Icici Web Seeks Sebi Nod To Sell Bonds Via Net

ICICI Web Trade, the wholly owned online trading subsidiary of ICICI Ltd, has approached the Securities and Exchange Board of India (Sebi) with a proposal to sell its safety bond issues through its Internet trading portal.

The company is also planning tie-ups with mutual funds such as Alliance Capital and Templeton Mutual Fund to sell all their schemes through the portal. It already has an alliance with Zurich India MF and ICICI Prudential MF for selling its schemes.

Confirming this here, chief operating officer Anup Bagchi said that they had already sounded out the markets regulator on the issue of allowing them to sell safety bonds through the net. Sebi officials are expected to take up the matter once the pressure from the Joint Parliamentary Committee (JPC) probing the March market crash, eases up a bit.

The company also has plans to sell primary issues through the Internet. All this will be an extension of its offline activities where its ICICI centres cater to distribution of mutual fund schemes as well as primary issues. Making applications online will obviate the necessity of physically submitting forms for those so inclined.

Company officials said that their experiment with Zurich India MF had met with surprising success - customers who are already trading in the equities market through the site can also allocate their funds for buying mutual fund units. In fact, movement of funds from the equities market to mutual funds is done seamlessly. Majority of its mutual fund customers are its online customers who have temporarily stopped buying shares because of the current market downturn and are preferring the relative safety of liquid funds instead.

In case of liquid funds, if redemption requests are made by 10:30 am the money from the proceeds gets credited the following morning at the net asset value of the day on which the request was made.

The market slowdown has resulted in the company's business in terms of volumes dipping by 50 per cent from the peak reached a month back, while in terms of number of shares traded it has gone down by more than 25 per cent. Last year the losses made by the company eroded its entire capital of Rs 30 crore, while in the first quarter of the current fiscal it managed to break even.