Dabba Trading

Anand Mahindra, top boss of Mahindra and Mahindra, recently shared a video about London's food delivery innovation, said to have been inspired from Mumbai's dabbawalas

Over the last year, NSE has been examining information or tips received about unauthorised or illegal activities such as collection of deposits assuring fixed or guaranteed returns

The National Stock Exchange (NSE) on Monday cautioned investors against some fraudsters running illegal dabba trading with guaranteed returns to investors. Dabba trading is an illegal form of trading in shares, where operators of such trading rings allow people to trade in equities outside the stock exchange platform. The cautionary statements came after NSE found that the entities -- Shri Parasnath Commodity Private Limited, Shri Parasnath Bullion Private Limited, Faary Tale Trading Private Limited and Bharat Kumar (associated with Trade with Trust) --were providing dabba or illegal trading platform with assured returns. The exchange said that these persons are not registered either as a member or authorised persons of any registered member of the NSE. Moreover, a police complaint has been lodged in this regard. Cautioning investors, NSE asked them not to subscribe to any such scheme or product offered by any person or entity offering guaranteed returns in the stock market as the

New margin norms may spur a parallel market where trades are done on exchanges but settled off-market

In dabba trading, brokers cut deals on paper chits, instead of the exchange platform to save costs and steer clear of all regulations

Dabba trading is the informal, unregulated market where transactions are executed outside an exchange, and the settlement is in cash

ON FULL COURSEA comparison flow chart of transaction cost (Rs)Particulars Full service brokers Discount broking Dabba tradersBrokerage for 1 round buying and selling 667.00 40.00 534.60Taxes and other expenses 229.71 134.65 --Total expenses 896.71 174.65 534.60Margin for 1 lot of Nifty futures 66750 53400 --Source: Samco SecuritiesNote: Discount broking sample is derived from Samco Ventures; other discount brokers offer transactions at around the same cost; the above is for a sample transaction of Buying and Selling 1 lot (75 quantity) of Nifty FuturesFeared with demonetization like actions from the government coupled with intermittent raids by the markets regulator, a number of dabba traders have shifted to the organized means of trading across commodity, equity and currency. Major beneficiaries of this shift are discount brokers due to their low transaction cost compared to the full service brokers.The three leading discount brokers, as a consequence, including Zeroda, Samco ...

In a late night conference call involving Mumbai, Ahmedabad, Jaipur and Delhi based large dabba traders

Writes to states to tackle dubba trading in commodities; plans to inspect warehouses for better delivery practice