A Project Report on

CAPITAL MARKET
Submitted to NARMADA COLLEGE OF MANAGEMENT, BHARUCH.

Affiliated to GUJARAT TECHNOLOGICAL UNIVERSITY AHMEDABAD. In partial fulfillment of the Requirement for the degree of MASTERS OF BUSINESS ADMINISTRATION Submitted To Ms. NILAM PANCHAL Submitted By RONAK PATEL (1120) AMAN PANCHAL(1106) MBA (Semester 3)

INTRODUCTION A capital market is a market for securities (debt or equity), where business enterprises (companies) and governments can raise long-term funds. It is defined as a market in which money is provided for periods longer than a year, as the raising of short-term funds takes place on other markets (e.g., the money market). The capital market includes the stock market (equity securities) and the bond market(debt). Financial regulators, such as the UK's Financial Services Authority (FSA) or the U.S. Securities and Exchange Commission (SEC), oversee the capital markets in their designated jurisdictions to ensure that investors are protected against fraud, among other duties. Broadly speaking the CAPITAL MARKET is classified in to two categories. They are the Primary market (New Issues Market) and the Secondary market (Old (Existing) Issues Market). This classification is done on the basis of the nature of the instrument brought in the market. However on the basis of the types of institutions involved in capital market, it can be classified into various categories such as the Government Securities market or Gilt-edged market, Industrial Securities market, Development Financial Institutions (DFIs) and Financial intermediaries. All of these components have specific features to mention. The structure of the Indian capital market has its distinct features. These different segments of the capital market help to develop the institution of capital market in many dimensions. The primary market helps to raise fresh capital in the market. In the secondary market, the buying and selling (trading) of capital market instruments takes place. The following chart will help us in understanding the organizational structure of the Indian Capital market.

1. Government Securities Market: This is also known as the Gilt-edged mar-

ket. This refers to the market for government and semi-government securities backed by the Reserve Bank of India (RBI). 2. Industrial Securities Market: This is a market for industrial securities i.e. market for shares and debentures of the existing and new corporate firms. Buying and selling of such instruments take place in this market. This market is further classified into two types such as the New Issues Market (Primary) and the Old (Existing) Issues Market (secondary). In primary market fresh capital is raised by companies by issuing new shares, bonds, units of mutual funds and debentures. However in the secondary market already existing i.e old shares and debentures are traded. This trading takes place through the registered stock exchanges. In India we have three prominent stock exchanges. They are the Bombay Stock Exchange (BSE), the National Stock Exchange (NSE) and Over The Counter Exchange of India (OTCEI). 3 Development Financial Institutions (DFIs) : This is yet another important segment of Indian capital market. This comprises various financial institutions. These can be special purpose institutions like IFCI, ICICI, SFCs, IDBI, IIBI, UTI, etc. These financial institutions provide long term finance for those purposes for which they are set up. 4 Financial Intermediaries : The fourth important segment of the Indian capital market is the financial intermediaries. This comprises various merchant banking institutions, mutual funds, leasing finance companies, venture capital companies and other financial institutions. PRIMARY MARKET Securities available for the first time are offered through the primary market. The issuer may be a brand-new company or the one that has been in business for many years. The securities offered may be a new type for the issuer of additional amounts of a securities used frequently in the past. In primary market funds are mobilized in the primary market through prospectus, right issue, and private placement

Primary Market
Company announces IPO and distributes forms RESEARCH

Mr. A fills up form and submits it to the company

Mr. B fills up form and submits it to the company

Allotment Of Share

Mr. A is allotted some shares @ Rs 95 per share

Secondary Market
Mr. B is NOT allotted shares by the company. There were not enough shares to offer

Mr. A sells some of his shares in the market (at a higher price, say Rs. 105).

Mr. B buys some shares from the stock market through a broker at this price

ROLE OF PRIMARY MARKET The primary market provides the channel for sale of new securities. Primary market provides opportunity to issuers of securities; Government as well as corporate, to raise resources to meet their requirements of investment and/or discharge some obligation. They may issue the securities at face value, or at a discount/premium and these securities may take a variety of forms such as equity, debt etc. They may issue the securities in domestic market and/or international market. METHODS OF ISSUING SECURITIES IN THE PRIMARY MARKET

ISSUES

PUBLIC ISSUE

RIGHT ISSUE

PRIVATE PLACEME NT

BONUS ISSUE

INITIAL PUBLIC OFFER

FURTHER PUBLIC OFFER

INDIAN DEPOSITORY RECEIPT

PREFERE -NTIAL ISSUE

QUALIFIED INSTITUTI ONAL PLACEME NT

(a) Public issue: When an issue / offer of securities is made to new investors for
becoming part of shareholders family of the issuer it is called a public issue.

Public issue can be further classified into Initial public offer (IPO) and
Further public offer (FPO).

I. Initial public offer (IPO): When an unlisted company makes either a fresh issue of securities or offers its existing securities for sale or both for the first time to the public, it is called an IPO. This paves way for listing and trading of the issuers securities in the Stock Exchanges. II. Further public offer (FPO) or Follow on offer: When an already listed company makes either a fresh issue of securities to the public or an offer for sale to the public, it is called a FPO. III Indian depository receipt (IDR): IDRs are depository receipts denominated in Indian Rupees issued by a Domestic Depository in India. IDRs represent a proportional ownership interest in a fixed number of underlying equity shares of the issuer company (known as Deposited Shares.)
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 An IDR is a mechanism that allows investors in India to invest in listed foreign companies, including multinational companies, in Indian rupees.

(b) Rights issue (RI):

When an issue of securities is made by an issuer to its shareholders existing as on a particular date fixed by the issuer (i.e. record date), it is called an rights issue. The rights are offered in a particular ratio to the number of securities held as on the record date.
(C) Bonus issue:

When an issuer makes an issue of securities to its existing shareholders as on a record date, without any consideration from them, it is called a bonus issue. The shares are issued out of the Companys free reserve or share premium account in a particular ratio to the number of securities held on a record date. (d) Private placement: When an issuer makes an issue of securities to a select group of persons not exceeding 49, and which is neither a rights issue nor a public issue, it is called a private placement. Private placement of shares or convertible securities by listed issuer can be of two types:
(i)

Preferential allotment: When a listed issuer issues shares or convertible securities, to a select group of persons in terms of provisions of Chapter XIII of SEBI (DIP) guidelines, it is called a preferential allotment.
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 The issuer is required to comply with various provisions which

interalia include pricing, disclosures in the notice, lockin etc, in addition to the requirements specified in the Companies Act.

(ii)

Qualified institutions placement (QIP):

When a listed issuer issues equity shares or securities

convertible in to equity shares to Qualified Institutions Buyers only in terms of provisions of Chapter XIIIA of SEBI (DIP) guidelines, it is called a QIP. SECONDARY MARKET Once investors have purchased new issues they change hands in the secondary markets. This market is also known as the stock market. In India the secondary market consists of recognized stock exchanges operating under rules and regulations duly approved the government.

ROLE OF SECONDARY MARKET Secondary marketing is vital to an efficient and modern capital market. In the secondary market, securities are sold by and transferred from one investor or speculator to another. It is therefore important that the secondary market be highly liquid (originally, the only way to create this liquidity was for investors and speculators to meet at a fixed place regularly; this is how stock exchanges originated, see History of the Stock Exchange). As a general rule, the greater the number of investors that participate in a given marketplace, and the greater the centralization of that marketplace, the more liquid the market. Fundamentally, secondary markets mesh the investor's preference for liquidity (i.e., the investor's desire not to tie up his or her money for a long period of time, in case
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the investor needs it to deal with unforeseen circumstances) with the capital user's preference to be able to use the capital for an extended period of time. Accurate share price allocates scarce capital more efficiently when new projects are financed through a new primary market offering, but accuracy may also matter in the secondary market because: 1) price accuracy can reduce the agency costs of management, and make hostile takeover a less risky proposition and thus move capital into the hands of better managers, and 2) accurate share price aids the efficient allocation of debt finance whether debt offerings or institutional borrowing. These are important institutions and segments in the Indian capital market. Financial Regulatory Bodies Financial sector in India has experienced a better environment to grow with the presence of higher competition. The financial system in India is regulated by independent regulators in the field of banking, insurance, mortgage and capital market. Government of India plays a significant role in controlling the financial market in India. Securities and Exchange Board of India (SEBI) is one of the regulatory authorities for India's capital market.

