slide1 n.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
WELCOME PowerPoint Presentation
play fullscreen
1 / 62

WELCOME

333 Views Download Presentation
Download Presentation

WELCOME

- - - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript

    Slide 1: WELCOME TO PRESENTATION ON STATE OF INDIAN CAPITAL MARKET

    by. G .N. Bajpai Former - Chairman SECURITIES & EXCHANGE BOARD OF INDIA & LIFE INSURANCE CORPORATION OF INDIA On 14th OCTOBER 2005 At US IVCA Palo Alto, LA

    Slide 2:STRUCTURE OF PRESENTATON

    State of the Market Drivers Economic Factors Macro Global Micro Market Efficiency Regulators Philosophy Perspective Prescriptive Potential

    Slide 3:STATE OF MARKET

    Market Performance Ratios Volume Number of trades Amount Market Capitalization FII Investment

    Slide 4:MARKET PERFORMANCE

    Slide 5:MARKET PERFORMANCE

    Slide 6:RATIOS

    Slide 7:NUMBER OF TRANSACTIONS A COMPARISON

    Slide 8:STOCK INDEX FUTURES

    Slide 9:SINGLE STOCK FUTURES

    Slide 10:CAPITAL MARKET

    Slide 11:EQUITY

    Slide 12:DEBT

    Slide 13:DEBT

    Slide 14:FII INVESTMENT IN INDIA

    Simple and speedy registration process Minimum registration formalities 792 FIIs registered as on 30.09.2005 2139 sub accounts registered as on 30.09.2005 Cumulative FII Investment- US$ 38.96 bn.

    FII PARTICIPATION FII Investment in USD Mn. More than 80 new FIIs registered from April 2004.UN Pension Fund, CalPERS

    Slide 16:FII INVESTMENT

    Slide 17:FII- COUNTRY OF ORIGIN

    Slide 18:FII INVESTMENT

    Slide 19:FII INVESTMENT IN INDIA

    One of top growing economyGDP growth rate of over 6% in last decade India among top 3 Asian investment destinations in The 2005 World Investment Report - UNCTAD Foreign portfolio investment of more than US $ 8 billion in the Years 2005 One of the best performing among emerging stock markets, in recent times

    Slide 20:ECONOMIC FACTORS

    Macro GDP growth Savings growth Interest rates Financial Stability Geo political Growing Demand Global - Liquidity - Demand led growth

    Slide 21:GDP GROWTH

    Slide 22:GDP GROWTH

    Slide 23:SAVINGS GROWTH

    Slide 24:LIFE INSURANCE

    Slide 25:LIFE INSURANCE

    Slide 26:NON- LIFE INSURANCE

    Slide 27:NON- LIFE INSURANCE

    Slide 28:BANKING

    Slide 29:BANKING ( Cont)

    Slide 30:FINANCIAL STABILITY

    Slide 31:FOREX RESERVE

    Slide 32:ECONOMIC FACTORS

    Micro Firms Profitability Cost of Capital Productivity enhancement Competitive edge Dismantling of Administered rate investment instruments

    Slide 33:MARKET EFFICIENCY

    METAMORPHOSED MARKET

    Slide 34:METAMORPHOSED MARKET

    Slide 35: MARKET STRUCTURE (JULY 31, 2005)

    22 Stock Exchanges, 15 Subsidiaries Over 10000 Electronic Terminals at over 400 locations all over India. 9108 Stock Brokers and 14582 Sub brokers 9644 Listed Companies 2 Depositories and 483 Depository Participants 128 Merchant Bankers, 59 Underwriters 34 Debenture Trustees, 96 Portfolio Managers 83 Registrars & Transfer Agents, 59 Bankers to Issue 4 Credit Rating Agencies

    Slide 36: MARKET STRUCTURE (AUGUST 31, 2004)

    Venture Capital Funds 21 Foreign 61 Domestic 38 Mutual Funds And 479 Schemes Asset Base: US $ 44.94 bn. 739 Foreign institutional investors Cumulative FII investment - US$ 36.76 bn

    Slide 37:METAMORPHOSED MARKET

    Slide 38:STOCK INDEX FUTURES

    Slide 39:SINGLE STOCK FUTURES

    Slide 40:Quote from the Economic Survey 2003-04 Government of India

    The securities markets have made enormous progress in recent years. Indias equity market is now being increasingly recognized as a success story on the world scale

