COMPANY PROFILE: 2.
1 INTRODUCTION ABOUT THE COMPANY Even as the European and American stock markets reckon with the changes brought about by the Internet and IT/telecom advances, the Indian stock market has quickly moved to global standards. The sheer breadth of the changes since the National Stock Exchange started operations in 1994 and with the Securities and Exchange Board of India (SEBI) also driving the changes in the market system, have enabled the Indian market to move well ahead in just five years. Even as online automated trading and better clearing and settlement mechanisms have been put in place, perhaps, the most significant change in the Indian market has been the coming of paperless trading; it may well be a precursor to the next big changes rolling settlements and Internet trading. But the push towards paperless trading stands out even in a decade when the market landscape has changed beyond recognition. Dematerialization (holding and trading securities in paperless mode) was an alien concept in India before 1995; in five years, large quantities of paper have been flushed out of the system. Since the entry of the foreign institutional investors (FIIs) and online trading, the old system, laden with paperwork at every conceivable stage, was out of place in an otherwise fast trading environment. As the FIIs complained about the paperwork as a major constraining factor, the government and SEBI took notice. The requisite legislative changes were put in place quickly - the Depositories Act, 1996 was passed and the NSE, with the UTI and the IDBI, set up the National Securities Depository Ltd (NSDL). But the depository concept did not gain popularity; the FIIs which had clamored for its introduction, now ignored it. The reason: Lack of liquidity. But, unless the institutional investors stepped in, there could be no liquidity. This stalemate frustrated the push for a paperless environment. Until SEBI stepped in, that is. With regulatory pushes SEBI, in phases, made demat trading in stocks mandatory for institutions first and, then, for all investors. Mandatory paperless trading, forced the FIIs to dematerialize their holdings quickly. As a consequence of SEBI's action, most major stocks are traded in the paperless mode now. The second phase will involve some 200 stocks in a few months time. The effect of SEBI's action is evident from NSDL's statistics. A total of 698 companies, with a market capitalisation of Rs. 7,37,300 crores (almost 80 per cent of the market capitalisation of all listed stocks), is enrolled with the NSDL. With 13.65 billion shares in the demat mode, nearly 19 million investor accounts, and securities valued at Rs. 3,96,800 crores ($91 billions) actually dematerialised, the concept of dematerialisation can be said to have taken roots. If the regulatory direction is any indication, more paper will be flushed out of the system in the next two years. The costs of dematerialisation have declined as the NSDL slashed charges as volumes expanded and the competition _ from the Central Depository Services Ltd (CSDL)
floated by the BSE _ started in 1999 second half. A series of measures by SEBI and NSDL also helped ease the strain faced by retail investors. From a long-term perspective, demat in India is of considerable significance. Not only has the general trading environment improved and quickened, volumes too have perked up, even in the demat segment. With demat taking off, there is now scope for an improvement in the quality of investor services. As a consequence of dematerialisation, the Indian market is also well prepared for web-based trading though the quality of telecom infrastructure and inadequacies in the banking system-stock exchange linkages may cause delays. Notably, with regard to the thrust towards paperless trading, the Indian market managed in three years what took even the US much longer. With a high degree of dematerialisation a reality, the stage is set for rolling settlements and web-based trading. Once these are in place, the Indian market will have moved closer to the standards in advanced markets, such as the US. And paperless trading may well be the catalyst for such a rapid advancement. Executive summery: ICICI [Link] is the largest equity house in the country providing end-to-end solutions (including web-based services) through the largest non-banking distribution channel so as to fulfill all the diverse needs of retail and corporate customers. [Link] has a dominant position in its core segments of its operations Corporate Finance including Equity Capital Markets Advisory Services, Institutional Equities, Retail and Financial Product Distribution. With a full-service portfolio, a roster of blue-chip clients and performance second tonne, we have a formidable reputation within the industry. Today ICICI Securities is among the leading Financial Institutions both on the institutional as well as retail side. ICICI [Link], the step-down wholly owned US subsidiary of the company is a member of the National Association of Securities Dealers, Inc. (NASD). As a result of this membership, ICICI Securities Inc. can engage in permitted activities in the U.S. securities markets. These activities include Dealing in Securities and Corporate Advisory Services in the United States and providing research and investment advice to US investors. ICICI [Link] is also registered with the Financial Services Authority, UK (FSA)and the Monetary Authority of Singapore (MAS).
