The Hindu Business Line : `3,300 cos may lose listing'

Some 3,300 odd listed companies not indulging in compliance may be shown the door after the SEBI (Securities and Exchange Board of India) board takes a final view on the future of regional stock exchanges (RSEs) and the only-regional stock exchange listed entities.

The SEBI Chairman, Mr M. Damodaran, told reporters here on Tuesday that a large number of companies have not been complying with the mandatory listing obligations. "These companies have also formed a habit of not filing statutory documents with the regional office of the Registrar of Companies."

As non-promoter holding in these companies is generally very small, their so-called listing has failed to render any real service to the investor community at large. The SEBI chief made it clear that future of these stocks would be linked to the future of the RSEs.

On some of the possible steps the regulator might take before these entities are forced out of circulation from any of the RSEs, Mr Damodaran said that certain stocks may be put on BSE Indonext, on an experimental basis, if the regional stock exchange on which they are listed fail to demutualise and corporatise.

Alternative model

SEBI has already set in motion a process of looking for an alternative model for the survival of RSEs through dialogue and consensus.

The recommendations of the committee, headed by Mr G. Anantharaman, whole-time member of SEBI, on the subject has been posted on the SEBI site for an open and transparent discussion, he mentioned.

He said it was unfortunate that some RSEs are not able to tackle the problems even after they were put under administrators. "Appointment of administrator to run a stock exchange was a short-term measure. But in case of bourses such as the Calcutta Stock Exchange, repeated extensions of the administrator's tenure was required as little progress was made in the area of demutualisation and its patchy track record," said Mr Damodaran.

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