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Four foreign entities, lone Indian in race

Four foreign entities, lone Indian in race
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First Published: Mon, Jun 25 2007. 11 58 PM IST
Updated: Mon, Jun 25 2007. 11 58 PM IST
New Delhi: Five entities, including four foreign ones, have expressed interest in buying a stake in the Delhi Stock Exchange (DSE). “Two foreign institutions, two foreign asset management companies and an Indian industrialist have approached us to buy a stake in the exchange,” said Bharat Bhushan Sahny, chairman of the exchange’s demutualization committee.
Demutualization is a process by which exchanges reduce the holding of their member-brokers to 49%, thereby becoming independent. Stock market regulator Sebi has set a 28 August deadline for DSE’s demutalization. Indian laws allow foreign entities to own a maximum of 5% in a stock exchange.
Like other regional stock exchanges, DSE has seen its fortunes plummet after the emergence of the National Stock Exchange (NSE). In 2005-06, the latest period for which data is available, income from the exchange was Rs10 crore. The comparable numbers for NSE and the Bombay Stock Exchange were Rs472 crore and Rs145 crore, respectively.
Sebi has called for a meeting on 26 June to discuss the issue.
DSE is attractive to investors because it “holds Rs90 crore in cash and 90 crore in property”, says Sahny. A DSE executive, who works closely with the valuation committee and wished that he not be identified, said audit firm Deloitte Touche Tohmatsu has valued the exchange at around Rs600 crore.
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First Published: Mon, Jun 25 2007. 11 58 PM IST