Ashish Rukhaiyar / Mumbai February 10, 2010
Nod likely soon; lower membership fee aimed at attracting brokers of other exchanges.
Exchanges operating in the currency and the interest rate derivatives arena might soon have to gear themselves for increased competition. The United Stock Exchange (USE), close to getting the final regulatory approval, has initiated a membership drive.
The membership charges of USE, in which Bombay Stock Exchange (BSE) holds 15 percent, has been so designed as to attract a high number of brokers who are already members of other exchanges.
According to a person familiar with the development, the exchange has already got the in-principle approval and is "pretty close" to getting the final approval from the Securities and Exchange Board of India (Sebi), said a source, on condition of anonymity. Despite repeated attempts, T S Narayanasami, Managing Director and CEO of USE, could not be reached for comments.
According to an email, a copy of which is with Business Standard, sent to a large number of brokers, USE is charging Rs 1 lakh as deposit for trading members. The processing charges have been waived and there would be no other charges till trading commences. For clearing members, the deposit is Rs 50 lakh. Clearing members also have to pay a one-time processing fee of Rs 10,000 to USE and Rs 50,000 to Sebi.
Interestingly, the deposit has to be paid only at the time of activation and not at the time of application. Further, the mail said, "trading is expected to commence shortly".
A typical membership process involves applying to the exchange, that processes it and, if accepted, sends it to Sebi. Once this approval comes, membership is activated.
Lowering or waiving charges has been seen before. When MCX-SX wanted to attract a large number of brokers to counter the might of the National Stock Exchange (NSE), it waived admission fees and processing charges, albeit for a brief period of time. Currently, admission fees for MCX-SX is Rs 2 lakh for associates of MCX members and Rs 5 lakh for all other applicants. Those who are already members of BSE, NSE, NCDEX or are registered at Fedai (Foreign Exchange Dealers' Association of India) have to pay an admission fee of Rs 2.5 lakh. The processing fee has been fixed at Rs 10,000.
The NSE, which competes with MCX-SX in the currency derivatives segment, has a deposit requirement of Rs 20 lakh for applicants wanting to be trading-cum-clearing members of the currency segment. Those already members of NSE can get this for Rs 10 lakh.
Currency derivatives were launched in India in August 2008, while interest rate futures made their entry much later, in September 2009. Currently, NSE and MCX-SX are the only two exchanges registering impressive trading volumes in these instruments.
BSE also launched its currency derivatives segment before acquiring a 15 per cent stake in USE in August 2009. USE is based on a unique public-private partnership, having most of the public sector and private sector banks as stakeholders. USE shareholders also include Tata Consultancy Services, Jaypee Capital and MMTC.
Sunday 21 March 2010
BSE cries foul over NSE corporate bond advantage
Ashish Rukhaiyar / Mumbai February 09, 2010
The reporting platform is hosted by NSE, so it gets the business.
The rivalry between India’s two leading stock exchanges, the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), does not seem to be dying. This time, the two are glaring at each other over clearing and settlement of corporate bonds.
At the heart of the matter is the Fixed Income Money Market and Derivatives Association of India’s (Fimmda’s) platform hosted by NSE. This gives NSE far better access than BSE.
The problem started in October last year, when the Securities and Exchange Board of India (Sebi) issued a circular that clearing and settlement of trades in corporate bonds should be done through clearing corporations from December.
Market participants were given an option between NSE’s National Securities Clearing Corporation (NSCCL) and BSE’s Indian Clearing Corporation (ICCL). Prior to this, the two exchanges and Fimmda were authorised to set up and maintain only reporting platforms to capture information related to trading in corporate bonds.
According to an informed source, BSE is fighting hard to get the same access to the Fimmda platform. “RBI (Reserve Bank of India) requires that all corporate deals be reported to Fimmda. One can easily settle bond trades on the NSE platform because of built-in parameters. If someone wants to settle the same trade through BSE, he has to go to the exchange’s website and key in the details. This acts as a big deterrent,” said the source.
NSE, said a source, was recently asked by a senior finance ministry official to modify the system so that both exchanges could equally access the Fimmda platform.
