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A R T I C L E
S P O T L I G H T
R E G U L A T O R Y C H A N G E S
I N T E R N A T I O N A L N E W S
Shenzhen Stock Exchange launches listed companies-investors interaction platform
Eurex to launch dividend futures on single stocks from January 11, 2010
NATIONAL STOCK EXCHANGE OF INDIA LIMITED
HIGHL IGHTS OF NSE
N E W S L E T T E R January 2010
This paper focuses on comprehensive measures of financial development which have been published by the World Economic Forum
(WEF) since 2008. In 2009, the WEF ranked 55 countries including India on over 120 variables including institutional and business
environment, financial stability, size and depth of capital market. This paper specifically highlights the key weaknesses in India's
financial sector which account for its relatively low ranking. In the light of this analysis, the paper suggests some key financial sector
reforms.
Initiated by SEBI
Initiated by RBI
Extended market timings from January 4, 2010 onwards
Expansion of scheme of strikes in Stock Optionsst
Delivery period of Interest Rate Futures reduced from a month (1 business day of delivery month till the last business day of the
same month) to just 1 day (last business day of the delivery month)
Expiry/Last trading day for Interest Rate Futures revised to two business days (from seven business days) prior to the last
business day of the expiry/delivery month.
NSE NEWS
India's Financial Development: Measures and Analysis- by Anuradha Guru, NSE
NSE Launches Mutual Fund Service System
In November 2009, SEBI allowed transaction in Mutual Fund schemes through the stock exchange infrastructure. Consequently, NSE
launched India's first Mutual Fund Service System (MFSS) on November 30, 2009 through which an investor can subscribe or redeem
units of a mutual fund scheme.
NCFM NEWS
Till November 2009, 10 candidates have successfully acquired the NCMP (NSE Certified Market Professional) Level- 4
certification.
Stock Exchanges allowed to determine delivery period for Interest Rate Futures
Revision in the computation methodology of limitation period for cases filed for arbitration
ClearingandsettlementofInterestRateFuturestobedonebyexchangeclearingcorporationsorclearinghousesReview of External Commercial Borrowings (ECB) Policy
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Trading Value ( )Rs. hundred crore Avg. Daily Trading Value (Rs. hundred crore)
NSE's GLOBAL RANKINGS
Parameters Rankrd
Single Stock Futures 3rd
Stock Index Options 3rd
Stock Index Futures 3th
No. of Trades 4th
Market Capitalisation 12
M A R K E T R E V I E W
H I G H L I G H T S O F N S E N E W S L E T T E R January 2010
Prepared by SBU-EDUCATIONNational Stock Exchange of India Ltd.Exchange Plaza, Bandra Kurla Complex, Bandra (E) Mumbai - 400051. Tel No: 022-26598163For detailed NSE Newsletter or for e-subscription, log on to www.nseindia.com>Press Room>NSE Newsletter.For Market Data, refer to www.nseindia.com>Research>Datazone.
Articles for NSE Newsletter can be sent at [email protected]
Source : WFE (Rankings done for the period Jan- Jun 2009). Rankingsfor single stock futures, stock index options and stock index futuresis based on number of contracts traded.
Nifty Movements vis-a-vis other International Indices(Rebased to 100 for March 31, 2009)
Nifty Dow Jones NIKKIE Hang seng Nasdaq
Performance of select sectors vis-a-vis Nifty(Rebased to 100 for March 31, 2009)
CNX IT CNX FMCG INDEX S&P CNX Finance
S&P CNX Pet rohemica ls S&P CNX Pha rmaceu ti cal s CNX Bank Ni fty
CNX Infrastructure S&P CNX Nifty
Segments Turnover forNov. 2009 Dec. 2009 Change over turnover Capitalisation(Rs. crore) (Rs. crore) Sep. 2009 (Rs. crore) (Rs. crore)
CM 324,477 292,900 -9.73 13,948 5,699,637
WDM 64,999 37,567 -42.20 1788.91 3,129,747F&O 1,661,816 1,524,982 -8.23 72,618CDS(Currency 157,554 191,415 21.49 9,115Futures)
TOTAL 2,208,846 2,046,865 -7.33 8,829,384
Turnover for Percentage Average daily Market
NSE MARKET STATISTICS
Tra
ding
Va
lue
Avg.
Da
ily
Tra
ding
Value
1000
2000
3000
4000
5000
50
100
150
200
250
300
Jan-
09
Fe
b-
09
Mar-
09
Apr-
09
May-
09
Jun-
09
Ju
l-09
Aug-
09
Sep-
09
Oc
t-
09
Nov-
09
Dec-
09
Capital Market Segment
Jan-0
9
Fe
b-0
9
Mar-0
9
Apr-0
9
May-0
9
Jun-0
9
Ju
l-09
Aug-0
9
Sep-0
9
Oc
t-0
9
Nov-0
9
Dec-0
93000
6000
9000
12000
15000
18000
200
400
600
800
1000
F&O Segment
Tra
ding
Va
lue
Avg.
