Description
Finance is the process of conversion of accumulated funds to productive usage. Finance helps to direct the flow of economic & facilitate in the firm's smooth operations.
A
Study On
DEMATERIALISATION OF SECURITIES
XXXX FINANCE LTD,
Project submitted in !rti!" #u"$""ment #or t%e !&!rd o# t%e de'ree o#
(MASTER OF )USINESS ADMINISTRATION*
DECLARATION
I here by declare that the project work entitled
“DEMATERIALISATION OF SECURITIES* IN (XXXX FINANCE LTD”,
XXXXXX, is an original work carried out by me availing the guidance of my
project guide And it has been submitted to XXXXX in partial ful!llment for
the award of the degree of MASTER OF )USINESS ADMINISTRATION
+M,),A- of """" It has not been submitted to any other #niversity or
Institution for the award of $egree%$iploma to the best of my knowledge
PLACE.
DATE.
&
'our( sincerely,
INDEX
CHAPTER-I:
INTRODUCTION:
? Objectives of study
? Scope of study
? Methodology of study
? Limitations of study
CHAPTER-II:
)
REVIEW OF LIER!"RE
CHAPTER-III;
#OM$!%& $ROFILE
CHAPTER-IV;
'!! !%!L&SIS ( $RESE%!IO%)
? *isto+ical bac,g+ound of 'EM!
? #u++ent scena+io
? !ccount opening and maintenance
? Settlements
? Remate+ialisation
CHAPTER-V:
#O%#L"SIO%
-I-LIO.R!$*&
!$$E%'I#ES
*
CHAPTER-I
INTRODUCTION
+
FINANCE:
Finance is the p+ocess of conve+sion of accumulated funds to
p+oductive usage/ Finance helps to di+ect the flo0 of economic ( facilitate in
the fi+m1s smooth ope+ations/
!cco+ding to *OW!R' !%' O$IO%S Finance is defined as 2the
administ+ation a+ea of set of administ+ative functions in an o+gani3ation
0hich has to do 0ith the management of flo0 of cash so that the
o+gani3ation 0ill have the means 4 ca++y out its objectives as satisfacto+y as
possible and at the same time meet the obligations as they become due2/
FINANCIAL SYSTEMS:
It is a set of ma+,ets and institutions to facilitate the e5change of assets
and +is,s/ Indian financial system comp+ises of th+ee pa+ts vi3/6 FI%!%#I!L
I%SI"IO%S o+ I%ERME'I!RIES6 FI%!%#I!L M!R7ES6
FI%!%#I!L I%SR"ME%S/ Financial Inte+media+ies6 p+ovide funds by
pooling the funds f+om investo+s/ hey a+e the comme+cial ban,s6 mutual
funds6 insu+ance companies6 p+ovident funds6 facto+s (non ban,ing financial
institutions etc///Financial inst+uments6 th+ough 0hich the fi+m can +aise
funds f+om public o+ institutions/ Some of them a+e e8uity sha+es6
p+efe+ential sha+es6 bonds6 comme+cial pape+s6 ce+tificate of deposits etc///
FINANCIAL MARKETS:
Financial ma+,ets consist of t0o pa+ts/
9: #apital ma+,et
4: Money ma+,et
,
Money ma+,et is a ma+,et fo+ dealing in moneta+y assets of sho+t;te+m
natu+e fo+ meeting the tempo+a+y cash +e8ui+ements/ #apital ma+,et is a
ma+,et fo+ long;te+m funds/ #apital ma+,et has t0o
segments/
9: $+ima+y ma+,et / %ame settlement cycle 0/e/f/ !p+il 96 4@@4/
CURRENT SCENARIO:
SE-I has since int+oduced I4 +olling settlements f+om !p+il 96 4@@>/ I4
settlement cycle means that the final settlement of t+ansactions done on 6
i/e/ t+ade day by e5change of monies and secu+ities bet0een the buye+s and
selle+s +espectively occu+s on second business day afte+ the t+ade day
e5cluding Satu+days6 Sundays6 ban, holidays and e5change holidays/
DAY ACTIVITY
• +ading and daily do0nloading of statements
sho0ing details of t+ansaction and ma+gins at the end
of each t+ading day
• C !=D !J ent+y by the membe+; b+o,e+s=confi+mation by
the custodians
I 9 #onfi+mation of C!=D! data by the custodians up to a
specified deadline time/ 'o0nloading of secu+ities and
funds obligation statement by membe+s/
*.
