Mumbai, Aug 20: The Stock Holding Corporation of India Ltd (SHCIL), the country's largest share custodian, has chalked out plans to provide custodial services for debt instruments.

The custodian has initiated talks with the Securities Trading Corporation of India (STCI), to provide the Reserve Bank of India (RBI) subsidiary with a range of custodial facilities.

"The STCI which actively trades in government securities and public sector bonds, the turnover of which is in the vicinity of Rs 10,000 crore, has decided to widen its investor base and is looking at various options to achieve the same. For this it will require to create a number of facilities which we feel that we can provide to it", said BV Goud, managing director of SHCIL.

"We have initiated discussions with STCI to provide them with our custodial services for the instruments they handle which could include providing them back-up facility as well. Given the enormous size of the turnover of securities handled by STCI it will be a major boost to SHCIL's bottomline if we finalise the deal" said Goud.

Goud said that the latest move is among a series of steps that the largest custodial house is taking to improve its productivity as well as gear up to venture into fresh areas in the wake of the depository culture fast catching on in the Indian capital markets, which some feel will reduce the role of share custodians.

SHCIL is also planning to launch a major marketing exercise to woo non-resident Indian investors as its clients. "We plan to provide all facilities to NRI investor under one roof and would therefore send out teams of officials to market SHCIL to them once a detailed plan is worked out", said Goud.

"We also propose to concentrate a lot on high networth individuals as well as commercial banks and mutual funds. While we expect commercial banks to channelise more incremental deposits into the secondary markets in the near future, mutual funds which are now performing well are also being targetted for becoming our clients", said Goud. As regards stock lending, Goud said that SHCIL is about to finalise the operational guidelines for implementing the scheme.

Towards this effect, it has decided to seek the advise of top stock brokers and market players before finalising the guidelines. This exercise will be kicked off next week.

"Once the operational guidelines are in place we will seek the final approval from the Securities & Exchange Board of India . We hope to be in a position to commence stock lending operations by October", said Goud.SHCIL is also planning to obtain a banking license as well as seek approval from the Securities Exchange Commission (SEC) to become a global custodian.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.