SEBI grants approval to BSE SME Exchange
**The platform to provide new investment avenues for market participants and investors**
Securities and Exchange Board of India (SEBI) accorded approval to the proposed SME Exchange by BSE Ltd. on September 27, 2011.
Small and medium enterprises (SMEs) have always complained of difficulty in accessing both debt and equity capital. While the government has taken several measures to ease access to credit, giving them easier access to equity is the next step in that process.
SME Exchanges like AIM (London), Canada (TSXV), Hong Kong (GEM), Japan (Mothers), Korea (KOSDAQ) and US (NASDAQ) were studied in detail to understand their salient features, best practices and their business model. Learnings from the OTCEI, the capital market realities, and difficulties faced by SMEs have been taken into account while formulating the BSE SME Exchange in the Indian context.
Past few months, BSE SME Exchange has conducted several Seminars for educating the SMEs on the benefits of listing and the preparations required for listing on the BSE SME Platform across length and breadth of India. BSE SME has tied up with channel partners who include various institutions and associations engaged in the development of SMEs. More Seminars are lined up to cover all parts of the country in this year. Additionally, BSE SME has planned for sectoral seminars for auto ancillaries, infrastructure, pharmaceuticals, manufacturing, agro based industries, suppliers to OEMS etc. BSE SME is also planning to take SME cluster approach in the development of SME segment.
So far BSE SME has received wonderful response from various sectors, including agro-based industry, manufacturing, textiles, IT, construction, etc. A number of Merchant bankers are also optimistic about the initiative.
Speaking on the development, Madhu Kannan, MD and CEO of the BSE Ltd. said, “We are glad to have received approval from SEBI to launch the new exchange for Small and Medium enterprises. This is a great boost to our efforts in offering multiple asset classes to Indian investors. We are doing our bit to contribute towards the governmental agenda of greater financial inclusion and allowing promising enterprises of the future to access retail capital. We are committed to deliver the best products, services, and asset classes to all our stakeholders and look forward to the success of SME segment. We will continue to work closely with entrepreneurs, merchant bankers, market makers, investors, industry associations and all other stakeholders to ensure a smooth and successful roll-out and ongoing betterment of the SME exchange.”
Samata Patil / Ketan P. Mehta
September 28, 2011