Question

Briefly explain any two intermediaries of SEBI.

Answer 1

• Stock Brokers: Stock brokers are members of stock exchanges who facilitate the buying and selling of securities. Since individuals cannot directly trade on a stock exchange, they must go through stock brokers to buy or sell shares, debentures, and other listed securities. Stock brokers act as intermediaries connecting buyers and sellers in the securities market.
• Merchant Bankers: Merchant bankers are financial institutions that help companies raise funds by issuing shares, debentures, and other securities. They provide guidance on aspects like determining the size of the issue, drafting the prospectus and application forms, preparing allotment letters, and handling publicity. Some well-known examples of merchant banks in India are IDBI, ICICI, IFCI, and SBI Caps.