The National Stock Exchange of India Limited (NSE), is a Mumbai-based stock exchange. It is the largest stock exchange in India in terms of daily turnover and number of trades, for both equities and derivative trading. Though a number of other exchanges exist, NSE and the Bombay Stock Exchange are the two most significant stock exchanges in India, and between them are responsible for the vast majority of share transactions. The NSE’s key index is the S&P CNX Nifty, known as the Nifty, an index of fifty major stocks weighted by market capitalisation.

NSE is mutually-owned by a set of leading financial institutions, banks, insurance companies and other financial intermediaries in India but its ownership and management operate as separate entities. There are at least 2 foreign investors NYSE Euronext and Goldman Sachs who have taken a stake in the NSE. As of 2006, the NSE VSAT terminals, 2799 in total, cover more than 1500 cities across India. In October 2007, the equity market capitalization of the companies listed on the NSE was US$ 1.46 trillion, making it the second largest stock exchange in South Asia. NSE is the third largest Stock Exchange in the world in terms of the number of trades in equities. It is the second fastest growing stock exchange in the world with a recorded growth of 16.6%.

NSE has played a catalytic role in reforming the Indian securities market in terms of microstructure, market practices and trading volumes. The market today uses state-of-art information technology to provide an efficient and transparent trading, clearing and settlement mechanism, and has witnessed several innovations in products & services viz. demutualisation of stock exchange governance, screen based trading, compression of settlement cycles, dematerialisation and electronic transfer of securities, securities lending and borrowing, professionalisation of trading members, fine-tuned risk management systems, emergence of clearing corporations to assume counterparty risks, market of debt and derivative instruments and intensive use of information technology.

In recognition of the fact that technology will continue to redefine the shape of the securities industry, NSE stresses on innovation and sustained investment in technology to remain ahead of competition. NSE’s IT set-up is the largest by any company in India. It uses satellite communication technology to energise participation from around 200 cities spread all over the country. In the recent past, capacity enhancement measures were taken up in regard to the trading systems so as to effectively meet the requirements of increased users and associated trading loads. With upgradation of trading hardware, NSE today can handle up to 15 million trades per day in Capital Market segment. In order to capitalise on in-house expertise in technology, NSE set up a separate company, NSE Technology Services Ltd. which is expected to provide a platform for taking up all IT related assignments of NSE.

NEAT is a state-of-the-art client server based application. At the server end, all trading information is stored in an in-memory database to achieve minimum response time and maximum system availability for users. The trading server software runs on a fault tolerant STRATUS main frame computer while the client software runs under Windows on PCs.

NSE is one of the largest interactive VSAT based stock exchanges in the world. Today it supports more than 2000 VSATs and 3000 leased lines across the country. The NSE- network is the largest private wide area network in the country and the first extended C- Band VSAT network in the world. Currently more than 9000 users are trading on the real time-online NSE application. There are over 15 large computer systems which include non-stop fault-tolerant computers and high end UNIX servers, operational under one roof to support the NSE applications. This coupled with the nation wide VSAT network makes NSE the country’s largest Information Technology user.

In an ongoing effort to improve NSE’s infrastructure, a corporate network has been implemented, connecting all the offices at Mumbai, Delhi, Calcutta and Chennai. This corporate network enables speedy inter-office communications and data and voice connectivity between offices.

Origins

The National Stock Exchange of India was promoted by leading Financial institutions at the behest of the Government of India, and was incorporated in November 1992 as a tax-paying company. In April 1993, it was recognized as a stock exchange under the Securities Contracts (Regulation) Act, 1956. NSE commenced operations in the Wholesale Debt Market (WDM) segment in June 1994. The Capital Market (Equities) segment of the NSE commenced operations in November 1994, while operations in the Derivatives segment commenced in June 2000.

Innovations

NSE has remained in the forefront of modernization of India’s capital and financial markets, and its pioneering efforts include:

• Being the first national, anonymous, electronic limit order book (LOB) exchange to trade securities in India. Since the success of the NSE, existent market and new market structures have followed the “NSE” model.
• Setting up the first clearing corporation “National Securities Clearing Corporation Ltd.” in India. NSCCL was a landmark in providing innovation on all spot equity market (and later, derivatives market) trades in India.
• Co-promoting and setting up of National Securities Depository Limited, first depository in India.
• Setting up of S&P CNX Nifty.
• NSE pioneered commencement of Internet Trading in February 2000, which led to the wide popularization of the NSE in the broker community.
• Being the first exchange that, in 1996, proposed exchange traded derivatives, particularly on an equity index, in India. After four years of policy and regulatory debate and formulation, the NSE was permitted to start trading equity derivatives
  Being the first and the only exchange to trade GOLD ETFs (exchange traded funds) in India.
• NSE has also launched the NSE-CNBC-TV18 media centre in association with CNBC-TV18.

