Page 21 - DCOM304_INDIAN_FINANCIAL_SYSTEM

Indian Financial System Rupesh Roshan Singh, Lovely Professional University

Notes Unit 2: Financial Market Reforms

CONTENTS
Objectives
Introduction

2.1 New Issue Market during Pre-reform Period
2.1.1 An Overview
2.1.2 Security-wise New Issue Activity

2.2 New Issue Market during Post-reform Period
2.2.1 Measures to Bolster up New Issue Market
2.3 Developments in New Issue Market
2.3.1 Quantitative Dimension
2.3.2 Qualitative Dimension

2.3.3 Ownership Pattern of New Issues
2.4 Sectoral Pattern of New Issues
2.5 Mode of Distribution of New Issues

2.6 Summary
2.7 Keywords
2.8 Review Questions
2.9 Further Readings

Objectives

After studying this unit, you should be able to:
 Understand need for reforms;
 Understand the context and objectives of financial market reforms;

 Understand new issue market during pre-reforms period;
 Discuss the development in the new issue market;
 Explain Mode of distribution in the new issue market.

Introduction

The new issue market in India is not as much developed in terms of quantity and quality of
activities as also financial depth and sophistication as in the US, UK and European countries.
Nevertheless, it has over a period time, grown spectacularly in tandem with scorching pace of
economic and industrial growth of the country and emerged as robust and resilient constituent
of the financial market to cope with the competitive challenges across the economy. Dynamism
in the new issue market in India, as perceptibly reflected in the volume of new issue activity, use
of innovative instruments to garner funds, methods of distribution of securities, pricing of
issues and broadening of market base over a period of time, is because of inexorable policy

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