The newly-appointed Managing Director & Chief Executive Officer of the Bombay Stock Exchange (BSE), Madhu Kannan, is confident that the exchange will be able to capture the market share it has lost to the country’s largest exchange, National Stock Exchange (NSE), through greater focus on the cash segment, revamp of the derivatives segment, introduction of new products and greater use of technology.
In his first interaction with the media after taking over, Kannan said BSE would re-position itself and try to be on a par with global standards in the next one year.
“Going forward, our focus will be on rebuliding our market position. We will analyse the key areas and what we need to do,” said Kannan.
The erstwhile leader in the market has been losing customers to NSE since the latter’s inception. Now, the exchange wants to ensure that it has a good distribution network for its products and services across cash and derivatives.
Kannan, who was managing director (corporate strategy), Bank of America-Merrill Lynch, and former vice-president (international) of the New York Stock Exchange (NYSE), said technology would play a crucial role as the 135-year-old exchange looked to regain its market share.
The exchange, he said, would bring innovative products and technologies across segments to gain customers as new exchange-traded products were introduced.
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In 2007, BSE had tied up with the US Futures Exchange to list a dollar-denominated benchmark index futures contract on the Chicago-based electronic exchange. The exchange had also tied up with the Chicago Mercantile Exchange to develop risk management framework for margin requirements in futures and options. Despite these efforts, the exchange could not improve its F&O trading segment. Kannan said it was premature to comment on more partenrships with other global exchanges, but the exchange would definitely regain its strength in the F&O segment in the coming days.
“We will try to apply all relevant strengths of NYSE and other global exchanges on BSE and regain our market share. We have met our stakeholders and received a positive feedback,” said Kannan.
Kannan was appointed following the resignation of Rajnikant Patel. At present, BSE has about 800 brokers who trade in over 4,800 stocks through the BSE Online Trading System (BOLT), a product of CMC. The total market capitalisation of BSE’s 30-share Sensitive Index (Sensex) stands at Rs 48,03,040.68 crore.