Scope of the study:- The study is limited only to the overall idea and concept of Indian primary market .The basic emphasis is given on the different methods of raising funds and the overall impact on the economic development of India. Research Methodology:-Research always starts with a question or a problem. It is more systematic and intensive study directed towards a complete knowledge of the topic. I have prepared my project as descriptive type, as the objective of the study demands. I also tried to go through some analytical aspect of my topic by showing some graphical presentation. Objectives of the study:-The main objectives behind the project are as follows:- Proper understanding and analysis of primary market.
To know a brief understanding of securities and ways to raise funds by the financial institution. The overall impact on the growth of Indian economy.
Limitations of the study:-
Time was a constant constraint.
The project is more descriptive rather analytical.
The data required was secondary not from primary sources.
Corporate Finance is raised-from the primary capital market-through public offers, right issues and private placement. There is a flourishing market for public issues in India. The instruments commonly offered are equity, debentures, and a variety of convertibles including debentures bundled with warrants. Both private and public sector companies make public issues. An initial public offer (IPO) is the selling of securities to the public in the primary market by the unlisted companies either a fresh issue of securities or an offer for sale of existing securities are both for the first time to the public. The Indian IPO market is one of the promising markets for the investors. During the period 1993-94 to 2007-08 4,538 companies had been raised Rs.1,49,671 crores from the primary market through IPOs. Every company requires short-as well as long-term finance for continuing its operations effectively. Concept and Meaning :- Capital market deals in financial assets excluding coin and currency - is essentially a market for securities, which have either long-term or infinite maturities consists of two segments: Primary market
A security or financial instrument is a tradable asset of any kind. Securities are broadly categorized into: debt securities (such as banknotes, bonds and debentures), equity securities, e.g., common stocks; and,
derivative contracts, such as forwards, futures, options and swaps.
New issue of shares and debt securities are made in the primary market and the existing securities are traded in the secondary market. Thus, whenever a company has to raise funds, it approaches the primary market with one of the three options: Public Issue
An initial public offer (IPO) is the selling of securities to the public in the primary market by the unlisted companies either a fresh issue of securities or an offer for sale of existing securities are both for the first time to the public. The Indian IPO market is one of the promising markets for the investors. The primary market basically renders the important function of transfer of savings of the surplus units to deficit units. Its provides the channel for sale of new securities and empower various organizations-including the issuers of securities; the government; as well as corporate –to raise the resources to meet investment requirements and discharge obligations. Therefore the economy provides the abilities to invest and save respectively, which inevitably enhances savings and investment opportunities in the economy. Features of primary market:
Features of primary markets are:
This is the market for new long term equity capital. The primary market is the market where the securities are sold for the first time. Therefore it is also called the new issue market (NIM). In a primary issue, the securities are issued by the company directly to investors. The...
Please join StudyMode to read the full document