| makeover moment
Mumbai, Oct. 9: The countrys oldest bourse is ready to ride the wave of bullish sentiment sweeping through the stock market and has decided to throw open its doors to include 26 new members.
The Bombay Stock Exchange (BSE), which has 720 broker-members, has till recently seen new faces replacing old ones but the move to create trading rights to enlist new members is a rare phenomenon.
BSE executive director Manoj Vaish confirmed the move and said memberships will be available at Rs 65 lakh each.
The successful applicants will also have to shell out more funds in the form of security and other deposits.
The membership fee was fixed on the basis of the last deal struck at the exchange when a member sold his trading card recently.
In the early nineties, BSE invited professionals to join the bourse and floated a special scheme that allowed chartered accountants and other professionals to become trading members. They were offered memberships at a discount to the market rate.
The novel move comes at a time when the exchange is transforming itself into a corporate entity. The proposal, when implemented, will see the bourses own shares being traded on the stock exchange.
The exchange proposes to rename itself as BSE Ltd and issue 10,000 shares of Re 1 to each of its trading members.
To allow the listing and trading of its own shares, the new BSE scheme stated that a shareholder of BSE Ltd would not be deemed to be a trading and clearing member of the exchange, merely by holding any equity shares of the corporate entity.
The corporatisation plan has been submitted very recently to the finance ministry and the Securities and Exchange Board of India (Sebi).
Sources told The Telegraph that if all the approvals are obtained, the entire process of demutualisation will be completed by Diwali this year, an auspicious time for a new beginning.
The BSE has been a member-owned, mutualised exchange since its inception 128 years ago. Each member (broker) has a vote. Ownership and management control are not separated in a member-owned, mutualised exchange.