Da
ily
Tra
ding
Value
Jan-
09
Fe
b-
09
Mar-
09
Apr-
09
May-
09
Jun-
09
Ju
l-09
Aug-
09
Sep-
09
Oc
t-
09
Nov-
09
Dec-
09
0
200
400
600
800
1000
0
10
20
30
40
50
60
70
80
90
100
Currency Futures
Tra
ding
Va
lue
Avg.
Da
ily
Tra
ding
Va
lue
151719212325
2729313335
Jan-
09
Fe
b-
09
Mar-
09
Apr-
09
May-
09
Jun-
09
Ju
l-09
Aug-
09
Sep-
09
Oc
t-
09
Nov-
09
Dec-
09
0
100
200
300
400
500
600
700
WDM Segment
Tra
ding
Va
lue
Avg.
Da
ily
Tra
ding
Va
lue
80
95
110
125
140
155170
Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09
90
140
190
240
290
Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09
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N S E N E W S L E T T E R J a n 2 0 1 0
as they apply to domestic small and medium-size enterprises. A fundamental premise of Doing Business is that eco-
nomic activity requires good rules.This database suffers from quite a few limitations, such as, it does not measure
all aspects of the business environment that matter to firms or investorsor all factors that affect competitiveness;
itdoes not assess the strength of the financial system or financial market regulations, both important factors in un-
derstanding some of the underlying causes of the global financial crisis and it does not cover all regulations, or all
regulatory goals, in any economy. Thus it does not fully capture the financial development of a country. However,
this database has gained considerable attention in recent years among developing countries with hopes that a
higher spot on the list could help lure foreign investors. In 2010 database, India ranks 133 among 183 countries in
this database, falling one place from its position at 132 in 2009 database. Notably, some of the peer countries of
India rank above it- South Korea at 19, China at 89, Indonesia at 122 and Brazil at 129.
In another attempt to measure financial development, an occasional paper of the European Central Bank, brought
out in April 20091, constructs composite indices to measure domestic financial development in 26 emerging econo-
mies for 2008. The study uses 22 variables, grouped according to three broad dimensions: (i) institutions and regula-
tions; (ii) size of and access to financial markets and (iii) market performance. According to this index, South Korea
is ranked 6 among 30 countries, China 14 and India is at the position 22. This paper finds that India performed rela-
tively better as regards its financial markets and non-bank institutions, but requires improvements in the business
environment as well as bigger and efficient banks.
Recognizing that there is lack of intellectual agreement on how to define and measure financial system develop-
ment, the World Economic Forum (WEF), in September, 2008, released its first annual Financial Development Re-
port (FDR),which provides an Index and ranking of 52 of the worlds leading financial systems. The 2009 FDR re-
leased on October 8, 2009, ranks 55 countries based on over 120 variables spanning institutional and business envi-
ronments, financial stability, and size and depth of capital markets, among others and is thus one of the most com-
prehensive databases available on financial development.
For the purposes of this Reportand Index,financial development is defined as the factors, policies, and institutions
that lead to effective financial intermediation and markets, and deep and broad access to capital and financial
services. In accordance with this definition, the Report recognizes various aspects of development of a financial
system, presenting them as seven pillars of the Financial Development Index (FDI). These are:
1. Factors, policies, and institutions:the inputs that allow the development of financial intermediaries, mar-
kets, instruments and services. It includes: (i) institutional environment; (ii) business environment and (iii) fi-
nancial stability.
2. Financial intermediation:the variety, size, depth, and efficiency of the financial intermediaries and markets
that provide financial services. It includes: (iv) banks, (v) non-banks and (vi) financial markets.
3. Financial access: (vii)access of individuals and businesses to different forms of capital and financial services.
One of the key design principles of the Index is the inclusion of a large number of variables relevant to the finan-
cial development of both emerging and developed economies. However, the FDI developed by the WEF, like other
1 Domestic Financial Development in Emerging Economies Evidence and Implications, European Central Bank, Occasional Pa-
per Series, No 102 / April 2009
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viz. institutional environment. In the FDRs framework, the institutional environment encompasses: (i) laws and
regulations that allow the development of deep and efficient financial intermediaries, markets, and services,
which, inter-alia, includes a countrys capital account openness and domestic financial sector liberalization.;
(ii) macro prudential oversight of financial systems, i.e overall laws, regulations, and supervision of the finan-
cial sector; (iii) quality of contract enforcement and (iv) corporate governance.