Securities and Exchange Board of India (SEBI) National Stock Exchange Bombay Stock Exchange (BSE) Reserve Bank of India

SECRITIES & EXCHANGE BOARD OF INDIA Securities and Exchange Board of India (SEBI) was first established in the year 1988 as a non-statutory body for regulating the securities market. It became an autonomous body in 1992 and more powers were given through an ordinance. Since then it regulates the market through its independent powers.

Functions Of SEBI
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Regulates Capital Market Checks Trading of securities. Checks the malpractices in securities market. It enhances investor's knowledge on market by providing education. It regulates the stockbrokers and sub-brokers. To promote Research and Investigation

SEBI In India's Capital Market SEBI from time to time have adopted many rules and regulations for enhancing the Indian capital market. The recent initiatives undertaken are as follows:

Sole Control on Brokers:Under this rule every brokers and sub brokers have to get registration with SEBI and any stock exchange in India. For Underwriters:For working as an underwriter an asset limit of 20 lakhs has been fixed. For Share Prices:According to this law all Indian companies are free to determine their respective share prices and premiums on the share prices. For Mutual Funds:SEBI's introduction of SEBI (Mutual Funds) Regulation in 1993 is to have direct control on all mutual funds of both public and private sector.

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 BSE(BOMBAY STOCK EXCHANGE)

The Stock Exchange, Mumbai, popularly known as "BSE" was established in 1875 as "The Native Share and Stock Brokers Association". It is the oldest one in Asia, even older than the Tokyo Stock Exchange, which was established in 1878. It is a voluntary non-profit making Association of Persons (AOP) and is currently engaged in the process of converting itself into demutualised and corporate entity. It has evolved over the years into its present status as the premier Stock Exchange in the country. It is the first Stock Exchange in the Country to have obtained permanent recognition in 1956 from the Govt. of India under the Securities Contracts (Regulation) Act, 1956. The Exchange, while providing an efficient and transparent market for trading in securities, debt and derivatives upholds the interests of the investors and ensures redresses of their grievances whether against the companies or its own memberbrokers. It also strives to educate and enlighten the investors by conducting investor education program and making available to them necessary informative inputs. A Governing Board having 20 directors is the apex body, which decides the policies and regulates the affairs of the Exchange. The Governing Board consists of 9 elected directors, who are from the broking community (one third of them retire ever year by rotation), three SEBI nominees, six public representatives and an Executive Director & Chief Executive Officer and a Chief Operating Officer.

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 NSE(NATIONAL STOCK EXCHANGE) NSE was incorporated in 1992 and was given recognition as a stock exchange in April 1993. It started operations in June 1994, with trading on the Wholesale Debt Market Segment. Subsequently it launched the Capital Market Segment in November 1994 as a trading platform for equities and the Futures and Options Segment in June 2000 for various derivative instruments. NSE has been able to take the stock market to the doorsteps of the investors. The technology has been harnessed to deliver the services to the investors across the country at the cheapest possible cost. It provides a nation-wide, screen-based, automated trading system, with a high degree of transparency and equal access to investors irrespective of geographical location. The high level of information dissemination through on-line system has helped in integrating retail investors on a nation-wide basis. The standards set by the exchange in terms of market practices, Products, technology and service standards have become industry benchmarks and are being replicated by other market participants. Within a very short span of time, NSE has been able to achieve all the objectives for which it was set up. It has been playing a leading role as a change agent in transforming the Indian Capital Markets to its present form. The Indian Capital Markets are a far cry from what they used to be a decade ago in terms of market practices, infrastructure, technology, risk management, clearing and settlement and investor service. RESERVE BANK OF INDIA Reserve Bank of India is the apex monetary Institution of India. It is also called as the central bank of the country. The bank was established on April1, 1935 according to the Reserve Bank of India act 1934. It acts as the apex monetary authority of the country.The Central Office of the Reserve Bank has been in Mumbai since inception. The Central Office is where the Governor sits and is where policies are formulated. Though originally privately owned, since nationalization in 1949, the Reserve Bank is fully owned by the Government of India. The preamble of the reserve bank of India is as follows:
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"...to regulate the issue of Bank Notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage." Central Board The Reserve Bank's affairs are governed by a central board of directors. The board is appointed by the Government of India in keeping with the Reserve Bank of India Act. Local Boards

One each for the four regions of the country in Mumbai, Calcutta, Chennai and New Delhi Membership Consist of five members each Appointed by the Central Government For a term of four years

Functions To advise the Central Board on local matters and to represent territorial and economic interests of local cooperative and indigenous banks, to perform such other functions as delegated by Central Board from time to time. INSTRUMENTS OF CAPITAL MARKET The following instruments are being used for raising resources. 1. Equity shares 2. Preference shares 3. Non-voting equity shares 4. Cumulative convertible preference shares 5. Company fixed deposits 6. Warrants 7. Debentures/bonds 8. Secured premium notes (SPNs)
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9. Euro convertible bonds (ECBs) / Global depository receipts (GDRs)

INITIAL PUBLIC OFFERINGS (IPO) INTRODUCTION An initial public offering (IPO) referred to simply as an "offering" or "flotation," is when a company (called the issuer) issues common stock or shares to the public for the first time. They are often issued by smaller, younger companies seeking capital to expand, but can also be done by large privately-owned companies looking to become publicly traded. In an IPO the issuer may obtain the assistance of an underwriting firm, which helps it determine what type of security to issue (common or preferred), best offering price and time to bring it to market. An IPO can be a risky investment. For the individual investor, it is tough to predict what the stock or shares will do on its initial day of trading and in the near future since there is often little historical data with which to analyze the company. Also, most IPOs are of companies going through a transitory growth period, and they are therefore subject to additional uncertainty regarding their future values. REASON FOR LISTING When a company lists its shares on a public exchange, it will almost invariably look to issue additional new shares in order at the same time. The money paid by investors for the newly-issued shares goes directly to the company (in contrast to a later trade of shares on the exchange, where the money passes between investors). An IPO, therefore, allows a company to tap a wide pool of stock market investors to provide it with large volumes of capital for future growth. The company is never required to repay the capital, but instead the new shareholders have a right to future profits distributed by the company and the right to a capital distribution in case of dissolution.

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The existing shareholders will see their shareholdings diluted as a proportion of the company's shares. However, they hope that the capital investment will make their shareholdings more valuable in absolute terms. In addition, once a company is listed, it will be able to issue further shares via a rights issue, thereby again providing itself with capital for expansion without incurring any debt. This regular ability to raise large amounts of capital from the general market, rather than having to seek and negotiate with individual investors, is a key incentive for many companies seeking to list.

IPO MARKET IN INDIA The IPO Market in India has been developing since the liberalization of the Indian economy. It has become one of the foremost methods of raising funds for various developmental projects of different companies. IPO Market in India - Overview The IPO Market in India is on the boom as more and more companies are issuing equity shares in the capital market. With the introduction of the open market economy, in the 1990s, the IPO Market went through its share of policy changes, reforms and restructurings. One of the most important developments was the disassembling of the Controller of Capital Issues (CCI) and the introduction of the free pricing mechanism. This step helped in developing the IPO Market in India, as the companies were permitted to price the issues. The Free pricing mechanism permitted the companies to raise funds from the primary market at competitive price. IPO Market in India - Regulations The Central Government felt the need for a governed environment pertaining to the Capital market, as few corporate houses were using the abolition of the Controller of Capital Issues (CCI) in a negative manner. The Securities Exchange Board of India (SEBI) was established in the year 1992 to regulate the capital market. SEBI was given the authority of monitoring and regulating the activities of the bankers to
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an issue, portfolio managers, stockbrokers, and other intermediaries related to the stock markets. The effects of the changes are evident from the trend of the resources of the primary capital market which includes rights issues, public issues, private placements and overseas issues. IPO Market In India - Glimpses

The IPO Market in India experienced a boom in its activities in the year 1994. In the year 1995 the growth of the Indian IPO market was 32 % . The growth was halted with the South East Asian crisis.

