New exchange ISE set to trade by Oct

Even as the MCX Stock Exchange (MCX-SX) and the Delhi Stock Exchange (DSE) are hoping to launch equity trading on their platform soon, another Mumbai-based exchange, the Inter-connected Stock Exchange (ISE) is set to follow suit.

Apart from 13 regional stock exchanges which hold 5 per cent stake in ISE, the other big shareholders include Bennett, Coleman & Co, the publishers of The Times of India, Mumbai-based stock broker and bond dealer Darashaw & Co, Religare Technova and leading gold trader Prithviraj Kothari of Riddhi Siddhi Bullion. All of them hold 9 per cent each in the exchange. The wife of another top stock operator, O M Damani, holds 1 per cent.

ISE Managing Director P J Mathew told Business Standard, “The exchange was de-mutualised as per the regulatory norms. There are 40 share holders, out of which 13 are regional stock exchanges and we have over 1,500 listed companies on these exchanges which will be traded on ISE. Once Sebi (the Securities and Exchange Board of India) conducts inspection of our trading platform and risk management services, we will launch equity trading by October.”

ISE has brought in Tata Consultancy Services (TCS) as its technology partner. TCS will handle ISE’s clearing, trading, settlement and other software-related needs.

On an average, equity derivatives of Rs 80,000-1,00,000 crore are traded on the National Stock Exchange daily, while the combined cash equity volume on the Bombay Stock Exchange and NSE is over Rs 15,000 crore. There is an opportunity for other exchanges as the volumes are likely to double in the next couple of years. Other products such as currency and interest futures will gain momentum, too.

Mathew said ISE had over 2,500 trading terminals across the country through its 100 per cent subsidiary, ISE Securities and Services. ISE has 811 stock brokers registered with it, of which 420 are sub-brokers. Currently, these brokers trade on the NSE and BSE.

“Once ISE starts trading, the valuation of all the regional stock exchanges that are our share holders will go up,” said Mathew.