Bombay Stock Exchange is the oldest stock exchange in Asia and in INDIA with a rich heritage, now spanning three centuries in its 133 years of existence. What is now popularly known as BSE was established as “The Native Share & Stock Brokers’ Association” in 1875. Indian Share investment has come a long way since then to be the second largest Emerging Stock Market trading in the world
BSE is the first stock exchange in the country which obtained permanent recognition (in 1956) from the Government of India under the Securities Contracts (Regulation) Act 1956. BSE’s pivotal and pre-eminent role in the development of the Indian capital market is widely recognized. It migrated from the open outcry system to an online screen-based order driven trading system in 1995. Earlier an Association Of Persons (AOP), BSE is now a corporatised and demutualised entity incorporated under the provisions of the Companies Act, 1956, pursuant to the BSE (Corporatisation and Demutualisation) Scheme, 2005 notified by the Securities and Exchange Board of India (SEBI). With demutualisation, BSE has two of world’s best exchanges, Deutsche Börse and Singapore Exchange, as its strategic partners.
India vs China – The Race for economic One upmanship
Most visitors to India and China form their impressions about these countries by comparing such cities as Mumbai, New Delhi, and Bangalore with Shanghai, Beijing, and Guangzhou. The difference between the two countries’ urban centers is truly stark. China’s top cities now look more modern and sleeker than New York or London. By contrast, India’s premier cities are still vivid examples of the third world. Yet most people overlook the fact that, even though China is clearly ahead of India, the former looks stronger than it is while the latter is stronger than it looks. Yet one cannot overlook the fact that adult literacy in India runs at only about 61%, far below the 91% figure for China, the 90% figure for Indonesia, and the 89% figure for Brazil.
In 2008, China’s GDP was just a bit more than three times that of India. If India’s GDP grows at 8% to 9% a year over the next decade—a reasonable prediction based on analyses by Goldman Sachs (GS), the U.S. National Intelligence Council, and other analysts—India’s GDP in 2020 will be almost the same as China’s in 2008. Of course, China would have powered ahead by then, but the fact remains that India’s economy is about 12 to 14 years, not decades, behind China’s. This is exactly the difference from 1978, when Deng Xiaoping launched China’s reforms, to 1991, when India jumped onto a similar train.
Over the past 133 years, BSE has facilitated the growth of the Indian corporate sector by providing it with an efficient access to resources. There is perhaps no major corporate in India which has not sourced BSE’s services in raising resources from the capital market.
Today, BSE is the world’s number 1 exchange in terms of the number of listed companies and the world’s 5th in transaction numbers. The market capitalization as on December 31, 2007 stood at USD 1.79 trillion . An investor can choose from more than 4,700 listed companies, which for easy reference, are classified into A, B, S, T and Z groups.
The BSE Index, SENSEX, is India’s first stock market index that enjoys an iconic stature , and is tracked worldwide. It is an index of 30 stocks representing 12 major sectors. The SENSEX is constructed on a ‘free-float’ methodology, and is sensitive to market sentiments and market realities. Apart from the SENSEX, BSE offers 21 indices, including 12 sectoral indices. BSE has entered into an index cooperation agreement with Deutsche Börse
The National Stock Exchange of India Limited has genesis in the report of the High Powered Study Group on Establishment of New Stock Exchanges, which recommended promotion of a National Stock Exchange by financial institutions (FIs) to provide access to investors from all across the country on an equal footing. Based on the recommendations, NSE was promoted by leading Financial Institutions at the behest of the Government of India and was incorporated in November 1992 as a tax-paying company unlike other stock exchanges in the country.
The Bombay Stock Exchange Limited (Marathi/Hindi: मुंबई शेयर बाज़ार Mumbaī Śeyar Bāzār) (formerly, The Stock Exchange, Mumbai; popularly called The Bombay Stock Exchange, or BSE) has the greatest number of listed companies in the world, with 4700 listed as of August 2007. It is located at Dalal Street, Mumbai, India. On 31 December 2007, the equity market capitalization of the companies listed on the BSE was US$ 1.79 trillion, making it the largest stock exchange in South Asia and the tenth largest in the world.
The Bombay Stock Exchange was established in 1875. Around 6,000 Indian companies list on the stock exchange, and it has a significant trading volume.
The BSE SENSEX (SENSitive index), also called the “BSE 30”, is a widely used market index in India and Asia. Though many other exchanges exist, BSE and the National Stock Exchange of India account for most of the trading in shares in India.
On its recognition as a stock exchange under the Securities Contracts (Regulation) Act, 1956 in April 1993, NSE commenced operations in the Wholesale Debt Market (WDM) segment in June 1994. The Capital Market (Equities) segment commenced operations in November 1994 and operations in Derivatives segment commenced in June 2000.
* The World Council of Corporate Governance has awarded the Golden Peacock Global CSR Award for BSE’s initiatives in Corporate Social Responsibility (CSR).
* The Annual Reports and Accounts of BSE for the year ended March 31, 2006 and March 31 2007 have been awarded the ICAI awards for excellence in financial reporting.
* The Human Resource Management at BSE has won the Asia – Pacific HRM awards for its efforts in employer branding through talent management at work, health management at work and excellence in HR through technology
Drawing from its rich past and its equally robust performance in the recent times, BSE will continue to remain an icon in the Indian capital market.
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