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To safeguard interests of investors of firms listed solely on exiting stock exchanges, BSE has placed as many as 54 firms listed on the Bangalore Stock Exchange and OTC Exchange of India to the dissemination board (DB).
The move, which is effective from today, would allow buyers and sellers of the securities of these companies to disseminate their bids/offers using the services of trading members at BSE.
In separate notices, BSE said it is placing 34 companies exclusively listed on the OTC Exchange as well as 20 firms on the Bangalore Stock Exchange on its DB.
Of these, six entities — C F Technologies, Essemm Information Systems, Krisn Information Technologies, Scarlet Flowers & Agritech, Thungabadra Pulps & Boards Mills and Union Home Products — listed on the Bangalore Stock Exchange are "vanishing companies", BSE said.
Some of firms on OTC Exchange which have been moved are: Zim Laboratories, Allied Stock Investors, Aditya Coating, Electronica Industries, Cherry Polypack and Hindustan Biotech.
BSE DB is an information disseminating mechanism made available on the bourse's website for buyers and sellers of companies, that are listed exclusively on exiting or de-recognised Regional Stock Exchanges (RSEs) and have failed to obtain listing on any RSE.
The board is required to be set up by stock exchanges having nationwide trading terminals such as BSE.
"Trading members are requested to note that the companies admitted to BSE Dissemination Board are not listed with BSE (are treated as unlisted companies)," BSE said.
"There will be no listing agreement executed by BSE with these companies," it added.
The exchange also said that there would be no monitoring of any compliance with respect to filings made by these firms and that information received from them would be disseminated on the DB platform.
Under the BSE dissemination board, brokers of the exchange would act as "point of contact" for registered client, for executing the bid/offers placed. Under the mechanism, there is no matching of trades on the board and they are cleared and settled outside BSE/Indian Clearing Corporation.
Investors, on their part, also do not have any recourse to the investor grievance redressal mechanism, including arbitration and investor protection fund.
As per regulator Sebi's norms, firms listed exclusively on exiting or de-recognised Regional Stock Exchanges (RSEs) are required to seek listing on at least any other RSE that is not seeking de-recognition and exit.
However, those companies which fail to list on any other RSE are treated as unlisted entity and have to be moved to dissemination board.
