Page 63 - DMGT401Business Environment

Business Environment

Notes 2. To provide access to investor all over the country through an appropriate communication
network.
3. To enable shorter settlement cycles and book entry settlement systems.

4. To bring the Indian stock market in line with international markets.
5. To promote the secondary market in debt instruments such as government and corporate
bonds.

NSR has an order-driven market and it allows members to trade through their office through
communication networks. NSE is the first exchange in India to introduce mark to market system
of margin which reduced the risk of default by members.

Over the Counter Exchange of India (OTCEI)

The OTCEI is primarily meant for small sized companies and small investors. This exchange has
the advantages of transparency, fast settlements and potential to reach the nooks and corners of
the country. OTCEI was modeled on National Association of Securities Dealers Automated
Quotation System (NASDAQ) in the US. In the USA all off-exchange trading was referred to as
the Over the Counter (OTC) Market.
OTCEI was incorporated as a company in 1990 under the Companies Act. It became operational
in 1992 and was the first stock exchange in India to introduce screen based automated ring less
trading system. It is promoted by the UTI, ICICI, IDBI, IFCI, LIC, GIC, SBI Caps, and CANBANK
as a company under Section 25 of the Companies Act 1956, with its headquarters at Mumbai.

Its objective are: (a) to help companies raise capital from the market at the cheapest costs and on
optimal terms (b) to help investors to access capital market safely and conveniently (c) to cater
to the needs of the companies which cannot be listed on other official exchange (d) to eliminate
the problems of illiquid securities, delayed settlements, and unfair prices faced by the investors.
Apart from the above stock exchanges are other national and regional stock exchanges in:

1. Ahmedabad
2. Bangalore
3. Bhubaneshwar
4. Kolkata
5. Cochin

6. Coimbatore
7. Delhi
8. Guwahati
9. Hyderabad
10. Jaipur
11. Ludhiana
12. Madhya Pradesh

13. Chennai
14. Magadh
15. Mangalore

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