APPLYING FOR AN IPO IN INDIA When a firm proposes a public issue or IPO, it offers forms for submission to be filled by the shareholders. Public shares can be bought for a limited period only and as per the law, any IPO should be traded openly only for minimum 3 days and 21 days maximum. For offers that are sponsored by financial institutions, the proposal should be traded for maximum 21 days and minimum 3 days. For offers that are sponsored by Indian financial institutions, the proposal should be traded for maximum 10 days. The submission form should be duly filled up and submitted by cash, cheque or DD prior to the closing date, in accordance with the guidelines mentioned in the form. IPO's by investment firms generally entail countersigned charges which signify a load to purchasers. THINGS TO CONSIDER BEFORE APPLYING FOR IPOS IN INDIA There are certain factors which need to be taken into consideration before applying for Initial Public Offerings in India. They are: Promoters, their reliability and past records Firm producing or facilitating services Product offered by the firm and its potential
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 Whether the firm has entered into a collaboration with technological firm Status of the associates Historical record of the firm providing the Initial Public Offerings Project value and various techniques of sponsoring the plan Productivity estimates of the project Risk aspects engaged in the execution of the plan Authority that has reviewed the plan ADVANTAGES OF IPO The Advantages of IPO are numerous. The companies are launching more and more IPOs to raise funds which are utilized for undertakings various projects including expansion plans. IPO has a number of advantages. IPO helps the company to create a public awareness about the company as these public offerings generate publicity by inducing their products to various investors.

The increase in the capital: An IPO allows a company to raise funds for utilizing in various corporate operational purposes like acquisitions, mergers, working capital, research and development, expanding plant and equipment and marketing. Liquidity: The shares once traded have an assigned market value and can be resold. This is extremely helpful as the company provides the employees with stock incentive packages and the investors are provided with the option of trading their shares for a price. Valuation: The public trading of the shares determines a value for the company and sets a standard. This works in favour of the company as it is helpful in case the company is looking for acquisition or merger. It also
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provides the share holders of the company with the present value of the shares.

Increased wealth: The founders of the companies have an affinity towards IPO as it can increase the wealth of the company, without dividing the authority as in case of partnership.

DRAWBACKS OF IPOs It is true that IPO raises huge capital for the issuing company. But, in order to launch an Initial Public Offering (IPO), it is also necessary to make certain investments. Setting up an IPO does not always lead to an improvement in the economic performance of the company. A continuing expenditure has to be incurred after the setting up of an IPO by the parent company. A lot of expenses have to be incurred in the form of legal fees, printing costs and accounting fees, which are connected to the registering of an IPO. Such expenses might cost hundreds of US dollars. Apart from such enormous costs, there are other factors as well that should be taken into consideration by the company while introducing an IPO. Such factors include the rules and regulations involved to set up public offerings and this entire process on the other hand involve a number of complexities which sometime require the services of experts in relevant fields. Some companies hire experts to do the needful to ensure a hassle-free execution of the task. After the IPO is introduced, the expenses become a routine in every activity involved. Besides, the CEO of the company would have to spend a lot of time in handling the SEC regulations or sometimes he hires experts to do the same. All these aspects, if not handled with efficiency, prove to be some major drawbacks related to the launch of IPOs. The launch of IPO also brings about shareholders of the company. Shareholders
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have ownership in the company. A major risk with shareholders is that, they can sell off their stocks any time they want, in case they see the price band of the stakes of that company is going down. This will lead to a further drop of the value of shares in the market which in turn will decrease the overall value of the company. BUYING IPO Buying IPO needs sound knowledge about the capital market and its working. The IPO helps the company to raise funds from the public by means of issuing shares to the various investors. Buying IPO - Overview Before Buying IPO one must be sure what an IPO is. When an existing company or a brand new company issue shares for the public to buy in the capital market for the first time, the process is called Initial Public Offering (IPO). With this the shares of the company gets listed in the stock exchange. It is also referred to as going public as the company approaches the public for the funds. All companies need to raise funds for various operations and one of the best options is raising funds through issue of shares. The investors are interested as they earn dividends from the shares. Important considerations in Buying IPO While buying IPO, the investors must be careful about choosing the company as there are numerous number of not-so-good companies. The investors must keep your eyes and ears open. It is advised that the investors seek help from professionals in this field rather than handling critical decisions on their own. CATEGORIES OF INVESTORS Investors are broadly classified under following categories: (i) Retail individual Investor (RIIs) (ii) NonInstitutional Investors (NIIs)
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(iii) Qualified Institutional Buyers (QIBs)

Retail individual investor means an investor who applies or bids for securities for a value of not more than Rs. 1, 00,000. Qualified Institutional Buyer shall mean:

a) A public financial institution as defined in section 4A of the Companies Act, 1956; b) A scheduled commercial bank; c) A mutual fund registered with the Board; d) A foreign institutional investor and subaccount registered with SEBI, other than a sub account which is a foreign corporate or foreign individual; e) A multilateral and bilateral development financial institution; f) A venture capital fund registered with SEBI; g) A foreign venture capital investor registered with SEBI; h) A state industrial development corporation; i) An insurance company registered with the Insurance Regulatory and Development Authority (IRDA); j) A provident fund with minimum corpus of Rs. 25 crores; k) A pension fund with minimum corpus of Rs. 25 crores); l) National Investment Fund set up by resolution no. F. No. 2/3/2005DDII dated November 23, 2005 of Government of India published in the Gazette of India.
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Investors who do not fall within the definition of the above two categories are categorized as NonInstitutional Investors

INTERMEDIARIES INVOLVED IN THE ISSUE PROCESS Intermediaries which are registered with SEBI are Merchant Bankers to the issue (known as Book Running Lead Managers (BRLM) in case of book built public issues), Registrars to the issue, Bankers to the issue & Underwriters to the issue who are associated with the issue for different activities. Their addresses, telephone/fax numbers, registration number, and contact person and email addresses are disclosed in the offer documents. Merchant Banker: Merchant banker does the due diligence to prepare the offer document which contains all the details about the company. They are also responsible for ensuring compliance with the legal formalities in the entire issue process and for marketing of the issue. Registrars to the Issue: They are involved in finalizing the basis of allotment in an issue and for sending refunds, allotment etc. Bankers to the Issue: The Bankers to the Issue enable the movement of funds in the issue process and therefore enable the registrars to finalize the basis of allotment by making clear funds status available to the Registrars. Underwriters:

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Underwriters are intermediaries who undertake to subscribe to the securities offered by the company in case these are not fully subscribed by the public, in case of an underwritten issue. ISSUE REQUIREMENTS SEBI has laid down entry norms for entities making a public issue/ offer. The same are detailed below Entry Norms: Entry norms are different routes available to an issuer for accessing the capital market. Entry Norm I (commonly known as Profitability Route) The Issuer Company shall meet the following requirements: Net Tangible Assets of at least Rs. 3 crores in each of the preceding three full years. Distributable profits in at least three of the immediately preceding five years. Net worth of at least Rs. 1 crore in each of the preceding three full years If the company has changed its name within the last one year, at least 50% revenue for the preceding 1 year should be from the activity suggested by the new name. The issue size does not exceed 5 times the pre issue net worth as per the audited balance sheet of the last financial year to provide sufficient flexibility and also to ensure that genuine companies do not suffer on account of rigidity of the parameters. SEBI has provided two other alternative routes to the companies not satisfying any of the above conditions, for accessing the primary Market, as under: Entry Norm II (Commonly known as QIB Route) Issue shall be through book building route, with at least 50% to be mandatory allotted to the Qualified Institutional Buyers (QIBs). The minimum postissue face value capital shall be Rs.10 crores or there shall be a compulsory marketmaking for at least 2 years
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Entry Norm III (commonly known as Appraisal Route) The project is appraised and participated to the extent of 15% by Financial Institutions / Scheduled Commercial Banks of which at least 10% comes from the appraiser(s). The minimum postissue face value capital shall be Rs. 10 crores or there shall be a compulsory marketmaking for at least 2 years.

