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International Journal of Current Trends in Science and Technology
Online ISSN: 0976-9730
Print ISSN: 0976- 9498 Section: Management and Economics

Bombay Stock Exchange and National Stock Exchange

Habeeb Tabassum
Faculty - St.Joseph’s Degree College
(Affilated to Osmania University)

Received 2017-11-10; Accepted 2017-11-30

DOI: https://doi.org/10.15520/ctst.v7i12.167

Abstract:
In this study an attempt is made has been made to analysis the financial performance of Indian stock
market out of 23 stock exchanges the two most prominent Stock Exchanges of India are Bombay stock
exchange, ruling on Indian economy over a year and the second one is National stock exchange .presently
NSE is giving a tough competition to BSE and just had completed two decades.
The present study is to find out that out of these two stock exchanges which one is performing better
financially on various basis. The analysis is done for Aftek Company. Such analysis is done by considering
the quantitative analysis .By considering the balance sheet of the Afetak Company the profits are computed.
This depicts the financial performance of the company and weather the company is stable to list its securities
in either Bombay stock exchange or National stock exchange.

Key Words: (1) BSE (2) NSE 3) financial perfomance

Introduction:
1.1 Introduction:
After the invention of money ,people started
expanding business not only with their money but
also with the borrowed capital .This lead to the
existence of Capital Market and Money Market
.The financial market has a segment of these market
.The financial market play a vital role in raising
funds from the public and helps the firm not only in
increasing the profits of the trade but also helps in
developing the financial Assets of the companies
.This lead to the evolvement of ‘'STOCK
EXCHANGE’.The stock exchange provide a
liquidity to the private investment for the investors
in corporate sector .Exchanges are crossing across
national boundaries leading to the extent of their
services which has led to the emergence of cross
border integration.
The Indian market consist of many developed
markets on the basis of 'QUALITATIVE
PARAMETER'. It has a collective pool of about 20
million investors .Over 9000companies listed their
exchanges in this stock market.
The two main stock exchanges of India are:
1. BSE
2. NSE
Bombay Stock Exchange:
The stock exchange of Mumbai is now 'Bombay
Stock Exchange Ltd ‘.BSE is the oldest Stock
Exchange of Asia.It was established in the year
1875.Since its inception it contains a deep
knowledge of capital marker More than 5000
companies have listed their exchanges on BSE Ltd,

