan against securities. The ownership of
securities continues to remain with the pledgor but the pledgee has a lien on them.
For creating pledge in depository system, the pledgor as well as the pledgee should have
demat accounts. For the securities in demat form, the pledgor may be able to get higher loan
amounts, with reduced margins and lower rate of interest as compared to securities in physical
form.
Bankers, share brokers, investors and other entities dealing in securities make frequent use of
the pledge facility in the normal course of their business. CDSL system permits creation of
Pre-requisites
• The pledgor and the pledgee must have demat accounts in CDSL to create a pledge.
However the pledgor and the pledgee may hold accounts through same DP or through
• The pledgor and the pledgee may enter into a pledge agreement in the normal course
of business.
• The pledgor and the pledgee account should not be tagged for closure.
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PLEDGE
CDSL system allows a holder of securities in demat account, pledgor, to use his / her
dematerialized securities as collateral. A flow chart showing pledge process is given below.
• The pledgor, desirous of pledging securities from his demat account in CDSL, submits
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• On receipt of the PRF from the pledgor, the pledgor's DP verifies that the securities to
be pledged are unencumbered and there is a free balance, i.e., the securities are not
• The pledgor's DP creates a pledge request in CDSL system by entering the details of
the PRF in the front-end system. CDSL system allocates a unique Pledge Sequence
• CDSL system generates a confirmation letter for the pledgor on setup of a pledge
request.
• The PSN generated by the system is noted on the PRF and a copy of the same is given
• The pledgee submits the duly acknowledged copy of the PRF to his / her DP who can
pledge request.
• A pledge request setup can be cancelled by the pledgor before the same is accepted /
CDSL system allows un-pledging i.e. release the pledged securities when the pledge
obligation is fulfilled or as agreed between the pledgor and the pledgee. CDSL system
provides two options to un-pledge the securities. IN the first option, the unpledged request can
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be set-up by pledgor and the same is approved by the pledgee. In the second option, pledgor
need not set-up the unpledged request, Pledgee will set-up the unpledged request unilaterally.
Flow chart showings unpledged process as per first option is given below.
• For un-pledging the securities, the pledgor submits a request on Un-pledge Request
Form (URF) in duplicate to his / her DP. The pledgee may countersign the URF.
• The pledgor's DP will set up an unpledge request based on the URF, in the CDSL
• Pledgee submits the duly acknowledged copy of the URF to his / her DP who either
• On acceptance/ rejection of the unpledge request, the status is changed from 'Unpledge
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• If the unpledge request is accepted, the pledged quantity of ISIN under this unpledge
account. An Unpledge request can be setup for partial quantity also depending on the
amount of advance being returned by the pledgor. For example if pledge request is
setup for 500 shares and an advance of Rs. 10000is taken against these shares, then
based on part of the advance returned by the pledgor, proportionate quantity of the
• An unpledge request setup can be cancelled by the pledgor before the same is accepted
• For unpledging the securities, the pledgee will submits a request on Unpledge Request
Form (URF).
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• The pledgee’s DP will set up an unpledged request based on the URF, in the CDSL
system.
'Unpledge Set-up' to 'Unpledge Accepted' or 'Unpledge Rejected', as the case may be.
• If the unpledged request is accepted, the pledged quantity of ISIN under this
pledgor's BO account. As mentioned earlier the Unpledge request can be setup for
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PLEDGE INVOCATION / CONFISCATION
CDSL system allows pledge invocation (confiscation) by the pledgee in case of need,
whereby the securities are transferred from Pledgor’s account to Pledgee’s account.
• The pledgee, through his DP, submits a request for invocation of the pledged
securities on an Invocation Request Form (IRF). Each IRF will be based on the PSN
• The pledge's DP sets up an invocation request for the pledge based on the IRF, and the
from pledgor’s account to pledge’s account takes place only if the pledge is setup
• If the invocation request is for a part quantity, the pledgee's DP can once again set up
the invocation request for the balance quantity of the pledge, if required.
• The pledgor's DP and pledge's DP will inform the pledgor and pledge about the status
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CHARGES OF DEPOSITORIES
74
Entry Fee
Each participant shall pay at the time of submitting its application to the depository, a non
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• In case of account opened in CDSL, an additional AMC of Rs.500 payable to CDSL
will be collected.
• NSDL charges Rs. 8 for sale tax; CDSL charges 0.01% (min Rs 5------max. Rs 12) for
sale tax.
