Financial Daily from THE HINDU group of publications
Saturday, Jan 08, 2005
Financial Daily from THE HINDU group of publications Saturday, Jan 08, 2005 |
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Markets
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Stock Exchanges `IndoNext will open up opportunities for SMEs' Our Bureau
The Finance Minister, Mr P. Chidambaram, launching the "BSE-IndoNext" at the BSE Convention Hall in Mumbai on Friday. At his left is the SEBI Chairman, Mr G.N. Bajpai. IndoNext is an alternative trading platform being promoted by the BSE and 18 Regional Stock Exchanges. — Shashi Ashiwal
Mumbai , Jan. 7 INDONEXT, the alternative trading platform for small and medium enterprises, will open up opportunities for these entities both in the domestic and the international arena, the Finance Minister, Mr P. Chidambaram, has said. "Ten years from today, we would be able to say that most of the companies that were launched on IndoNext would turn out to be national winners, and one or two of them would be international winners," Mr Chidambaram said at the launch of BSE IndoNext on Friday. IndoNext is also expected to bring liquidity to scrips that are currently listed on the regional stock exchanges. BSE, Federation of Indian Stock Exchanges and 18 regional stock exchanges have promoted IndoNext, which has 350 scrips listed on it. Market surveillance, clearing and settlement will be carried out by the BSE, while the regional stock exchanges (RSEs) will look after the listing norms for companies trading on this platform. Initially, securities of companies, with paid-up capital between Rs 3 crore and Rs 20 crore, which are currently listed on RSEs but not on the BSE would be transferred to IndoNext. Companies that are in the same range of paid-up capital, currently listed on the BSE in `B1' and `B2' groups and meeting certain eligibility criteria will also be transferred to IndoNext. The members of the BSE and subsidiaries of RSEs, which are members of the BSE, will be able to trade on BSE IndoNext during phase I of this platform. The regional stock exchanges that are part of Indonext include Madras Stock Exchange, Bangalore Stock Exchange, Interconnected Stock Exchanges of India, Ludhiana Stock Exchange and Vadodara Stock Exchange. "Our primary goal is to foster competition among stock exchanges. The competition must be among well-run and well-managed stock exchanges. That is why, after much debate, the law was amended to provide for mandatory demutualisation of stock exchanges," Mr Chidambaram said. IndoNext is envisaged to bring liquidity and attention to stocks that are listed on RSEs and ensure that investors who are comfortable dealing with the more familiar local exchanges can continue to do so. "This platform will be a single order book for small and medium companies. Current compliance rules for small companies will always be more expensive and arduous for small and medium companies," said Mr G.N. Bajpai, Chairman, Securities and Exchange Board of India, detailing the tenets on which IndoNext is being formed.
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