Investing in India: BSE, NSE, SENSEX, Indian Stock Market

D&B India has a great report on the leading Equity brokerage firms in India. Over 394 firms are listed by Size, Total Terminals, Sub brokers, Total Employees, Branches, Cities of operation and Offerings. Some excerpts:

For the broking industry, we started with an initial database of over 1,800 broking firms that were contacted, from which 464 responses were received. The list was further short listed based on the number of terminals and the top 210 were selected for profiling. 394 responses, that provided more than 85% of the information sought have been included for this analysis presented here as insights. All the data for the study was collected through responses received directly from the broking firms. The insights have been arrived at through an analysis on various parameters, pertinent to the equity broking industry, such as region, terminal, market, branches, sub brokers, products and growth areas. 

Some key characteristics of the sample 394 firms are:

• On the basis of geographical concentration, the West region has the maximum representation of 52%. Around 24% firms are located in the North, 13% in the South and 10% in the East
• 3% firms started broking operations before 1950, 65% between 1950-1995 and 32% post
  1995
• On the basis of terminals, 40% are located at Mumbai, 12% in Delhi, 8% in Ahmedabad, 7% in Kolkata, 4% in Chennai and 29% are from other cities
• From this study, we find that almost 36% firms trade in cash and derivatives and 27% are into cash markets alone. Around 20% trade in cash, derivatives and commodities
• In the cash market, around 34% firms trade at NSE, 14% at BSE and 52% trade at both exchanges. In the derivative segment, 48% trade at NSE, 7% at BSE and 45% at both, whereas in the debt market, 31% trade at NSE, 26% at BSE and 43% at both exchanges
• Majority of branches are located in the North, i.e. around 40%. West has 31%, 24% are located in South and 5% in East
• In terms of sub-brokers, around 55% are located in the South, 29% in West, 11% in North and 4% in East
• Trading, IPOs and Mututal Funds are the top three products offered with 90% firms offering trading, 67% IPOs and 53% firms offering mutual fund transactions
• In terms of various areas of growth, 84% firms have expressed interest in expanding their institutional clients, 66% firms intend to increase FII clients and 43% are interested in setting up JV in India and abroad
• In terms of IT penetration, 62% firms have provided their website and around 94% firms have email facility

30 companies make up the most watched index in India – the SENSEX (SENSitive IndEX). These are the largest capitalized companies.

National Stock Exchange (NSE) started trading in the equities segment (Capital Market segment) on November 3, 1994. There are 1,319 companies listed on NSE as of September 2007. List of most active stocks onthe NSE, is a who’s who list of Indian companies.

Bombay Stock Exchange Limited is Asia’s oldest stock exchange. It carries within itself the depth of knowledge of capital markets acquired since its inception in 1875. Located in Mumbai, the financial capital of India, it has been the backbone of the country’s capital markets.

There are several indices that measure BSE.

Stocks traded on the Exchange have been classified into ‘A’, ‘B1′, ‘B2′,’T', ‘S’, ‘TS’ ‘F’ ,’G’ and ‘Z’ groups.

The Exchange has for the guidance and benefit of the investors have classified the scrips in the Equity Segment into ‘A’, ‘B1′, ‘B2′,’T', ‘S’, ‘TS’ and ‘Z’ groups on certain qualitative and quantitative parameters which include number of trades, value traded, etc.

The “F” Group represents the Fixed Income Securities.

The “T” Group represents scrips which are settled on a trade to trade basis as a surveillance measure.

The “S” Group represent scrips forming part of the “ BSE-Indonext” segment .

The “TS” Group consist of scrips in the “ BSE-Indonext” segment which are settled on a trade to trade basis as a surveillance measure.

Trading in Govt. Securities for retail investors is done under “G” group.

The ‘Z’ group was introduced by the Exchange in July 1999 and includes the companies which have failed to comply with the listing requirements of the Exchange and/or have failed to resolve investor complaints or have not made the required arrangements with both the Depositories, viz., Central Depository Services (I) Ltd. (CDSL) and National Securities Depository Ltd. (NSDL) for dematerialization of their securities.

The Exchange also provides a facility to the market participants for on-line trading of odd-lot securities in physical form in ‘A’, ‘B1′, ‘B2′ ‘T’,'S’, ‘TS’ and ‘Z’ groups and Rights renunciations in all the groups of scrips in the Equity Segment.

As of June 2007, there are over 4800 companies listed on the Bombay Stock Exchange and over 1200 companies listed on the National Stock Exchange.