Let us first look at the status of development of financial markets. The financial markets of India can, at best,be described as developing. While the securities markets, especially the equity derivatives markets, can boost
of being in the league of some of the developed countries in terms of regulatory framework, market capitaliza-
tion, turnover and state of the art risk management; other segments of the financial markets fall behind in a
number of ways. For instance, the corporate bond markets are practically non-existent when compared with the
mounting long term funding requirements to finance Indias corporates and infrastructure development. They
account for only 3.9% of GDP in 2008, as against 61% in Korea and 37% in Malaysia, according to ADB estimates.
The recent government committee, High Powered Expert Committee on Making Mumbai an International Finan-
cial Centre (HPEC on MIFC), has pointed that corporate bond markets are an important missing link following
which Indias financial sector has not been able to achieve the desired bond-currency-derivatives (BCD) nexus
required, so as to be able to offer a whole milieu of financial services to market participants.
As regards the banking sector, a number of reforms have been undertaken towards liberalization and banks have
shown improvements in asset quality and profitability. However, as pointed out by Governor RBI, Dr D. Sub-
barao, in a recent speech 2, commercial banking in India has not penetrated sufficiently to serve the large mass
of rural, illiterate and poor people in any meaningful way. Estimates indicate that of the 600,000 habitation
centres in the country, only about 30,000 centres are covered by commercial banks. He adds that even where
100 per cent financial inclusion is claimed, oftentimes it is inclusion only in a nominal sense. Households have
bank accounts that remain dormant; few conduct any banking transactions and even fewer receive any credit.Thus, financial inclusion in its true sense still evades us. Also, the sector is plagued with high intermediation
costs largely on account of high operating cost.
Looking at the government securities markets, one finds that it faces difficulties such as lack of liquidity across
different maturity levels and thus lack of a benchmark yield curve. The latter is generally held to be one of the
reasons for non-development of corporate bond markets in the country.
In the insurance sector, in terms of insurance penetration (ratio of premium to GDP), at 4.6%, in 2007, India is
at par with most other emerging market economies. However, it fairs poorly with respect to insurance density
(ratio of premium to total population) at only 46.6%. The participation of low-income groups in life insurance is
still very limited.
Thus, each of the segments of the financial markets has its own set of shortcomings that need special attention.
As regards openness of capital account, India has cautiously opened up its capital account since the early 1990s,
with the thrust of policy reform being in favor of a compositional shift in capital flows away from debt to non-
debt creating flows, viz., FDI and foreign portfolio investment; strict regulation of external commercial
2 Keynote address by Dr. Duvvuri Subbarao, Governor, Reserve Bank of India at the International Finance and Banking Con-
ference organized by the Indian Merchants Chamber on Banking - Crisis and Beyond on November 25, 2009 in Mumbai.
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In the context of India, the recently submitted report of the Government Committee on Financial Sector Reforms
(CFSR) (popularly known as the Raghuram Rajan Committee) has, inter-alia, recommended that a Financial Sector
Oversight Agency (FSOA) should be set up by statute, whose focus will be supervisory. It will monitor the function-
ing of large, systemically important, financial conglomerates; anticipating potential risks, it will initiate balanced
supervisory action by the concerned regulators to address those risks; it will address and defuse inter-regulatory
conflicts, and look out for the build-up of systemic risks.
This recommendation should be taken forward in the right earnest.
Looking at the issue of contract enforcement in India, we find an appalling state of affairs. According to the
Doing Business database 2010, contract enforcement in India requires 46 procedures, 1420 days (of which days
spent in trial and judgment are 1095) and the cost of the same is 40% of the claim amount. India ranks one but
last, in terms of this indicator, among 183 countries captured by the database. Some serious measures are re-
quired to come out of this abysmal situation.
On corporate governance, the latest episode at Satyam Computer Services raises several questions about the role
of three pillars of corporate governance in a firm i.e the Board of directors and independent directors; sharehold-
ers and institutional investors; and the auditors. Over and above all this, we need to ponder over the fact that in
spite of being proactive in promulgating corporate governance regulations and being touted as one of the best in
terms of corporate governance standards compared to our Asian counterparts, where does our country fail to pre-
vent such fiascoes? Satyams case highlights the need to make corporate governance laws more effective to
achieve more transparency and accountability. A New Companies Bill 2008 is under the consideration of the Par-
liament. It aims to improve corporate governance by vesting greater powers in shareholders. These have been
balanced by greater emphasis on self-regulation, minimization of regulatory approvals and increased and more
transparent disclosures. Will this be effective in addressing contemporary corporate governance issues in India,
remains to be seen.
