SME POLICY SERIES 2 : SME Exchanges in India - Federation of ...

FISME POLICY PAPER2October 2012SMEPOLICYSERIESSME Exchanges in India: Review and Suggestions*1. BackgroundThe role of the capital market in growth of large companies hardly needs anyelaboration. The case of Small and Medium Enterprises (SMEs) in India, however, isdifferent. One of their characteristic features has been their singular reliance ondebt finance that too from conventional sources: Banks, Non-Banking FinanceCompanies (NBFCs) and Financial Institutions (FIs). Risk capital is largely inaccessibleto them. Of late, few SMEs belonging to the services sector and new age technologybased industries have started getting access to risk capital through Venture CapitalFunds (VCs) or Private Equity Funds (PEs), but manufacturing SMEs continue tostruggle with drought of risk funds as they cannot match the windfall returns that hightech-servicesector companies can promise.India tried to open the risk capital window to SMEs twice in past: first with Over-thecounterExchange of India (OTCEI) launched in 1990 and second with 'BSE Indonext'launched in 2007. The earlier attempts indicate that retail investors shied away frominvesting in SMEs either because of lack of knowledge about track record andbusiness models of SMEs or investor's lack of patience in understanding nuances ofthe issues and envisioning prospects thereof. It is third time that an attempt has beenmade to create SME dedicated platform.2. Policy initiativesIn order to fill this vacuum and based on constant demand from the SME sector, SEBIintroduced Chapter X-B in SEBI (ICDR) Regulations, 2009 (initially introduced asChapter X-A and renumbered through a subsequent amendment) enabling creationof a separate platform for SMEs desiring access to the capital market. Some of the keyfeatures of the regulations are:The only way the Smalland Medium enterprisescan access capitalmarket is throughintervention byGovernment of India byway of directions to theFIs and the Banks toearmark a smallproportion of funds forinvesting into the issueson SME exchanges.There are regulatory andprocess issues whichcan be sorted outwithout much difficultyonce the BIG decision istaken by theGovernment.a. Transparency in reporting financial and material information about the issuerCompany and its promoters - detailed requirement of the offer document andlisting agreement with the SME Exchange insisted upon, on similar lines as forlisting on the Main Board;b. Increasing the threshold limit of investment to Rs. 1 lakh, thus ensuring thatmarginal investors do not make investment in SMEs. The increased investmentlevel would also ensure that investors belonging to the HNI category or from theinstitutions would participate in the investment of SMEs either in the primary orthe secondary market;c. Introduction of the concept of market making for a minimum period of 3 yearsto ensure that enough liquidity is maintained in the initial period for investors,existing or prospective. In a way, it also provides an option for initial investors toexit from the investment by selling shares to the market maker;d. Insistence of minimum subscriber level of 50 for a successful public issue;e. Increased onus on the Merchant Banker for due diligence and filing final* The Policy paper is prepared by FISME team led by Rajesh Dubey, Advisor (Finance) with Jnandeep Saikia,Coordinator (Finance) and Nishita Sharma, Research Intern. The paper is largely based on the proceedings of theStakeholders' Roundtable on SME Exchange organized by FISME on 28th March 2012 in New Delhi. (See details atback page).1

