NSE MD and CEO Ashish Kumar Chauhan addressed issues including the hike in Securities Transaction Tax, handling technical glitches, and the upcoming NSE IPO. He emphasized the importance of reducing market speculation, technological readiness for T+0 settlements, and the introduction of new SME IPO criteria based on free cash flow.

NSE CEO Discusses Key Financial Developments and Challenges

NSE Managing Director Addresses Key Issues and Initiatives

Ashish Kumar Chauhan, Managing Director and CEO of the National Stock Exchange (NSE), recently discussed several key topics concerning the Indian financial landscape.

Securities Transaction Tax (STT) Increase

In the FY27 budget, the government introduced an increased Securities Transaction Tax (STT) to curb excessive market speculation. Chauhan noted that while this hike may affect daily traders, the government's primary goal is to reduce over-speculation, particularly in equity futures and options.

Addressing Technical Issues in Volatile Markets

Chauhan highlighted the complexity of global IT systems, drawing parallels with widespread digital services.
He emphasized the need for vigilance to prevent technical glitches, despite significant investments in resilience from Indian stock exchanges.
No system is entirely foolproof, Chauhan acknowledged.

NSE's Framework for SME IPOs

The NSE has introduced a new framework for SME IPOs, focusing on free cash flow to ensure high-quality market entries. This metric is chosen for its ability to assure long-term sustainability and profitability.

Chauhan stressed the importance of this move as a filter against companies with weak business models.

Transition to T+0 Settlement

Chauhan expressed confidence in India's technological infrastructure, noting that segments like mutual fund distributions already operate on similar timelines.
He also mentioned that global readiness remains a factor in the transition to T+0 settlement.
India is a leader in technology utilization for settlements, Chauhan asserted.

NSE IPO Timeline

Following the receipt of the No Objection Certificate, the NSE IPO process is expected to be completed by late 2023, Chauhan outlined.

Preparations are underway, with an anticipated eight to nine months needed to finalize all regulatory and documentation steps, he reassured stakeholders.