Page 42 - DCOM504_SECURITY_ANALYSIS_AND_PORTFOLIO_MANAGEMENT

Unit 1: Introduction to Capital Market

7. India is one of the few countries to have started the Straight Through Processing (STP), Notes
which will completely automate the process of order flow and clearing and settlement on
the stock exchanges.
8. RBI has introduced the Real-time Gross Settlement system (RTGS) in 2004 on experimental
basis. RTGS will allow real delivery v/s payment which is the international norm
recognized by BIS and IOSCO.
9. To improve the governance mechanism of stock exchanges by mandating demutualisation
and corporatisation of stock exchanges and to protect the interest of investors in securities
market the Securities Laws (Amendment) Ordinance was promulgated on 12th October
2004. The Ordinance was replaced by a Bill that was followed by the Securities and Exchange
Board of India (Amendment) Act, 2009. Under this, the Presiding Officer and Members of
the Tribunal hold office for a term of five years and are eligible for re-appointment.

Listing of Securities

Listing means admission of the securities to dealings on a recognised stock exchange. The
securities may be of any public limited company, central or state government, quasi governmental
and other financial institutions/corporations, municipalities, etc.
The objectives of listing are mainly to:
1. provide liquidity to securities;

2. mobilize savings for economic development;
3. protect interest of investors by ensuring full disclosures.
The exchange has a separate Listing Department to grant approval for listing of securities of
companies in accordance with the provisions of the Securities Contracts (Regulation) Act, 1956,
Securities Contracts (Regulation) Rules, 1957, Companies Act, 1956, Guidelines issued by SEBI
and Rules, Bye-laws and Regulations of the Exchange.

A company intending to have its securities listed on the Exchange has to comply with the listing
requirements prescribed by the Exchange. Some of the requirements are as under:
1. Minimum Listing Requirements for new companies

2. Minimum Listing Requirements for companies listed on other stock exchanges
3. Minimum Requirements for companies delisted by this Exchange seeking relisting of this
Exchange

4. Permission to use the name of the Exchange in an Issuer Company's prospectus
5. Submission of Letter of Application
6. Allotment of Securities

7. Trading Permission
8. Requirement of 1% Security
9. Payment of Listing Fees
10. Compliance with Listing Agreement
11. Cash Management Services (CMS) – Collection of Listing Fees

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