The issue was also raised at a seminar organised by the National Institute of Public Finance and Policy in January, said a source who was present at the event. The seminar was attended by senior officials from the government, RBI, Sebi, stock exchanges and banks, besides money market representatives.
An email to NSE was not answered will the time of going to press. But, the numbers speak for themselves. According to Sebi, corporate bonds worth Rs 31,397 crore were settled on NSE’s platform in January. The BSE platform saw trades worth a paltry Rs 1,244 crore. In December, the NSE platform accounted for bond trading worth Rs 17,300 crore, compared to BSE’s Rs 404 crore.
NSE itself had, in a circular issued on November 23, noted that “where trades are reported on the FIMMDA reporting platform, the participants can directly express their intent to settle on the (NSCCL) platform in the clear & settle screen”. This is not possible if one wants to settle through BSE’s ICC.
A Sebi circular issued in April 2007 had said: “BSE and NSE shall ensure that the norms on trading hours and access rights to trading systems shall broadly follow the norms presently followed in the equity segment. BSE and NSE shall ensure that the norms are harmonious between the exchanges.”
The reporting platform is hosted by NSE, so it gets the business.
The rivalry between India’s two leading stock exchanges, the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), does not seem to be dying. This time, the two are glaring at each other over clearing and settlement of corporate bonds.
At the heart of the matter is the Fixed Income Money Market and Derivatives Association of India’s (Fimmda’s) platform hosted by NSE. This gives NSE far better access than BSE.
The problem started in October last year, when the Securities and Exchange Board of India (Sebi) issued a circular that clearing and settlement of trades in corporate bonds should be done through clearing corporations from December.
Market participants were given an option between NSE’s National Securities Clearing Corporation (NSCCL) and BSE’s Indian Clearing Corporation (ICCL). Prior to this, the two exchanges and Fimmda were authorised to set up and maintain only reporting platforms to capture information related to trading in corporate bonds.
According to an informed source, BSE is fighting hard to get the same access to the Fimmda platform. “RBI (Reserve Bank of India) requires that all corporate deals be reported to Fimmda. One can easily settle bond trades on the NSE platform because of built-in parameters. If someone wants to settle the same trade through BSE, he has to go to the exchange’s website and key in the details. This acts as a big deterrent,” said the source.
NSE, said a source, was recently asked by a senior finance ministry official to modify the system so that both exchanges could equally access the Fimmda platform.
The issue was also raised at a seminar organised by the National Institute of Public Finance and Policy in January, said a source who was present at the event. The seminar was attended by senior officials from the government, RBI, Sebi, stock exchanges and banks, besides money market representatives.
An email to NSE was not answered will the time of going to press. But, the numbers speak for themselves. According to Sebi, corporate bonds worth Rs 31,397 crore were settled on NSE’s platform in January. The BSE platform saw trades worth a paltry Rs 1,244 crore. In December, the NSE platform accounted for bond trading worth Rs 17,300 crore, compared to BSE’s Rs 404 crore.
NSE itself had, in a circular issued on November 23, noted that “where trades are reported on the FIMMDA reporting platform, the participants can directly express their intent to settle on the (NSCCL) platform in the clear & settle screen”. This is not possible if one wants to settle through BSE’s ICC.
A Sebi circular issued in April 2007 had said: “BSE and NSE shall ensure that the norms on trading hours and access rights to trading systems shall broadly follow the norms presently followed in the equity segment. BSE and NSE shall ensure that the norms are harmonious between the exchanges.”
BSE cries foul over NSE corporate bond advantage
Ashish Rukhaiyar / Mumbai February 09, 2010
The reporting platform is hosted by NSE, so it gets the business.
The rivalry between India’s two leading stock exchanges, the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), does not seem to be dying. This time, the two are glaring at each other over clearing and settlement of corporate bonds.
At the heart of the matter is the Fixed Income Money Market and Derivatives Association of India’s (Fimmda’s) platform hosted by NSE. This gives NSE far better access than BSE.
The problem started in October last year, when the Securities and Exchange Board of India (Sebi) issued a circular that clearing and settlement of trades in corporate bonds should be done through clearing corporations from December.
