Indian Financial Markets (eBook)

Cover 1
India’s Financial Markets 6
Copyright Page 7
Dedications 8
Table of Contents 10
Foreword 14
Preface 16
Chapter 1. The Economy 18
1.1 Overall Growth Experience 18
1.2 Understanding India’s Post-Independence Trajectory 20
1.3 Interpreting the Growth Experience 22
1.4 Trends and Volatility in GDP Growth 38
1.5 Conclusions 47
Chapter 2. The Firms 50
2.1 The CMIE Database 50
2.2 The Large Nonfinancial Firms of India 51
2.3 Role of Equity Financing 57
2.4 Regulation of Firms 60
Chapter 3. Private Equity and the IPO Market 62
3.1 Private Equity Investment 63
3.2 The IPO Market 69
Chapter 4. The Public Equity Market 72
4.1 Products, Venues, Market Design 72
4.2 Liquidity 81
4.3 Derivatives 85
4.4 Risk and Return 89
4.5 Role of Indian Equity in Global Portfolios 96
Chapter 5. Government Bonds 98
5.1 Products in the Government Debt Market 98
5.2 Markets 107
5.3 Regulation and Market Access 110
5.4 Elusive Liquidity 111
Chapter 6. Corporate Bonds 112
6.1 The Products 112
6.2 Markets 123
6.3 Secondary Market Trading 125
6.4 Regulation and Next Steps Forward 126
Chapter 7. Commodity Futures Markets 130
7.1 A Little History 130
7.2 Products in the Commodity Derivatives Markets 132
7.3 Markets 137
7.4 Market Outcomes 144
7.5 Regulation and Legal Framework 146
Chapter 8. Real Estate 150
8.1 Price Trends in Real Estate 150
8.2 Accuracy of Prices 152
8.3 Property Development 153
8.4 Segments of the Overall Real Estate Market 155
8.5 Investors 163
8.6 Title and Transparency in Indian Real Estate 165
8.7 The Sensitive Issue of Corruption 166
8.8 Conclusion 168
Chapter 9. The Rupee 170
9.1 Market Description 170
9.2 Going Under the Hood 173
9.3 A De Facto Pegged Exchange Rate to the US Dollar 174
9.4 Difficulties of Implementing the Pegged Exchange Rate 175
9.5 Four Phases in INR/USD Volatility 177
9.6 Conclusion 180
Chapter 10. Financial Firms 182
10.1 A Bird’s Eye View 182
10.2 The Nature of the Financial Firm in India 183
10.3 Infrastructure 184
10.4 Transaction-Oriented Firms 186
10.5 Banks 190
10.6 Insurance Companies 197
10.7 Pensions 198
10.8 Mutual Funds 200
10.9 Foreign Institutional Investors 204
10.10 Private Equity Funds 205
10.11 The Fundamental Difficulties of Fund Management 206
Chapter 11. Policy Issues 208
11.1 The State of Indian Finance 208
11.2 Reform 210
11.3 The Agenda at SEBI 218
11.4 Conclusion 229
Chapter 12. What Can Global Financial Firms Do with India? 230
12.1 Portfolio Investment 231
12.2 Private Equity 232
12.3 FDI 233
12.4 The Mauritius Route 233
12.5 India-Related Financial Business Outside India 233
Appendix A. Sources 236
Appendix B. Abbreviations 238
Appendix C. Interpreting Those Strange Indian Numbers 242
Bibliography 244
Index 248