In addition to satisfying the aforesaid entry norms, the Issuer Company shall also satisfy the criteria of having at least 1000 prospective allotees in its issue. Certain category of entities which are exempted from the aforesaid entry norms, are as under: (a) Private Sector Banks (b) Public sector banks (c) An infrastructure company whose project has been appraised by a Public Financial Institution or IDFC or IL&FS or a bank which was earlier a PFI and not less than 5% of the project cost is financed by any of these institutions.

Besides entry norms, there are some mandatory provisions which an issuer is expected to comply before making an issue
Minimum Promoters contribution and lockin:

In a public issue by an unlisted issuer, the promoters shall contribute not less than 20% of the post issue capital which should be locked in for a period of 3 years. Lockin indicates a freeze on the shares. The remaining pre issue capital should also be locked in for a period of 1 year from the date of listing.

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In case of public issue by a listed issuer [i.e. FPO], the promoters shall contribute not less than 20% of the post issue capital or 20% of the issue size. This provision ensures that promoters of the company have some minimum stake in the company for a minimum period after the issue or after the project for which funds have been raised from the public is commenced. IPO Grading: IPO grading is the grade assigned by a Credit Rating Agency registered with SEBI, to the initial public offering (IPO) of equity shares or other convertible securities. The grade represents a relative assessment of the fundamentals of the IPO in relation to the other listed equity securities. Such grading is generally Assigned on a five-point point scale with a higher score indicating stronger fundamentals and vice versa as below. IPO grade 1 Poor fundamentals IPO grade 2 BelowAverage fundamentals IPO grade 3 Average fundamentals IPO grade 4 Aboveaverage fundamentals IPO grade 5 Strong fundamentals IPO grading has been introduced as an endeavour to make additional information available for the investors in order to facilitate their assessment of equity issues offered through an IPO. Disclosure of IPO Grades, so obtained is mandatory for companies coming out with an IPO. IPO Ratings, IPO Grading and IPO Ranking are among the few popular inputs investor's uses before applying in initial public offerings IPO.

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IPO Ratings are provided by various financial institutions & independent brokers. Few popular IPO Rating providers in India are Capital Market, Money Control, S P Tulsans IPO recommendations etc. IPO Grading is provided by SEBI approved rating agencies including CRISIL, CARE and ICRA. IPO Grading is designed to provide investors an independent, reliable and consistent assessment of the fundamentals of IPO Issuer Companies. As IPO Grading is decided much earlier then the issue price or issue dates are finalize (usually on the IPO filing) and they just tell about the fundamentals of the company, investors should not consider them as 'Buy IPO' or 'Skip IPO' recommendations. PRICING OF AN ISSUE

(a) Who fixes the price of securities in an issue? Indian primary market ushered in an era of free pricing in 1992. SEBI does not play any role in price fixation. The issuer in consultation with the merchant banker on the basis of market demand decides the price. The offer document contains full disclosures of the parameters which are taken in to account by merchant Banker and the issuer for deciding the price. The Parameters include EPS, PE multiple, return on net worth and comparison of these parameters with peer group companies.

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TYPES OF PRICING OF AN ISSUE

TYPES OF PRICING OF AN ISSUE

FIXED PRICE ISSUE

BOOK BUILT ISSUE

Fixed Price Issue: When the issuer at the outset decides the issue price and mentions it in the Offer Document, it is commonly known as Fixed price issue. Book built Issue: When the price of an issue is discovered on the basis of demand received from the prospective investors at various price levels, it is called Book Built issue. IPO PROCEDURE Appointment Procedure 1. Meeting of Board of Directors 2. Appointing of Merchant Bankers- Specialized financial Consultancy who looks after Initial Public Offering 3. Appointing of Registrar and transfer agent done by Merchant Bankers 4. Banks- Appointed by Merchant Bankers 5. Appointing of Lawyer

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Real Procedure 6. Book issued by Merchant bankers and submits it to SEBI which includes Reason of Issuing, no of Shares, Financial Condition of the company, current Business, Management, Growth in Sectors and Risk factor 7. Prospectus- Issued to stock Market and registrars 8.Printing Of Forms 9. Appointment of Brokers 10. Marketing & Advertising 11. Brokers Meeting in a Company 12. Road Shows or meetings 13. IPO starts 3-7 days opened 14. IPO closed Post IPO 15. Collection of Forms 16. Oversubscription or Under subscription 17. Allotment Of shares a. Pro data allotment b. lottery system 18. Issue of share certificate a. Letter of allotment b. Regret Letter 19. Refund cheque 20. Listing Of shares in NSE or BSE

OFFER DOCUMENT Offer document is a document which contains all the relevant information about the company, promoters, projects, financial details, objects of raising the money, terms of the issue etc and is used for inviting subscription to the issue being made by the issuer.
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Offer Document is called Prospectus in case of a public issue or offer for sale Letter of offer is an offer document in case of a Rights issue and is filed with Stock exchanges before the issue opens.

DIP- BIDDING RELATED BIDDING PERIOD: OPENING/ CLOSING DATES: Bid to be open for at least 3 working days and not more than 7 working days, which may be extended to 10 working days, in case the price band is revised.

REVISION OF PRICE BAND: Any revision in the price band to be widely disseminated by informing the stock exchanges, issuing press release and indicating on the website/terminals of the syndicate members. BIDS: PLACING Individual as well as QIBs to place their bids only through the designated brokers. RII may bid at cut of price instead of writing the specific bid prices in the bid forms. Bidding is permitted only if an electronically linked transparent facility is used. REVISION

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 Investors shall have the right to revise their bids provided that QIBs shall not be allowed to withdraw their bids after closure of bidding. ROLE OF BIDDING CENTERS: Accept bid-cum-application forms from investors along with cheque/demand draft. Register bids (for all options) through online/offline terminals Generate transaction registration slips (TRS) for each of the options. Lodge bid-cum-applications with Escrow bankers. APPLICATIONS SUPPORTED BY BLOCKED AMOUNT (ASBA) ASBA means Application Supported by Blocked Amount. ASBA is an application containing an authorization to block the application money in the bank account, for subscribing to an issue. If an investor is applying through ASBA, his application money shall be debited from the bank account only if his/her application is selected for allotment after the allotment is finalized, or the issue is withdrawn/failed. DETAILED PROCEDURE OF APPLYING IN IPO THROUGH ASBA Under ASBA facility, investors can apply in any public/rights issues by using their bank account. Investor submits the ASBA form (available at the designated branches of the banks acting as self certified Syndicate Banks(SCSBs)) after filling the details like name of the applicant, PAN, Demat account number, bid quantity, bid price and other relevant details of the application in the bidding platform.

29

Investors shall ensure that the details that are filled in the ASBA form are correct otherwise the form is liable to be rejected.

30

BOOK BUILDING PROCEDURE Book building is a process of price discovery. Book Building Process, with reference to the Issue, refers to the process of the collection of Bids on the basis of this Red Herring Prospectus within the Price Band. The Issue Price is finalised after the Bid/Issue Closing Date. The principal parties involved in the Book Building Process are:1. The Company; 2. The BRLMs; 3. Syndicate Members who are intermediaries registered with SEBI or registered as brokers with BSE/NSE and eligible to act as Underwriters. 4. The SCSBs; 5. The Escrow Collection Bank(s); and 6. The Registrar to the Issue.

