Based on the following case study, answer the question.

Big Limited is requiring ₹1000 crores for modernisation of its existing projects. A meeting of its finance department head was called with the board of directors to decide how to manage the required funds. It was decided in the meeting that ₹200 crores will be raised immediately by giving privilege to the existing shareholders to subscribe to a new issue of shares according to the terms and conditions of the company. ₹300 crores will be raised by allotting securities to institutional investors. Half of the balance required funds will be raised by a direct appeal to investors by means of a advertisement in newspapers and rest to issuing houses and stock brokers at an agreed price.

Identify that part(s) of Capital Market that is discussed in above case study.

Primary Market

The correct answer is option (1)- Primary Market.

In the case study provided, the primary market of the Capital Market is discussed.

The case study mentions that ₹200 crores will be raised by giving privilege to the existing shareholders to subscribe to a new issue of shares according to the terms and conditions of the company: This subscription of new shares by existing shareholders is a primary market activity where new securities are issued to raise fresh capital.The case study mentions that ₹300 crores will be raised by allotting securities to institutional investors. All are the method of issuing shares in primary market.