Veto Switch Gears and Cables Ltd, a NSE (Emerge) listed small company, had witnessed a risk averse face of Indian bankers when it came to the primary market seven years ago.

PV Sharma, Group CFO of Veto said here on Saturday at a CII meet that except for a nationalised bank, which was its banker, no other banker subscribed to its initial public offering.

Veto, which accessed primary capital in 2007 through an IPO and listing on the Emerge platform of NSE, saw only Indian Overseas Bank subscribe to its equity.

The experience of the company, which fetched handsome premium and returned higher valuation as well as bonus shares, underlined Indian bankers’ predisposition in loan and interest income rather than providing financial support to small and medium sized companies.

On the Emerge, the minimum lot size being Rs 1 lakh, the company had to seek equity financing support from its dealers. “It’s a known systemic bottleneck”, said Sharma.

Khyati Shah, Chief Manager of Emerge, said the NSE platform for the MSMEs, has SEBI’s view on the typical problem faced by an issuer on the SME exchanges. Even employees, who get shares in ESOP arrangement of such listed companies, are not comfortable with the system.

Veto has planned to graduate to the main board of the NSE shortly.

Emerge has one five listed entities on it. The BSE counterpart of Emerge, which has been early starter also faced the same problem of pricing and low liquidity related to minimum lot size.

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