AT least 10 companies from Gujarat are likely to be listed in the first-ever dedicated exchange for small and medium enterprises (SMEs) – the BSE SME Exchange – slated to be launched in September.
Exchange officials are confident of having about 50 companies from across India on the SME Exchange at the time of the launch. “We should be able to have about 40-50 companies to start with. All these companies are currently at various stages of filing for the listing. At least 10 companies are from Gujarat and they are actively considering to list on the SME Exchange,” said Lakshman Gugulothu, chief executive officer, BSE SME Exchange. Real estate, pharma, trading, manufacturing and services companies are likely to make it to the exchange.
The scrips listed on the SME Exchange platform will be put under the M-group and MT-group in the BSE’s BOLT system. The trading of scrips will be done in the cash market as lots, unlike BSE scrips which are traded as individual shares. All existing trading members of BSE will be eligible to participate in the SME Exchange and need not register separately.
“At present, there are two challenges ahead of us. First, it is to educate and convince SME owners to get listed on the SME Exchange and second, the investors also need to be convinced to invest in the SMEs,” said Gugulothu.
The SME Exchange is expected to benefit SMEs to raise funds and leverage on their share value for the future growth of companies. The listing norms have also been relaxed for SMEs, with a reduction in duration and costs for initial public issue (IPO) procedures. “The duration for IPO procedure will reduce to about 1-2 months against the normal 8-10 months. This will save cost as well as time for the listing,” said Gugulothu.
Companies having a post-issue paid-up capital of up to Rs 10 crore will be covered under the SME platform, while companies with a post-issue paid-up capital between Rs 10 crore and Rs 25 crore will be listed on the SME platform. Those exceeding the paid-up capital limit of Rs 25 crore would necessarily have to list on the main board of the exchange.
At a seminar held in Ahmedabad on Saturday, the SME Exchange in association with the Federation of Indian Chambers of Commerce and Industry, made presentations to SME owners from across Gujarat to apprise them of the benefits of the SME Exchange.
