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WHY INVEST IN INDIA

Stable Government at the Centre

Mr. Narendra Modi becoming the Prime Minister for the second time with a thumping majority paves a way for a stable government. This means confidence and continuity for the policies and its implementations.

Big Focus on Development

Big focus on exports, infrastructure, agriculture, creation of jobs, rural development in coming years, resulting in a big boost to corporate earning which will enable a bullish trend in the stock markets.

One of the Leading Economies

The current size of the Indian economy is around USD 2.7 trillion GDP and Prime Minister Modi’s goal is to make it to USD 5 trillion by 2024 and subsequently, to USD 1 trillion by 2030.

Leading FPI Destination

India is a sought after destination for FDI in view of ease of doing business ranking released by the World Bank going up to 63 from 142 in last five years. It is expected to break in top 50 in next few years.

Strong Growth Trends

If India continues its recent growth trend, average household incomes will triple over the next two decades and it will become the world's fifth largest consumer economy by the year 2025.

Large Working Population

The proportion of working age population in India is likely to reach more than 64% by 2021, with a large number of young persons in the 20-35 age group.

ABOUT SMC

    • Established in 1990, SMC is a diversified financial services company in India offering brokerage services across the asset classes of equities (cash and derivatives), commodities and currency, investment banking, wealth management, distribution of third party financial products, research, financing, depository services, insurance broking (life & non-life), clearing services, mortgage advisory and real estate advisory services to corporates, institutions, high net worth individuals and other retail clients.

Serving Over

Unique Clients

Workforce of

Employees

 

Presence in

Cities in India & Abroad

 

Large Network of

Sub Brokers & Authorised Persons

TYPES OF INVESTMENTS ALLOWED

Equity

Shares, Debentures and Warrants, listed or to be listed (both Primary / Secondary).
Units of domestic Mutual Fund Schemes, whether listed or not. Indian Depository Receipts (IDRs) & other instruments as permitted from time to time.

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Debt

Dated Government Securities.
Commerical Papers issued by an Indian Company.
Security Receipts issued by Asset Reconstruction Companies. Perpetual Debt Instruments and Debt Capital Instruments, as specified by RBI from time to time.
Infrastructure NCDs and Bonds.

Derivatives

Equity.
Interest Rate.
Currency.

Real Estate Funds

Alternate Investment Funds.
Real Estate Investment Trusts.
Infrastructure Investment Trusts.

WHO IS AN FPI

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FPI is a resident in a country other than India, whose securities market regulator is a signatory to IOSCO's MMOU (Appendix A Signatories) or a signatory to a bilateral MOU with SEBI. In case of a Bank, it should be resident of a country whose central bank is a member of the Bank for International Settlements (BIS).

Unified market access route for all portfolio investments in India.

Proposal by SEBI committee – convergence of all portfolio investment routes, including FII, Sub Account and QFI.

Simplified entry norms - no registration requirement with SEBI.

Investor is from a Country which is a member of IOSCO, have bilateral MOU with SEBI, whose central bank is a member of BIS, is listed in public statement issued by FATF and list of FATF member country.

The investor is regulated and supervised in its home regulations by the market or banking regulator.

Has sufficient experience, good track record, is professionally competent, financially sound, generally good reputation of fairness and integrity.

The investor is fit and proper and legally allowed to invest in overseas jurisdictions.

Investor is not a Non Resident Indian/ OCI or a Resident Indian. If the entity is non-individual :-

(a) the contribution of a single NRI or OCI or RI shall be below twenty-five percent of the total contribution in the corpus of the applicant.

(b) the aggregate contribution of NRIs, OCIs, and RIs shall be below fifty percent of the total contribution in the total corpus.

(c) the NRIs, OCI or RI should not be in the control of the applicant.

As per the circular by SEBI dates 5th November 2019, the classifications of FPIs have changed. Now there are only two categories Cat 1 and Cat 2, classified as under.

Category I

a) Government and Government related investors such as central banks, sovereign wealth funds, international or multilateral organizations or agencies, including entities controlled, or at least 75%, directly or indirectly, owned by such Government and Government related investor(s);

(b) Pension funds and university funds;

(c) Appropriately regulated entities such as insurance or reinsurance entities, banks, asset management companies, investment managers (‘IMs’), investment advisors, portfolio managers, broker dealers and swap dealers;

(d) Entities from the Financial Action Task Force (‘FATF’) member countries which are:

Appropriately regulated funds;

Unregulated funds whose IM is appropriately regulated and registered as a Cat I FPI -Provided that the IM undertakes the responsibility of all the acts of commission or omission of such unregulated fund;

University related endowments of such universities that have been in existence for more than five years;

(e)An entity:

Whose IM is from FATF member country and such an IM is registered as Cat I FPI; or

Which is at least 75% owned, directly or indirectly by another entity, eligible under sub-clause (ii), (iii) and (iv) above, and such an eligible entity is from a FATF member country.

