BSE starts SME exchange, NSE follows suit with 'Emerge'

Leading bourses BSE and NSE today launched their SME exchange platforms to enable small and medium enterprises to raise funds and get listed as public entities.

While BSE kick-started its SME platform under the brand name of BSE SME Exchange with listing of BCB Finance, NSE followed suit by announcing the launch its own platform 'Emerge', whose online version went active today.

"Our SME Exchange hopes to list 10 companies by the end of the fiscal and nearly 100 in the next 18 months," BSE managing director and chief executive Madhu Kannan told PTI after inaugurating the BSE SME Exchange.

The exchange will provide an opportunity to small entrepreneurs to raise equity capital for growth and expansion. It will also provide immense opportunity for investors to identify and invest in good SMEs at early stage, Kannan said.

The exchanges have been working on SME platforms since early this year. Markets regulator Sebi had in September last year granted permission to BSE to launch its SME exchange. NSE received the approval in October, 2011.

The government has been taking a number of steps for SMEs to address challenges of globalisation, higher cost of funds, IT upgrade, infrastructure constraints faced by SMEs, said RK Mathur, micro, small and medium enterprises (MSMEs) Secretary, while launching the BSE platform.

SMEs have huge listing potential but so far there have been only debt-financing options, without any access to alternative equity options, BSE SME Exchange Chief Executive Lakshman Gugulothu said, adding that there is a general lack of awareness among SMEs about equity capital, stock markets and funding options, other than banks.

"The Emerge [of NSE] will provide investors with opportunities to invest in growing businesses. It has the potential to significantly improve access to risk capital for emerging economies," the country's largest bourse said in a statement.