• NSDL charges Rs. 25 for creation of Pledge, CDSL charges Rs. 12 for creation,
A settlement fee at the rate of Rs. 1 per instruction in respect of securities received from the
clearing corporation into the pool account of each clearing member maintained with
participation subject to a maximum of Rs. 1000 and a maximum of Rs. 5000 per quarter per
A settlement fee at the rate of Rs. 5 per debit instruction for transfer of securities from the CM
account of clearing to the CM account of another clearing member shall be charged to the
• In respect of commercial papers and short term debt instruments such as certificate of
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• Transfer of the accounts of Client from one participant to another as a consequence of
MINIMUM FEE
In case the total fee billed to the participants in a financial year is less than the minimum fee
of Rs. 100000 then the participants shall be charged the difference thereof.
SECURITY DEPOSIT
Every participant shall pay to the Depository Rs. 10 lakh by way of interest fee refundable
security deposit. However a clearing corporation or a clearing house of stock exchange will
1. With the effect from the april 1 2009, an issuer of listed securities shall pay an annual
custody fee at the the rate of Rs. 8 per folio in depository, subject to minimum amount
2. The above fee would be applicable on all securities i.e. equity, debt, unit of mutual
3. The fee will be based on the total ISIN position as on march 31, of the previous
financial year.
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Provided however that, in case the issued capital or ISIN positions increase during the
financial year due to issue of further shares, by way of public pffer, the annual custody fee
The will be charged every year on a financial year basis and shall be payable by April 30 of
If an issuer fails to pay the fees mentioned under “Annual Custody Fee” by the due date, the
depository may charge interest @ 12% p.a. on the amount, from the due date of payment till
the payment is received by the Depository. Provided further that the depository may stop
issuer and / or its Registrar and Transfer agentas mentioned in the Bye Laws and Business
Rules.
Provided further that the depository may not permit the issuer to use its infrastructure
An issuer of unlisted securities shall pay a joining fee of Rs. 20000 plus taxes at applicable
rate at the time of joining NSDL, for the purpose of making its shares available for
dematerialization.
Provided however that in case the issuer gets its securities listed on any recognised stock
exchange within one year of joining NSDL, the joining fee paid by the issuer will get adjusted
against the one time custody fee or annual custody fee, as the case may be.
If an issuer gets its securities delisted from all stock exchanges where its securities were
listed, it shall pay joining fee of Rs. 20000/- plus taxes at the applicable rates. If an issuer fails
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to pay the fees, the depository may stop providing details of clients/ clearing member/
clearing corporations/ its registrar and transfer agent as mentioned in the bye laws and
business rules.
CHARTERD
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One of the biggest problems faced by the Indian capital market has been the manual and
paper based settlement system. Under this system, the clearing and settlement of transaction
take place only with the use of paper work. The system of physical delivery of scripts poses
many problems for the purchaser as well as the seller in the form of delayed settlements, long
settlement periods, high level of failed trade, high cost of transaction, bad deliveries etc. In
many cases transfer process takes much longer time then two month as stipulated in section
113 of companies Act, 1956 or section 22 A of the securities Contracts (Regulations) Act,
1956. Moreover, a large number of transactions end up as bad deliveries due to faulty
compliance of paper work, mismatch of signatures on transfer deeds with specimen record of
the issuer or other procedural reasons. Besides, theft, forgery, multination of certificates and
has shown rapid growth in the recent past with foreign investors, more stock exchanges and
increased market intermediaries. The old manual system of settlement and transfer has almost
failed to handle the growing volume of paper that has loaded the market.
Thus, to eliminate paperwork, facilitate scrip less trading and electronic book entry of the
transfer of securities, shorten settlement periods, and to improve liquidity in the stock market,
it was found necessary to replace the old system of transfer and settlement with the new and
modern system of depositories. Accordingly the government of India enacted the depositories
Act in 1996 for the orderly growth and development of the Indian capital market.
It is a system whereby the transfer and settlement of scripts take place not through the
traditional method of transfer deeds and physical delivery of scripts but through the modern
system of effecting transfer of ownership of securities by means of book entry on the ledgers
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or the depositary without the physical movement of scripts. The new system, thus, eliminates
paper work, facilities automatic and transparent trading in scripts, shortens the settlement
period and ultimately contributes to the liquidity of investment in securities. The system is
how market works and depository participant role toward beneficial participant and
participant (NSDL&CDSL). Working at SHCIL and preparing this project report was a
“YOUSWOT
MAY BE GOOD, BUT
ANALYSIS
IF YOUR COMPETITORS
NEED TO CHANGE”
STRENGTHS:
SHCIL is the first depository participant. It has the opportunity of holding more than
Multiple products and services: SHCIL provides a variety of services under the same
roof.
