Indian bourse operator NSE aims for listing in second half of 2018

Vikram Limaye, the new chief executive of National Stock Exchange, the delayed time frame was dictated by the need to address a regulatory probe into whether NSE employees had provided unfair trading access to select brokers. (Reuters)
Updated 29 September 2017

Indian bourse operator NSE aims for listing in second half of 2018

MUMBAI: The new chief executive of India’s National Stock Exchange (NSE) said he does not expect the bourse’s eagerly awaited listing to take place until the second half of 2018.
The exchange had originally planned to go public this year, in what could be one of India’s biggest ever IPOs.
Vikram Limaye, who took the helm in July after heading infrastructure lender IDFC, said the delayed time frame was dictated by the need to address a regulatory probe into whether NSE employees had provided unfair trading access to select brokers.
NSE has applied to the Securities and Exchange Board of India (SEBI), the market regulator, to settle the issue, which has cast a shadow over the initial public offering that some market participants have said could raise up to $1.5 billion.
Limaye, in an interview with Reuters, said the probe was ongoing and the exchange was awaiting a decision from SEBI on its settlement offer but had yet to hear from the regulator.
At the same time, consultant EY, one of the agencies appointed to look into the case, could submit its report within two weeks, he said. That report would then be presented to the NSE board and to SEBI, which will decide on the final action.
NSE will re-submit its application for an IPO after it has clarity from SEBI.
“I would certainly like to do the IPO as soon as possible but it’s not up to me,” Limaye said. A listing by March would be “very difficult”, and a more realistic time frame would be the second half of next year, he said.
NSE had initially applied for an IPO in December 2016, intending to list by the first half of this year. NSE Chairman Ashok Chawla, in interviews with local media earlier this year, pushed back the deadline to December and later until March.
The repeated delays reflect the difficulties NSE has faced in getting SEBI approval after the exchange disclosed that some brokers had been provided early access to its co-location servers. The servers are placed at the site of exchanges to speed up algorithmic trading.
The exchange appointed Deloitte to look into the case, and the consultant had discovered some brokers had exploited technical loopholes in the NSE’s trading systems to gain first-access to the servers.
However, Deloitte was unable to prove whether NSE employees had colluded with brokers to provide early access.
Sources had told Reuters the NSE’s disclosure contributed to the departure of former CEO Chitra Ramkrishna. Other executives at NSE have since departed, including co-founder Ravi Narain
NSE’s smaller rival BSE listed in February, and has seen its stock gain more than a fifth as equity markets have hit record highs amid strong retail inflows and an IPO boom.
Limaye, 51, said he did not expect the delay in the IPO timeline to affect valuations as their business and market share remained strong.
Instead, he said it was important the exchange resolve the probe and alter an outside perception that NSE is insular and opaque.
As part of his priorities, Limaye, a former accountant and banker who has worked at firms like Ernst & Young and Citibank, said he was making it a priority to open communication with stakeholders and improve corporate governance standards.
“We have obviously looked at which areas need to be reviewed, where controls need to be strengthened,” Limaye said.
“I’m building all the bridges that are required in order to make sure that stakeholder relationships are back to where they need to be.”

World leaders prepare for Davos amid gloomy forecasts

Klaus Schwab, founder and executive chairman of the World Economic Forum. (AFP)
Updated 16 January 2019

World leaders prepare for Davos amid gloomy forecasts

  • Delegates to annual forum to include presidents of Iraq and Afghanistan

DUBAI: World leaders are preparing to head to the annual meeting of the World Economic Forum (WEF) in Davos, Switzerland, amid the riskiest global backdrop in years, according to a report from the event organizer itself.

As the WEF announced the names of some of the 3,000 participants set to attend the meeting and details of the four-day agenda, it also published a gloomy outlook on international politics, economics, the environment and technology. 

Rising geopolitical and geo-economic tensions are the most urgent risks in 2019, with 90 percent of experts surveyed expecting further economic confrontation between major powers, according to the WEF’s annual Global Risks Report.

“The world’s ability to foster collective action in the face of urgent major crises has reached crisis levels, with worsening international relations hindering action across a growing array of serious challenges. Meanwhile, a darkening economic outlook, in part caused by geopolitical tensions, looks set to further reduce the potential for international cooperation in 2019,” it added.

Although political and economic worries were top of the immediate agenda for the 1,000 experts polled by the WEF, the environment and climate change are also a cause for concern, as are “rapidly evolving” cyber and technological threats, the WEF said.

Børge Brende, the WEF president, said: “With global trade and economic growth at risk in 2019, there is a more urgent need than ever to renew the architecture of international cooperation. We simply do not have the gunpowder to deal with the kind of slowdown that current dynamics might lead us toward. What we need now is coordinated, concerted action to sustain growth and to tackle the grave threats facing our world today.”

The leaders who will begin to arrive in Switzerland in the next week include Shinzo Abe, prime minister of Japan; Jair Bolsonaro, president of Brazil; Angela Merkel, chancellor of Germany; and Wang Qishan, vice president of China.

With US President Donald Trump pulling out of the meeting to deal with the partial government shutdown, the American delegation is expected to be led by Steven Mnuchin, Treasury secretary, and Mike Pompeo, secretary of state.

The Middle East is well represented at the meeting, with at least nine heads of state or government from the region, including Palestine, Iraq, Egypt, Jordan and Lebanon. Saudi Arabia will be represented by a team of senior policymakers and business leaders.

The risk report will give them all food for thought in the Alpine resort.

Asking whether the world is “sleepwalking into a crisis,” the report responded: “Global risks are intensifying but the collective will to tackle them appears to be lacking. Instead, divisions are hardening. The world’s move into a new phase of strongly state-centered politics continued throughout 2018.

“The idea of ‘taking back control’ — whether domestically from political rivals or externally from multilateral or supranational organizations — resonates across many countries and many issues.”

Macro-economic risks have moved into sharper focus, it said. 

“Financial market volatility increased and the headwinds facing the global economy intensified. The rate of global growth appears to have peaked,” the report said, pointing to a slowdown in growth forecasts for China as well as high levels of global debt — at 225 percent of global gross domestic product (GDP), significantly higher than before the financial crisis 10 years ago.

Raising the prospect of a “climate catastrophe,” the report said extreme weather, which many experts attribute to rapid climate change, was a risk of great concern. “The results of climate inaction are becoming increasingly clear,’ the WEF said.

Of the 3,000 participants at Davos, which runs from Jan. 22 to 25, around 78 percent are men, with an average age of 54. 

The oldest will be the 92-year-old British broadcaster David Attenborough, the youngest 16-year-old South African wildlife photographer Skye Meaker.