Market participants were given an option between NSE’s National Securities Clearing Corporation (NSCCL) and BSE’s Indian Clearing Corporation (ICCL). Prior to this, the two exchanges and Fimmda were authorised to set up and maintain only reporting platforms to capture information related to trading in corporate bonds.
According to an informed source, BSE is fighting hard to get the same access to the Fimmda platform. “RBI (Reserve Bank of India) requires that all corporate deals be reported to Fimmda. One can easily settle bond trades on the NSE platform because of built-in parameters. If someone wants to settle the same trade through BSE, he has to go to the exchange’s website and key in the details. This acts as a big deterrent,” said the source.
NSE, said a source, was recently asked by a senior finance ministry official to modify the system so that both exchanges could equally access the Fimmda platform.
The issue was also raised at a seminar organised by the National Institute of Public Finance and Policy in January, said a source who was present at the event. The seminar was attended by senior officials from the government, RBI, Sebi, stock exchanges and banks, besides money market representatives.
An email to NSE was not answered will the time of going to press. But, the numbers speak for themselves. According to Sebi, corporate bonds worth Rs 31,397 crore were settled on NSE’s platform in January. The BSE platform saw trades worth a paltry Rs 1,244 crore. In December, the NSE platform accounted for bond trading worth Rs 17,300 crore, compared to BSE’s Rs 404 crore.
NSE itself had, in a circular issued on November 23, noted that “where trades are reported on the FIMMDA reporting platform, the participants can directly express their intent to settle on the (NSCCL) platform in the clear & settle screen”. This is not possible if one wants to settle through BSE’s ICC.
A Sebi circular issued in April 2007 had said: “BSE and NSE shall ensure that the norms on trading hours and access rights to trading systems shall broadly follow the norms presently followed in the equity segment. BSE and NSE shall ensure that the norms are harmonious between the exchanges.”
The reporting platform is hosted by NSE, so it gets the business.
The rivalry between India’s two leading stock exchanges, the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), does not seem to be dying. This time, the two are glaring at each other over clearing and settlement of corporate bonds.
At the heart of the matter is the Fixed Income Money Market and Derivatives Association of India’s (Fimmda’s) platform hosted by NSE. This gives NSE far better access than BSE.
The problem started in October last year, when the Securities and Exchange Board of India (Sebi) issued a circular that clearing and settlement of trades in corporate bonds should be done through clearing corporations from December.
Market participants were given an option between NSE’s National Securities Clearing Corporation (NSCCL) and BSE’s Indian Clearing Corporation (ICCL). Prior to this, the two exchanges and Fimmda were authorised to set up and maintain only reporting platforms to capture information related to trading in corporate bonds.
According to an informed source, BSE is fighting hard to get the same access to the Fimmda platform. “RBI (Reserve Bank of India) requires that all corporate deals be reported to Fimmda. One can easily settle bond trades on the NSE platform because of built-in parameters. If someone wants to settle the same trade through BSE, he has to go to the exchange’s website and key in the details. This acts as a big deterrent,” said the source.
NSE, said a source, was recently asked by a senior finance ministry official to modify the system so that both exchanges could equally access the Fimmda platform.
The issue was also raised at a seminar organised by the National Institute of Public Finance and Policy in January, said a source who was present at the event. The seminar was attended by senior officials from the government, RBI, Sebi, stock exchanges and banks, besides money market representatives.
An email to NSE was not answered will the time of going to press. But, the numbers speak for themselves. According to Sebi, corporate bonds worth Rs 31,397 crore were settled on NSE’s platform in January. The BSE platform saw trades worth a paltry Rs 1,244 crore. In December, the NSE platform accounted for bond trading worth Rs 17,300 crore, compared to BSE’s Rs 404 crore.
NSE itself had, in a circular issued on November 23, noted that “where trades are reported on the FIMMDA reporting platform, the participants can directly express their intent to settle on the (NSCCL) platform in the clear & settle screen”. This is not possible if one wants to settle through BSE’s ICC.
