SME Times News Bureau | 03 May, 2010
Market regulator SEBI's issuance of guidelines for market makers on Small and Medium Enterprise (SME) exchange or separate platform of existing exchange having nation wide terminal is a major step towards the corporatisation of the SMEs and marks the beginning of the gradual roll out of the SME Exchange, said a industry body.
"Considering the present stage of development of SME and the inherent dynamism among the entrepreneurs in this sector, time is now ripe to encourage the existing Stock Exchanges to set up a trading platforms in securities of SMEs. This will not only enable SMEs access capital but also go a long way in promoting entrepreneurship development in India," said CII Director General Chandrajit Banerjee in a press release.
He added that a SME exchange or a separate platform of existing exchange having nation wide terminal will help SMEs in the country to raise capital for expansion.
"The sources of capital for SMEs are rather limited as these enterprises are generally unable to access the capital markets. The listed SME would henceforth enjoy greater visibility in the eyes of the investors, thereby enabling them to raise the much needed capital for expansion," the CII chief said.
CII viewed that disclosure requirements needed as part of the listing agreements should be simple and easily compliable so that the benefits of raising capital through the capital markets route is not withered due to high cost of compliance.