31

STEPS INVOLVED IN BOOK BUILDING PROCESS Nominate Book Runner Form Syndicate of Brokers, Arrangers, Underwriters, Financial Institutions, etc. Submit Draft Offer Document to SEBI without Mentioning Coupon Rate or Price Circulate Offer Document among the Syndicate Members Ask For Bids on Price and Quality of Securities Aggregate and Forward All Offers to Book Runner Run the Book to Maintain a Record of Subscribers and Their Orders Consult With Issuer and Determine the Issue Price as a Weighted Average of the Offers Received Firm Up Underwriting Commitments Allot Securities among Syndicate Members Securities Issued and Listed Trading Commences on Exchanges

32

GREEN SHOE OPTION: (For stabilising the post listing price) INTRODUCTION Green Shoe Option is a price stabilizing mechanism in which shares are issued in excess of the issue size, by a maximum of 15%. From an investors perspective, an issue with green shoe option provides more probability of getting shares and also that post listing price may show relatively more stability as compared to market volatility. REQUIREMENTS Shareholders approval for allotment of further shares to SA One BRLM to be appointed as SA Maximum shares that can be over-allotted 15% of the issue size Disclosures of specified details in offer document Stabilisation mechanism available for 30 days after trading starts Shares to be transferred to lenders not later than 2 working days after the stabilising period subject to the remaining lock-in SA to file daily & final report to SEs/SEBI ALLOTMENT OF SHARE After the closure of the issue, for e.g. a book built public issue, the bids received are aggregated under different categories i.e., firm allotment, Qualified Institutional Buyers (QIBs), NonInstitutional Buyers (NIBs), Retail, etc. The oversubscription ratios are then calculated for each of the categories as against the shares reserved for each of the categories in the offer document. Within each of these categories, the bids are then segregated into different buckets based on the number of shares applied for.

33

The oversubscription ratio is then applied to the number of shares applied for and the number of shares to be allotted for applicants in each of the buckets is determined. Then, the number of successful allottees is determined. This process is followed in case of proportionate allotment. Thus allotment to each investor is done based on proportionate basis in both book built and fixed price public issue is detailed below: In case of Book Built issue 1. In case an issuer company makes an issue of 100% of the net offer to public through 100% book building process Not less than 35% of the net offer to the public shall be available for allocation to retail individual investors;

Not less than 15% of the net offer to the public shall be available for allocation to noninstitutional investors i.e. investors other than retail individual investors and Qualified Institutional Buyers;

Not more than 50% of the net offer to the public shall be available for allocation to Qualified Institutional Buyers: 2. In case of compulsory BookBuilt Issues at least 50% of net offer to public being allotted to the Qualified Institutional Buyers (QIBs), failing which the full Subscription monies shall be refunded. 3. In case the book built issues are made pursuant to the requirement of mandatory allocation of 60% to QIBs in terms of Rule 19(2)(b) of Securities Contract (Regulation) Rules, 1957, the respective figures are 30% for RIIs and 10% for NIIs.

34

In case of fixed price issue The proportionate allotment of securities to the different investor categories in a fixed price issue is as described below: 1. A minimum 50% of the net offer of securities to the public shall initially be made available for allotment to retail individual investors, as the case may be. 2. The balance net offer of securities to the public shall be made available for allotment to: Individual applicants other than retail individual investors, and Other investors including corporate bodies/ institutions irrespective of the number of securities applied for. TIME LIMIT FOR ALLOTMENT & INTEREST FOR DELAY As far as possible allotment of securities offered to public shall be made within 15 days of the closure of public issue. The company would need to pay interest at 15% p.a., if the allotment letters/ refund orders are not despatched within the aforesaid period. IPO REFUND IPO Refund is disbursed by the merchant bankers to the applicants of Initial Public Offerings. In India, these IPO Refunds are generally made through electronic clearing services for pre-designated numbers of centres. The clearing houses that are also involved with the process of IPO Refund are controlled by the Apex Bank of India, the Reserve Bank of India. The directives on the IPO Refund money are issued by the Securities and Exchange Board of India (SEBI). The directives on the IPO Refund money are laid down as per the "Disclosure and Investor Protection Guidelines, 2000" formulated by the Securities and Exchange Board of India (SEBI).
35

These IPO Refunds are also made by direct credit and real time gross settlement (RTGS), as per the laid down eligibility criteria of the applicant. For applications, which are made completely in the dematerialized form, the relevant details of bank account of the IPO applicant are taken from depositories. IPO GREY MARKET IPO Grey market is an unofficial market where IPO shares are bought and sold before they become officially available for trading on the stock exchange. IPO Grey Market is an over-the-counter market where dealers may execute orders for preferred customers as well as provide support for a new issue before it is actually issued. Grey market trading include trading (selling or buying) applications at certain amount and trading (selling or buying) allocated shares through IPO allotment before they list on stock exchanges. Grey market trading is usually done among the small set of people who trust each other as there is no official platform or rules define for these trading. Two popular terms used in IPO grey market are Grey Market Premium' and Kostak.

36

TERMS USED IN IPO GREY MARKET

Grey market premium

Kostak

1. Grey market premium (or grey market price)

It is a premium amount in rupees at which IPO shares are being traded in Grey Market before they get listed in stock exchange. Grey market premium can be in positive or in negative based on demand and supply of the stock. Grey Market Premiums are also attached with words Buyer' or Seller'. They tell the price either at which buyers are willing to buy shares or the price at which sellers are willing to sell their IPO shares. 1. Example: Mundra port and SEZ Limited

Issue Price: Rs 440 per equity share Grey Market Premium: Rs 400 (Buyers) This means buyers are ready to buy Mundra Port shares at 440+400 = Rs 840. 2. Example : SVPCL Limited

Issue Price: Rs 45 per equity share Grey Market Premium: Rs -6 (Seller)

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This means sellers are ready to sell SVPCL shares at the discount of Rs 6. i.e. 45-6 = Rs 39.
2. Kostak (or price of application) It is the premium amount in rupees at which IPO applications are being traded

in IPO Grey Market. Usually Kostak' value is defined as the premium of a maximum lot retail application in an IPO. Kostak price is important mostly before issue is close for subscription and final bidding status is available to the IPO investors. Very few IPOs applications are traded after final bidding status is available to the investors. Kostak' is especially for people who do not want to take risk with IPO allotment or listing gains. Example: BGR Energy Issue Price: Rs 480 Per Equity Lot Size: Grey Market Premium: Rs 350 to Rs 360 Kostak (Rs 100000): Rs 2500 to Rs 2600

Share

(at

Limited upper band) 14

This means BGR applications of Rs 1 lakh are being traded in IPO Grey Market at Rs 2500 to Rs 2600. Even though the Grey Market Premium of this IPO is around 75% of the issue price, the Kostak' is just 5% of the application amount. This is because Grey Market traders are assuming that the issue will highly oversubscribe and there will not be firm allotment even for retail investors who will apply full Rs 1 lakh. They are assuming one out of two people will get allotment and thus Rs 2 lakh investment will give them approximate Rs 5000 return. This way they are ready to buy 1 lakh application for Rs 2500.

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HOW GREY MARKET WORKS? Approach 1: Trading IPO Allocated shares in grey market: Investor applies for shares through an IPO. They take a financial risk as there are chances that they may not get allocated any share or they receive the shares but shares may list below the issue price. Let's call them Sellers'. There are few other people in the market who think that the share values more then its issue price. They start collecting these shares even before they are allocated by the issue registrar through IPO allotment process or before shares are in the stock market legally for sell through stock exchanges. Let's call then Buyers'. Buyers contact the grey market dealers and place the order to buy IPO share at certain premium. The grey market dealer contact sellers who applied in the IPO and ask them if they are willing to sell their IPO shares (if they receive allotment) at certain premium at this time. If the sellers like the premium and they are not willing to take risk of stock market listing, they may sell the IPO shares to the grey market dealer and book the profit. At this time the seller has to finalize the deal with the grey market dealer at a certain price. Grey market dealer get the application detail from seller and send a notification to the buyer that he bought a certain number of shares from the sellers in grey market. Allotment is done and sellers may or may not receive allotment of shares. If shares are allocated to the investor, either he may get call from the dealer to sell them at certain price or to transfer allocated shares to some demat account. In case of selling the shares, settlement is done based on the profit or loss and the grey market premium at which buyers and sellers made a deal. If no shares are allocated to the sellers the deal get cancelled without any settlement.

