Vikram Limaye opts out of 2nd term as NSE CEO & MD, says 'not interested'

Vikram Limaye has decided not to seek a reappointment as managing director and chief executive officer (MD & CEO) of the National Stock Exchange (NSE). This comes as a surprise as the former IDFC MD was widely expected to get another term after a fairly successful five-year stint at the country’s largest bourse. His tenure ends on July 16, 2022.

“I have informed the board that I am not interested in pursuing a second term and will therefore not be applying and participating in the process that is underway,” Limaye said in a statement on Tuesday.

Limaye’s departure could once again push the exchange into a period of uncertainty and further delay its initial public offering (IPO) plans.

He took charge as MD & CEO of the NSE in July 2017 — seven months after the abrupt departure of Chitra Ramkrishna amid allegations of wrongdoings at the exchange’s colocation facility and misgovernance over the appointment of former group operating officer Anand Subramanian.

Limaye joined at a time when the NSE was going through a crisis, with probes initiated by the Securities and Exchange Board of India (Sebi) and the Central Bureau of Investigation (CBI) into allegations of various wrongdoings between 2010 and 2016 against the exchange’s staffers. The NSE also underwent forensic audits by firms such as EY and Deloitte.

Despite the upheaval, the NSE managed to clock a strong financial performance and cement its leadership position under Limaye’s leadership. The exchange’s revenues have grown at a compound annual growth rate of 26 per cent to Rs 8,500 crore between FY17 and FY22, while net profit has grown at 29 per cent CAGR to Rs 4,400 crore. 

In the preceding five years ended FY17, revenues and profit grew at a CAGR of 8 per cent and 6 per cent, respectively. The exchange also saw its market share grow in the equities cash segment from 85 per cent to 92 per cent and maintained its monopoly in the derivatives segment.

Limaye is also credited with strengthening governance, stakeholder outreach, and technology transformation at the exchange.

“I have done my best to lead the organisation in a very difficult period and to stabilise, strengthen and transform the NSE. I am grateful to all stakeholders, regulators, and the government for their support,” he said.

Last week, the NSE invited applications for the post of MD & CEO. In 2017, Sebi introduced new rules that require the MD & CEO of a market infrastructure institution (MII) to undergo an appointment process for a second term anew. In other words, the incumbent has to compete with fresh candidates to get reappointed. Also, the MD & CEO is now allowed a maximum of two terms of five years each.

Limaye’s decision to opt out would open the appointment process, with the senior leadership of the NSE now expected to submit their applications. Consultancy firm Korn Ferry has been hired to oversee the process.