The London Stock Exchange (LSE) is pulling out all the stops to invite Indian companies to raise capital. Martin Graham, head of equity markets, LSE, tells Rajesh Bhayani that the disclosure norms in the Alternative Investment Market (AIM) are as stringent as those followed by LSE. Graham is responsible for more than half of the combined revenues of the London Stock Exchange and the Borsa Italiana. Excerpts:
What kind of business potential do you see for LSE in India?
We can offer many more products to Indian exchanges and companies. Apart from equities and AIM, we have many products in the fixed income segment. LSE also has a very strong presence in the exchange traded market. We have a whole range of ETFs, including commodity-based ETFs. We do see possibilities for collaboration with Indian entities for ETF products.
When economies are slowing, do you think Indian companies will come and raise money from London?
Let me tell you many Indian companies are showing interest in raising funds on the LSE platform. SMEs from India are also showing interest to list on AIM. Our pipeline for Indian companies is healthy. I am quite optimistic about Indian companies coming to LSE.
Is LSE in talks with any Indian exchanges?
We are talking to Indian companies, the regulator and also with exchanges as an ongoing process. We are ready to collaborate with Indian exchanges. There can be collaboration by allowing two-way trading, which means Indian investors can invest in companies listed on LSE and vice versa. We can provide technology and throw open a wide range of products, including fixed income products.
Are you averse to picking up stake in Indian exchanges?
Please understand our growth model. We grow organically, through consolidation and collaboration. We also grow with competition. I can only say that we are ready to collaborate with exchanges here and we will act in the interest of our shareholders.
We have seen the Satyam fraud and charges of lenient corporate governance. How do you respond to such events?
I think stringent disclosures and corporate governance requirements are very important and our model supports these norms. AIM is a successful experiment as companies raised $11 billion in 2008 alone, which was more than the amount raised from Nasdaq. We have stringent disclosure norms for AIM-listed companies as well. Only the entry norms are easier for the AIM segment.