A Sebi circular issued in April 2007 had said: “BSE and NSE shall ensure that the norms on trading hours and access rights to trading systems shall broadly follow the norms presently followed in the equity segment. BSE and NSE shall ensure that the norms are harmonious between the exchanges.”
Securities tribunal gives boost to private equity investors
Ashish Rukhaiyar / Mumbai January 26, 2010
A recent ruling by the Securities and Appellate Tribunal (SAT) saying the veto rights of shareholders do not classify control over the company is all set to change the way investment agreements are drafted between companies and private equity or venture capital entities.
In a landmark judgment last week, the tribunal has shot down the stand of markets regulator Securities and Exchange Board of India (Sebi) that said veto rights constituted “control” of the company under Regulation 12 of the Takeover Regulations.
Legal experts said this order has come as a major relief to investors who were wary of seeking such rights for fear of triggering the open offer regulations. The order has put to rest a lot of related ambiguities too, they added.
The case goes back to 2007 when private equity firm Subhkam Ventures, through a preferential allotment, acquired more than 15 per cent in MSK Projects thereby triggering an open offer. It filed an open offer draft document with Sebi under Regulation 10 of the Takeover Regulations, mentioning that it was only a financial investor and the acquisition would not lead to any change in the control of the company.
Sebi, however, wanted the open offer to be made under Regulation 12 (change in control) along with Regulation 10. This was challenged by Subhkam Ventures at SAT, which based on the facts of the matter, ruled that “Regulation 12 does not get triggered and Sebi was not justified in making the appellant (Subhkam Ventures) incorporate this regulation in the letter of offer”.
Lawyers who deal with private equity and venture capital players said the agreements between private equity and venture capitalist entities and companies are standard in form and such ambiguities are common, so this order would set to rest a lot of issues. “This order should benefit and bring certainty to those venture capital and private equity investors who have made investments in companies on similar terms and conditions,” said Vishal Gandhi of Gandhi & Associates.
According to law firm Nishith Desai Associates, “The order brings much relief to financial investors who have been uneasy about seeking such rights in listed companies for fear of triggering the requirement to make an open offer and also the implications of being regarded as persons in ‘control’ over the company”.
Sebi’s stand in the case stemmed from the fact that the shareholder agreement between Subhkam Ventures and MSK Projects gave the former rights to veto certain business decisions, appoint a nominee on the board of the company and quorum rights (meaning Subhkam nominee should be present at the board meetings).
SAT, in its judgement, has said the provisions of the veto rights do not give control to Subhkam Ventures. “On the contrary, it only enables (Subhkam) to safeguard its investment and interest of the shareholders in general,” it said.
Gandhi, however, cautioned that the order has still left some of the important issues unresolved. "The larger question is that if the investors are not in control and if the promoters are unable to take a decision due to the investors exercising their rights, then can one say that the promoters are in control? And, if neither the investors nor the promoters are in control, then who really is in control?" asked Gandhi.
The answer to this may be found by examining other related provisions of the shareholders agreement that specify the consequences of the exercise of a veto right by the investors, he adds.
"This ruling will help in the overall growth of the PE industry," says Vishal Tulsyan, director & CEO, Motilal Oswal Venture Capital Advisors. "One major concern was that rights of the PE player was getting diluted. This will no more be the case," he added.
Sebi has an option to approach the Supreme Court on the SAT ruling. However it is not yet known whether it will do so.
A recent ruling by the Securities and Appellate Tribunal (SAT) saying the veto rights of shareholders do not classify control over the company is all set to change the way investment agreements are drafted between companies and private equity or venture capital entities.
In a landmark judgment last week, the tribunal has shot down the stand of markets regulator Securities and Exchange Board of India (Sebi) that said veto rights constituted “control” of the company under Regulation 12 of the Takeover Regulations.
Legal experts said this order has come as a major relief to investors who were wary of seeking such rights for fear of triggering the open offer regulations. The order has put to rest a lot of related ambiguities too, they added.
The case goes back to 2007 when private equity firm Subhkam Ventures, through a preferential allotment, acquired more than 15 per cent in MSK Projects thereby triggering an open offer. It filed an open offer draft document with Sebi under Regulation 10 of the Takeover Regulations, mentioning that it was only a financial investor and the acquisition would not lead to any change in the control of the company.