In conclusion
There is unanimity in the opinion that India has come a long way on the path of development of its financial sec-
tor- deregulating, liberalising and increasing competitiveness along the way. However, there is no room for com-
placency. The imperatives of changing time, technology and needs of the economy, require us to take further
steps to build up on the financial sectors capabilities, already achieved, in the form of the next generation re-
forms. This would help our financial markets achieve their full potential growth. The CFSR aptly summarises the
necessity of financial reforms as-
- Financial sector reform is both a moral and economic imperative.
The starting point for the same could be working on the lines of recommendations of two important recent gov-
ernment committee reports, viz. HPEC on MIFC and CFSR. Some of the thoughts of these committees have been
articulated above keeping the findings of the WEFs FDR 2009 in the foreground.
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S P O T L I G H T
NSE Launches Mutual Fund Service System
Until November 2009, the Indian investors interested in subscribing to a mutual fund had to identify a dis-tributor of the mutual fund and submit all documents along with payment instrument where applicable to thedistributor or directly to Mutual Fund/AMC/ RTA. In November 2009, SEBI allowed transaction in Mutual Fund
schemes through the Stock Exchange infrastructure. Consequent to this market development, NSE launchedIndias first Mutual fund Service System (MFSS) on November 30, 2009 through which an investor can subscribeor redeem units of a mutual fund scheme.
Mutual Fund Service System (MFSS) is an online order collection system provided by NSE to its eligible mem-bers for placing subscription or redemption orders on the MFSS based on orders received from the investors.This has made buying and selling of mutual funds easier for investors. The subscription/redemption requestwould thereafter get processed and investor would know about status of the request only in the form of directcommunication from Mutual Fund/AMC/RTA. The NSE MFSS facilitates entry of both buy and sell orders. Withthe MFSS, investors can place an order through a registered NSE member who is eligible to participate in MFSSfor subscription/redemption of units. In order to subscribe units, members are required to place buy orders. Amember who wishes to redeem units of mutual fund scheme will be required to place sell orders in the sys-tem. Participants can choose between physical mode and depository mode while putting their subscription /redemption requests on the MFSS. All orders are settled on order to order basis, on T+1 (working days).
Mutual Funds are not listed like stocks, i.e., their prices would not change on a real time basis as in stocks.The Net Asset Value (NAV) will remain the same as declared by the fund houses. Investors are allowed to con-vert their existing physical units (represented by account statement) into a demat form, fund houses will haveto coordinate this with the registrar, transfer agents and depository participants to facilitate the process.
Individuals, Hindu Undivided Families (HUFs) and body corporates can participate in MFSS subject to complet-ing the KYC procedure. In case of a minor the guardian would have to be KYC compliant.
Benefits of using MFSS for participation in mutual funds
Through this platform investors are able to get a single view of his portfolio across multiple assetslike securities, mutual fund units etc.,
Investors are able to get services from same intermediary for different asset class.
Investors can optimize their investment decisions due to reduced time lag in movement of funds.
Investors can have a voice in agreeing on charges to be paid for services rendered.
Reduction of paperwork.
Transparency in knowing status of order till completion thereby reducing disputes.
Recourse to grievance resolution in case of deficiency in service provided by member
As many as 10 fund houses have joined the NSE MFSS Platform and as on December 31, 2009 and there were667 subschemes available for trading. As of December 2009, there were 982 orders placed for subscription
worth Rs.3.55 crore and 97 orders worth Rs.0.92 crore were redeemed. 175 trading members were registered
in MFSS as participants by end December 2009.
The launch of this new trading platform will facilitate in the expansion of the reach of mutual fund schemesto more cities as trading terminals are spread all over the country.
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R E G U L A T O R Y C H A N G E S
Initiated by SEBI
1. Stock Exchanges allowed to determine delivery period for Interest Rate Futures
Based on feedback received from Exchanges, SEBI has, vide its circular dated 22 nd December, 2009 allowedStock Exchanges to set any period of time during the delivery month as the delivery period for the deliverablegrade securities.
2. Revision in the computation methodology of limitation period for cases filed for arbitration
The Secondary Market Advisory Committee (SMAC) of SEBI, reviewed the existing provisions in the ExchangeByelaws, which specify a limitation period of six months for reference of a complaint/claim/difference/disputefor arbitration.
While computing the said limitation period, the time taken in amicable settlement of claims, complaints, differ-ences, disputes through the Investors Grievances Redressal Committee mechanism of the Exchange under its
Rules, Bye-laws & Regulations is excluded.
