The Hindu Business Line : SEBI to focus on market risks

THE Securities and Exchange Board of India (SEBI) has drafted a strategic action plan for 2004-05 to address the structural, systemic and operational risks of the market.

According to the annual report of the capital market regulator, promoting Indonext - the new trading platform for small and mid cap companies, implementing T+1 rolling settlement, introduction of real estate fund form part of its prospects for FY 05.

SEBI is also seeking to provide a regulatory framework for hedge funds to participate in the Indian securities markets. Eligibility norms for Indian depository receipts would also be issued this year, according to the annual report.

A total of Rs 23,271 crore of capital has been raised in FY04. This is five times higher than the amount raised in FY03. Over 74 per cent of this was raised in the last two months of the year. Significantly, 57 per cent has been mobilised in March 2004 alone.

With respect to broker activity in the exchanges, the report states that Kolkata continues to have the largest number of stockbrokers, followed by the NSE, the OTCEI and the BSE in that order. Ninety per cent of the NSE brokers are active, while only 72 per cent of those in the BSE are active.

The report has highlighted SEBI's surveillance activities. The market regulator has been investigating several high profile incidents, including the crash on May 17 and insider trading allegations on the GTB scrip.

"SEBI's separate market surveillance department has been strengthened to monitor market movements, identify price volatility, analyse its causes and take prompt action in close coordination with stock exchange and depositories. While the front line responsibility for market surveillance lies with the stock exchanges, SEBI keeps a constant oversight on the surveillance activities of stock exchanges as well," said the report.

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