I 4 $ay;in of funds and secu+ities and payout of funds and
secu+ities by $+e;specified deadline times/ he
membe+s a+e +e8ui+ed to submit the pay in inst+uctions
fo+ funds and secu+ities to ban,s and deposito+ies
+espectively/
I > !uction fo+ sho+tages in delive+y of secu+ities
I B !uction pay;in and pay;out of funds and secu+ities/
JC!=D!) ! mechanism 0he+eby the obligation of setting the t+ansactions
done by a membe+ b+o,e+ on behalf of a client is passed on to a custodian
based on his confi+mation/ he custodian can confi+m the t+ades done by the
membe+s on;line/
+ading on the on;line sc+een based system )>@ p/m/ he sc+ipts t+aded on he Stoc, E5change6 Mumbai a+e classified
into 1!16 1-916 -4161#16 1F16.16 and 1KLH g+oups/
!6 -96 -4 and # g+oup1s +ep+esent the e8uity ma+,et segment/
F g+oup +ep+esents the debt ma+,et /
K g+oup cove+s the companies6 0hich have failed to comply 0ith listing
+e8ui+ements and=o+ failed to +esolve investo+ complaints o+ have not made
the +e8ui+ed a++angements fo+ demate+iali3ation of thei+ secu+ities 0ith both
the deposito+ies/
PROBLEMS WITH PHYSICAL MODE OF SETTLEMENT:
he capital ma+,et 0as a ma+ginal institution in the financial ma+,et
fo+ almost th+ee decades afte+ India1s independence/ *o0eve+6 until late
eighties the common man ,ept a0ay f+om capital ma+,ets/
%ot many companies accessed the capital ma+,et and6 thus6 the
8uantum of funds mobili3ed th+ough the ma+,et 0as meage+/ ! majo+
p+oblem6 ho0eve+6 continued to plague the ma+,et/ he Indian ma+,ets 0e+e
lite+ally 0eighed do0n by the need to deal 0ith sha+es in the pape+ fo+m/
he+e 0e+e p+oblems galo+e 0ith handling documents ;; fa,e and
stolen sha+es6 fa,e signatu+es and signatu+e mismatches6 duplication and
mutilation of sha+es6 t+ansfe+ p+oblems etc/ he t+ading volumes 0e+e small
due to small investing population/
*0
T,% *o--o."#/ &$% 'o0% o* +,% 0&6o$ 7$o(-%0' *&%5 *o$ 7,)'"&-
%$+"*"&+%' () +,% "#2%'+o$':
a/ Ino+dinate delay in +eceiving secu+ities afte+ t+ansfe+ by the
companies/
b/ Retu+n of sha+e ce+tificates as bad delive+ies on account of signatu+e
mismatch o+ fo+ged signatu+e of t+ansfe+o+ o+ fa,e ce+tificates/
c/ 'elay in +eceipt of secu+ities afte+ allotment by the companies/
d/ %on +eceipt of secu+ities/
e/ $+ocedu+al delays in getting duplicate sha+es=debentu+e ce+tificates/
f/ Sto+ing physical ce+tificates/
Lac, of mode+ni3ation became a hind+ance to g+o0th of seconda+y
ma+,et and +esulted in c+eation of cumbe+some p+ocedu+es and pape+ 0o+,/
*o0eve+6 the +eal g+o0th and change occu++ed f+om mid;eighties in the
0a,e of libe+ali3ation initiatives of the .ove+nment/
he +efo+ms in the financial secto+ 0e+e envisaged in the ban,ing
secto+6 capital ma+,et6 secu+ities ma+,et +egulation6 mutual funds6 fo+eign
investments and .ove+nment cont+ol/
*1
hese institutions and stoc, e5changes e5pe+ienced that the pape+
ce+tificates a+e the main cause of investo+ dispute+s and a+bit+ation cases/
hus6 the .ove+nment of India decided to set up a fully automated and high
technology based model e5change6 0hich 0ould offe+ sc+een based t+ading
and deposito+ies as the ultimate ans0e+ to all such +efo+ms/
he+efo+e6 the .ove+nment of India p+omulgated the 'eposito+ies
O+dinance in 9EE?/ *o0eve+6 both *ouses of $a+liament passed the
'eposito+ies !ct in 9EEC/ he unpa+alleled success of the int+oduction of
the deposito+y concept in the Indian capital ma+,ets is +eflected in the on;
going successful +eduction in the pe+iod bet0een t+ading and settlement/
PROBLEMS WITH PHYSICAL MODE OF SETTLEMENT:
he capital ma+,et 0as a ma+ginal institution in the financial ma+,et
fo+ almost th+ee decades afte+ India1s independence/ *o0eve+6 until late
