The BSE SME Exchange is a platform for Small and Medium-Sized Enterprises (SMEs) to raise equity capital for their growth and expansion. These small scale businesses are the backbone of the Indian economy providing employment to 70 million people through 30 million enterprises.
Last month, as part of the COVID-19 relief for the SME sector, BSE SME had halved the tangible asset requirement for companies planning to be listed to Rs 1.5 crore.
Further, of the mandatory three years of operations, a company will now be eligible to list if it has combined positive cash accruals (earnings before depreciation and tax) in any one year. Earlier, the requirement was to show positive cash accruals for all three years.
Both BSE-SME and NSE-Emerge have also cut the annual listing fee by 25 percent to help more SMEs list. BSE SME has some 320 companies listed on its platform. SMEs that are Limited Companies can apply to be listed on the exchange.
These SMEs looking to list will have to comply with certain criteria on net worth (at least Rs 1 crore), tangible assets, having a website, etc. The company can seek consultation and appoint a Merchant Banker in an advisory capacity to be listed on the BSE SME exchange. The appointed merchant banker will conduct due diligence, help with documentation on all regulatory approvals and IPO.