Stock Market: A Persistent Leader
For most of the recent past, Ashishkumar Chauhan, CEO & MD, BSE has kept plodding at increasing the market share of its transactions business. Even as the exchange has not been able to make a dent in trading volumes of the NSE, nevertheless India’s oldest exchange is carving out a place for itself in the capital market spotlight.
Chauhan has increased the focus of the exchange on new platforms such as the BSE StAR MF platform and the India INX, its international exchange at the GIFT City in Gujarat. Over the past years, Chauhan also ramped up the technology, investing in improving the speed of transactions on the exchange. And the results are showing.
The BSE has been seeing a surge in volumes on its StAR MF platform, which grew over a 150 per cent to 2.7 million orders in the first quarter of FY18. The strong inflows has seen the platform garner a market share of more than 68 per cent in the mutual fund transaction space.
In its international exchange, volumes have been rising with the India INX clocking turnovers of around $50 million a day. Currently, 20 members are active on the exchange, and another 100 are at various stages of registration.
For BSE, a booming stock market is good for business. Its business has seen clear improvement in operating metrics as income from operations zoomed 26 per cent in the first quarter over last year. The business has also seen an improvement of 49 per cent from income in transaction charges, which has been led by the equity cash segment which was up 46 per cent, year-on-year, in Q1FY18 over last year. “It has been a good quarter. We have a steady nature of business, and some of our initiatives over the last few years are bearing fruit,” says Chauhan.
The BSE is ranked among the top 10 exchanges in the world with a market capitalisation of over $2,000 billion, and has one of the largest number of listed companies at 5,749 companies.
When he stepped into the shoes of the CEO back in 2012, the BSE was not known for its speed of trading. But the man is credited for reviving the BSE including making it the fastest exchange in the world with less than six microseconds response time. Chauhan also introduced new products like the SME segment, where the BSE has a lion’s share of the trading volumes of over 80 per cent.
Chauhan also took the institution public with a successful IPO back in January, which saw the stock list at over 34 per cent premium to its offer price. But the stock has meandered lately at the same levels of Rs 1,070-odd when it got listed.
Chauhan is now looking at introducing more products in the institution, and wants to raise more capital for Indian businesses. In 2016, the exchange raised $37 billion in capital for Indian companies in both debt and equity. “I don’t see a reason why we can’t raise more than $100 billion a year,” avers Chauhan.
As India is close to being a $2.5-trillion economy, naturally its savings stands at $750 billion per annum, reckons Chauhan. “That amounts to savings of more than $3 trillion in four years, which is huge, and which requires proper channelising.”
Chauhan’s goal is “to increase the options for all stakeholders and investors” at BSE. If that leads to bringing back even some of the growth the institution enjoyed in the olden days, Chauhan would have done his job.
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