Sebi Regulations and Guidelines to Investors
Q) Examine the role of SEBI as a regulatory authority, regulation of capital markets leads to increase in investors’ protection.
This assignment discusses the role played by the Securities and Exchange Board of India (SEBI) as a regulator of Indian capital markets and discusses in depth the capital market reforms initiated by SEBI.
In spite of these reforms and increasing regulatory powers over the years, SEBI has been largely unsuccessful in controlling capital market scams. The strengths and weaknesses of SEBI as a regulatory organization are also examined.
It describes the recent initiatives by SEBI to promote investor education and corporate governance, transparency and abidance of regulations among corporates.
Issues:
» The genesis of SEBI
» Role and functions of SEBI
» Introduction to Capital Market
» Role of SEBI in the Capital Market
» Investor protection
» Identify the loopholes in the financial system that allows capital market scams to happen and suggest a suitable course of action to avoid them.
Introduction
On April 12, 1988, the Securities and Exchange Board of India (SEBI) was established with a dual objective of protecting the rights of small investors and regulating and developing the stock markets in India.
In 1992, the Bombay Stock Exchange (BSE), the leading stock exchange in India, witnessed the first major scam masterminded by Harshad Mehta (Mehta).
Harshad Mehta: the high-profile stockbroker
Harshad Shantilal Mehta (1954-2002) was an Indian stockbroker who grabbed headlines for the notorious BSE security scam of 1992. By year 1990, Mehta became a prominent name in the Indian stock market. He started buying shares heavily. The shares of India's foremost cement manufacturer Associated Cement Company (ACC) attracted him the most and the scamster is known to have taken the price of the cement company from 200 to 9000 (approx.) in the stock market – implying a 4400% rise in its price. It is believed that It was later revealed
This assignment discusses the role played by the Securities and Exchange Board of India (SEBI) as a regulator of Indian capital markets and discusses in depth the capital market reforms initiated by SEBI.
In spite of these reforms and increasing regulatory powers over the years, SEBI has been largely unsuccessful in controlling capital market scams. The strengths and weaknesses of SEBI as a regulatory organization are also examined.
It describes the recent initiatives by SEBI to promote investor education and corporate governance, transparency and abidance of regulations among corporates.
Issues:
» The genesis of SEBI
» Role and functions of SEBI
» Introduction to Capital Market
» Role of SEBI in the Capital Market
» Investor protection
» Identify the loopholes in the financial system that allows capital market scams to happen and suggest a suitable course of action to avoid them.
Introduction
On April 12, 1988, the Securities and Exchange Board of India (SEBI) was established with a dual objective of protecting the rights of small investors and regulating and developing the stock markets in India.
In 1992, the Bombay Stock Exchange (BSE), the leading stock exchange in India, witnessed the first major scam masterminded by Harshad Mehta (Mehta).
Harshad Mehta: the high-profile stockbroker
Harshad Shantilal Mehta (1954-2002) was an Indian stockbroker who grabbed headlines for the notorious BSE security scam of 1992. By year 1990, Mehta became a prominent name in the Indian stock market. He started buying shares heavily. The shares of India's foremost cement manufacturer Associated Cement Company (ACC) attracted him the most and the scamster is known to have taken the price of the cement company from 200 to 9000 (approx.) in the stock market – implying a 4400% rise in its price. It is believed that It was later revealed