eighties the common man ,ept a0ay f+om capital ma+,ets/
%ot many companies accessed the capital ma+,et and6 thus6 the
8uantum of funds mobili3ed th+ough the ma+,et 0as meage+/ ! majo+
p+oblem6 ho0eve+6 continued to plague the ma+,et/ he Indian ma+,ets 0e+e
lite+ally 0eighed do0n by the need to deal 0ith sha+es in the pape+ fo+m/
he+e 0e+e p+oblems galo+e 0ith handling documents ; fa,e and
stolen sha+es6 fa,e signatu+es and signatu+e mismatches6 duplication and
mutilation of sha+es6 t+ansfe+ p+oblems etc/ he t+ading volumes 0e+e small
due to small investing population/
+&
T,% *o--o."#/ &$% 'o0% o* +,% 0&6o$ 7$o(-%0' *&%5 *o$ 7,)'"&-
%$+"*"&+%' () +,% "#2%'+o$':
a/ Ino+dinate delay in +eceiving secu+ities afte+ t+ansfe+ by the
companies/
b/ Retu+n of sha+e ce+tificates as bad delive+ies on account of signatu+e
mismatch o+ fo+ged signatu+e of t+ansfe+o+ o+ fa,e ce+tificates/
c/ 'elay in +eceipt of secu+ities afte+ allotment by the companies/
d/ %on +eceipt of secu+ities/
e/ $+ocedu+al delays in getting duplicate sha+es=debentu+e ce+tificates/
f/ Sto+ing physical ce+tificates/
Lac, of mode+ni3ation became a hind+ance to g+o0th of seconda+y
ma+,et and +esulted in c+eation of cumbe+some p+ocedu+es and pape+
0o+,/ *o0eve+6 the +eal g+o0th and change occu++ed f+om mid;eighties
in the 0a,e of libe+ali3ation initiatives of the .ove+nment/
he +efo+ms in the financial secto+ 0e+e envisaged in the ban,ing
secto+6 capital ma+,et6 secu+ities ma+,et +egulation6 mutual funds6
fo+eign investments and .ove+nment cont+ol/
+)
hese institutions and stoc, e5changes e5pe+ienced that the pape+
ce+tificates a+e the main cause of investo+ dispute+s and a+bit+ation cases/
hus6 the .ove+nment of India decided to set up a fully automated and high
technology based model e5change6 0hich 0ould offe+ sc+een based t+ading
and deposito+ies as the ultimate ans0e+ to all such +efo+ms/
he+efo+e6 the .ove+nment of India p+omulgated the 'eposito+ies
O+dinance in 9EE?/ *o0eve+6 both *ouses of $a+liament passed the
'eposito+ies !ct in 9EEC/ he unpa+alleled success of the int+oduction of the
deposito+y concept in the Indian capital ma+,ets is +eflected in the on;going
successful +eduction in the pe+iod bet0een t+ading and settlement/
ACCOUNT OPENING AND MAINTENANCE:
!n individual 0ho 0ants to ,eep his = he+ cash safe in a ban, has to
open an account 0ith a ban, as a fi+st step and maintain cash in boo, ent+y
fo+m/ Simila+ly6 an investo+ has to open a demat account 0ith any '$ of
#'SL as a fi+st step to hold secu+ities in demat fo+m in the deposito+y system/
he investo+ can open an account 0ith any '$ of #'SL/ #'SL system
facilitates opening of demat accounts fo+ diffe+ent catego+ies of investo+s/
'emat accounts opened 0ith #'SL a+e +efe++ed as 1-eneficial O0ne+
!ccounts1 o+ 1-O account1/ !s e5plained ea+lie+6 0hen secu+ities a+e held in
physical fo+m name of the investo+ is +eco+ded in the boo,s of the company
as 1Registe+ed o0ne+1/ When the same secu+ities a+e conve+ted into
elect+onic fo+m and held in a demat account6 the deposito+y becomes
+egiste+ed o0ne+ of the secu+ities/
+*
Since deposito+y is acting as a custodian of the secu+ities6 o+iginal
investo+ is legally entitled fo+ all +ights = liabilities attached 0ith secu+ities
and hence a+e called a 1-eneficial O0ne+1/ !ll accounts opened on #'SL
system a+e beneficial accounts i++espective of the type of account/
! demat account may be opened and maintained in the name
Finance is the process of conversion of accumulated funds to productive usage. Finance helps to direct the flow of economic & facilitate in the firm's smooth operations.
