NSE CEO Discusses Key Financial Developments and Challenges

In a recent discussion, National Stock Exchange (NSE) Managing Director and CEO Ashish Kumar Chauhan shed light on the increased Securities Transaction Tax (STT) introduced in the FY27 budget. Chauhan noted that the hike, particularly affecting equity futures and options, aims to reduce excessive market speculation. He remarked that while daily traders might be impacted, the government's main objective is to curb over-speculation.

Addressing technical issues during volatile markets, Chauhan noted the complexity of global IT systems, citing comparable experiences with widespread digital services. He reassured that Indian stock exchanges are making significant investments to ensure resilience, though acknowledged that no system is entirely foolproof. He emphasized the need for vigilance to prevent technical glitches.

On SME IPOs, Chauhan highlighted the NSE's new framework focusing on free cash flow to ensure high-quality market entries. This metric was 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.

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

Finally, regarding the NSE IPO, Chauhan outlined a timeline, following the receipt of the No Objection Certificate, which places the process completion around late 2023. He reassured stakeholders that preparations are underway, with an anticipated eight to nine months needed to finalize all regulatory and documentation steps.