Category II

Include all the investors not eligible under Category-I Foreign Portfolio Investor such as

a) Appropriately regulated funds not eligible as Category-I foreign portfolio investor;

b) Endowments and foundations;

c) Charitable organisations;

d) Corporate bodies;

e) Family offices;

f) Individuals;

g) Appropriately regulated entities investing on behalf of their client, as per conditions specified by the Board from time to time;

h) Unregulated funds in the form of limited partnership and trusts.

i) Others

Another major development in the recent circular is that a client can now trade as Omnibus account; this is major step towards making the market more accessible for the Foreign Clients.

Appropriately regulated entities such as banks and merchant banks, asset management companies, investment managers, investment advisors, portfolio managers, insurance & reinsurance entities, broker dealers and swap dealers will be permitted to undertake investments on behalf of their clients as Category II FPIs in addition to undertaking proprietary investment by taking separate registrations as Category I FPI.

a) Where such entities are undertaking investments on behalf of their clients, Category II FPI registration shall be granted subject to following conditions: Clients of FPI can only be individuals and family offices.

b) Clients of FPI should also be eligible for registration as FPI and should not be dealing on behalf of third party.

c) If the FPI is from a Financial Action Task Force member country, then the KYC including identification & verification of beneficial owner of the clients of such FPI should be done by the FPI as per requirements of the home jurisdiction of the FPI. FPIs from non-Financial Action Task Force member countries should perform KYC of their clients including identification & verification of beneficial owner as per Indian KYC requirements.

d) FPI has to provide complete investor details of its clients (if any) on quarterly basis (end of calendar quarter) by end of the following month to DDP.

e) Investments made by each such client, either directly as FPI and/or through its investor group shall be clubbed with the investments made by such clients (holding more than 50% in the FPI) through the above referenced appropriately regulated FPIs.

Process Flow

Particulars Category I Category II Indicative Time Frame
Registrations Provide Documentation for Permanent Account Number 8 -15 Days
Provide Documentation for Designated Depository
Participant Registration (Custodian)
3 - 5 Days
SEBI Fees / (US $)
Every Block of Three Years
US $ 3,000 US $ 300
Registration Done, What Next? Open INR Accounts with a Bank 2 - 4 Days
Open a Custody Account with Custodian 2 Days
Open a Brokerage Account with Broker 2 -4 Days

SMC’S Strengths

ALGO AND LOW LATENCY SOLUTIONS

Best in class hardware to facilitate ultra low latency trading.

Ability to provide passive risk monitoring to clients who are interested in low latency setup.

Multiple options in terms of connectivity and risk management to facilitate trading in India.

Can provide high quality market data for all the products traded in India for clients trading.

STRONG TEAM & WORLD CLASS INFRA

Team of Highly skilled and experienced professionals with over 12 years of experience.

Experience of working in the USA for one of the top HFT firms.

Multiple brokerage models including volume based, fixed and profit sharing.

Co-location presence in all the trading venues in India namely NSE, BSE, MCX.

STRONG TEAM & WORLD CLASS INFRA

Team of Highly skilled and experienced professionals with over 12 years of experience.

Experience of working in the USA for one of the top HFT firms.

Multiple brokerage models including volume based, fixed and profit sharing.

Co-location presence in all the trading venues in India namely NSE, BSE, MCX.

KYC PROCESS

About
About

DOCUMENTS REQUIRED

  • Individuals
    • Proof of Identity (Passport mandatory)
    • Proof of Address
    • Bank Proof
    • Bank Letter
    • PAN
  • Non-Individuals
    • Constitutive Documents (MoA, Trust Deed, Partnership Deed)
    • Regulatory Affiliation details
    • Bank Letter stating satisfactory relationship (Cat III only)
    • Shareholding details and Ultimate Beneficiaries’ details
    • Senior Management Credentials / Photo
    • Board Resolution stating that entity is allowed to invest
    • Certificate of Incorporation
    • Proof of Address
    • Financials
    • PAN
    • Authorized Signatories details
    • Bank Account details