History and Details of Stock Exchanges in India.
Stock Exchanges in India
Stock Exchange is the intermediary which facilitates the transaction between the buyers and sellers of the stock or securities. Stock Exchanges of India are abided to follow the rules directed by the Securities and Exchange Board of India. Stock Exchanges are a vital part of the country’s economy. Here in this article, we will go through the history of stock exchanges, a list of stock exchanges, and many more.
List of Stock Exchanges in India.
| RECOGNIZED STOCK EXCHANGE | SEGMENTS PERMITTED | |
|---|---|---|
| 1 | BSE Ltd. | Equity, Equity Derivatives, Currency Derivatives (including Interest Rate Derivatives), Commodity Derivatives, Debt |
| 2 | National Stock Exchange of India Ltd. | Equity, Equity Derivatives, Currency Derivatives (including Interest Rate Derivatives), Commodity Derivatives, Debt |
| 3 | Calcutta Stock Exchange Ltd. | |
| 4 | Metropolitan Stock Exchange of India Ltd. | Equity, Equity Derivatives Currency Derivatives (including Interest Rate Futures), Debt |
| 5 | India International Exchange (India INX) | Equity Derivatives (Equity Index Derivatives & Single Stock Derivatives)
Commodity Derivatives, Currency Derivatives, Debt |
| NSE IFSC Ltd | Equity Derivatives (Equity Index Derivatives & Single Stock Derivatives) Currency Derivatives, Commodity Derivatives Debt Securities (Masala Bonds) |
|
| 6 | Indian Commodity Exchange Limited | Commodity Derivatives |
| 7 | Multi Commodity Exchange of India Ltd. | Commodity Derivatives |
| 8 | National Commodity & Derivatives Exchange Ltd. | Commodity Derivatives |
Let us see the history of some of these stock exchanges of India.
Bombay Stock Exchange Limited
BSE Ltd is an Indian Stock Exchange located at Dalal Street Mumbai. It was established in 1875 by Premchand Roychand. It is the oldest Stock Exchange in Asia. On 31st August 1957, BSE became the first Indian Stock Exchange recognized by the Government of India under the Securities Contracts Regulation Act. In 1986 BSE created an index called BSE Sensex which can give an idea of the overall performance of Indian stock markets which consists of 30 stocks.
The derivatives market started in the year 2000 by BSE, trading can be done of BSE Sensex future contracts. Options trading was started in 2001-02. BSE is also listed on the stock exchange and has a stock price of Rs 1,070 as of today.
National Stock Exchange of India Ltd.
It is also known as NSE Limited. NSE was established back in 1992 as the first electronic Indian Stock Exchange. NSE provided the first screen-based trading system to investors, due to that investing and trading of stocks and securities became easy. NSE was set up by some of the Indian Financial institutions as well as some of the foreign financial institutions. Financial institutions that were part of it are Life Insurance Corporation (LIC), State Bank of India, IDFC Limited, and Stockholding Corporation of India Limited.
NSE was the tax-paying company in 1992 and turned to a stock exchange in 1993. In June 1994, NSE dived into the segment of the wholesale debt market. The Benchmark Index of NSE is NIFTY50 which is used by the investors to keep themselves up to date regarding the movements in the equity market of India. NSE started derivatives trading in the year 2000. Futures and Options are traded of various indexes, such as the NIFTY50 index, NIFTY Bank Index, NIFTY IT index, etc.
Calcutta Stock Exchange (CSE)
Calcutta Stock Exchange was incorporated in 1908 with 150 members. It is located in Lyons Range, Kolkata. It also has an index called CSE-40 similar to NIFTY50.
It was granted recognition as a stock exchange by the government of India in 1980 under the Securities Contracts Regulation Act. Calcutta Stock Exchange replaced itself with screen-based trading in 1997. CSE has been asked to exit from the list of stock exchanges, the case is still pending in the Calcutta High Court.
Metropolitan Stock Exchange (MSE)
MSE was incorporated in 2008 and SEBI permitted them to undertake trades in 2009. It provides the platform to trade in capital markets, futures & options, and also in debt markets. MSE also works to literate people in the segment of finance.
The SX40 index was introduced by MSE on February 9, 2013. It consists of 40 large-cap stocks, diversified into different sectors. Debt Market was introduced by MSE on June 7, 2013. The exchange also allowed trading on cash-settled interest rate futures (IRF) on the Government of India Security. Such products are very helpful for investors to hedge against volatile interest rates.
India International Exchange (India INX)
India INX is the subsidiary of BSE Ltd. It is the first international exchange at GIFT IFSC. They commenced their operation on 16th Jan 2017. They offer 22 hours of trading in products such as index, single stock products, commodity derivatives, currency derivatives, and debt securities.
India INX also introduced the Global Securities Market platform. It is one of the fastest exchanges in the world. They have a turnaround time of 4 microseconds, having an advanced technology interface.
List of Former Stock Exchanges in India
There are many stock exchanges that exited from the list of stock exchanges under the SEBI exit policy. Here are a few mentioned below.
| STOCK EXCHANGE | CLOSED IN YEAR |
|---|---|
| Bangalore Stock Exchange | 2014 |
| Pune Stock Exchange | 2015 |
| Jaipur Stock Exchange | 2015 |
| Delhi Stock Exchange | 2017 |
| Ahmedabad Stock Exchange | 2018 |
Conclusion
Stock Exchanges work to provide a platform between buyers and sellers and also it becomes easy to regulate for SEBI. There are in total 8 stock exchanges in India which are currently active.