Legal & Taxation

BSESME Exchange & Institutional Trading Platform

Group Members
Glen Nazareth Glen Noronha Dylan Rodrigues Royluis Rodrigues Nicolin Rosario - 26 - 27 - 28 - 29 - 30

Bombay Stock Exchange (BSE)

Established in 1875 Over 6000 stock listed Provides a host of other services to capital market participants SMEs are the backbone of the nation's economy

Hours of operation
Session Pre-open Trading Session Trading Session Position Transfer Session Closing Session Option Exercise Session Timing 09:00 - 09:15 09:15 - 15:30 15:30 - 15:55 15:50 - 16:05 16:07

The hours of operation for the BSE quoted above are stated in terms the local time (GMT + 5:30). BSE's normal trading sessions are on all days of the week except Saturday, Sundays and holidays declared by the Exchange in advance

Awards
The World Council of Corporate Governance has awarded the Golden Peacock Global CSR Award for BSE's initiatives in Corporate Social Responsibility (CSR). The Annual Reports and Accounts of BSE for the year ended 31 March 2006 and 31 March 2007 have been awarded the ICAI awards for excellence in financial reporting. It has been cited as one of the world's best performing stock market by Reuters. The Human Resource Management at BSE has won the Asia - Pacific HRM awards for its efforts in employer branding through talent management at work, health management at work and excellence in HR through technology.

BSE SME provide immense opportunities to the following market participants.

Entrepreneurs :To raise equity capital for growth and expansion of SMEs in a cost effective manner. Investors : Opportunities to identify and invest in good companies at an early stage, long term Capital Gain tax benefit and Exit Route. Tax Benefits: Tax Benefits Long Term Capital Gains Tax indexation Short Term Capital Gains Tax Shares listed on BSE SME Unlisted Shares 0% 20% after 15% 30%

Small & Medium Enterprise (SME)

The backbone of the nations economy Micro, Small and Medium Enterprises (MSMEs) contribute - 8% of the country's GDP - 45% of the manufactured output - 40% of our exports The Micro Small and Medium Enterprise (MSME) sector forms the largest generator of employment in the Indian economy. Need finance for growth as well as for existing operations.

Face problems in raising funds, providing securities and creating credibility in market.
SME exchange is a stock exchange dedicated for trading the shares of small and medium scale enterprises (SMEs)

Need for SME Exchange

Equity financing opportunities Lower the Debt burden Expand the investors base Enhance companys visibility Incentive for the employees

Need for SME Exchange

Encourage Innovation and entrepreneurial spirit Distribute risk more efficiently

SME sector will grow better on two pillars of Financial system i.e. Banking
and Capital Market

Build a bridge between the SMEs, Private Equity and the Venture Capital

Institutional Trading Platform

According to section 106X,institutional trading platform means, the trading platform in a SME exchange for listing & trading of specified securities of small &medium enterprises for informed investors.

Institutional trader manages relatively large amounts of capital.

They are the ones who are actively responsible to keep the market working.

Benefits of listing on Institutional Trading Platform.

Facilitate capital raising by small & medium enterprises.
Provide easier entry & exit options for certain investors & some companies. Provide better visibility & wider investor base. Relaxed compliance & cost effective listing. Tax benefits to long term investors.

Eligibility Criteria for listing under Institutional Trading Mechanism

The company, its promoter , group company or director doesn't appear in Reserve Bank of India. There is no winding up petition against the company, accepted by a competent court. The paid up capital of the company has not exceeded 25 crore rupees in previous financial year.

The company has 1full years audited financial statements for immediate preceding financial year.

SME Exchange SEBI Guidelines

An issuer whose post-issue face value capital Between 1 crore and Rs10 crore will be invariably covered under the SME Platform. An issuer, whose post-issue face value capital between Rs 10 cores and Rs 25 cores may get listed on either SME Platform or Main Board.

And issue with post issue face value capital above Rs 25 cores has to be necessarily listed on the Main board of the BSE.
The minimum application amount as well as minimum trading lot shall not be less than Rs.1,00,000/ Net Tangible assets of at least Rs. 1 Crore as per the latest audited financial results.

SME Exchange SEBI Guidelines

Minimum 50 investors are required and each should invest at least Rs. 1,00,000/- at the time of IPO. (Compared to 1,000 minimum investors required for BSE Main exchange) Net Worth (excluding revaluation reserves) of at least Rs. 1 Crore as per the latest audited financial results. Company shall mandatorily facilitate trading in demat form. Mandatory to have website of the company. All existing Trading Members would be eligible to participate in SME exchange without any further registration

SEBI Guidelines Obligations of Market Makers

The Merchant Banker shall be responsible for market making for a minimum period of 3 years through a stock broker who is registered as market maker with SME Exchange.

The market maker shall be required to provide two way quote for 75% of time in a day, the same shall be monitored by the Stock exchange

THANK YOU