Presentation on:Securities and Exchange Board of India (SEBI)

Presented to:Mr. Chaksh Sharma

Presented by:Sagar Sood

Presentation Plan• History• Establishment of SEBI• Reasons for establishment of SEBI• SEBI headquarters• SEBI official website• Board of members• Organizational structure• Departments under SEBI• Role of SEBI• Powers• Objectives• Functions• Satyam scam

HISTORY

• Officially established by The Government of India in the year 1988

• It was given statutory powers in 1992 with SEBI Act 1992

• SEBI was a non statutory body but in year 1995, the SEBI was given additional statutory power by the Government of India.

ESTABLISHMENT OF SEBI

• The Securities and Exchange Board of India (SEBI) is the regulator for the securities market in India.

• SEBI was established by the Government of India on 12 April 1988

• It promote orderly and healthy growth of securities market and for investor protection

Reason for the establishment of SEBI

• The capital market had witnessed a tremendous  growth during the 1980·s

• This ever expanding investor population and market capitalization led to a variety of malpractices.

• These malpractices include rigging of prices, unofficial premium on new issues, violation of rules and regulations, delay in delivery of shares etc.

• So, the Government of India decided to set-up a separate regulatory body known as SEBI.

SEBI headquarters

Official website of SEBI

BOARD OF MEMBERS

Shri U. K. Sinha,Chairman, SEBI,SEBI Bhavan, Bandra Kurla Complex,Bandra (E), Mumbai - 400051

Shri Prashant SaranWhole-Time Member, SEBI,SEBI Bhavan, Bandra Kurla Complex,Bandra (E), Mumbai - 400051

Shri Rajeev Kumar AgarwalWhole-Time Member, SEBI,SEBI Bhavan, Bandra Kurla Complex,Bandra (E), Mumbai - 400051

Shri V. K. Jairath194 B Kalpatru Horizon,S.K. Ahire Marg, Worli,Mumbai 400018

Shri Anand SinhaDeputy GovernorReserve Bank of India

Shri Naved MasoodSecretary,Ministry of Corporate Affairs

ORGANISATION STRUCTURE

• The activities of SEBI have been divided into 4 operational departments.

• Each department is headed by an Executive Director 

• Apart from its head office at Mumbai SEBI has regional offices in Kolkata, Chennai, Delhi to attend  to investor complaints.

Departments under SEBI

Primary market

department

Secondary market

department

Issue management department

Institutional investment department

• Primary Market Department: It deals with all policy matters and regulatory issues relating to primary market.

• Issue Management and Intermediaries Departments: This department is concerned with inspection of offer documents and other things like registration, regulation and monitoring of issue related to intermediaries.

• Secondary Market Department: It looks after all the policy and regulatory issues for the secondary market; administration of the major stock exchanges and other matters related to it.

• Institutional Investment Department: It concerned with framing policy for foreign institutional investors.

ROLE OF SEBI

• To the issuers- it aims to provide a market place in which they can confidently look forward to raising finances they need in an easy, fair and efficient manner.

• To the investors- it should provide protection of their rights and interests through adequate, accurate and authentic information and disclosure of information on a continuous basis.

• To the intermediaries- it should offer a competitive, professionalized and expanding market with adequate and efficient infrastructure so that they are able to render better service to the investors and issuers.

POWERS

• Power to call periodical returns from recognized stock exchange.

• Power to control and regulate stock exchange.

• Power to call any information or explanation from recognized stock exchanges or their members.

• Power to levy fees or other charges for carrying out the purpose of regulation.

• Power to grant registration to market intermediaries.

• Registration of brokers.

Objectives

• To protect the interest of investors so that there is a steady flow of savings in to the capital market.

• To regulate the securities market.• To ensure fair practices by the

issuers of securities so that they can raise resources at minimum cost.

• To promote efficient services by brokers, merchant bankers and other intermediaries so that they become competitive and professional.

• To provide suitable education and guidance to investors so as to enable them to protect their interest.

Functions

• There are mainly two types of functions performed by SEBI

REGULATORY FUNCTIONS DEVELOPMENTAL FUNCTIONS

REGULATORY FUNCTIONS

• Registration of brokers and other players in the market.

• Registration of collective investment schemes and Mutual Funds.

• Prohibition of fraudulent and unfair trade practices.

• Regulation of Stock Bankers and portfolio exchanges, and merchant bankers.

• Levying fee or other charges for carrying out the purposes of the Act.

DEVELOPMENTAL FUNCTIONS

•  Promoting investor’s education.

• Training of intermediaries.

• Conducting research and published information useful to all market participants.

• Promotion of fair practices.

• Code of conduct for self- regulatory organizations.

• Promoting self-regulatory organizations.

SEBI’s role in Satyam Scam

• M/s Satyam Computer Services Limited caused loss to the investors to the tune of Rs.14,162 crore.

• The company head, Ramalinga Raju and members of his family secured illegal gains by various tricks.

• The sebi team worked for 45 days and filed the chargesheet against the accused for cheating, and falsification of accounts.

Source of information

• http://www.sebi.gov.in/sebiweb/home/list/1/3/0/0/Regulations

• http://www.indianexpress.com/news/satyam-scam-sebi-imposes-rs-5l-fine/982544/

• http://in.answers.yahoo.com/question/index?qid=20081117080937AArbJgh