As part of its mission activation programme, the Over The Counter Exchange India (OTCEI) exchange has permitted parallel listing of companies listed on the exchange even if the trading in the last six months is less than 50 per cent of the total trading days.
The proposal was cleared by P S Subramanyam, chairman at its meeting held on October 23.
As per the earlier guidelines, the listed companies on OTCEI could not be listed if they were listed on any other exchange and this has led to a large number of good companies getting delisting from the exchange once they grew bigger.
Pravin Mohnot, managing director, said, "This move would provide an opportunity for arbitrage which would encourage trading volumes on OTCEI."
In another significant decision, OTCEI plans to scrap the concept of market making for initial public issues on the exchange, subject to the Securities and Exchange Board of India's (Sebi) board decision.
The removal of this market making clause is expected to attract a large number of companies, especially technology companies on the exchange as it would provide these companies an national reach.
However, other Sebi guideline regarding listing will be applicable on these companies.
"The concept of market making has failed to create liquidity and attract companies on the exchange," Mohnot adds.
In addition to these decisions, OTCEI is looking at opportunities such as providing an online initial public offerings and book building exchange to the brokers.
This facility will be in line with the Sebi norms. It also plans to start trading in retail debt market and private placement through demat mode. OTCEI will also provide clearing and settlement facilities through NSSDL and will be in the T+5 mode.
This move is expected to provide further liquidity and growth of debt market in the country.
"Normally, the debt market in any country is more than twice the equity market. However, due to lack of retail participation in this market has failed to generate volumes and we wish to capitalise on this," Mohnot said.
Meanwhile, more than 300 terminals are expected to start off in the next three months following OTCEI's decision to waive of pending dues of Rs two lakh for permitted fees (fees for trading in the permitted segment) and deferment of technology fees from brokers/member.
Moreover, it has now decided to charge a flat fee of Rs 10,000 for transfer of cards.
