Ajay Thakur, with 20+ years in India’s capital markets, launched BSE’s SME Platform, listing 228 companies and raising Rs. 1923.81 crores in funding.

Ajay Thakur has over two decades of experience in India’s capital markets, having worked with the country’s largest custodian and stock exchange. Starting his career in 1994 with Stock Holding Corporation Ltd as Senior Executive – Market Operations, he moved to Vadodara Stock Exchange and played key roles in market operations and setting up the depository. In 1996, he joined BSE Ltd as Head of Arbitration and Business Development, where he developed the derivatives segment and expanded regional centers.

Currently, as Head of BSE SME, he launched the SME Platform on March 13, 2012, making BSE the first exchange to do so. The platform has been recognized by the Asian Development Bank and IOSCO for its cost-effectiveness and success in promoting SME listings. Under his leadership, the platform has listed 228 companies from 29 sectors, raising Rs. 1923.81 crores with a market capitalization of Rs. 24,167.49 crores.

Ajay Thakur, Head of SME at BSE, commends Bondada Engineering Limited’s IPO for its impressive debut at a 99.49% premium on the BSE SME platform. The shares closed at Rs 149.62, with the first day’s turnover reaching Rs 27.50 crore.

Ajay Thakur was awarded the “Pillar of Hindustani Society” at the annual Trans Asian Chamber of Commerce and Industry conference held at the Royal Yacht Club, Mumbai, in recognition of his significant contributions to the growth and development of SMEs

EAP Consulting Services LLP and BSE SME hosted a session led by Mr. Ajay Kumar Thakur, highlighting the benefits of listing SMEs on the BSE SME Platform. The event focused on enhancing access to equity capital, increasing company credibility, and navigating listing requirements, benefiting a diverse range of companies in Navi Mumbai.

EAP Consulting Services LLP (EAP) recently hosted a session with BSE SME and Start-up at their Navi Mumbai office, aimed at facilitating the listing of small and medium enterprises (SMEs) and start-ups. The session, led by Mr. Ajay Kumar Thakur, Head of SME & Startup at BSE Limited, highlighted the benefits of the BSE SME Platform. This platform offers a regulated environment for SMEs from the unorganized sector, providing access to equity capital and enhanced growth opportunities. Mr. Thakur emphasized the platform’s role in boosting company credibility, liquidity, and public awareness, while also facilitating compliance with listing requirements. The event, attended by prominent companies across various sectors, underscored EAP’s commitment to helping SMEs navigate the listing process and prepare for future growth. EAP’s efforts, appreciated by Mr. Thakur, aim to foster greater investment and development in the SME sector.

Ajay Thakur, Head of BSE SME & Startups, highlights BSE’s new collaboration with Federal Bank to boost SME and startup listings. This partnership aims to utilize Federal Bank’s extensive network to educate and facilitate equity financing, fostering growth and opportunities across India’s SME and startup sectors.

Mr. Ajay Thakur, Head of BSE SME & Startups, unveils BSE’s partnership with the Chhattisgarh government. This initiative aims to enhance SME listings, helping businesses raise equity funds, unlock value, and drive employment and economic growth in the state.

Head of SME & Start-Up at BSE, reveals a new partnership with Onsurity Technologies to enhance affordable healthcare options and promote SME listings. This collaboration will provide SMEs with exclusive healthcare benefits and guidance on listing opportunities, addressing essential post-pandemic needs.

Mr. Ajay Thakur, Head of BSE-SME & Startups at BSE India, shares insights on the evolution of the SME and Startup platforms, highlighting their role in providing new opportunities for smaller businesses on the Bombay Stock Exchange.

Mr. Ajay Thakur explained that the SME and Startup platforms were created in response to the need for stock exchanges tailored to smaller businesses. The goal was to provide a pathway for SMEs to list with more manageable eligibility and compliance requirements, eventually enabling them to migrate to the main board as they grow. SEBI introduced guidelines for SME exchanges in 2010, and BSE launched its platform on March 13, 2012. At that time, financial literacy about equity funding was low, and it took about three years to persuade stakeholders to support the new platform. Currently, there are 354 SMEs listed on BSE, which have raised Rs 3750 crore and achieved a market capitalization of Rs 40,500 crore. Although the size of listed SMEs is still relatively small, Mr. Ajay Thakur is optimistic about future growth.

The SME listing criteria are kept simple to encourage participation. Companies must have a paid-up capital below Rs 25 crore, be in existence for at least three years with operating profit in one year, and have net tangible assets of Rs 1.5 crore. Mr. Ajay Thakur noted that fears about compliance have been addressed by keeping the norms straightforward. Approximately 33% of listed SMEs have migrated to the main board, indicating that the compliance process is manageable and beneficial.