Based on the recommendations of the SMAC, SEBI has decided, vide circular dated 2nd December, 2009 that thelimitation period of six months should be computed from the end of the quarter during which the disputedtransaction(s) were executed. The period of one month from the date of receipt of complaint/claim/difference/dispute by the trading member or the actual time taken by the trading member from the date ofreceipt of complaint/claim/difference/ dispute by the trading member to the date of receipt of the tradingmembers last communication by the investor, to resolve / counter the complaint / claim/ difference/ dispute,whichever ends earlier, should be excluded.
Apart from the above, in certain instances it was observed by SEBI that the arbitration applications are beingrejected on the grounds of having exceeded the limitation period, without going into the circumstances leadingto the arbitration not being filed within the time period. In case the arbitration application is not filed withinthe limitation period for reasons beyond the control of the party, rejection of the same is not in the interest ofinvestors. Accordingly, it has been decided that:
The limitation period can be extended in certain cases for a further period of three months by the stockexchange.
The stock exchange can decide on extending the limitation period for a period of three months, only afterobtaining sufficient documentary proof in this regard and recording the reasons for the same in writing.
In this regard, the party is required to provide to the stock exchange sufficient documentary proof regarding thereasons for the delay in filing the arbitration case and the stock exchange should examine, if the reasons /documentary proof submitted, for not filing the arbitration within the limitation period were indeed beyond thecontrol of the party.
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R E G U L A T O R Y C H A N G E S ( c o n t d . . )
h. In case of default in delivery of securities by the SGL account holders, it will be treated as "bouncing"and current penalties in respect of SGL bouncing would apply. In case of default in delivery of security by theCSGL account holders, arising out of the actions of the individual Gilt Account Holders (GAH), it will be theresponsibility of the CSGL account holders to suitably deal with the concerned GAH to prevent recurrence ofsuch defaults. The ECH/ECC will inform the PDO, Mumbai about any such default by the SGL/CSGL accountholders on the same day.
i. Individual ECH/ECC may decide upon the time frame for the settlement. However, the pay-out of thesecurities for settlement of IRF contracts should be completed latest by 2.30 PM.
2. Review of External Commercial Borrowings (ECB) Policy
On a review of the prevailing macroeconomic conditions and developments in international financial markets,the RBI has, vide its circular dated 9 th December, 2009, modified the ECB policy as indicated below:
(i) All-in-cost ceilings
As per the extant policy, the all-in-cost ceilings have been dispensed with, under the approval route, until
December 31, 2009. In view of the improvement in the credit market conditions and narrowing credit spreadsin the international markets, the existing relaxation in the all-in-cost ceilings under the approval route witheffect from January 1, 2010 has been withdrawn. Accordingly, the all-in-cost ceilings under the approvalroute for the ECBs, where Loan Agreements have been signed on or after January 1, 2010 will be as under:
*for the respective currency of borrowing or applicable benchmark.
Eligible borrowers proposing to avail of ECB after December 31, 2009, where the Loan Agreement has been
signed on or before December 31, 2009 and where the all-in-cost exceed the above ceilings, should furnish acopy of the Loan Agreement. Such proposals would continue to be considered under the approval route.
(ii) Integrated township
As per the extant policy, corporates, engaged in the development of integrated township, as defined in PressNote 3 (2002 Series) dated January 04, 2002, issued by the Department of Industrial Policy and Promotion(DIPP), Ministry of Commerce & Industry, Government of India are permitted to avail of ECB, under the ap-proval route, until December 31, 2009. On a review of the prevailing conditions, it has been decided to ex-tend the current policy until December 31, 2010, under the approval route. All other terms and conditions,stipulated in the A.P. (DIR Series) Circulars referred to above, remain unchanged.
iii) Buyback of the Foreign Currency Convertible Bonds (FCCBs)
In terms of A.P. (DIR Series) Circular No. 39 dated December 8, 2008, read with A.P. (DIR Series) Circular No.58 dated March 13, 2009 and A.P. (DIR Series) Circular No. 65 dated April 28, 2009, Indian companies havebeen allowed to buyback their Foreign Currency Convertible Bonds (FCCBs) both under the automatic routeand approval route until December 31, 2009. Keeping in view the prevailing macroeconomic conditions andglobal developments, especially the improvements in the stock prices, it has been decided to discontinue thefacility with effect from January 1, 2010.