The company has more than 100 branches all over the world. It is very much
The company has highly computerized, state of art technology to facilitate the
The company has to its credit 70% of the institutional business Alliance
The company is blessed with a trained pool of professional staff and very good
customers.
The employees are assigned to different departments on rotation basis. This results in
a pool of staff that will always be ready to replace others in case of their absence.
Since the main business of the company is providing DP services, unlike the service
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The variety of services offered has enabled SHCIL to have a much more competitive
WEAKNESS
amount or receivables. The clients are not provided any incentives or motivations,
The company has not undertaken sufficient steps to create awareness among the
The company has also failed in creating awareness among the clients regarding the
necessity of updating the information with regard to their address, which makes some
OPPORTUNITIES
The company can take steps to increase the awareness among the clients and thereby
The company has regularly come with new products and services in order to proceed
THREATS
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The number of competitors is increasing at a higher rate. Their charges are also low
when compared to the charges of SHCIL. The nearest competitors are banks providing
The company does not charge any amount for closing the account. Since retaining the
customer is very important and most of the customers will not think of closing the
account at time of opening the account the company can charge some for closure.
The discounts and offers given by other DP’s when compared to offersof SHCIL are
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DEPOSITORY SYSTEM AND CAPITAL MARKET
RELATION
CAPITAL MARKET
EXCHANGE
CC / CH
SEBI
DEPOSITORY
NSDL/
CDSL
INVESTOR
All system is controlled by the stock exchange board of India (SEBI) a regulatory under the
act 1992. The SEBI makes all the connectivity in clearing member and depository system
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CHAPTER-4
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89
90
91
92
93
94
95
96
97
CHAAPTER-5
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RECOMMENDATIONS AND SUGGESTIONS
Since the interest and web based communication is getting popular SHCIL should
update their website at least on a weekly basis so that the major percentage of the
To encourage the existing and prospective shareholders good returns must be ensured
Since the Investors taken interest in Equity shares SHCIL should provide frequent
Since the Investors expect better service form SHCIL, it should provide value-added
services.
The online trading efforts must be made more scientific and effective.
Therefore it is essential for the company to give more priority about Safety and Security and
returns.
Though the Equity shares has got the highest risk, the investors are willing to take risk
by investing in Equity shares for higher returns since the SHCIL is doing well.
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It is noted from the survey the Value-added services provided by SHCIL is through
Online updates.
The service provided by the SHCIL is better when compared to other financial
institutions.
The investors feel that the Interest rates provided or charged by SHCIL is high against
The survey indicates that the investors are more safe and secured from the demat in
SHCIL
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CONCLUSION
On the whole, my project at SHCIL was worthwhile as I got the opportunity to learn a lot
about the capital market. It was a wonderful experience interacting with employees of the
organization and simultaneously enhancing my knowledge and skills about stock market
operations. I got to know about the process of dematerialization, account opening and how the
Working at SHCIL and preparing this project report was a learning experience and I shall
SHCIL’S depository participants services address their individual investment needs. With a
parentage of leading financial institutions and insurance majors and a proven track record in
the custodian business, they have reiterated SHCIL’S past success by establishing themselves
as the first ever and largest depository participants in India. Across the count, fourteen in
connected to NSDL and seven connected to CDSL ensure fast and direct processing of their
clients instructions. Sale and purchase of shares is done and BSE membership through which
trading is done through their own clients.They have also taken care of their client’s
depository needs like dematerialization, rematerialization and pledging of shares. It also has
various types of products like Add shares, fund investment, pension funds, stock direct,
insurance, GOI bonds, equibuy and various services. Periodic statements sent to their client’s
keep them informed of their account status. Registration with their website, enables their
client to check their account related information, stock market reports and statistics.
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CHAPTER-6
BIBLIOGRAPHY
102
BIBLIOGRAPHY
www.moneycontrol.com
www.nsdl.co.in
www.cdsl.co.in
www.shcil.com
www.nseindia.com
www.bseindia.com
www.sebi.gov.in
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CHAPTER-7
APPENDIX
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APPENDIX
QUESTIONNAIRE
NAME:
ADDRESS:
CONTACT NO:
Q1. What is the instrument you prefer the most while making investment decisions?
Q2. How much time would you give your investments to grow?
A) yes B)No
Q5.Are you well informed about the latest products in the markets?
A) Yes B)No
A) Television B) Magazines
C) Internet D) Advisors
Q7.Do you have any idea about the FMP and SIP plans of mutual funds?
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A) Yes B) No
Q8. Does the employee assist you in making a sound investment decision?
A) Yes B)No
A) Excellent B) Good
C) Average D) poor
A) Yes B) No
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