Ex-SEBI chief Damodaran slams idea of self-reg­u­la­tion by bro­kers

The Hindu Business Line - - NEWS - PALAK SHAH

For­mer SEBI chair­man M Damodaran on Satur­day slammed the idea of bro­ker as­so­ci­a­tions pro­mot­ing self-reg­u­la­tory or­gan­i­sa­tion (SRO). Ad­dress­ing the an­nual con­fer­ence of As­so­ci­a­tion of Na­tional Ex­change Mem­bers of In­dia (ANMI) in Mum­bai, he said he was not a sup­porter of SROs as such ini­tia­tives have not suc­ceeded in the past.

“See the state of SROs formed by char­tered ac­coun­tants, med­i­cal coun­cil, bar coun­cil. It is mis­er­able. It is nec­es­sary to first lay the build­ing blocks be­fore set­ting up an SRO. ,” Damodaran said.

Ashish Chauhan, MD, CEO, BSE raised the pitch for ex­tend­ing trad­ing hours for bourses in the eq­uity seg­ment and For­mer SEBI chair­man M Damodaran

ques­tioned bro­kers for their in­con­sis­tent ap­proach to­wards the same in com­mod­ity seg­ment.

“Stock bro­kers do not want longer trad­ing hours in the eq­uity seg­ment on the ar­gu­ment that their cost will go up, but they are fine if com­mod­ity mar­kets trade for longer hours. Trad­ing tech­nol­ogy is avail­able and in­vestors in In­dia de­serve the best of tech­nol­ogy and longer trad­ing hours.” Chauhan also said that fundrais­ing through the ex­change plat­form was much less com­pared to trad­ing vol­umes. “Poli­cies should en­cour­age fund-rais­ing through ex­change plat­forms,” said Chauhan.

Vikram Li­maye, MD, CEO, NSE said “There is a be­lief that only spec­u­la­tors are dom­i­nat­ing the mar­ket. For thriv­ing pri­mary mar­kets, you re­quire a ro­bust sec­ondary mar­ket and all kinds of par­tic­i­pants. Spec­u­la­tion is not bad and an im­por­tant as­pect of price dis­cov­ery. A liq­uid se­cu­ri­ties mar­ket is crit­i­cal for well-func­tion­ing of pri­mary mar­kets. If we do not get our mar­ket de­vel­op­ment right in the next 3-4 years, long term would be a prob­lem. Cap­i­tal rais­ing in In­dia has been ro­bust,” Li­maye said.

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