Average Maturity Period All -in-cost Ceilings over six month Libor*
Three years and up to five years 300 basis points
More than five years 500 basis points
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R E G U L A T O R Y C H A N G E S ( c o n t d . . )
v) ECB for the NBFC Sector
As per the current ECB norms, Non-Banking Finance Companies (NBFCs), which are exclusively involved in thefinancing of the infrastructure sector, are permitted to avail of ECBs from multilateral / regional financial
institutions and Government owned development financial institutions for on-lending to the borrowers in theinfrastructure sector under the approval route. In view of the thrust given to development of infrastructuresector, it has been decided with immediate effect to allow NBFCs exclusively involved in financing the infra-structure projects to avail of ECB from the recognized lender category including international banks under theapproval route, subject to complying with the prudential standards prescribed by the Reserve Bank and theborrowing entities fully hedging their currency risk. The AD Category-I bank should certify the compliancewith the prudential norms by the borrowing NBFCs.
(v) ECB for Spectrum in the Telecommunication Sector
As per the extant policy, as indicated in Circular dated October 22, 2008, payment for obtaining license/permit for 3G Spectrum is considered an eligible end - use for the purpose of ECB under the automatic route.
It has now been decided to permit eligible borrowers in the telecommunication sector to avail of ECB for thepurpose of payment for Spectrum allocation. This modification will come into effect with immediate effect.
All other aspects of ECB policy such as USD 500 million limit per company per financial year under theautomatic route, eligible borrower, recognised lender, end-use, average maturity period, prepay-ment, refinancing of existing ECB, reporting arrangements and terms and conditions stipulated in theA.P. (DIR Series) Circulars are unchanged.
Extended market timings from January 4, 2010 onwards
From January 4, 2010 onwards, the Indian Stock markets would open from 9:00 a.m. to 3:30 a.m:
Normal Market / Retail Debt Market / Limited Physical Market Open: 9:00 a.m. Accordingly, the BlockTrade session shall be available from 9:00 am to 9:35 am. Normal Market / Retail Debt Market / Lim-ited Physical Market close time shall remain unchanged i.e. 3:30 pm. There is no change in the tim-ings of closing session and Auction market.
N S E N E W S
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N S E N E W S ( c o n t d )
2. Expansion of scheme of strikes in Stock Options
In pursuance of SEBI guidelines for providing scheme of strikes in Stock options contracts and in ac-cordance with consolidated circular no NSE/F&O/124/2008 (Download no. NSE/F&O/11675) datedNovember 25, 2008, currently for all Stock options contracts, the Exchange introduces strikes as perthe following scheme:
Considering the need to provide a larger and uniform coverage of strikes for stock options contracts,the following revised strike parameters scheme has been formulated by NSE vide its circular dated10th December, 2009:
Underlying Closing Price Step
ValueNo. of Strikes (Inthe money- At themoney-Out of the
Less than or equal to Rs.50 2.5 3-1-3
>Rs.50 to Rs.250 to Rs.500 to Rs.1000 to Rs.2500 to Rs.9999 100 3-1-3
Underlying Closing Price StepValue
No. of Strikes pro-vided (In the money- At the money-Out
of the money)Less than or equal toRs.50
2.5 5-1-5
>Rs.50 to Rs.100 to Rs.250 to Rs.500 to Rs.1000 100 5-1-5
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N S E N E W S ( c o n t d )
3. Delivery period of Interest Rate Futures reduced from a month (1st business day of delivery month
till the last business day of the same month) to just 1 day (last business day of the delivery month)
Currently, for interest rate futures, the delivery of deliverable grade securities takes place from the firstbusiness day of the delivery month till the last business day of the delivery month. SEBI, vide its circulardated December 22, 2009 has now permitted the Exchanges to set any period of time during the deliverymonth as the delivery period for Interest Rate Futures contracts. Accordingly, the delivery period has beenrevised. The delivery settlement day for the Interest Rate Futures contract would be the last business dayof the delivery month. The last trading day and the intention day would therefore accordingly be two busi-ness days prior to the delivery settlement day. This would be applicable from March 2010 contract on-wards.
4. Expiry/Last trading day for Interest Rate Futures revised to two business days (from seven businessdays) prior to the last business day of the expiry/delivery month.
Currently, the last trading/expiry day for Interest Rate Future (IRF) contracts is determined as seven work-ing days prior to the last working day of the expiry/delivery month. In pursuance to SEBI circular SEBI/DNPD/Cir- 49/2009 dated December 22, 2009 and, in partial modification of our circulars NSE/CD/036/2009 dated August 25, 2009 andNSE/CD/057/2009 dated December 18, 2009, the exchange hasrevised the expiry/last trading day as, two working days prior to the last working day of the expiry/delivery month. In view of the above, the revised last trading/expiry dates for IRF contracts available fortrading will be as follows:
NCFM NEWS
Till November 2009, 10 candidates have successfully acquired the NCFM (NSE Certified Market Profes-sional) Level 4 certification.