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Habeeb Tabassum / Bombay Stock Exchange and National Stock Exchange
Making it a number one exchange board of India in
terms of listing members. The BSE act as a
backbone of countries capital market.AS one of the
finest exchange board of India BSE of us
capitalization of about 1082, 517.7$.
National Stock Exchange:
The National stock exchange came into existence in
1992.It is the largest and most advanced stock
market of India .In terms of transactions it is
regarded as the 3rd biggest exchange in Asia.In
terms of transaction volume it is among the 5
biggest stock exchange in the world.In April
1993,NSE is recognised as stock exchange under
the contract (Regulatory) act,1956.After its
commencement
it started its operation in Wholesale Debt Market
(WDM) segment in June 1994.NSE consist of US
capitalisation of about 1019,109.0$.
1.1Aims:
The Aim of the project is to draw a comparative
study of BSE and NSE.The aim is to help the
investor to understand about the functioning of BSE
and NSE
1.2 Objectives:
 To generates literature reviews on BSE and
NSE Sensex Index.
 To writes the research methodology to
develop the project on BSE and NSE.
 TO performs the data analysis on BSE and
NSE.
 To develops a comparative project report on
BSE and NSE Sensex.
1.3 Methodology:
 The efforts have been made to study the
research based on the comparison of Indian
stock market. The research has done from
books, international magazine, journals, and
previous research papers. The research is done
based on the quantitative analysis. Based on
the quantitative data the data is collected and
relevant formulas and methods are applied to
draw a comparison of financial performance
of BSE and NSE. In some situations BSE
beats the NSE, while in other the NSE
overtook the BSE. At present the NSE is
highly competing with the BSE.
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 The study help us to know about the listing
agreements .this agreements are the main tool
through which a company can list its securities
in the stock market. While listing a stocks it is
mandatory for every company to follow the
listing procedure and agreement, without which
a company is prohibited for listing..The
company listed in BSE should have listing
history on BSE for at least one year.even it
should hold a good track of record . A company
can list its securities either in Bombay stock
exchange or National stock exchange.
1.4 Defination:
Defination of “Bombay Stock Exchange”
The first and largest securities market in India, the
Bombay Stock Exchange (BSE) was established in
1875 as the Native Share and Stock Brokers'
cooperative. Based in Mumbai, India, the BSE lists
close to 6,000 companies and is one of the greatest
exchanges in the world. The BSE has helped
develop the country's capital markets, including the
retail debt market, and helped grow the Indian
corporate sector.
Definition of ‘National Stock Exchange’
The first stock exchange in America that was
completely electronically automated. All members
of the exchange are registered broker-dealers. This
exchange created the National Securities Trading
System (NSTS), which performs all auction market
tasks on an automated basis.
Related Work:
Literature Review is the backbone for the project
development .It has been developed from research
papers, books and journals .The data collection is
the source of literature review .this data collection
act as a tool which has been scrutinised with
qualitative analysis. This process helps to
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Habeeb Tabassum / Bombay Stock Exchange and National Stock Exchange
understand the relationship between their research
problem and the body of knowledge in the area .The
following material reveals the research work done
for the project development:
Debjiban Mukherjee (2007) Made a comparative
study of Indian stock market with international
stock market. in his study he discussed about the
origin of various stock Exchange. According to the
research done by Mukharjee (2007) he found that
the stock market is witnessing the heightened
activities and is increasingly gaining importance in
the present senerio.in his findings he described that
in the current context of globalisation and the
subsequent integration of global market the study(of
this paper) captures the trends, similarities, patterns
in the activities and movement of Indian stock
market with international market. This study covers
New York stock Exchange (NYSE),Tokyo Stock
Exchange(TSE),Korean Stock
Exchange(KSE),from various socio-political-
economic background.he highlighted about the
study of both BSE and NSE as a part of Indian
stock market. I used this concept to illustrate the
market capitalisation of stock market,their listing
procedure and agreement.
Sandeep S Shenoy and Dr C K Hebbar have made
research on Indian market and abroad. In their
findings they narrated the ways of introduction of
market reforms in India as well as abroad.They also
described about the market capitalisation of stock
exchanges across the world.with their findings the
researches able to know primarily about the market
performance of Indian stock market and foreign
markets and can distinguish their performance and
draw conclusions from them .The main objective of
their study is to compare the Indian stock market
with the major global stock exchanges.I used this
concept to discuss about the stock market reform in
India
Ekta Arora made a research on the performance of
Bombay Stock Exchange and National Stock
Exchange in India . In her findings she highlighted
about the performance of stock exchanges ,their
xsecurities .The study was made to analyse the
performance of NSE and BSE in india .such study
was done by comparing the data on 100
companies.The most important objective in her
study is to compare the services provided by
depositaries and to offer the suggestions for
improving performance of NSE and BSE in India.
Dr. Daksha Pratapsinh Chauhan (Vol.1, Issue. 1,
Dec’ 2013) made aresearch on the performance of
stock exchanges in India.In the present study he has
International Journal of Current Trends in Science and Technology , Vol. 7, Issue. 12,
Page no: ME 20440-20445
tried to study the financial performances of BSE
and NSE over the last one decade. In his study he
find out that out of these two stock exchanges
which one is performing better financially on
various basis. Stock exchanges are the mirrors of
economy. Through the present study the condition
and soundness of Indian economy will also be
revealed. He did research based
What Is an Exchange?
First, what is an exchange? Put simply, an
exchange is an institution, organization, or
association which hosts a market where stocks,
bonds, options and futures, and commodities are
traded.
Buyers and sellers come together to trade during
specific hours on business days. Exchanges impose
rules and regulations on the firms and brokers that
are involved with them. If a particular company is
traded on an exchange, it is referred to as "listed".
Securities that are not listed on a stock exchange are
sold OTC, which stands for Over-The-Counter.
Companies that have shares traded OTC are usually
smaller and riskier because they do not meet the
requirements to be listed on a stock exchange.
Many giant blue chip stocks, such as Berkshire
Hathaway, at one time traded on the over-the-
counter market before migrating to the so-called
"Big Board", or New York Stock Exchange.
What Is the Purpose of a Stock Exchange?
Perhaps they pass away and their estate is subject
to some hefty estate taxes. They may even leave it
to their grandchildren, who get to enjoy the stepped
up basis loophole, but the heirs want to liquidate to
buy a house. Whatever is driving their decision,
they aren't likely to tie up their funds unless they
know somehow, someway, at some point in the
future, they'll be able to find a buyer for their
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Habeeb Tabassum / Bombay Stock Exchange and National Stock Exchange
holdings without too much trouble in what is known
as "the secondary market". TAX PAID
Without a stock exchange, these owners would have
to go around to friends, family members, and 2018
community members, hoping to find someone to Tax paid,
2016 0
whom they could sell their shares. (Technically,

