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How to List Your Company in the Indian Stock Market?
If you wish to list your own company in the Indian stock market or just wonder how many companies can be listed, you are at the right place.
Published on 03 July 2023
To begin with, there is no particular limit to the number of companies listed on the stock market. With every passing year, the number of listed companies is increasing at a high rate. After the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) introduced dedicated platforms for Small & Medium Enterprises, the number of companies opting to get listed has been increasingly slowly but steadily . To know more interesting facts about the number of companies listed in the Indian stock market, you can continue reading the blog.
Number of Listed Companies in the Stock Market
In India, there are two types of stock exchanges: the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). Since both exchanges in India provide authentic platforms for companies to raise capital and investors to trade securities, these have become the quintessential stock exchanges in India. Some companies prefer to be listed in one exchange, while others choose to be listed in both exchanges for better visibility. Thus, the number of listed companies in the stock market tends to vary from time to time
Listed Companies in the Bombay Stock Exchange (BSE)
The Bombay Stock Exchange, or BSE Limited, is the oldest in Asia, dating back to its establishment in 1875. It is in Mumbai, India. BSE is considered one of the largest stock exchanges in the world. A diverse range of companies are listed across various sectors and segments. Companies need to fulfill various listing requirements to list their shares on the exchange, such as minimum market capitalization and profitability track record. BSE is an important financial institution in India and operates under the regulatory framework of the Securities and Exchange Board of India (SEBI).
As of January 13, 2023, the number of listed companies in the stock market, mainly in the BSE, was approximately 5. The market capitalization of all these listed companies was around Rs 2,82,13,564 crores. The list includes companies & excludes mutual funds, Exchange Traded Funds (ETFs), shares with Differential Voting Rights (DVRs), REITs, InVITs, and companies listed in the SME platform of BSE.
Listed Companies in the National Stock Exchange (NSE)
The National Stock Exchange was established in 1992 and is India's first electronic stock exchange. It has introduced an automated screen-based trading system called National Exchange for Automated Trading (NEAT). It enables transparent and efficient trading of various financial products, such as equities, derivatives, Exchange Traded Funds (ETFs), and debt instruments. The stock exchange emphasizes investor protection and has implemented various measures to enhance transparency in trading in the Indian stock market, risk management, and safeguard the investor's interests.
As of December 31, 2022, around 2,113 companies have been listed on the stock exchange. The total market capitalization of the listed companies was approximately Rs 2,75,67,268. The list excludes REITs, InVITs, mutual funds, shares with Differential Voting Rights (DVRs), and companies in the SME platform of NSE.
Ways to List a Company in the Indian Stock Market
If you are wondering 'how to list a company in the stock market,' you must know that it involves a systematic process and regulatory requirements should be met. Let us look at the general steps to be followed in listing a company in the Indian stock market.
1. Eligibility
You must ensure that you comply with the eligibility requirements set by the stock exchange and regulatory authorities. Some of these requirements include fulfilling financial benchmarks, minimum net worth, profitability track record, and corporate governance norms.
2. Appoint Intermediaries
While listing your company, you may be assisted by professionals such as merchant bankers, auditors, and legal advisors. You may need to appoint such intermediaries to prepare the necessary documents and ensure regulatory compliance.
3. Verify Financial Statements
To build investor confidence, conducting a thorough due diligence exercise is crucial. You may need to verify financial statements of the company and ensure their authenticity, and you may need to examine and verify the other aspects of the company's operations.
4. Drafting of Prospectus
The prospectus serves as an invitation to investors to trade. It must be drafted carefully and comply with regulatory guidelines. You must include detailed information about the company, operations, risk factors, financials, and prospects.
5.Approval from SEBI
After drafting your prospectus, you can submit it to SEBI for review and approval.
6. Appointment of Registrars
If you get the approval, you may need to appoint a registrar and a share transfer agent who can handle the company's registrar, IPO process, and shareholder services.
7. Book Building/IPO
If you plan to raise funds for your company through an Initial Public Offering (IPO), it is essential to conduct the book-building process. You may have to set up a price band for the shares and invite bids from investors, and it is required to determine the final offer price based on the demand.
8. Listing & Trading
The company can list its shares on the preferred stock exchange. The shares are allocated to investors, and trading in the Indian stock market begins.
Summing Up
There are many listed companies in the stock market. The number of companies listed in the BSE and NSE varies as some prefer to list their companies in both, whereas others choose only one stock exchange. So, list your own company now by following a proper procedure & guidelines. If you are a trading and investing enthusiast, look for an authentic platform and enjoy trading.
