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Meet with Sebi today

Calcutta, August 4: The Securities and Exchange Board of India (Sebi) has convened a meeting tomorrow with the heads of the regional bourses on demutualisation.

This is the first meeting with the regulator since the exchanges submitted their corporatisation plans. July 31 was the deadline for submitting corporatisation plans.

“Some exchanges have not submitted their proposals as yet, while some proposals are deficient. Sebi wants to figure why the exchanges could not file their proposals in time, and also discuss the plans submitted by the others,” said Sebi officials.

The finance ministry has indicated that stock exchanges will have to set the demutualisation ball rolling within March 31, 2004. In two years, all bourses will have to reduce the voting right of brokers to less than 51 per cent.

Observers, however, say demutualisation could take a long time to get started. “One of the most contentious issues is valuation, and it would not be surprising to see litigation delaying the implementation,” said the head of an exchange.

In another development, the Federation of Indian Stock Exchanges led by former Sebi chairman M. R. Mayya is meeting BSE officials on August 11 to discuss the formation of IndoNext — a trading platform for small- and mid-cap companies.

BSE wants IndoNext to be a part of itself. “It could be a separate subsidiary of BSE, or just another platform under it. We will be discussing issues like sharing of listing fees and turnover fee (with the regional exchanges) in our next meeting,” Mayya added.

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