Question

Bandhu Limited is a real estate company, which was formed in $1960$. In about $55$ years of its existence, the company has managed to carve out a niche for itself in this sector. In order to establish itself in India, the company decided to list its securities on BSE, in order to raise money through India market.
State the functions performed by SEBI that make investors comfortable and secured in dealing with Bandhu Ltd.

Answer 1

The main regulatory functions of SEBI revolve around the effective management of the stock market. The various regulatory functions that this organization is entrusted with are:

• Every mutual fund or investment plan, before being introduced into the market is to be regulated by this body
  
• Brokers, merchant bankers are intermediaries that operate in the stock market. But there is a code of conduct and certain rules and regulations that they need to abide by and these rules have been structured, framed and put into place by SEBI
  
• Private placement often leads to various discrepancies because of which certain regulatory measures have been put in place by SEBI, that regulates such operations
  
• If you are associated with stock exchange in any manner, for example, you might be a share transfer agent, a stockbroker etc, you will then have to be registered with SEBI and this body will regulate your functions
  
• One of the main functions of Sebi is to oversee the process when one company takes over another one
  
• The audit and inquiries of various stock exchanges are also part of SEBI’s function
  

The Developmental functions of SEBI

If you are being trained to become an intermediate in the investment market in India, then your train will be promoted by SEBI

• One of the most important developmental features of this body is that stockbrokers who are registered can now trade through the internet.
  
• If going through the stock exchange then an initial offer made by the public on the primary market is also permissible
  
• The expense of issue is a huge one and hence in order to reduce it, underwriting has become optional.
  
• Following are the functions performed by SEBI that make investors comfortable and secured in dealing with Bandhu Ltd.