Axis Title
you can do this. You don't have to sell your shares 2014
on a stock exchange. You can take physical Year,
2012 2016
possession of them in certificate form, endorse
2010
them, and sign them over to someone in exchange
for payment in your lawyer's office or at your 2008
dining room table if you are so inclined. When the 1 2 3 4 5
stock exchange was closed during World War I, Axis Title
many people did just that, creating a secondary
shadow market. The downside is that there is no
transparency. Nobody knows what the best price is Analysis:
for a given stock at any given moment in time. You The above table shows the tax rate paid by the
could be selling your shares for $50 while the guy Afetak Company in the past five years.During the
two towns over is getting $70.) With a stock FY2012 and FY2013 the company paid the tax at
exchange, you will never know the person on the the rate of 4.83 and 0.54. Tax paid in FY2012 was
other end of the trade. He, she, or it could be relatively higher when compared to FY2013. From
halfway around the world. It could be a retired the past three years the company is free from the tax
teacher. It could be a multi-billion dollar insurance payable as the tax rate is 0 for the years 2014, 2015,
group. It could be a publicly traded mutual 1016.
fund or hedge fund.
The need for convenience is what led to the Interpretation:
establishment of the biggest stock exchange in the Thus we can interpret that the company is enjoying
world. In the United States, a group of stockbrokers the high profit this year s it is free from the tax. It
met under a buttonwood tree in New York City. On remarks a constant growth in its performance in
May 17th, 1792, twenty-four of these stockbrokers FY2016.
got together outside of 68 Wall Street to sign the The facts and figures have been downloaded from
now-famous Buttonwood Agreement, which Afetak published balance sheet from
effectively created the New York Stock & http://profit.ndtv.com/stock/aftek-
Exchange Board. Almost three-quarters of a century ltd_aftek/financials-historical
later, in 1863, it was officially renamed the New
4.5 Formula-2:
York Stock Exchange. These days, most people
refer to it as the NYSE.
TOTAL LIABILITIES=BILLS PAYABLE+LONGTERM DEBTS+EQUITY
The facts and figures have been downloaded from SHARE CAPITAL+GENERAL RESERVE
Afetak published balance sheet from
http://profit.ndtv.com/stock/aftek-
ltd_aftek/financials-historical Years 2012 2013 2014 2015 2016