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Approach 2: Trading IPO Applications in grey market:

Investor applies for shares through an IPO. They take a financial risk as there are chances that they may not get allocated any share or they receive the shares but shares may list below the issue price. Let's call them Sellers'. There are few other people in the market who think that the share values more then its issue price. They start collecting these shares through grey market dealers much before the shares are even allocated. Let's call then Buyers'. Buyers decide the price of the application based in various assumptions and market conditions. They give an offer to the sellers that they are willing to buy an IPO Application (without knowing that how many shares will get allocated) at certain premium. To avoid the risk of allocation seller may sell their application at certain premium to the buyer through grey market dealer. This kind of trading is call application trading or kostak'. In case of Kostak' seller need not to worry about the share allotment in IPO. He receives the allotment or not he will get the premium at which he sold his IPO allocation. Grey market dealer get the application detail from seller and send a notification to the buyer that he bought an IPO application at certain premium from the sellers in grey market. Allotment is done by the issue registrar. The application seller sold may or may not receive allotment of shares. If shares are allocated to the sold application, either seller may get call from the dealer to sell them at certain price or to transfer allocated shares to some demat account. In case of selling the shares, settlement is done based on the profit or loss. If no shares are allocated to the sellers the deal is over without any settlement. The seller still gets his premium as he sold his application.

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RECENT TREND
Several factors are converging in 2012 to help the capital markets stabilize after experiencing significant volatility last year. Although some issues remain uncertain particularly Europes financial struggles several areas of the market are rebounding and gaining momentum. Here are seven capital market trends Kimco is watching in 2012, and how we see them impacting retail real estate throughout the year. 1. Spreads will continue to compress in the unsecured bond market. The unsecured bond market experienced an enormous amount of volatility in 2011. Spreads compressed significantly in the first half of the year, then widened as concerns about Europes debt crisis mounted in Kimcos case to in excess of 300 basis points over 10-year paper. The bond market was extremely weak over the summer, until late September when Deutsche Bank sold 1.5 billion euros in unsecured bonds. Since then, the market has been open. Volatility remains, although weve seen spreads start to compress again. Even at spreads of 200-250 basis points, with the 10-year bond trading somewhere around 2 percent, youre still looking at 10year financing in the low 4 percent area for a company like ours. Thats pretty attractive debt that is easy to access, so the unsecured bond market is clearly open and available. As we look into 2012, we expect to see further spread compression as we get more clarity around the European financial crisis and U.S. economic recovery. This should create opportunity for all REITs to opportunistically tap the unsecured bond market. 2. U.S. corporate bond sales in 2012 will continue to rebound. Issuers are continuing to lock in decreasing yields on investment-grade corporate bonds, which have fallen to 3.54 percent, near the record low 3.45 percent reached August 4. IBM, Procter & Gamble, and Petroleo Brasileiro SA led January with $10.5 billion of offerings combined, while AT&T and Freeport led February with $3 billion each of offerings. In addition, investors are more confident that Europes financial struggles wont derail U.S. economic recovery. And the Federal Open Market Committee announced last month it will keep short-term interest rates at 0.0 percent to 0.25 percent through at least late 2014. These factors are making corporate bond yields attractive, and indicate the market for new corporate bond issues should remain quite active in 2012. 3. More U.S. banks will repair their balance sheets and improve their liquidity positions. Capital is increasingly available within the commercial banking system
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for companies with solid credit. Kimcos new $1.75 billion unsecured revolving credit facility is an example. We had decided to renew our $1.5 billion unsecured revolving U.S. credit facility a year early. Demand was tremendous when we went to market in summer 2011 looking for a five-year facility. We quickly had commitments from 28 banks totaling over $2.8 billion $1 billion more than we had requested. This included commitments from European lenders, including Deutsche Bank, UBS, and RBS, all of which made fairly large commitments to our revolver. On the pricing front, we negotiated a borrowing spread of 105 basis points over LIBOR, one of the tightest spreads in the industry, and about 100 basis points tighter than spreads 12 months prior. So for solid credits, there is the ability to access significant amounts of medium-term capital at very low costs. 4. The commercial mortgage-backed securities (CMBS) market will be available in 2012. Insurance companies were a great source of financing for the right properties in 2011. Were cautiously optimistic the CMBS market will be open in 2012, with many insurance companies having a lot of money to put to work. Remember, the market overheated by the summer of 2011, and then closed down for a little while. But securitizations are getting done, and were starting to see deal flow. In addition, banks have opened up. With Treasuries as low as they are yields on 10-year Treasury notes remain around 2 percent there is clearly access to capital within the mortgage market. 5. Its uncertain how long the spread differential between the bank and unsecured bond markets will last. The spreads in the bank market are significantly tighter than spreads in the unsecured bond market. For instance, for a five-year unsecured paper, the spread differential between a bank and an unsecured bond loan is between 100 and 150 basis points. You would think after all the trouble banks have endured, there wouldnt be that much difference. And if the unsecured bond market ostensibly has so much capital available, maybe the positions would be reversed. Nevertheless, this is an opportunity to take advantage of the disconnect between the bank and the bond market today while it lasts. 6. Equity markets should remain open in 2012. The equity markets are open for companies with stories that include a fairly quick, accretive use of proceeds. So were more cautious about the equity markets going forward. Kimcos capital plan as we continue into 2012 is to avoid the common equity markets, and instead look at our assets where we can recycle capital, sell assets we want to move particularly those outside the retail sector , and use those proceeds to further our investment in our core shopping center business.

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7. European markets hang in the balance. Naturally, a big question is: What will happen in Europe and how will it affect banks and economies worldwide? Market sentiment has vacillated in recent weeks as Greece struggles to come to an agreement on financial reforms. A Greek default will impact bond issuances in sovereign countries, including Italy, Spain, and Portugal. A liquidity injection by the European Central Bank could help stabilize the countries. Although Europe is not moving as quickly as some would like, the issues are clearly on the table and some level of resolution will happen during 2012. If there is a resolution in Europe with which people can get comfortable, we believe risk appetites in the U.S. credit market will improve. The capital markets operated fairly well through 2011, and we expect to see them remain open as we continue into 2012. We feel very good about our balance sheet today, and are squarely focused on continuing to improve our balance sheet metrics, including net debt to recurring EBITDA and fixed charge coverage. Two-anda-half years ago, Kimcos net debt to recurring EBITDA was more than 8.3 times on a recurring basis. Today, its around six times. Looking ahead, we have $460 million of perpetual preferred stock with a coupon of 7.75 percent that will be callable in October. We recently announced the new issuance of $400 million of perpetual preferred stock at a coupon of 6 percent. We will use the proceeds from this offering partially towards calling the higher coupon perpetual preferred stock when it becomes available. This is a savings of 175 basis points, or almost 2 cents per share on an FFO basis. We also have approximately $300 million of bonds that will mature between late 2012 and January 2013. Depending on spread compression, theres also an opportunity to pre-fund some of those maturing bonds to lower our overall capital cost and improve our coverage ratios.