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I N T E R N A T I O N A L N E W S
1. Shenzhen Stock Exchange launches listed companies-investors interaction platform
In order to enhance the standardized operation of listed companies, protect the legitimate rights and inter-ests of investors, especially small-medium investors, the SZSE recently has launched the Interaction Plat-
form for SZSE-listed Companies and Investors Relation. The establishment of the platform will provide animportant channel for direct communication and dialogue between listed companies and investors; benefitthe optimization of the relations between public investors and listed companies and facilitate investors towidely participate in the corporate governance. And the platform is also a major measure for the SZSE toregulate and deepen the administration of listed companies-investors relations.
Investors may, through the interaction platform, inquire about the relevant information of SZSE-listed com-panies, put forward to listed companies consulting, advice, complaint or other relevant questions, or refer toquestions brought by other investors to listed companies and corresponding answer by listed companies.
The SZSE requires that all listed companies shall designate special person to take charge of the interactionplatform work and promptly handle or answer relevant questions. At the same time, the SZSE clearly re-quires that listed companies shall properly handle different questions in light of different situations of thesequestions in the interaction platform, and shall not give any answer in respect of information not publicly
disclosed.
2. Eurex to launch dividend futures on single stocks from January 11, 2010
The international derivatives exchange Eurex announced that it will offer futures contracts based on particu-lar dividends of individual shares from 11 January 2010. Eurex will launch Dividend futures on the constitu-ents of the Dow Jones EURO STOXX 50. Following the successful introduction of the index dividend futures onthe Dow Jones EURO STOXX 50 in June 2008, Eurex further expands its offering. Thus, for the first time inEurope the pure dividend component of the underlying stocks of a benchmark equity index are available forexchange trading and clearing as a stand-alone product.
Eurex is introducing these products to enable investors to hedge or trade the dividends that are announcedand paid by the individual index constituents in each year. The separate exchange listing of this dividendelement will improve possibilities for risk management and increases transparency on one of the fundamen-tal elements determining a shares value.
Eurex will initially introduce dividend futures on 25 of the constituent components of the Dow Jones EUROSTOXX 50. Hence, investors can manage their exposure to the 2010 dividend period. Eurex will offer annualcontracts in each name from December 2010 out to December 2014 that will settle to the value of the divi-dends paid in the annual period to that date. With the introduction of the dividend futures, Eurex aims towork closely with the current market participants and to attract new entrants to the asset class.
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MANAGERIAL PERSONNEL NSE
Name DESIGNATION DEPARTMENT
Mr. Ravi Narain Managing Director and CEO
Ms. Chitra Ramkrishna Jt. Managing Director
Mr. J Ravichandran Director Finance & Accounts, Legal & Secretarial
Mr. Ravi Apte Chief Technology Officer
Mr. R Sundararaman Sr. Vice President NSCCL
Mr. Yatrik R Vin Sr. Vice President Finance & Accounts
Ms. Kamala Vice President Compliance, Inspection, Membership, Arbitra-tion, Defaulters Section & Investor Service Cell
Mr. Nirmal Mohanty Head - SBU EDU SBU - Education
Mr. R Nanda Kumar Vice President NSCCL - Development & NCCL, NOW, WebTeam
Mr. Ravi Varanasi Vice President Investigation, Surveillance & Inspection
Ms. T. S. Jagadharini Vice President Trade (Capital Market, Currency Derivatives,F&O & WDM), Development & Marketing
Mr. Vidhu Shekhar Vice President New Products & Six Sigma Inititiatives
Mr. Arup Mukherjee Asst. Vice President SBU - Education
Mr. C. N. Upadhyay Asst. Vice President Inspection & Compliance
Mr. Dhruvkumar Patil Asst. Vice President Investor Service Cell
Mr. Hari K Asst. Vice President Listing & Corporate Communications
Mr. Mahesh Haldipur Asst. Vice President Premises
Mr. Mayur Sindhwad Asst. Vice President NOW, Dotex International Ltd.