Sebi, however, wanted the open offer to be made under Regulation 12 (change in control) along with Regulation 10. This was challenged by Subhkam Ventures at SAT, which based on the facts of the matter, ruled that “Regulation 12 does not get triggered and Sebi was not justified in making the appellant (Subhkam Ventures) incorporate this regulation in the letter of offer”.
Lawyers who deal with private equity and venture capital players said the agreements between private equity and venture capitalist entities and companies are standard in form and such ambiguities are common, so this order would set to rest a lot of issues. “This order should benefit and bring certainty to those venture capital and private equity investors who have made investments in companies on similar terms and conditions,” said Vishal Gandhi of Gandhi & Associates.
According to law firm Nishith Desai Associates, “The order brings much relief to financial investors who have been uneasy about seeking such rights in listed companies for fear of triggering the requirement to make an open offer and also the implications of being regarded as persons in ‘control’ over the company”.
Sebi’s stand in the case stemmed from the fact that the shareholder agreement between Subhkam Ventures and MSK Projects gave the former rights to veto certain business decisions, appoint a nominee on the board of the company and quorum rights (meaning Subhkam nominee should be present at the board meetings).
SAT, in its judgement, has said the provisions of the veto rights do not give control to Subhkam Ventures. “On the contrary, it only enables (Subhkam) to safeguard its investment and interest of the shareholders in general,” it said.
Gandhi, however, cautioned that the order has still left some of the important issues unresolved. "The larger question is that if the investors are not in control and if the promoters are unable to take a decision due to the investors exercising their rights, then can one say that the promoters are in control? And, if neither the investors nor the promoters are in control, then who really is in control?" asked Gandhi.
The answer to this may be found by examining other related provisions of the shareholders agreement that specify the consequences of the exercise of a veto right by the investors, he adds.
"This ruling will help in the overall growth of the PE industry," says Vishal Tulsyan, director & CEO, Motilal Oswal Venture Capital Advisors. "One major concern was that rights of the PE player was getting diluted. This will no more be the case," he added.
Sebi has an option to approach the Supreme Court on the SAT ruling. However it is not yet known whether it will do so.
BSE pitches its new F&O contract for Budget play
Ashish Rukhaiyar / Mumbai January 23, 2010
The Union Budget is a few weeks away and entities across sectors are busy drafting their wishlists. Officials of the Bombay Stock Exchange (BSE), Asia’s oldest, are busy, too, but to get the exchange’s almost dormant equity derivatives segment in order by the Budget eve.
BSE officials are busy meeting market participants, especially derivatives strategists, to pitch for a product they launched around two months ago —mid-month expiry contracts. It hasn’t excited many so far, but BSE feels the Budget eve is a good time to push it. It says it will give investors a better opportunity to place directional bets based on expected Budget announcements.
For, the Budget is likely to be presented on February 26, Friday, the last working day of the month. The February contracts of the National Stock Exchange (NSE) will expire on the last Thursday of the month, the 25th. The next series (March) will begin only on the day of the Budget and expire on March 25. On the other hand, BSE’s March series expires on March 11.
The pricing formula for derivatives products factors in the expiry date. The nearer the expiry, the lesser is the cost of carry. This, in turn, brings down the overall price of the contract.
“BSE’s mid-month expiry contract is a cleaner instrument to express Budget sentiments without worrying about roll-week issues. A smaller carry component will cause less distortion in F&O (futures and options) pricing. This will also provide a lot of arbitrage opportunities,” said Sayee Srinivasan, who heads product strategy at BSE.
He is confident that the mid-month contracts will find takers, especially during the Budget. “For long, market players did not have any option. This is the first time they have a choice to take a shorter-term bet based on an important event like the Budget,” he said.
According to Srinivasan, if an investor is comfortable with liquidity on BSE, he will buy put options on BSE instead of NSE. “Both contracts provide protection against the same risk, but the product difference in the form of the expiry date will lead to different prices,” he said.