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HDFC Bank Limited (BSE: 500180, NSE: HDFCBANK, NYSE: HDB) is an Indian financial services company based in Mumbai, Maharashtra that was incorporated in August 1994. HDFC Bank is the fifth or sixth largest bank in India by assets and the second largest bank by market capitalization as of February 24, 2012. The bank was promoted by the Housing Development Finance Corporation, a premier housing finance company (set up in 1977) of India. As on October 2012, HDFC Bank has 2,544 branches and over 10,000 ATMs, in 1,399 cities in India, and all branches of the bank are linked on an online real-time basis. As of 30 September 2008 the bank had toTal assets of Rs.1006.82 billion. For the fiscal year 2010-11, the bank has reported net profit of 3,926.30 crore (US$714.59 million), up 33.1% from the previous fiscal. Total annual earnings of the bank increased by 20.37% reaching at 24,263.4 crore (US$4.42 billion) in 2010-11. HDFC Bank is one of the Big Four banks of India, along with: State Bank of India, ICICI Bank and Punjab National Bank. History HDFC Bank was incorporated in 1994 by Housing Development Finance Corporation Limited (HDFC), India's largest housing finance company. It was among the first companies to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector. The Bank started operations as a scheduled commercial bank in January 1995 under the RBI's liberalisation policies. Times Bank Limited (owned by Bennett, Coleman & Co./The Times Group) was merged with HDFC Bank Ltd., in 2000. This was the first merger of two private banks in India. Shareholders of Times Bank received 1 share of HDFC Bank for every 5.75 shares of Times Bank. In 2008 HDFC Bank acquired Centurion Bank of Punjab taking its total branches to more than 1,000. The amalgamated bank emerged with a base of about Rs. 1,22,000 crore and net advances of about Rs.89,000 crore. The balance sheet size of the combined entity is more than Rs. 1,63,000 crore. Current Price (Rs) 662.35 % Change -1.07 Face Value 2 Market Cap (Rs Cr) 1,56,427.20

Company HDFC Bank

Volume 42714

Equity 472.34

44

45

SBI provides a range of banking products through its vast network of branches in India and overseas, including products aimed at non-resident Indians (NRIs). The State Bank Group has the largest banking branch network in India. SBI has 14 local head offices situated at Chandigarh (Punjab & Haryana), Delhi, Lucknow (Uttar Pradesh), Patna (Bihar), Kolkata (West Bengal), Guwahati (North East Circle), Bhubaneswar (Orissa), Hyderabad (Andhra Pradesh), Chennai (Tamil Nadu), Trivandrum (Kerala), Bengaluru (Karnataka), Mumbai (Maharashtra), Bhopal (Madhya Pradesh) & Ahmedabad (Gujarat) and 57 Zonal Offices that are located at important cities throughout the country. SBI is a regional banking behemoth and is one of the largest financial institutions in the world. It has a market share among Indian commercial banks of about 20% in deposits and loans. The State Bank of India is the 29th most reputed company in the world according to Forbes. Also, SBI is the only bank featured in the coveted "top 10 brands of India" list in an annual survey conducted by Brand Finance and The Economic Times in 2010. History

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The roots of the State Bank of India lie in the first decade of 19th century, when the Bank of Calcutta, later renamed the Bank of Bengal, was established on 2 June 1806. The Bank of Bengal was one of three Presidency banks, the other two being the Bank of Bombay (incorporated on 15 April 1840) and the Bank of Madras (incorporated on 1 July 1843). All three Presidency banks were incorporated as joint stock companies and were the result of the royal charters. These three banks received the exclusive right to issue paper currency in 1861 with the Paper Currency Act, a right they retained until the formation of the Reserve Bank of India. The Presidency banks amalgamated on 27 January 1921, and the re-organized banking entity took as its name Imperial Bank of India. The Imperial Bank of India remained a joint stock company. Pursuant to the provisions of the State Bank of India Act of 1955, the Reserve Bank of India, which is India's central bank, acquired a controlling interest in the Imperial Bank of India. On 30 April 1955, the Imperial Bank of India became the State Bank of India. The government of India recently acquired the Reserve Bank of India's stake in SBI so as to remove any conflict of interest because the RBI is the country's banking regulatory authority. In 1959, the government passed the State Bank of India (Subsidiary Banks) Act, which made eight state banks associates of SBI. A process of consolidation began on 13 September 2008, when the State Bank of Saurashtra merged with SBI. SBI has acquired local banks in rescues. The first was the Bank of Behar (est. 1911), which SBI acquired in 1969, together with its 28 branches. The next year SBI acquired National Bank of Lahore (est. 1942), which had 24 branches. Five years later, in 1975, SBI acquired Krishnaram Baldeo Bank, which had been established in 1916 in Gwalior State, under the patronage of Maharaja Madho Rao Scindia. The bank had been the Dukan Pichadi, a small moneylender, owned by the Maharaja. The new banks first manager was Jall N. Broacha, a Parsi. In 1985, SBI acquired the Bank of Cochin in Kerala, which had 120 branches. SBI was the acquirer as its affiliate, the State Bank of Travancore, already had an extensive network in Kerala. Current Price Company (Rs) SBI Market % Face Cap (Rs Change Volume Equity Value Cr) 276818
47

2,090.90 0.06

671.04 10

1,40,307.75

ICICI Bank was established in 1994 by the Industrial Credit and Investment Corporation of India, an Indian financial institution, as a wholly owned subsidiary. The parent company was formed in 1955 as a joint-venture of the World Bank, India's public-sector banks and public-sector insurance companies to provide project financing to Indian industry. The bank was initially known as the Industrial Credit and Investment Corporation of India Bank, before it changed its name to the abbreviated ICICI Bank. The parent company was later merged into ICICI Bank. ICICI Bank launched internet banking operations in 1998. ICICI's shareholding in ICICI Bank was reduced to 46 percent, through a public offering of shares in India in 1998, followed by an equity offering in the form of American Depositary Receipts on the NYSE in 2000. ICICI Bank acquired the Bank of Madura Limited in an all-stock deal in 2001, and sold additional stakes to institutional investors during 2001-02. In the 1990s, ICICI transformed its business from a development financial institution offering only project finance to a diversified financial services group, offering a wide variety of products and services, both directly and through a number of subsidiaries and affiliates like ICICI Bank. In 1999, ICICI become the first Indian company and the first bank or financial institution from non-Japan Asia to be listed on the NYSE. In 2000, ICICI Bank became the first Indian bank to list on the New York Stock Exchange with its five million American depository shares issue generating a demand book 13 times the offer size.

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In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the merger of ICICI and two of its wholly owned retail finance subsidiaries, ICICI Personal Financial Services Limited and ICICI Capital Services Limited, with ICICI Bank. The merger was approved by shareholders of ICICI and ICICI Bank in January 2002, by the High Court of Gujarat at Ahmedabad in March 2002, and by the High Court of Judicature at Mumbai and the Reserve Bank of India in April 2002. In 2008, following the 2008 financial crisis, customers rushed to ATM's and branches in some locations due to rumors of adverse financial position of ICICI Bank. The Reserve Bank of India issued a clarification on the financial strength of ICICI Bank to dispel the rumors. ICICI Bank Limited (NSE: ICICIBANK, BSE: 532174, NYSE: IBN) is an Indian diversified financial services company headquartered in Mumbai, Maharashtra. It is the second largest bank in India by assets and third largest by market capitalization. It offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialized subsidiaries in the areas of investment banking, life and non-life insurance, venture capital and asset management. The Bank has a network of 2,883 branches and 10021 ATM's in India, and has a presence in 19 countries, including India. The bank has subsidiaries in the United Kingdom, Russia, and Canada; branches in United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International Finance Centre; and representative offices in United Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia. The company's UK subsidiary has established branches in Belgium and Germany. Current Price % Face Company (Rs) Change Volume Equity Value Axis Bank Ltd. 1,265.35 0.84 142755 414.53 10 Market Cap (Rs Cr) 52,452.55

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Axis Bank Limited (BSE: 532215, LSE: AXBC) is an Indian financial services firm headquartered in Mumbai, Maharashtra. It had begun operations in 1994, after the Government of India allowed new private banks to be established. The Bank was promoted jointly by the Administrator of the Specified Undertaking of the Unit Trust of India (UTI-I), Life Insurance Corporation of India (LIC), General Insurance Corporation Ltd., National Insurance Company Ltd., The New India Assurance Company, The Oriental Insurance Corporation and United India Insurance Company UTI-I holds a special position in the Indian capital markets and has promoted many leading financial institutions in the country. As on the year ended 31 March, 2012, Axis Bank had an operating revenue of 134.37 billion and a net profit of 42.42 billion. Axis Bank (erstwhile UTI Bank) opened its registered office in Ahmedabad and corporate office in Mumbai in December 1993. The first branch was inaugurated in April 1994 in Ahmedabad by Dr. Manmohan Singh, then the Honorable Finance Minister. The Bank, as on 31st March, 2012, is capitalized to the extent of Rest. 4.132 billion with the public holding (other than promoters and GDRs) at 54.08%. Current Price % Face Company (Rs) Change Volume Equity Value Axis Bank Ltd. 1,265.35 0.84 142755 414.53 10 Market Cap (Rs Cr) 52,452.55

