IIBS has organized a one-day industry visit for the students of the 2022 batch on August 29, 2022, to the Securities and Exchange Board of India. 54 students were part of this tour with two faculties. The tour was coordinated by Dr. Anil Kumar. The tour was beneficial to the students because it provided important insights into the regulatory body's activities and responsibilities to investors, exchanges, industries, and so on.
The Manager, of SEBI Bangalore, explained the operation of SEBI to the students. She began with a little introduction about SEBI, which was founded as a financial entity under the Ministry of Finance in 1988 but became functional on April 4th, 1992 after an Act of Parliament was approved. Further, he explained the different acts of SEBI, such as the SEBI Act 1992 and the Depositories Act 1996.
She also touched upon certain necessary goals of the SEBI, which are to safeguard the interests of investors and regulate and promote the securities and commodities markets. She also explained the powers of SEBI, which are: legislative powers to formulate the rules; judicial powers for adjudicating disputes and issuing orders; and executive powers for administering the set regulations and taking measures against organizations breaking the laws.
Later, she spoke about the Indian securities market, where equities, debt, and mutual funds are the instruments on which trading is done. The actors in the Indian Securities Market are the issuers, the intermediaries, and the investors. She also mentioned a few players in the Indian Securities Market. Some of them include stock exchanges and brokers; depository participants and depositories; merchant bankers; transfer agents; bankers to an issue; portfolio managers; credit rating agencies; investment advisers; etc.
In continuation, she talked in short about the growth of the Indian securities market and clarified the two divisions of the securities market: the primary market and the secondary market. The primary market encompasses an initial public offering, whereby securities are offered for the first time. It assists in capital creation. Furthermore, she discussed the roles of both the main market and the secondary market.
The presentation moved further with the explanation of mutual funds. The correct individual should pick the right plan at the right moment. Then mutual funds are certainly suitable. People in their 20s to 40s can invest in small-cap and middle-cap schemes with low funds invested because they have high risks but may provide returns in the long run. People in their 60s should not invest in small-cap schemes because they rely on their pension and this high-risk scheme will not be as beneficial for them. They can primarily invest in fixed deposits in public sector banks, monthly investment schemes, or dividend mutual funds.
She mentioned security market scams, which may be executed in three ways: trade-based, information-based, and miscellaneous. Insider trading (unpublished price-sensitive information), price manipulation, collective investment plans, and the 1992 swindle were some of the instances of the scams listed by the resource person.
As noted, "Every action has consequences." she indicated the steps taken in the case of fraud, i.e., administrative warning, inquiry for cancellation or suspension, debarring procedures, levy of penalty, prosecution, and referral. He also encouraged them to understand the legal ramifications since they were going to be financial experts in various fields. Students were also informed about the Grievance Redressal that SEBI gives. Anyone with issues may go to the www.scores.gov.in website and make a complaint, which can be read online. It also offers a mobile app called SCORE.
Before closing the discussion, she elucidated several departmental duties in SEBI, including Corporate Finance, Economic and policy research, Enforcement, Human Resources, legal affairs, Investigation, Investment Management, and International activities. She also advised on the career alternatives in SEBI and the process of selection. The session ended with a vote of thanks by Dr.Anilkumar.R, Associate professor at IIBS and also SEBI Resource Person.
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