Markets

Currently, NSE has the following major segments of the capital market:

• Equity
• Futures and Options
• Retail Debt Market
• Wholesale Debt Market
• Currency futures

Indices

NSE also set up as index services firm known as India Index Services & Products Limited (IISL) and has launched several stock indices, including:

• S&P CNX Nifty
• CNX Nifty Junior
• CNX 100 (= S&P CNX Nifty + CNX Nifty Junior)
• S&P CNX 500 (= CNX 100 + 400 major players across 72 industries)
• CNX Midcap (introduced on 18 July 2005 replacing CNX Midcap 200)

Certifications

NSE also conducts online examination and awards certification, under its programmes of NSE’s Certification in Financial Markets (NCFM). Currently, certifications are available in 19 modules, covering different sectors of financial and capital markets. Branches of the NSE are located throughout India.

NSE Milestones

• November 1992 Incorporation
• April 1993 Recognition as a stock exchange
• May 1993 Formulation of business plan
• June 1994 Wholesale Debt Market segment goes live
• November 1994 Capital Market (Equities) segment goes live
• March 1995 Establishment of Investor Grievance Cell
• April 1995 Establishment of NSCCL, the first Clearing Corporation
• June 1995 Introduction of centralised insurance cover for all trading members
• July 1995 Establishment of Investor Protection Fund
• October 1995 Became largest stock exchange in the country
• April 1996 Commencement of clearing and settlement by NSCCL
• April 1996 Launch of S&P CNX Nifty
• June 1996 Establishment of Settlement Guarantee Fund
• November 1996 Setting up of National Securities Depository Limited, first depository in India, co-promoted by NSE
• November 1996 Best IT Usage award by Computer Society of India
• December 1996 Commencement of trading/settlement in dematerialised securities
• December 1996 Dataquest award for Top IT User
• December 1996 Launch of CNX Nifty Junior
• February 1997 Regional clearing facility goes live
• November 1997 Best IT Usage award by Computer Society of India
• May 1998 Promotion of joint venture, India Index Services & Products Limited (IISL)
• May 1998 Launch of NSE’s Web-site: www.nse.co.in
• July 1998 Launch of NSE’s Certification Programme in Financial Market
• August 1998 CYBER CORPORATE OF THE YEAR 1998 award
• February 1999 Launch of Automated Lending and Borrowing Mechanism
• April 1999 CHIP Web Award by CHIP magazine
• October 1999 Setting up of NSE.IT
• January 2000 Launch of NSE Research Initiative
• February 2000 Commencement of Internet Trading
• June 2000 Commencement of Derivatives Trading (Index Futures)
• September 2000 Launch of ‘Zero Coupon Yield Curve’
• November 2000 Launch of Broker Plaza by Dotex International, a joint venture between NSE.IT Ltd. and i-flex Solutions Ltd.
• December 2000 Commencement of WAP trading
• June 2001 Commencement of trading in Index Options
• July 2001 Commencement of trading in Options on Individual Securities
• November 2001 Commencement of trading in Futures on Individual Securities
• December 2001 Launch of NSE VaR for Government Securities
• January 2002 Launch of Exchange Traded Funds (ETFs)
• May 2002 NSE wins the Wharton-Infosys Business Transformation Award in the Organization-wide Transformation category
• October 2002 Launch of NSE Government Securities Index
• January 2003 Commencement of trading in Retail Debt Market
• June 2003 Launch of Interest Rate Futures
• August 2003 Launch of Futures & options in CNXIT Index
• June 2004 Launch of STP Interoperability
• August 2004 Launch of NSE’s electronic interface for listed companies
• March 2005 ‘India Innovation Award’ by EMPI Business School, New Delhi
• June 2005 Launch of Futures & options in BANK Nifty Index
• December 2006 ‘Derivative Exchange of the Year’, by Asia Risk magazine
• January 2007 Launch of NSE – CNBC TV 18 media centre
• March 2007 NSE, CRISIL announce launch of IndiaBondWatch.com
• June 2007 NSE launches derivatives on Nifty Junior & CNX 100
• October 2007 NSE launches derivatives on Nifty Midcap 50
• January 2008 Introduction of Mini Nifty derivative contracts on 1st January 2008
• March 2008 Introduction of long term option contracts on S&P CNX Nifty Index
• April 2008 Launch of India VIX
• April 2008 Launch of Securities Lending & Borrowing Scheme
• August 2008 Launch of Currency Derivatives

Corporate Office:

National Stock Exchange of India Ltd.
Exchange Plaza,
Plot no. C/1, G Block,
Bandra-Kurla Complex
Bandra (E)
Mumbai – 400 051.
India

Tel: +91-22-26598100 – 14
Fax: +91-22-26598120

List of offices

http://www.nseindia.com