No impact of the budget

Over the past few years, the budget has lost its significance as an event that impacts the stock market in a major way. If we look at the movement of the Sensex on budget day, it hardly saw a major swing. This year, however, it was expected that the Union Budget would bring in some strong reforms in the form of a definitive road map for the DTC, GST, etc., which was supposed to help improve the market sentiment. Nonetheless, it failed to do so.

Barring the BSE FMCG Index, which is considered to be a defensive sector, all the other major indices closed in the red. Although a couple of measures were taken, they failed to cheer the market overall and the Sensex fell by 190.61 points. If we look at the last fortnight ending on March 21, 2012, the broader indices closed in the green and were up by more than two per cent. The worst performing sectors were the BSE PSU Index and the Oil & Gas Index, which lost 0.35 per cent and 1.8 per cent respectively.

On the global front, the situation still seems buoyant. In the last fortnight, the US markets continued their northbound journey, with the Dow trading above the 13000 mark and the S&P 500 above the 1400 mark. The best performing market was Japan, where the Nikkei went up 4.66 per cent during the same period. The European markets witnessed some buying interest, and the FTSE ended the fortnight with a gain of around 1.5 per cent.

Going forward, the market will now shift its focus from the fine print of the budget to the Q4 results that will determine their future course.

New Initiatives: The Next Big Thing

The recognition of SMEs as a vital component of the Indian economy has come under greater focus today. However, there are few initiatives that have been instrumental in addressing the needs of SME businesses. The BSE is among these institutions that are playing a key role in improving the financing infrastructure for SMEs. The BSE SME Exchange platform (henceforth referred to as BSE SME) announced its launch on March 13, 2012 in a well-attended bell ringing ceremony at the BSE. The platform will provide capital access to SMEs as well as new investment avenues for market participants and investors.

Developed after studying the salient features, best practices and business models of similar global Exchanges, the listing norms on the BSE SME platform have been made simpler and convenient for SMEs as compared to the listing norms on the main board.

In the past few months, the BSE SME has conducted dozens of seminars across India to educate the SMEs on the benefits of listing and the preparations required for listing on the BSE SME platform. BSE SME has also tied up with channel partners, including various institutions and associations engaged in the development of SMEs.

BCB Finance (an NBFC and Broking Services firm) was the first company to be listed on this platform. Shri R K Mathur, Secretary, MSME, GoI, Shri Rajeev Agarwal, Whole Time Member, SEBI, and Shri C S Mohapatra, Adviser (FSDC), DEA, MoF were the chief dignitaries who graced the occasion of the launch of the platform.

Speaking at the ceremony, Shri R K Mathur, Secretary, MSME, GoI, said, “MSME department has been looking forward to this platform. Great efforts have been put in by BSE, and we deeply appreciate the same. SEBI has also been supportive throughout. I heartily congratulate BCB Finance Ltd. to be the first company to get listed on BSE SME platform. We are committed to do our bit to make this initiative a success”.

Talking about MSMEs and the BSE SME platform, Shri Madhu Kannan, MD & CEO, BSE, said, “SMEs are building blocks of the economy and the capital markets have great potential to tap opportunities and help this sector grow. BSE SME platform will be a committed partner to MSMEs to transform ideas into big companies”.

The launch of the Exchange platform from India’s premier bourse will significantly support the interests of the MSME sector in India. It is a major step towards alleviating the issues and addressing the challenges faced by SMEs.