Derivatives strategists, however, are taking this with a pinch of salt. “Theoretically, this is possible. Practically, it will not happen,” said Siddarth Bhamre, fund manager (derivatives), Angel Broking.
He said the cost of carry of the BSE’s contract would be lower but absence of liquidity would push up the impact cost. BSE has been trying hard to gain a foothold in the derivatives segment, where NSE has a near monopoly. While in the recent past, BSE has been registering some trades on its F&O platform, it is nothing compared to its rival.
Interestingly, BSE officials are aware of the issue and agree that liquidity is the biggest block in their plan. “There is a lot of product differentiation. BSE contracts have a bigger tick size, mid-month expiry and active-passive pricing structure. Liquidity will take some time but will definitely be there,” said Srinivasan.
BSE recently increased the tick size for Sensex futures and options from Rs 0.05 to Rs 1. It also announced a rebate for traders placing passive orders.
The Union Budget is a few weeks away and entities across sectors are busy drafting their wishlists. Officials of the Bombay Stock Exchange (BSE), Asia’s oldest, are busy, too, but to get the exchange’s almost dormant equity derivatives segment in order by the Budget eve.
BSE officials are busy meeting market participants, especially derivatives strategists, to pitch for a product they launched around two months ago —mid-month expiry contracts. It hasn’t excited many so far, but BSE feels the Budget eve is a good time to push it. It says it will give investors a better opportunity to place directional bets based on expected Budget announcements.
For, the Budget is likely to be presented on February 26, Friday, the last working day of the month. The February contracts of the National Stock Exchange (NSE) will expire on the last Thursday of the month, the 25th. The next series (March) will begin only on the day of the Budget and expire on March 25. On the other hand, BSE’s March series expires on March 11.
The pricing formula for derivatives products factors in the expiry date. The nearer the expiry, the lesser is the cost of carry. This, in turn, brings down the overall price of the contract.
“BSE’s mid-month expiry contract is a cleaner instrument to express Budget sentiments without worrying about roll-week issues. A smaller carry component will cause less distortion in F&O (futures and options) pricing. This will also provide a lot of arbitrage opportunities,” said Sayee Srinivasan, who heads product strategy at BSE.
He is confident that the mid-month contracts will find takers, especially during the Budget. “For long, market players did not have any option. This is the first time they have a choice to take a shorter-term bet based on an important event like the Budget,” he said.
According to Srinivasan, if an investor is comfortable with liquidity on BSE, he will buy put options on BSE instead of NSE. “Both contracts provide protection against the same risk, but the product difference in the form of the expiry date will lead to different prices,” he said.
Derivatives strategists, however, are taking this with a pinch of salt. “Theoretically, this is possible. Practically, it will not happen,” said Siddarth Bhamre, fund manager (derivatives), Angel Broking.
He said the cost of carry of the BSE’s contract would be lower but absence of liquidity would push up the impact cost. BSE has been trying hard to gain a foothold in the derivatives segment, where NSE has a near monopoly. While in the recent past, BSE has been registering some trades on its F&O platform, it is nothing compared to its rival.
Interestingly, BSE officials are aware of the issue and agree that liquidity is the biggest block in their plan. “There is a lot of product differentiation. BSE contracts have a bigger tick size, mid-month expiry and active-passive pricing structure. Liquidity will take some time but will definitely be there,” said Srinivasan.
BSE recently increased the tick size for Sensex futures and options from Rs 0.05 to Rs 1. It also announced a rebate for traders placing passive orders.
Brokerage, MF top bosses go places
Ashish Rukhaiyar / Mumbai January 22, 2010
Leading brokerages and mutual fund (MF) houses are busy churning their portfolios, with the markets coming back to life. But they are also seeing churning at the top.
Along with the market, a host of top-level executives at these firms are going places, literally, and have started responding to the call from headhunters like never before. The fallout has been predictable. In the last few months, high profile names such as Keshav Sanghi, Devesh Kumar and Krishnamurthy Vijayan have moved.
Kumar, till recently the managing director of Centrum Stock Broking, is joining Fortune Financial Services, a listed capital market intermediary. He is tipped to be the group CEO and would be responsible for expanding Fortune’s broking and investment banking operations.
