DSE stake sale gets FIPB nod

The plan to revive the Delhi Stock Exchange got a shot in the arm today with the Foreign Investment Promotion Board (FIPB) giving its nod to six foreign investment proposals.

The proposals will have a total 26 per cent stake in the bourse for Rs 100 crore.

The six foreign investors are "" Wilmette Holdings Ltd, Mauritius (5 per cent), Kuwait-based Noor Financial Investment Company (5 per cent), Passport India Investments, Mauritius (5 per cent), Ikarus Petroleum of Kuwait ( 5 per cent), Kuwait Privatisation Projects Ltd (5 per cent) and NRI Bhupendra Kumar Modi (1 per cent), DSE sources said.

As the maximum foreign investment in a stock exchange is now capped at 26 per cent, the bourse will have to sell 25 per cent stake to minimum five domestic investors.

The exchange is looking for 11 investors to dilute 51 per cent stake, in line with the Securities and Exchange Board of India's (Sebi) demutualisation scheme, before August-end.

According to the Sebi norms, each single investor can buy a maximum of 5 per cent stake in a stock exchange. The bourse has submitted a list of foreign and domestic investors to Sebi for its approval.

Domestic firms like Financial Technologies, Parsvnath Developers Ltd, Rajasthan Global Capital and Bennett, Coleman & Co are some of the front-runners to buy stakes in the bourse.

The DSE, defunct for the last three years, is also in talks several domestic banks and institutional investors. The enterprise value of the DSE is pegged at Rs 400 crore-500 crore and the 51 per cent stake is likely to fetch Rs 200 crore-250 crore to the member brokers, who will divest their stake.

The daily turnover of the DSE, where about 3,000 companies are listed, was around Rs 375 crore in 2000-01. The bourse recently increased its paid-up capital to Rs 3.03 crore to enable the company to list on the Bombay Stock Exchange at a future date.