NSE Working Towards Cutting Time Taken For Share Transfers, Says MD

The executive noted that the exchange has already worked on reducing the transfer time to a significant extent, however, certain technical factors remain

According to SEBI norms, market infrastructure entities like stock exchanges need to ensure that shareholders, directors, and major management executives associated with the entity are ‘fit and proper’ persons.

The National Stock Exchange is working towards lowering the time taken for transferring shares in the buyer’s name, which currently takes as long as four to five months sometimes, the NSE MD, Ashish Kumar Chauhan, said in a post-earnings conference call. 

The executive noted that the exchange has already worked on reducing the transfer time to a significant extent, however, certain technical factors remain and stressed that the accountability for the delay doesn’t always lie with the NSE, reported Moneycontrol.

Commenting about the share transfer process, Chauhan noted, “Because we are not listed, our process of transferring shares is very different from other listed exchanges. We have to do a search about the fit and properness of every potential shareholder who sends us this certificate for transfer and that takes time.”

According to SEBI norms, market infrastructure entities like stock exchanges need to ensure that shareholders, directors, and major management executives associated with the entity are ‘fit and proper’ persons. This criteria is evaluated based on financial integrity, reputation, honesty, no court conviction or restraining orders, etc.

Replying about the proposed initial public offering (IPO) of the NSE, Chauhan said that there is no update on the matter yet, as the exchange is awaiting approval from the Securities and Exchange Board of India (SEBI). “We do not know when SEBI will be giving us a signal to go for IPO. So, currently, we have no update to give you on that,” he noted.

Notably, NSE shares have attracted interest from several wealth management firms and high net worth individuals in the last few years. About 8,700 individual investors cumulatively hold a stake of over 12 per cent in the exchange, coming up to about 65 million shares, as of December end 2023. Official data on the exchange website revealed that the shares were traded in the price range of Rs 2,850 to Rs 3,600 in January.