    Slide 41:METAMORPHOSED MARKET

    Slide 42:INDIAN DISCLOSURE STANDARDS

    Initial and Continuous Disclosures norms of global standards India scores 100% as far as disclosure standards are concerned (What works in Securities Laws?: Rafael La Porta, Florencio Lopez- de-Silanes, Andrei Shleifer. www.nber.org/papers/w9882)

    Slide 43:INDIAN ACCOUNTING STANDARDS

    Indian Accounting Standards: Principle based. Aligned to International Accounting Standards. In terms of consolidation, segmental reporting, deferred tax accounting and related party transactions, the gap between Indian and US GAAP is minimal. (CLSA - CG Watch; September 2004)

    Slide 44:INDIAN ACCOUNTING STANDARDS

    Indian Accounting Standards Principle based. Aligned to International Accounting Standards. Indian Accounting Standards score a maximum of 3 according to CALPERS Permissible Equity Market Analysis (Disclosure Quality and Emerging Market Mutual Fund Investment: Reena Aggarwal, Leora Klapper, Peter D. Wysocki http://www.worldbank.org/research/bios/lklapper/mutual%20funds_AKW.pdf)

    Slide 45:Quote from The Economic Intelligence Unit 2003 Study : Asian experience

    Top of the Country class, as might be expected is Singapore followed by Hong Kong and, somewhat surprisingly, India where overall disclosure standards have improved dramatically, accounting differences between local and US standards have been minimized and the number of companies with a majority of independent directors has risen significantly.

    Slide 46:

    Slide 47:

    Indias stock market regulatory authority, the Securities and Exchange Board of India (SEBI) continues to raise the bar for good corporate governance.

    Slide 48:METAMORPHOSED MARKET

    Slide 49:METAMORPHOSED MARKET

    Slide 50:CLEARING SYSTEM

    CENTRAL COUNTERPARTY clears all trades, determines obligations of members, arranges for pay-in of funds/securities, receives funds/ securities, arranges for pay-out of funds/ securities to members, guarantees settlement, and collects and maintains margins

    Slide 51:METAMORPHOSED MARKET

    Indian Settlement System conforms to: CPSS-IOSCO Principles & G-30 Recommendations

    Slide 52:T+2 SETTLEMENT SYSTEM

    Slide 53:METAMORPHOSED MARKET

    Slide 54:DYNAMIC RISK MANAGEMENT SYSTEM

    Capital adequacy norms Trading and Exposure limits Margin requirements VaR based margins Mark-to-Market margin Index-based market-wide Circuit breakers Settlement guarantee fund On-line position monitoring Automatic disablement of Brokers terminal

    Slide 55:Quote from Financial Times

    Worlds biggest democracy can show Google how to conduct an online IPO .in India you cannot apply on the web but investors can access one of the worlds largest financial networks with 7000 terminals scattered around 350 cities. And every step of the book building process is public. The Indian system is a refreshing example of a transparent IPO market but it is also a rare one, especially in the insider-friendly Asian markets

    Slide 56:REGULATORY PHILOSOPHY

    MANDATE

    Slide 57:MANDATE

    PROTECT THE INTEREST OF INVESTORS IN SECURITIES AND TO PROMOTE THE DEVELOPMENT OF, AND TO REGULATE, THE SECURITIES MARKET AND FOR MATTERS CONNECTED THEREWITH OR INCIDENTAL THERETO SEBI Act. EMERGENCE OF REGULATORY PHILOSOPHY Regulators focus should not be on the regulations but on the development of the Market. Regulations happen to be incidental to the developments.

    Slide 58:PERSPECTIVE

    PRESCRIPTIVE POTENTIAL

    Slide 59:PRESCRIPTIVE

    Market Depth Product Diversification Mortgage Backed Securities Assets Backed securities Warrants Vibrancy of Bond markets Co-ordination between trading platforms and OTC markets Disinvestment Market integration-convergence of Securities and Commodities markets Consolidation of regulation over listed companies Consolidated regulation over intermediaries Broadening market participation

    Slide 60:PRESCRIPTIVE

    Capacity BuildingRegulator and Industry-pillars of scalability and quality of intermediation Balance between Costs of regulation and market development Co-operation with Regulatorscross border and cross jurisdiction-building common standards of regulations

    Slide 61:POTENTIALS

    Macro financial stability High Forex Reserve Low inflation Low interest rates High GDP Growth Projection Growing Prosperity Demand Disposable Incomes New breed Indian (global) entrepreneurs Indian Capital Market have the potential to deliver high rate of returns in medium to long duration.

    Slide 62:

    THANK YOU