Finance

SME IPO Listing Platforms in India

NSE Emerge NSE EMERGE is the National Stock Exchange of India’s initiative for small and medium-sized enterprises and startup companies from India. NSE EMERGE was launched in 2012 and since then have been working towards providing a viable and sustainable option for the smaller companies to raise equity capital and provide an attractive alternate investment opportunity to the informed investor community. These companies can get listed on NSE without Initial public offering (IPO). This platform helps SMEs and Startups to connect with investors for funding.

BSE SME BSE Ltd had launched the BSE SME Platform in 2012 as per the rules and regulations laid down by SEBI. BSE SME Platform offers an entrepreneur and investor friendly environment, which enables the listing of SMEs from the unorganized sector scattered throughout India, into a regulated and organized. It provides a regulated plaform for SMEs to raise funds from the public

BSE SME will provide immense opportunities to the following market participants.

Entrepreneurs -To raise equity capital for growth and expansion of SMEs in a cost effective manner.

Investors -Opportunities to identify and invest in good companies at an early stage and Exit Route.

   

NSE Emerge – Criteria For Listing

Parameter Criteria for listing – SMEs Criteria for listing – Technology Startups*
1. Incorporation Incorporated under Companies Act 1956/2013 Incorporated under Companies Act 1956/2013
2. Post Issue Paid-up Capital Post issue paid up capital (face value)<= INR 25 cr. Post issue paid up capital (face value)<= INR 25 cr.
3.Track Record •Positive EBITDA in at least 2 out of the last 3 financial years preceding the application •Positive Net Worth • Annual Revenue >= INR 10 cr. • Annual growth (users/revenue/customer base) >= 20% • Positive Net Worth
4.Shareholding conditions No specific shareholding condition • At least 10% of its pre-issue capital to be held by qualified institutional buyer(s) (QIB) as on the date of filing of draft offer document. • At least 10% of its pre-issue capital should be held by a member of the angel investor network or Private Equity Firms and Such angel investor network or Private Equity should have had an Investment in the start-up ecosystem in 25 or more start-ups their aggregate investment is more than 50 crores as on the date of filing of draft offer document
5. Other Conditions • The applicant company has not been referred to erstwhile Board for Industrial and Financial Reconstruction (BIFR) • No proceedings have been admitted under Insolvency and Bankruptcy Code against the issuer and Promoting companies • The company has not received any winding up petition admitted by a NCLT / Court. • No material regulatory or disciplinary action by a stock exchange or regulatory authority in the past three years against the applicant company. • The applicant Company has not been referred to erstwhile Board for Industrial and Financial Reconstruction (BIFR) • No petition for winding up is admitted by a Court of competent jurisdiction against the applicant Company. • No material regulatory or disciplinary action by a stock exchange or regulatory authority in the past three years against the applicant company.
6. Disclosure Requirements • Any material regulatory or disciplinary action  by any authority in past one year • Any defaults in respect of payments • Litigation against the promoters • Track record of directors with respect to any cases filed or ongoing investigations , etc. • Any material regulatory or disciplinary action  by any authority in past one year • Any defaults in respect of payments • Litigation against the promoters • Track record of directors with respect to any cases filed or ongoing investigations , etc.

BSE SME – Criteria For Listing

Parameter Criteria For Listing – SMEs
1.Incorporation Incorporated under Companies Act 1956/2013
2. Post Issue Paid-up Capital Post issue paid up capital (face value)<= INR 25 cr.
3. Track Record •Positive Net Worth •Net Tangible Assets should be INR 1.5 crores •Company must have distributable profits for at least two out of the last three financial years, excluding extraordinary income. •The company or the partnership/proprietorship/LLP Firm or the rm which have been converted into the company should have a combined track record of at least 3 years. OR •In case it has not completed its operation for three years then the company/ partnership/ proprietorship/ LLP Firm should have been funded by Banks or nancial institutions or Central or state government or the group company should be listed for at least two years either on the main board or SME board of the Exchange.
4. Other Conditions •It is mandatory for a company to have a website. •It is mandatory for the company to facilitate trading in demat securities and enter into an agreement with both the depositories. •There should not be any change in the promoters of the company in preceding one year from date of filing the application to BSE for listing under SME segment
5. Disclousre Requirements • A certificate from the Applicant Company / Promoting Company stating that the Company has not been referred to the Board for Industrial and Financial Reconstruction (BIFR). •There is no winding up petition against the company, which has been admitted by the court or a liquidator has not been appointed.

NSE Emerge vs BSE SME – Differences

Some key differences in listing criteria of both SME Indices :

Parameter NSC Emerge BSE SME
1. Track Record Company should have Positive EBITDA in at least 2 out of the last 3 financial years preceding the application No such requirement for BSE SME Companies. However, companies are required to have net tangible assets of INR 1.5 crores
2. Website It is not mandatory for company to have a website It is mandatory for a company to have a website
3. Change in Promoters There is no specific regulation with respect to change in promoters No change in promoters in the preceding one year from the date of listing application
   


The content of this document is for information purpose only and does not constitute advice or a legal opinion. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer to relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc. before acting on the basis of this write up. The possibility of other views on the subject matter cannot be ruled out. By the use of the said information, you agree that the Treelife is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof.

Last Updated on: 8th December 2023, 06:11 pm


Disclaimer:

The content of this article is for information purpose only and does not constitute advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer to relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc. before acting on the basis of the above write up. The possibility of other views on the subject matter cannot be ruled out. By the use of the said information, you agree that the Author / Treelife is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof.

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