Rajkot-based Saurashtra Kutch Stock Exchange (SKSE) has decided to accept the exit policy of the Securities and Exchange Board of India (SEBI), becoming the first regional stock exchange (RSE) in Gujarat to do so.
It has also shelved its plans to merge with other regional exchanges in order to meet with the equity market regulator's recent notification, which made it mandatory for RSE to have minimum net worth of Rs 100 crore and annual turnover of Rs 1000 crore.
The decisions in this regard was taken by the board members of SKSE after meeting with SEBI officials last week.
“After checking all the aspects and talking with SEBI officials, we have dropped idea of merger with any other stock exchanges and decided to accept exit policy of SEBI," said Chirag Dedakiya, general manager of SKSE.
“We will now develop SKSE securities, our subsidiary firm, as an independent broking house and also plan to introduce new products like commodity, currency trading in it," he said. At presently there are over 40,000 trading accounts in SKSE Securities which has daily turnover of about Rs 30 crore. SKSE Securities, floated in 2001, is already working as broking house in Rajkot and Jamnagar but since the main company was attached with SEBI, it did not try to spread its network.
In October SEBI had directed SKSE for quick assessment of its properties, following which SKSE directors met the SEBI officials and discussed the exit policy.
“The board has appointed chartered accountant H P Mehta as valuer to assess our property. The valuer will send all the detail of assessment to the SEBI," Dedakiya said.
Dedakiya said, “We have to give 20 percent of total assessment value to the SEBI as security to settle old pending claims if any. If no dues are found SEBI will return the amount to us.” Saurashtra Kutch Stock Exchange Limited was incorporated in July 1989 and was recognised by the government of India.
The recognition had been renewed from time to time by the central government and SEBI.
The Rajkot-based RSE was derecognized by the stock market regulator in July 2007 over vacuum in the top level management, inadequate infrastructure for day-to-day operations of the exchange and the overall lack of interest of members to revive trading on the regional bourse.