The soon-to-be-launched BSE SME Exchange, the subsidiary of BSE, hopes to start with at least 10-15 IPOs and also have 50 SMEs listed through IPOs by the end of this financial year. The exchange, which is waiting for the final approval from market regulator Sebi for October launch, believes at least 200 companies get listed through IPOs in the next two years, said Lakshman Gugulothu, chief executive officer at BSE SME Exchange.
In an exclusive interaction with the FE here, he said: ?Our objective is to become one of the top SME exchanges in the world in the next 10 years and to compete with that of London AIM, TSX Venture of Canada, Kosdaq of Korea and like others.?
?Given the huge advantages and benefits for listing in our SME Exchange, a huge number of venture capitalists, angel investors are shifting their focus towards investing in SMEs and help them get listed in our exchange to reap rich benefits,? he said.
?We see at least 50 companies shown interest in our SME exchange and at least 25 have already signed with merchant bankers for IPOs. Some of the IPOs have been kept ready and we hope to start with at least 10-15 IPOs when we launch the exchange, which is expected in early October,? Gugulothu said.
To a question, he said: ?There are nearly 26 million SMEs in India and over 1 million are potential enough to get listed in stock exchanges. More than 100,000 such SMEs fall under our (SME Exchange) category. Even if we able to tap some of them, it will become a huge success for us and we are involved in educating them on the benefits/advantages by listing in our exchange.? BSE SME Exchange is an integrated platform and has over 600,000 terminals spread across the country to enable people get traded and achieve benefits
According to him, it is interesting to note that there might be migration of some of the existing listed SMEs in our parent BSE to our exchange once we launched as SME Exchange offers lot of benefits including better valuation, improvement in debt and equity ratios, immense tax benefits including gain from capital gain tax, unlocking the wealth in medium and long terms, luring of foreign investors, access to easy options of alternate funding as banks and PEs will finance loans easily. ?There are nearly 4,000 companies listed in BSE fall under our category and even small migration will benefit us immensely,? he said further.
To another question, he said: ?We hope the ministries concerned have been debating on waiving of securities transaction tax (STT). The STT alone compound nearly 40% of the overall tax cost of listing in stock exchanges. We hope the ministries concerned will come out with positive announcement.?