Ashwani Bhatia, Sebi’s whole-time member on Friday said that chartered accountants should practice more diligence when auditing companies listed on the SME (Small and medium-sized enterprises)exchange platforms.
Speaking at an industry event for CAs, the banker-turned-capital markets regulator said that it is important to closely monitor listed SMEs because these companies have the potential to grow and eventually become part of the main board in the future.
“We have seen some challenges there (SME platform). We request you to be extra careful as far as SME IPOs and fundraising are concerned because these small companies will become much, much bigger going forward,” Bhatia added.
He expressed his satisfaction with the growth of the SME platform, as such entities have raised Rs 14,000 crore has been raised by such entities, with Rs 6,000 crore being raised in FY24 alone. Comparing CA’s to doctors he further added that they act as first-level regulators by ensuring orderly conduct of companies.
Bhatia also appreciated SBI’s past chairman R K Talwar and mentioned that the strength of character of the leader helps create “great institutions”. According to him many Sebi investigations and orders taking over a year to complete, would have not been needed, had at all the CAs been more careful.
Previously in March, Sebi chairperson Madhabi Puri Buch had also raised concerns revolving around “price manipulation” in the SME platform listings and trading, asking investors to be cautious.
He also said that, despite the regulator introducing regulations to facilitate delisting, the outcome has been quite the opposite, with minimal interest for that front.
The all-time member also hinted that high valuations contribute to the low interest in delisting in India and that even foreign entities are looking at the listing.
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