Companies have been making a beeline for delisting from the regional stock exchanges over the last three weeks following the withdrawal of the mandatory listing norms.
Kotak Mahindra Bank indicated its decision to delist its shares from regional exchanges on April 23, a day after the finance minister announced withdrawal of circulars issued in 1977 and 1985 related to compulsory listing.
Companies which followed suit included Bajaj Auto, Ashok Leyland, National Aluminium, Indian Rayon, Grasim Industries, Birla VXL, KEC International, Narmada Cement, LCC Infotech, CMC, Bajaj Auto Finance, Chemplast, Pantaloon Retail (India) and Ginni Filaments.
The companies are getting themselves delisted from almost all bourses barring the Bombay and the National Stock Exchange.
Firms that have delisted from the BSE included Narmada Cement and Ginni Filaments. Bourses at Kolkata, Delhi and Ahmedabad were the most affected. These receive several delisting intimations every day.
These bourses had received half of the Rs 50 crore (Rs 500 million) combined listing charges in 2002-03. This fee was payable to bourses by companies for listing.
Officials of a handful of companies said the firms which were yet to announce delisting decisions would join the bandwagon in August-September.
"The delisting resolution is to be ratified by shareholders. Most companies will place a resolution pertaining to the delisting at their annual general meetings. By the end of the third quarter, all AGMs will be over and so will be the companies' relationships with regional bourses," said a company secretary.
The Pratip Kar committee on delisting recommended that companies be allowed to decide where to list.
Following this, the finance ministry informed the stock exchanges that it was withdrawing the mandatory listing of companies with regional exchanges.
A Sebi official said the Central Listing Authority (CLA) would be "established" with effect from such date as might be specified by the market regulator. The date of establishment is to be specified by Sebi shortly.
"It is clarified that till such time that Sebi specifies the date of establishment of CLA, all listing applications shall be made to stock exchanges directly and the bourses shall deal with such listing applications as also the pending listing applications as hitherto following the current rules and procedures", he said.