4.4 Formula-1:
Current 176.75 154.49 169.72 169.59 181.33
Liabiliti
TAX PAID es

Year 2012 2013 2014 2015 2016

Tax paid 4.83 0.54 0 0 0

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Habeeb Tabassum / Bombay Stock Exchange and National Stock Exchange
twenty years and today it has overtaken the BSE
CURRENT LIABILITIES which ruled monopolistically on Indian capital
market over a century. This shows the efficiency
Years Current Liabilities and effectiveness of the performance of the
management of NSE. BSE and NSE are not rivals;
100%
176.75
154.49169.72169.59 both of them are the pillars of Indian economy.
181.33
90% Both must be try to be complimentary to each other.
2012 2013 2014
80% 2015 2016 If both will go hand in hand than it will result in
1 rapid growth and upliftmen of the nation.
2 3 4 5 Refrences:
1. Comparative Analysis of Indian Stock
Analysis:
Market with International Markets
The above table demonstrates the current liabilities
of a Afetak company. In the table data related to the 2. Debjiban Mukherjee T. A. Pai Management
5 years are depicted .during the period the company Institute, Manipal, India
has the highest current liability of about 181.33 in
the year 2016.The liabilities of the company http://www.greatlakes.edu.in/pdf/Herald/Vol
changes in every year. 1/DebijanMukherjee.pdf
Interpretation: 3. International Journal of Science Research
The performance of the afetak company is furnished and Technology Volume 1 Issue 1, p p 38-
in the above table. During the past five years there
is a fall and increase in the liabilities of the 45 , 15th September 2015 38 “Stock Market
company. In 2013 the liabilities of the company Reforms – A Comparative study between
was very low when compared with the other years.
From 2013 to 2016 there was a studious growth in Indian Stock Exchanges & Select Exchanges
the liabilities of the company. Hence the Abroad” Sandeep S Shenoy Department of
performance of the company is considered to be fair
and good Commerce, Manipal University School of
Conclusion: Management, Maniple, India – 576104
Hence after studying and comparing both the 4. Dr C K Hebbar Department of Commerce,
Bombay stock exchange and National stock
University College,
exchanges, we can conclude that both BSE and
NSE are the pillars of Indian stock market. As 5. EKTA ARORA Sr. Asstt. Prof.. MBA
nervous system is important for the functioning of
Deptt., HCTM Kaithal.
the body, similarly they are the nervous system of
the Indian economy. They are not the rivals; they Haryana.INTERNATIONAL JOURNAL
should try to be complementary to each other. If
OF SOCIAL SCIENCES &
both go hand in hand than it will result in rapid
growth and up liftmen of the nation. Though they INTERDISCIPLINARY RESEARCH Vol.1
function differently and rules, norms and
No. 4, April 2012, ISSN 2277 3630
procedures of both the stock exchanges are different
they are the main source in the up liftmen of the http://www.indianresearchjournals.com/pdf/
nation’s growth. The growth of the nation entirely
IJSSIR/2012/April/14.pdf
depends on these two factors.
Finally it can be concluded that BSE and NSE are 6. Dr. Daksha Pratapsinh Chauhan Professor,
the icons of Indian capital market. BSE is the icon
Head & Dean, Dept. of Commerce &
of stability, consistent and constant growth in terms
of financial performance whileNSE is the icon of Business Administration, Saurashtra
rapid growth and taking a lead in implementing
University, Rajkot, India.International Journal
innovations. NSE was incorporated only before
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Habeeb Tabassum / Bombay Stock Exchange and National Stock Exchange
of Conceptions on Management and Social
Sciences Vol. 1, Issue. 1, Dec’ 2013; ISSN:
2357–2787
http://www.worldairco.org/IJCMSS/Decembe
r2013Paper28.pdf
7. http://www.ijsrt.us/pdf%20files/paper%206.
pdf
8. http://shodhganga.inflibnet.ac.in/bitstream/1
0603/33046/18/18_chapter%208.pdf
9. BSE http://www.bseindia.com/
10. NSE https://www.nseindia.com/
11. http://www.efficientcarbon.com/wp-
content/uploads/2013/04/List-of-Top-100-
BSE-and-NSE-Listed-companies-arranged-
by-Sectors.pdf
12. http://www.hindustanpetroleum.com/bse-
nse-historical-prices
13. http://www.investorwords.com/7527/BSE_S
ensex.html
14. http://whatis.techtarget.com/definition/Nifty
-NSE-Nifty
15. https://www.scribd.com/doc/19803701/Calc
ulation-of-Sensex-and-Nifty

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