A
Study On
DEMATERIALISATION OF SECURITIES
XXXX FINANCE LTD,
Project submitted in !rti!" #u"$""ment #or t%e !&!rd o# t%e de'ree o#
(MASTER OF )USINESS ADMINISTRATION*
DECLARATION
I here by declare that the project work entitled
“DEMATERIALISATION OF SECURITIES* IN (XXXX FINANCE LTD”,
XXXXXX, is an original work carried out by me availing the guidance of my
project guide And it has been submitted to XXXXX in partial ful!llment for
the award of the degree of MASTER OF )USINESS ADMINISTRATION
+M,),A- of """" It has not been submitted to any other #niversity or
Institution for the award of $egree%$iploma to the best of my knowledge
PLACE.
DATE.
&
'our( sincerely,
INDEX
CHAPTER-I:
INTRODUCTION:
? Objectives of study
? Scope of study
? Methodology of study
? Limitations of study
CHAPTER-II:
)
REVIEW OF LIER!"RE
CHAPTER-III;
#OM$!%& $ROFILE
CHAPTER-IV;
'!! !%!L&SIS ( $RESE%!IO%)
? *isto+ical bac,g+ound of 'EM!
? #u++ent scena+io
? !ccount opening and maintenance
? Settlements
? Remate+ialisation
CHAPTER-V:
#O%#L"SIO%
-I-LIO.R!$*&
!$$E%'I#ES
*
CHAPTER-I
INTRODUCTION
+
FINANCE:
Finance is the p+ocess of conve+sion of accumulated funds to
p+oductive usage/ Finance helps to di+ect the flo0 of economic ( facilitate in
the fi+m1s smooth ope+ations/
!cco+ding to *OW!R' !%' O$IO%S Finance is defined as 2the
administ+ation a+ea of set of administ+ative functions in an o+gani3ation
0hich has to do 0ith the management of flo0 of cash so that the
o+gani3ation 0ill have the means 4 ca++y out its objectives as satisfacto+y as
possible and at the same time meet the obligations as they become due2/
FINANCIAL SYSTEMS:
It is a set of ma+,ets and institutions to facilitate the e5change of assets
and +is,s/ Indian financial system comp+ises of th+ee pa+ts vi3/6 FI%!%#I!L
I%SI"IO%S o+ I%ERME'I!RIES6 FI%!%#I!L M!R7ES6
FI%!%#I!L I%SR"ME%S/ Financial Inte+media+ies6 p+ovide funds by
pooling the funds f+om investo+s/ hey a+e the comme+cial ban,s6 mutual
funds6 insu+ance companies6 p+ovident funds6 facto+s (non ban,ing financial
institutions etc///Financial inst+uments6 th+ough 0hich the fi+m can +aise
funds f+om public o+ institutions/ Some of them a+e e8uity sha+es6
p+efe+ential sha+es6 bonds6 comme+cial pape+s6 ce+tificate of deposits etc///
FINANCIAL MARKETS:
Financial ma+,ets consist of t0o pa+ts/
9: #apital ma+,et
4: Money ma+,et
,
Money ma+,et is a ma+,et fo+ dealing in moneta+y assets of sho+t;te+m
natu+e fo+ meeting the tempo+a+y cash +e8ui+ements/ #apital ma+,et is a
ma+,et fo+ long;te+m funds/ #apital ma+,et has t0o
segments/
9: $+ima+y ma+,et / %ame settlement cycle 0/e/f/ !p+il 96 4@@4/
CURRENT SCENARIO:
SE-I has since int+oduced I4 +olling settlements f+om !p+il 96 4@@>/ I4
settlement cycle means that the final settlement of t+ansactions done on 6
i/e/ t+ade day by e5change of monies and secu+ities bet0een the buye+s and
selle+s +espectively occu+s on second business day afte+ the t+ade day
e5cluding Satu+days6 Sundays6 ban, holidays and e5change holidays/
DAY ACTIVITY
• +ading and daily do0nloading of statements
sho0ing details of t+ansaction and ma+gins at the end
of each t+ading day
• C !=D !J ent+y by the membe+; b+o,e+s=confi+mation by
the custodians
I 9 #onfi+mation of C!=D! data by the custodians up to a
specified deadline time/ 'o0nloading of secu+ities and
funds obligation statement by membe+s/
*.