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Industrial Finance Corporation of India (IFCI) was established by government of India in the year 1948. During this period there were no commercial bank that provided long-term industrial finance and even merchant bankers and underwriting firms were almost non-existent. IFCI was established with an intention to provide long-term finance needs of the industrial sector. It got listed in the year 1993 changing its status from statutory corporation to a company. Until the establishment of ICICI in 1956 and IDBI in 1964, IFCI remained solely responsible for implementation of the governments industrial policy initiatives. It made a significant contribution to the modernization of Indian industry, export promotion, import substitution, pollution control, energy conservation and generation through commercially viable and market- friendly initiatives. Some sectors that have directly benefited from IFCI include:

Agro-based industry (textiles, paper, sugar) Service industry (hotels, hospitals) Basic industry (iron & steel, fertilizers, basic chemicals, cement) Capital & intermediate goods industry (electronics, synthetic fibres, synthetic plastics, miscellaneous chemicals) and Infrastructure (power generation, telecom services)

It has subsidiaries namely IFCI Financial services, Asset Care Enterprise, Foremost Factors, IFCI Venture Capital Funds are among others.
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It has reputed clients namely Ranbaxy Laboratories, Jaypee Group, Lanco, Emaar, Adani Group, JSW energy, Bhushan Power and Steel etc. Milestones IFCI has provided financial assistances of Rs 462 billion to 5707 concerns since its inception. IFCI assistance has enabled to create production capacities of 6.5 million spindles in the textile industry, 14,953 MW of electricity, 32.8 million tpa of petroleum refining, 8 port projects, 66 telecom projects and 1 bridge project., 59.3 million tpa of cement are among various projects to whom its has given financial assistance. IFCI has founded and developed various institutions namely ICRA for credit assessment rating, Tourism Finance Corporation of India (TFCI) for promotion of the hospitality industry, are among others. Products and services Project Finance- It provides short term, medium term loans and long term loans to concerns for expansion, technology up-gradation, R&D expenditure, and for other financial purposes. It caters to segments like PSUs, infrastructure projects, manufacturing facilities, promoter funding etc. Nodal Agency- It has formed nodal agency for monitoring of sugar development fund (SDF) loans. Corporate Advisory Services- It provides advisory services such as investment appraisal, project conceptualization, assistance in legal documentation, etc

52

company SBI Bank Of Baroda PNB Canara Bank Bank Of India IDBI Union Bank Of India Oriental Bank Indian Bank Syndicate Bank Allahabad Bank Corporation Bank Indian Overseas Bank Andhra Bank CentralBank of India UCO Bank Dena Bank Bank of Maharashtra Vijaya Bank StateBank Bikane&Jai St.Bk of Travancore State Bank Of Mysore United Bank Punjab & Sind Bank Bank of Punjab

Sales (Rs.Million) 1065214.5 296737.24 364280.31 308506.22 284806.66 233699.3 211442.78 158148.85 122313.23 152683.52 155232.78 130177.84 178970.84 113387.28 191494.99 146323.72 67941.28 72139.64 79881.25 62913.58 68287.62 50784.31 79610.93 64745 3285.97

Current Price 2090.9 723.2 740 429.55 271.5 102.4 225.2 312.9 184.15 120.2 134.9 403.15 74.8 103.1 73.6 71.4 104.65 55 55.25 390.15 512.35 526.05 67.1 65.55 44.05

Change (%) 0.06 -0.58 0.78 -1.15 0.48 -0.05 -0.66 -0.78 3.6 0.67 0.48 1.43 -0.33 -0.29 -0.27 0.49 0.24 1.1 0.18 -0.2 0.57 3.47 0.68 -2.38 0 Change (%) 2.54 -1.23 -0.61 1.6 0

P/E Ratio 9.53 5.67 5.14 6.06 5.45 6.26 6.09 6.95 4.33 4.66 3.95 3.9 5.79 4.34 8.04 4.51 3.98 6.3 5.07 3.65 4.48 5.97 3.49 4.03 0

Market Cap.(Rs.Million) 1403087.65 297324.43 250992.23 190290.65 155781.37 130910.01 123983.64 91292.07 79142.15 72354.38 67453.53 59718.31 59615.47 57692.74 54178.09 47460.45 36633.62 32427.56 27378.53 27310.5 25617.5 24619.03 24223.03 15352.33 4625.25

52-Week High/Low 2475/1576 881/606 1091/659 566/306 408/254 122/77 274/150 336/190 265/152 128/67 211/103 528/336 119/66 139/79 112/62 95/45 116/48 59/38 69/44 470/302 671/451 601/408 87/46 95/56 0/0

company IDFC Power Finance Corp Rural Electn. Corp IFCI Haryana Finanl.

Sales (Rs.Million) 60943.2 130174.9 103375.9 27556.8 168.57

Current Price 161.55 180.6 219.45 28.6 24.65

P/E Ratio 15.39 6.06 6.44 5.83 0

Market Cap.(Rs.Million) 244613.4 238394.3 216697.9 32542.15 9552.07

52-Week High/Low 169/90 224/131 251/142 49/20 25/25

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Corp Tourism Finance Corp Guj. State Fin. Corp Kamalakshi Fin Corp

1292.71 262.39 2.2

23.5 3.63 0

1.08 -4.72 0 Change (%) -1.07 -0.66 0.84 0.3 2.92 0 1.48 0 -0.36 1.17 1.57 0 -1.74 2.26 -0.2 0.24 1.37 0.43 6.81 0

3.42 0 0 P/E Ratio 26.71 15.87 11.6 40.99 19.73 13.33 9.49 52.93 13.29 6.84 8.95 0 6.8 8.24 8.63 1.42 14.45 8.22 0 0 NA

1896.84 323.48

29/18 2-Apr 0/

company HDFC Bank ICICI Bank Axis Bank Kotak Mahindra Bank Indusind Bank Yes Bank Federal Bank Centurion Bk of Punj ING Vysya Bank J&K Bank Karur Vysya Bank Bank of Raj South Indian Bank Karnataka Bank City Union Bank Standard Chartered Devp Credit Bank Lakshmi Vilas Bank Dhanlakshmi Bank United Western Bank Ltd

Sales (Rs.Million) 272863.5 335426.5 219946.5 61802.36 53591.93 63073.58 55583.92 12685.3 38568.08 48355.77 32703.73 13594.89 35834.25 31128.77 16967.74 79432.33 7169.69 15192.56 13936.54 4866.15

Current Price 662.35 1018.55 1265.35 626 384.6 419.45 468.75 41.4 459.65 1321.85 459.05 212.1 22.6 155.8 50.25 102.9 44.4 81.3 62.7 25.9

Market Cap.(Rs.Million) 1565527 1174398 540187.1 465587.3 180690.7 149595.9 80178.52 78932.68 70046.19 64080.38 49238.43 34222.35 30198.6 29337.82 25750.1 24696 10687.76 7930.06 5338.05 1392.59

52-Week High/Low 673/400 1102/641 1309/785 652/418 387/222 430/231 495/322 43/41 480/276 1433/645 482/322 214/207 28/20 159/64 54/34 109/72 52/31 105/69 79/42

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BIBLIOGRAPHY

The Economic Times Marketing management (Philip Kotler) Standard Chartered RHP

WEBOGRAPHY
1. www.Google.com 2. www.bseindia.com 3. www.nseindia.com

4. www.sebi.gov.in 5. www.sebi.com 6. www.chittoprarh.com 7. www.greymarket.in 8. www.nayaisue.com 9. www.ipobloggers.com 10. www.moneycontrol.com

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