Sundararaman Ramamurthy, CEO and Managing Director of BSE
| Photo Credit:
KSL
The country’s oldest exchange, BSE, is not engaging in any price or competition wars, but is rather striving for a level playing field and deepening markets.
“We are not into price or competition wars,” said Sundararaman Ramamurthy, CEO and managing director of BSE, in an interview with businessline. “Our idea is not a specific number of market share, but a level playing field. Where market participants will decide which exchange is giving them benefit, and they trade.”
“We are facing headwinds with having a more level playing field between exchanges and are working very hard in these areas. The first area is best price execution. While the regulators have clearly directed exchanges that there should be best price execution, some of the brokers still have software which is not providing a level playing field. Because of this, the customers do not get the price advantage of a better exchange,” said Sundararaman Ramamurthy, CEO and Managing Director of BSE, in an interview with businessline.
“The second area is the issuance of a common contract note, which has somehow been dragging for a while. Hopefully, it should be over by the end of April. These two should provide a much more level playing field,” he added.
Meanwhile, BSE is focusing on building better internal efficiencies and introducing alternative products to expand the breadth of the market. This approach, Ramamurthy said, would eventually drive volumes and profitability.
Global competition
Ramamurthy also said that in today’s interconnected financial world, competition isn’t confined to local exchanges. “Our feeling is that competitions are not local, they are global,” he said. “There is clear mobility of capital across jurisdictions, talent across jurisdictions. There is no reason for anybody to stick to any country and any stock exchange.”
“There is room for more than two exchanges in this country,” he said. “There can be more spaces, because everybody will bring their unique selling point.”
The exchange’s focus is now on customer delight, after having worked towards making BSE vibrant and adding more brokers, foreign portfolio investors (FPIs), and data centers in the past two years.
Regulatory changes
The BSE chief welcomed SEBI’s recent six-point tightening of the futures and options (F&O) market, as it had the desired effect of curbing the heightened activity, which was drawing investors who did not understand risk.
On SEBI’s proposed shift to a futures-equivalent method of calculating open interest in equity derivatives, Ramamurthy said the industry broadly supports the idea. However, questions remain on “how it will be measured, disseminated, at what frequency, the number against which it will be monitored, and any actions emanating for any outliers,” he said.
On diversification in clearing corporations, he flagged possible complications around shareholding, financial independence, and fixed capital requirements could “either make life easier or difficult,” depending on the final implementation.
Published on April 21, 2025