I 4 $ay;in of funds and secu+ities and payout of funds and
secu+ities by $+e;specified deadline times/ he
membe+s a+e +e8ui+ed to submit the pay in inst+uctions
fo+ funds and secu+ities to ban,s and deposito+ies
+espectively/
I > !uction fo+ sho+tages in delive+y of secu+ities
I B !uction pay;in and pay;out of funds and secu+ities/
JC!=D!) ! mechanism 0he+eby the obligation of setting the t+ansactions
done by a membe+ b+o,e+ on behalf of a client is passed on to a custodian
based on his confi+mation/ he custodian can confi+m the t+ades done by the
membe+s on;line/
+ading on the on;line sc+een based system )>@ p/m/ he sc+ipts t+aded on he Stoc, E5change6 Mumbai a+e classified
into 1!16 1-916 -4161#16 1F16.16 and 1KLH g+oups/
!6 -96 -4 and # g+oup1s +ep+esent the e8uity ma+,et segment/
F g+oup +ep+esents the debt ma+,et /
K g+oup cove+s the companies6 0hich have failed to comply 0ith listing
+e8ui+ements and=o+ failed to +esolve investo+ complaints o+ have not made
the +e8ui+ed a++angements fo+ demate+iali3ation of thei+ secu+ities 0ith both
the deposito+ies/
PROBLEMS WITH PHYSICAL MODE OF SETTLEMENT:
he capital ma+,et 0as a ma+ginal institution in the financial ma+,et
fo+ almost th+ee decades afte+ India1s independence/ *o0eve+6 until late
eighties the common man ,ept a0ay f+om capital ma+,ets/
%ot many companies accessed the capital ma+,et and6 thus6 the
8uantum of funds mobili3ed th+ough the ma+,et 0as meage+/ ! majo+
p+oblem6 ho0eve+6 continued to plague the ma+,et/ he Indian ma+,ets 0e+e
lite+ally 0eighed do0n by the need to deal 0ith sha+es in the pape+ fo+m/
he+e 0e+e p+oblems galo+e 0ith handling documents ;; fa,e and
stolen sha+es6 fa,e signatu+es and signatu+e mismatches6 duplication and
mutilation of sha+es6 t+ansfe+ p+oblems etc/ he t+ading volumes 0e+e small
due to small investing population/
*0
T,% *o--o."#/ &$% 'o0% o* +,% 0&6o$ 7$o(-%0' *&%5 *o$ 7,)'"&-
%$+"*"&+%' () +,% "#2%'+o$':
a/ Ino+dinate delay in +eceiving secu+ities afte+ t+ansfe+ by the
companies/
b/ Retu+n of sha+e ce+tificates as bad delive+ies on account of signatu+e
mismatch o+ fo+ged signatu+e of t+ansfe+o+ o+ fa,e ce+tificates/
c/ 'elay in +eceipt of secu+ities afte+ allotment by the companies/
d/ %on +eceipt of secu+ities/
e/ $+ocedu+al delays in getting duplicate sha+es=debentu+e ce+tificates/
f/ Sto+ing physical ce+tificates/
Lac, of mode+ni3ation became a hind+ance to g+o0th of seconda+y
ma+,et and +esulted in c+eation of cumbe+some p+ocedu+es and pape+ 0o+,/
*o0eve+6 the +eal g+o0th and change occu++ed f+om mid;eighties in the
0a,e of libe+ali3ation initiatives of the .ove+nment/
he +efo+ms in the financial secto+ 0e+e envisaged in the ban,ing
secto+6 capital ma+,et6 secu+ities ma+,et +egulation6 mutual funds6 fo+eign
investments and .ove+nment cont+ol/
*1
hese institutions and stoc, e5changes e5pe+ienced that the pape+
ce+tificates a+e the main cause of investo+ dispute+s and a+bit+ation cases/
hus6 the .ove+nment of India decided to set up a fully automated and high
technology based model e5change6 0hich 0ould offe+ sc+een based t+ading
and deposito+ies as the ultimate ans0e+ to all such +efo+ms/
he+efo+e6 the .ove+nment of India p+omulgated the 'eposito+ies
O+dinance in 9EE?/ *o0eve+6 both *ouses of $a+liament passed the
'eposito+ies !ct in 9EEC/ he unpa+alleled success of the int+oduction of
the deposito+y concept in the Indian capital ma+,ets is +eflected in the on;
going successful +eduction in the pe+iod bet0een t+ading and settlement/
PROBLEMS WITH PHYSICAL MODE OF SETTLEMENT:
