Country’s premier stock exchange BSE Ltd on Tuesday launched institutional trading platform in the BSE SME segment to facilitate the start-up companies and SMEs to list without IPO.
The launch of BSE SME ITP is consequent to SEBI’s provision in ICDR (Issue of Capital and Disclosure Requirements) guidelines allowing SMEs to list on the exchange without bringing in initial public offer (IPO).
In addition to allowing SMEs and start-up companies to raise capital, the BSE SME ITP will provide easier entry and exit options for informed investors like angel investors, VCFs and PEs etc. The new platform offers better visibility and wider investor base while offering tax benefits to long term investors.
“BSE is a leader in the SME category with over 46 listed companies. Additional 15 companies are at various stages of completion of their IPO taking the total listed companies to 61. This new platform will enable SMEs to raise money without having to go through the extensive IPO process,” BSE MD & CEO Ashishkumar Chauhan told reporters here after the launch.
“With an advanced trading platform and better services launch of ITP on BSE SME will complete the products which are valuable to investors and companies,” he added.
As per the regulatory norms, the BSE SME institutional trading platform offers relaxed compliance and cost effective listing to SMEs. The regulator has provided an exemption to SMEs, under which companies have to offer up to 25 per cent of its shareholding through an IPO.
Any company with a paid up capital not exceeding Rs. 25 crore in any of the previous financial years and has at least one full year’s audited financial statements for the immediately preceding financial year at the time of making listing application is eligible to get listed at the BSE SME ITP.
Any company that has not completed a period of more than 10 years after incorporation and its revenues have not exceeded Rs. 100 crore in any of the previous financial years is also one of the eligibility criterion.