Regarding startups, Mr. Ajay Thakur mentioned that BSE launched a platform for them in December 2018, which became operational in August 2019. To date, 12 technology startups have listed, with another 5-7 in the pipeline. Startups need to be operational for at least two years with a positive net worth, or if not registered, they must have a minimum paid-up capital of Rs 1 crore. This platform helps startups raise funds even if they do not receive angel, VC, or private equity funding.

To encourage listings, BSE engages with startups and SMEs by creating awareness about the benefits of public listing and connecting them with professionals such as merchant bankers and chartered accountants. The platform is open to various types of investors, including private equity, venture capital, retail investors, and high-net-worth individuals. Startups and SMEs that list on BSE can later migrate to the main board if their paid-up capital exceeds Rs 10 crore and their market capitalization surpasses Rs 25 crore, provided they receive approval from two-thirds of non-promoters. This migration allows them to compete on equal footing with larger companies.

Key requests from startups include funding and liquidity for investors. Listed startups benefit from higher visibility, access to pure equity funds, stronger balance sheets, liquid ESOPs, and flexibility for investors to enter and exit as needed.

Mr. Ajay Thakur highlighted that BSE is working to deepen and broaden the capital market, with over eight crore investors now participating. The exchange is continually creating awareness through various programs to support funding for SMEs and startups.

Challenges for startups seeking public listing include high expectations and fears about compliance, which can shift focus from business operations to managing regulatory requirements. Mr. Ajay Thakur acknowledged these challenges and emphasized BSE’s ongoing efforts to address them and enhance financial literacy among promoters. He believes that the platform provides significant opportunities for wealth creation and business growth.

Ajay Thakur discusses the migration process for MSMEs transitioning from BSE SME and NSE Emerge platforms to the mainboard. He addresses the opportunities, challenges, and requirements for companies seeking to enhance their visibility, credibility, and growth potential by moving to a larger exchange

In an exclusive discussion between Faiz Askari, Founder of SMEStreet, and Ajay Thakur, Head of BSE-SME & Startups at BSE India, they explored the evolving landscape of SME fundraising and recent trends.

Faiz Askari began by inquiring about the current level of awareness among SMEs regarding stock listings as a fundraising option and Mr. Thakur’s observations on SMEs navigating this process.

Mr. Ajay Thakur emphasized the crucial role of MSMEs (Micro, Small, and Medium Enterprises) in the Indian economy, particularly in tier 2 and tier 3 cities. He explained that the idea of creating a platform specifically for SMEs to raise funds through stock listings began in 2010. Following SEBI’s introduction of the SME exchange framework, BSE launched its SME platform in March 2012. Since its inception, over 330 SMEs have been listed on the BSE platform, raising Rs 3340 crore and achieving a market capitalization of over 33,000 crores across 22 different sectors.

Mr. Thakur addressed the impact of the COVID-19 pandemic, noting that despite the challenges, there have been 10 new listings in the past two months. He expects continued growth in SME listings as more businesses recognize the opportunities available through stock market participation.

Recent adjustments to SME listing norms have been made to encourage greater participation. Previously, a very small percentage of MSMEs were part of the formal sector. The new guidelines now allow any SME with an operating profit in at least one of the last three years and net tangible assets of Rs 1.5 crore to apply for listing. These relaxed norms are intended to make the listing process more accessible and attract more SMEs to the formal sector.

Mr. Thakur outlined several benefits for SMEs listed on BSE SME:

• 1. Fundraising:SMEs can raise funds through equity dilution for capital expenditures
  or working capital needs.
• 2. Company Strength: Equity infusion helps SMEs strengthen their financial position,
  reduce debt costs, and support growth.
• 3. Credibility: Listing increases transparency and enhances the credibility of the
  promoters, leading to greater trust.
• 4. Visibility: Listing on the exchange enhances the company’s visibility both
  domestically and internationally.
• 5. Equity as Currency: Listed equity can be used for further fundraising and can
  serve as collateral for loans if promoters wish to avoid dilution.
• 6. Employee Benefits: SMEs can offer stock options (ESOPs) to reward employees.
• 7. Value Realization: Listing helps reveal the company’s value by making it publicly
  traded.

In response to a question about the impact of the revised definition of MSMEs on fundraising, Mr. Thakur stated that the increased investment limit for plant and machinery to Rs 20 crores will help more companies qualify as MSMEs. This change is expected to facilitate connections with banks and capital markets, encouraging more entrepreneurs to consider listing their companies.

The conversation underscored the growing opportunities for SMEs in the stock market, driven by relaxed listing norms and supportive frameworks aimed at enhancing fundraising and business growth.