he capital ma+,et 0as a ma+ginal institution in the financial ma+,et
fo+ almost th+ee decades afte+ India1s independence/ *o0eve+6 until late
eighties the common man ,ept a0ay f+om capital ma+,ets/
%ot many companies accessed the capital ma+,et and6 thus6 the
8uantum of funds mobili3ed th+ough the ma+,et 0as meage+/ ! majo+
p+oblem6 ho0eve+6 continued to plague the ma+,et/ he Indian ma+,ets 0e+e
lite+ally 0eighed do0n by the need to deal 0ith sha+es in the pape+ fo+m/
he+e 0e+e p+oblems galo+e 0ith handling documents ; fa,e and
stolen sha+es6 fa,e signatu+es and signatu+e mismatches6 duplication and
mutilation of sha+es6 t+ansfe+ p+oblems etc/ he t+ading volumes 0e+e small
due to small investing population/
+&
T,% *o--o."#/ &$% 'o0% o* +,% 0&6o$ 7$o(-%0' *&%5 *o$ 7,)'"&-
%$+"*"&+%' () +,% "#2%'+o$':
a/ Ino+dinate delay in +eceiving secu+ities afte+ t+ansfe+ by the
companies/
b/ Retu+n of sha+e ce+tificates as bad delive+ies on account of signatu+e
mismatch o+ fo+ged signatu+e of t+ansfe+o+ o+ fa,e ce+tificates/
c/ 'elay in +eceipt of secu+ities afte+ allotment by the companies/
d/ %on +eceipt of secu+ities/
e/ $+ocedu+al delays in getting duplicate sha+es=debentu+e ce+tificates/
f/ Sto+ing physical ce+tificates/
Lac, of mode+ni3ation became a hind+ance to g+o0th of seconda+y
ma+,et and +esulted in c+eation of cumbe+some p+ocedu+es and pape+
0o+,/ *o0eve+6 the +eal g+o0th and change occu++ed f+om mid;eighties
in the 0a,e of libe+ali3ation initiatives of the .ove+nment/
he +efo+ms in the financial secto+ 0e+e envisaged in the ban,ing
secto+6 capital ma+,et6 secu+ities ma+,et +egulation6 mutual funds6
fo+eign investments and .ove+nment cont+ol/
+)
hese institutions and stoc, e5changes e5pe+ienced that the pape+
ce+tificates a+e the main cause of investo+ dispute+s and a+bit+ation cases/
hus6 the .ove+nment of India decided to set up a fully automated and high
technology based model e5change6 0hich 0ould offe+ sc+een based t+ading
and deposito+ies as the ultimate ans0e+ to all such +efo+ms/
he+efo+e6 the .ove+nment of India p+omulgated the 'eposito+ies
O+dinance in 9EE?/ *o0eve+6 both *ouses of $a+liament passed the
'eposito+ies !ct in 9EEC/ he unpa+alleled success of the int+oduction of the
deposito+y concept in the Indian capital ma+,ets is +eflected in the on;going
successful +eduction in the pe+iod bet0een t+ading and settlement/
ACCOUNT OPENING AND MAINTENANCE:
!n individual 0ho 0ants to ,eep his = he+ cash safe in a ban, has to
open an account 0ith a ban, as a fi+st step and maintain cash in boo, ent+y
fo+m/ Simila+ly6 an investo+ has to open a demat account 0ith any '$ of
#'SL as a fi+st step to hold secu+ities in demat fo+m in the deposito+y system/
he investo+ can open an account 0ith any '$ of #'SL/ #'SL system
facilitates opening of demat accounts fo+ diffe+ent catego+ies of investo+s/
'emat accounts opened 0ith #'SL a+e +efe++ed as 1-eneficial O0ne+
!ccounts1 o+ 1-O account1/ !s e5plained ea+lie+6 0hen secu+ities a+e held in
physical fo+m name of the investo+ is +eco+ded in the boo,s of the company
as 1Registe+ed o0ne+1/ When the same secu+ities a+e conve+ted into
elect+onic fo+m and held in a demat account6 the deposito+y becomes
+egiste+ed o0ne+ of the secu+ities/
+*
Since deposito+y is acting as a custodian of the secu+ities6 o+iginal
investo+ is legally entitled fo+ all +ights = liabilities attached 0ith secu+ities
and hence a+e called a 1-eneficial O0ne+1/ !ll accounts opened on #'SL
system a+e beneficial accounts i++espective of the type of account/
! demat account may be opened and maintained in the name