DSE meet to find investor makes no headway

Delhi stock exchange's (DSE) plan to look for a overseas investor, who can bring in $10-15 million, is yet to take off.

Its meeting to consider the appointment of ASP Research to scout for an overseas investor remained inconclusive and the demutualisation commitee has decided to examine the whole issue again.

ASP Research will need to scout for an overseas investor who is willing to acquire 51 per cent equity in the exchange. The investor will need to invest around $10-15 million.

DSE's Executive Director PK Singhal refused to comment on the details of the meeting. He said he was not aware of any proposal from any overseas investor.

Demutualisation may take time. This is because no consultant for stake-selling has been appointed yet. The agenda papers indicate that ASP Research representatives had earlier visited the DSE.

They subsequently offered their services to find an overseas investor. Vijay Bhushan, a board member, said it was not clear whether foreign shareholders can acquire 51 per cent stake.

Referring to BSE's scheme, Bhushan said, "While they have not placed any specific restrictions on foreign shareholding, they have not explicitly allowed it either."

The DSE's scheme has not been approved by Sebi.

For demutualisation, DSE has the option of either selling the stake to an investor, or to opt for a public issue.

Owing to the absence of a business model, some DSE members think that stake-selling will result in better pricing. It will also allow the existing members to exit.

In case, the DSE opts for a public issue, fresh funds will come into the exchange.

DSE is not operational according to its 2003-2004 balance sheet. Yet, apart from fixed assets, it has cash assets of over Rs 56 crore. It has also earned nearly Rs 5 crore from listing fees.