1. Availability of Financing Options for SMEs, Listing and Operations of SME Exchange

2. 2 BSE – Home to SME Companies

3. 3 Financing Options for SMEs Debt Financing Servicing Obligations Banks and Financial Institutions Equity Financing Medium Term Venture Capital and Private Equity Equity Financing Long Term Public

4. 4 Regulatory Framework Whether there existed a regulatory framework that allowed SME companies to access public?

5. 5 Different Packaging  No SEBI filing and vetting process, but only with the Exchanges – WOW !!!  Diluted regulatory requirement – u No SEBI eligibility criteria u No IPO grading u Lower no. of minimum allottees u Lower continuing listing requirements  Opportunity available for migrating to main board

6. 6 Providing Safeguards  Participation only by investors willing to invest minimum of Rs. 1 lac  Mandatory market making for a period of 3 years from date of listing  100% underwriting

7. 7 BSE Eligibility criteria  Net Tangible Asset of atleast Rs. 1 crore  Net worth of atleast Rs. 1 crore  Minimum post issue paid up capital of Rs. 1 crore  Track record of distributable profits in 2 out of 3 preceding financial years OR Minimum Net worth of Rs. 3 crores

8. 8 BSE’s Endeavour to encourage this segment  Extensive awareness programs across India with various industry chambers, professional bodies etc.  Dedicated website www.bsesme.com  Research report coverage on companies listed on SME  Lower costs of listing

9. 9 SME’s apprehensions  Lack of familiarity of capital markets  Family owned structures and fear of losing control  Costs and fulfillment of regulatory requirements during and after IPO  Lack of investors and existing uncertainties surrounding success of offering after paying initial costs

10. 10 Statistics DetailsSME Market Number of Listed Companies8 Market Capitalization (Rs. Crores)171.02 Daily Average Turnover for Sept 2012 (Rs Crores)0.59 SectorsNumber of issuers Market capitalization (Rs Cr – Sept 2012) Finance470.54 Capital Goods152.02 Healthcare125.50 Information Technology114.97 Miscellaneous17.99

11. 11 Issue Costs as per offer document Issue CostsRs. In lacs% of issue cost Payment to Merchant Banker including fees and reimbursements of selling commissions brokerages, payment to other intermediaries such as legal advisors, registrars, bankers etc and out of pocket expenses 36.9863.96 Advertising and marketing expenses5.008.65 Printing and Stationery (incl. distribution)7.5012.97 Other (Regulatory fees and other expenses) 8.3414.43 Total57.83100.00

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