Vijayan, who quit JPMorgan Asset Management as its executive chairman, will join IDBI Mutual Fund. When contacted, he declined to comment. Sanghi will join Citi. He was the CEO of Reliance Equity International. He could not be contacted.
Similarly, Ajay Bhatia recently moved from Macquarie to Indiabulls Securities as the president of its capital markets division. Jayesh Parekh, who was the head of sales at Motilal Oswal Securities has joined Abu Dhabi Investment Authority as fund manager. Four senior people have also joined the investment banking team of Emkay Global Financial Services. Fund managers Promodh Gupta and Pankaj Tiberwal have quit Principal Mutual Fund.
Market players said that while people movement has been on for some time now, it is only recently that even the top brass has started moving. They said the upsurge in the market sentiment has been the primary reason that has led to increased business volume for most brokerages.
“This is a good time to step on the gas and we, too, have been doing selective hiring to strengthen our capital market side,” said Abhay Bhalerao, director, Equirus Capital, a boutique investment bank operating in the mid-market segment. Equirus recently expanded its top brass by hiring Abhijeet Biswas as director focusing on industrial, energy, health care and FMCG.
Ruth Singh, who heads human resources at Emkay Global Financial Services, said that the firm was also beefing up its capital market division. “We are expanding our ECM (equity capital market) team and have recently got senior people on board for our investment banking division,” said Singh.
The growth in business volume is also seen from the impressive profit growth registered by some of the listed brokerage entities. India Infoline’s third quarter consolidated net profit has almost doubled to Rs 59.51 crore when compared to the corresponding quarter of the previous financial year. Meanwhile, the benchmark Sensex has nearly doubled in the last one year, moving from 9,000 levels to the current 17,000.
Leading brokerages and mutual fund (MF) houses are busy churning their portfolios, with the markets coming back to life. But they are also seeing churning at the top.
Along with the market, a host of top-level executives at these firms are going places, literally, and have started responding to the call from headhunters like never before. The fallout has been predictable. In the last few months, high profile names such as Keshav Sanghi, Devesh Kumar and Krishnamurthy Vijayan have moved.
Kumar, till recently the managing director of Centrum Stock Broking, is joining Fortune Financial Services, a listed capital market intermediary. He is tipped to be the group CEO and would be responsible for expanding Fortune’s broking and investment banking operations.
Vijayan, who quit JPMorgan Asset Management as its executive chairman, will join IDBI Mutual Fund. When contacted, he declined to comment. Sanghi will join Citi. He was the CEO of Reliance Equity International. He could not be contacted.
Similarly, Ajay Bhatia recently moved from Macquarie to Indiabulls Securities as the president of its capital markets division. Jayesh Parekh, who was the head of sales at Motilal Oswal Securities has joined Abu Dhabi Investment Authority as fund manager. Four senior people have also joined the investment banking team of Emkay Global Financial Services. Fund managers Promodh Gupta and Pankaj Tiberwal have quit Principal Mutual Fund.
Market players said that while people movement has been on for some time now, it is only recently that even the top brass has started moving. They said the upsurge in the market sentiment has been the primary reason that has led to increased business volume for most brokerages.
“This is a good time to step on the gas and we, too, have been doing selective hiring to strengthen our capital market side,” said Abhay Bhalerao, director, Equirus Capital, a boutique investment bank operating in the mid-market segment. Equirus recently expanded its top brass by hiring Abhijeet Biswas as director focusing on industrial, energy, health care and FMCG.
Ruth Singh, who heads human resources at Emkay Global Financial Services, said that the firm was also beefing up its capital market division. “We are expanding our ECM (equity capital market) team and have recently got senior people on board for our investment banking division,” said Singh.
The growth in business volume is also seen from the impressive profit growth registered by some of the listed brokerage entities. India Infoline’s third quarter consolidated net profit has almost doubled to Rs 59.51 crore when compared to the corresponding quarter of the previous financial year. Meanwhile, the benchmark Sensex has nearly doubled in the last one year, moving from 9,000 levels to the current 17,000.
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