Mr. Nilesh Tinaikar Asst. Vice President Development
Ms. Nisha Subhash Asst. Vice President Investigation
Mr. R Jayakumar Asst. Vice President Secretarial
Ms. Rana Usman Asst. Vice President NSCCL - Securities, F&O Clearing and SLB
Mr. Ravindra MohanBathula
Asst. Vice President Legal
Mr. Suprabhat Lala Asst. Vice President Trade - (Capital Market, F&O, Currency De-rivatives & WDM)
Mr. Suresh Narayan Asst. Vice President India Index Services & Products Ltd. & DotexInt'l
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MANAGERIAL PERSONNEL NSE
Name DESIGNATION DEPARTMENT
Mr. T Venkat Rao Branch In-charge Regional Office - Delhi
Mr. Ajith Kumar V Manager Administration & Development
Ms. Aparna Bhat Manager NSCCL -Risk Management
Mr. Amit Bhobe Manager NCCL
Mr. Amol Mahajan Manager Finance & Accounts
Ms. Anuradha Guru Officer on Special Duty SBU - Education
Mr. Arvind Goyal Manager Currency Derivatives - Trade
Mr. Avinash Kharkar Manager Listing
Mr. Bireshwar Chatterjee Manager Investigation
Ms. Himabindu Vakkalanka Manager Development
Mr. Huzefa Mahuvawala Manager NSCCL -Risk Management
Mr. Janardhan Gujaran Manager F&O - Trade
Ms. Jayna Gandhi Manager Finance & Accounts
Mr. Johnson Joseph Chiriyath Manager Investor Service Cell
Mr. Kiran Dusane Manager Premises
Mr. Kiran Sawant Manager NSCCL - Collaterals
Ms. Pareezad Deboo Manager NSCCL - Currency Derivatives
Mr. Prashanto Banerjee Manager Marketing
Mr. Ram Surve Manager Human Resources
Ms. Rehana D'Souza Manager MembershipMr. Sandeep Dandapat Branch In-charge Regional Office - Kolkata
Mr. Sandeep Manoharan Manager NSCCL - Development
Mr. Shekhar Rao Manager Finance & Accounts
Ms. Sonali Karnik Manager Surveillance
Mr. Sunil Gawde Manager Capital Market - Trade
Ms. Sunitha Anand Branch In-charge Regional Office - Chennai & Hyderabad
Ms. Sushama Bhagchandani Manager Finance & Accounts
Mr. Vinayak Shenoy Manager Finance & Accounts
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MANAGERIAL PERSONNEL OF NSE INFOTECH SERVICES LTD.
Name Designation Dept
Mr.N Muralidaran CEO Projects
Mr.G. M. Shenoy Senior Vice President Projects
Mr.M. R. Krishnan Vice President Infrastructure
Ms.Hema Iyer Vice President Risk Management
Mr.Mahesh Soparkar Group Head Projects, DBA/SysAdmin
Mr.P. R. Visvas Assistant Vice President Internal Systems - Listing, DWH
Ms.Mamatha Rangaprasd Assistant Vice President Trade
Mr.Mahesh Basrur Assistant Vice President FOCASS, NCSS
Mr.Hemant Patade Assistant Vice President BCP
Mr.Deviprasad Singh Assistant Vice President Telecom
Ms.Smrati Kaushik Senior Manager Trade
Mr.Viral Mody Senior Manager Trade
Mr.Hitesh Shah Senior Manager DBA /Sys Admin
Mr.Sujoy Das Senior Manager PRISM / TAPMr.Sudhir Sawant Senior Manager Project Management Office
Mr.Pranav Gupta Senior Manager Risk Management
Mr.Rajanish Nagwekar Senior Manager Index / Neat Plus
Mr.Nipun Dave Senior Manager Architecture
Mr.Bineet Jha Senior Manager HWARE SUPPORT
Ms.Geeta Mathew Senior Manager ASG / Operations
Mr.Mathew Joseph K Senior Manager NCSS
Mr.Benny Sebastian Senior Manager Membership
Mr.Manoj Joshi Manager Projects
Ms.Anuja Joshi Manager BCPMr.Suresh Chandani Manager Trade
Mr.Shibu Tomy Manager NFA/FAMS
Ms.Pranali Taskar Manager Telecom
Mr.Umesh Agroya Manager Telecom
Mr.Joy John Manager BCP - Chennai
Mr.Narayan Neelakanthan Manager Telecom
Ms.Bernadine Swamy Manager HRD
Mr.Mahesh Dere Manager Membership
Mr.Anoop Kumar Rawat Consultant DBA
Mr.Nitin Gupte Manager Telecom
Mr.Sandeep Kumar Gupta Manager ASG
Mr.Tushar H. Kulkarni Manager C2N
Mr.Prasad Addagatla Manager SysAdmin
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MANAGERIAL PERSONNEL OF NSE INFOTECH SERVICES LTD.
Name Designation Dept
Mr.Suraj P Bangera Manager Web
Mr.Manoj Kumar Singh Manager TECH - DelhiMr.Sagar Joshi Manager Project Management Office
Mr.Shreekantha Velankar Manager DWH
Mr. Balakrishnan M Manager FOCASS
Mr.Aditya Agarwal Manager Architecture
Ms.Meena Hajare Manager Listing
Mr.Nishant Jha Manager OPMS
Ms.Veena Khilnani Manager DBA
Mr.Vinit Naik Manager Survellience
Ms.Vishakha Shenoy Manager PRISM