RSEBL.pptx

Intern experience in RSEBL

1. INTRODUCING STOCK MARKET Presentation by: Dawa Dakpa , Research/Listing Division

2. GIST OF THE PRESENTATION Overview; Vision & Mission; Objective; Definition of Stock Market, Shares & Securities; Shares transaction; Benefits from shares, stocks & Securities; Conclusion; and Q&A.

3. Overview of RSEB: Established in October 1993; Incorporated under Companies Act 1989; Regulated under the Financial Institutions Act 1992; Owned by Four Brokerage Firms; De-linked from RMA in July 1996 as an autonomous body ;

4. Non-Profit making/service oriented organization; and Developed under the technical assistance of the Asian Development Bank and the parenthood of the Royal Monetary Authority.

5. VISION: “ To become an integral part of the financial system and participant in the nation building”. MISSION: “To develop and establish a fair, orderly and transparent securities market with the objective to facilitates efficient mobilization and allocation of capital, and ensure apt regulation to maintain market integrity and investor confidence”.

6. OBJECTIVES: to encourage wider spread of shares ownership in enterprises; to mobilize saving; to provide forum to raise equity capital for new venture and; to provide liquidity to the existing shareholders;

7. What is a Stock market? It provides a venue to convert Securities into money or vice versa. What is a share? A share of stock represents a part ownership of a company. for example, if you buy 10,000 shares in a company that has issued 100,000 shares, you own 10% of that company.

8. What are Securities? A securities includes (shares, stock, bonds, debenture stock or other marketable securities), as may be declared by the Government to be securities that is available for trade on a Stock Exchange. It can be of equity and debt securities.

9. BUYING AND SELLING OF SHARE How can I buy or sell shares? Approach the Brokers for buy or sell Where can you find one? BOB Securities Ltd. Bank of Bhutan; BNB Securities Ltd. Bhutan National Bank; RICB Securities Ltd Royal Insurance Corpn. of Bhutan; and DROOK Securities Ltd Bhutan Dev. F inance Corpn

10. PROCEDURES FOR BUYERS Proceed to any of the brokerage firm with a copy of CID; Fill up an application form; order slip; and client’s agreement form; Deposit money as advised by the broker in one of the commercial bank; The broker will then place order at the exchange trading floor; The order will remain in the RSEBL system till it gets a matching sell order i.e at same price; and The trades were executed on every Tuesdays and Fridays depending on the matching order.

11. PROCEDURES FOR SELLERS Same procedures will be followed like that of the buyers except; and Instead of money, the seller must surrender the trade confirmation issued by the previous executing broker.

12. AFTER TRADING Ownership shall be changed to the buyer’s name automatically within t+3, i.e. trade date plus three working days; Buyer must get the Trade Confirmation within t+3; Seller must get the sale proceeds of the shares within t+3; All trades must be settled within t+3; and The change of ownership with the respective companies will be done by the exchange accordingly;

13. Transaction of Shares Trading Cycle BROKER - Creates Client Account - Accepts Orders with Money for Buy & Shares for sell EXCHANGE - Pooling of Orders - Matching of Orders - Trading COMPANY Dividends BANKS DEPOSITORY Book Entry Register of shareholders at CD Clearing & Settlement CUSTODIAN CLIENT

14. WHAT ELSE DO I BENEFIT BEING AN INVESTOR? is entitled to receive any dividends; have bonus; can participate in rights issues; and As owners of the company, Shareholders can also participate in decision making process during the AGM through voting rights. WHAT IS A DIVIDEND? A dividend is a part of a company’s profit after tax distributed to shareholders.

15. UPDATING THE MAILING ADDRESSES: A shareholder must update his mailing address whenever he move from one place to place. Lost of Trade Confirmation: Write an application to the Central Depository. The CD will issue a Balance Confirmation.  

16. WHAT IS A RIGHTS ISSUE? A rights issue is an invitation from a company to its existing shareholders to purchase additional shares proportionate to their existing holding in the company. WHAT IS A BONUS ISSUE? A bonus issue is a process where money from a company’s reserves is converted into issued capital, which is then disturbed to shareholders as new shares, in proportion to their original holdings.

17. RISKS & REWARDS IN SHARE INVESTMENT Both Risks and Rewards; Remember value can fall as well as rise. Risks are correlated with probability of returns. Different securities carries different risk - return profiles. “ Therefore invest with knowledge”.

18. LISTED COMPANIES 1. BBPL Bhutan Board Products Ltd. 1993 2. BCCL Bhutan Carbide and Chemicals Ltd. 1993 3. PCAL Penden Cement Authority Ltd. 1993 4. BFAL Bhutan Ferro Alloys Ltd. 1995 5. BTCL Bhutan Tourism Corporation Ltd. 1994 6. RICB Royal Insurance Corporation of Bhutan Ltd. 1993 7. BNB Bhutan National Bank Ltd. 1996 8. DPCL Druk Petroleum Corporation Ltd. 1995 9. BDL Bhutan Dairy And Agro Products Ltd. 1994 10. DSML Druk Mining Ltd. 1995 11. STCB State Trading Corporation of Bhutan Ltd. 1997 12. DSCL Druk Satair Corporation Ltd. 1998 13. BPCL Bhutan Polymers Co. Ltd. 1997 14. DPOP Druk Plaster and Chemicals Ltd. 2001 15. EBCC S.D Eastern Bhutan Coal Company Ltd. 2005 16. KCL Kuensel Corporation Ltd. 2007 17. BTL Bhutan Times Ltd. 2008 18. DWAL Druk Wang Alloys Ltd. 2008 19. JMCL Jigme Mining Corporation Ltd. 2008 20. DFAL Druk Ferro Alloys Ltd. 2009 21. BIL Bhutan Insurance Ltd. 2009

19. NON-COMMERCIAL TRANSACTIONS It is a change of ownership in shares without any monetary transactions like gifts and inheritance within the immediately family members; This is done directly by the Exchange and instructs the companies and the brokers by the Exchange;

20. Original trade confirmation for endorsements; CID copy of the transferee; Court affidavit verifying that the transferor and the transferee are within the immediate family members; and Transfer fee calculated at 1% of number of shares times the face value of shares. DOCUMENTS REQUIRED FOR NON COMMERCIAL TRANSACTIONS:

21. For any further information or queries please contact us at: Royal Securities Exchange of Bhutan Ltd. Post Box # 742 Thimphu Fax # : 323849 Phone #s : 324296/323994/323995 E-mail : [email protected] Website : www.rsebl.org.bt

22. KADINCHEY …………...