prospectus or red herring prospectus with SEBI and Registrar of Companiesbefore opening of an issue and also providing market making for the sharesfor a period of 3 years, either on own accord or through a tie up with anominated investor. Also, honoring commitments of defaulting underwriterson devolvement is the responsibility of the Merchant Banker;f. 100% underwriting of shares so that the SME issuer is ensured of success of thepublic issue in terms of raising capital; andg. Relaxing the norm for grading of initial public offering.In addition to the above, SEBI has issued SEBI (Alternative Investment Fund)Regulations, 2012 which when read together with Sec. 10(23FB) of IT Act, 1961,provides for income tax exemption to Venture Capital Fund (VCF) or Venture CapitalCompany (VCC) and Alternative Investment (SME) Category I Funds (See Annexure),provided:a) At least 75% of their corpus are invested in SMEs or SMEs listed on SMEExchangeb) At least 2/3rd of their investments are in unlisted SMEs or which are listed on theSME Exchange and balance in other investments such as shares of VentureCapital Undertakings (VCUs) whose shares are proposed to be listed or suchlisted companies which are financially weak or is a sick industrial undertaking.Additionally, SEBI (Alternative Investment Fund) Regulations, 2012 providesthat Alternative Investment Fund (SME) Funds may enter into tie up withMerchant Banker for subscribing to the unsubscribed portion of the sharesissued on SME Exchange.From a MerchantBanker's point of view,the market making roleentails commitment ofadditionalcapital, requiringadditional fundsarrangement at theirend. Though MerchantBanker can enter intoarrangements withnominated investors formarket making purpose,the onus neverthelessrests with theissuer and MerchantBanker for findingsuitable investors withstrong financial muscleand as such doesnot seem to be afeasible way out.3. Problems being encounteredEven with the introduction of the regulations for SMEs listing and SME Exchange forover two years, and tax exemption available for investors, the response to SMEExchange has been lackadaisical, mainly on account of the following reasons:A. Regulatory requirements which result in increasing the capital raising costmanifoldB. Limited awareness about the changes introduced in the SEBI (ICDR)Regulations, 2009 for SMEs and also limited knowledge about how to go aboutwith an issueC. Nature of expectations of the SME sector with regard to disclosure requirementsassociated with public issue and alternatives available.A. Regulatory requirements which result in increasing the capital raising costCosts associated with any public issue can be clubbed in the following major heads:Publicity related expenses i.e. making the details of the public issue known to theprospective investors; Fees paid to various intermediaries associated with the issueand Compliance related expenses for continuing with listing of the issue.From the way the regulations have been drafted and promulgated, it is clear that theauthorities want matured investors subscribing to the shares of issuer SME companieson the SME Exchange. Given that, the requirement of releasing advertisement in atleast one English National Daily, one Hindi National Daily and a regional languagenewspaper with wide circulation at the place where the registered office of the issuer issituated, at multiple occasions is an avoidable cost for the SME units. The times whenadvertisement is required to be released are given below:2a) Pre-issue, after completion of due diligence by the Merchant Banker, providingfor minimum disclosures relating to the issueb) Information memorandum which would include snapshot of the financialstatement

c) Announcement of 'issue opening today' on the issue opening dayd) For issues adopting book building process - announcement of floor price or price band if notmentioned in the red herring prospectus, 2 working days before opening of the bide) Announcement of 'issue closing today' on the issue closing dayf) Post issue advertisement indicating details relating to over subscription, basis of allotment, number,value and percentage of all applications and successful allottees including under ASBA, date ofcompletion of despatch of refund orders or instructions to Self-Certified Syndicate Banks by theRegistrar, date of despatch of certificates and date of filing of listing application, etc. is required tobe released within 10 days from the date of completion of the allotmentAlso, if book - building process is adopted – revision in floor price or price band, if any, has to beannounced by way of press releases. Given the size of the SME issue, the cost of releasing advertisementcould be a substantial cost for the SMEs when compared to the issue size.With regard to fee paid to various intermediaries, the most critical responsibility rests on the MerchantBanker viz. due diligence of the offer document, market making, assessment of underwriters' capabilities,tie-up with various other intermediaries, underwriting that portion of underwritten shares that anyunderwriter fails to honour etc. of the aforementioned roles, the role for market making and honouringcommitments of underwriters who fail to subscribe their portion on devolvement are additionalresponsibilities when compared to responsibilities on the Main Board. It is natural to expect that theMerchant Banker would ask additional fee for the additional services offered by them which would be anadditional cost for the SMEs issuing shares on the SME Exchange.From a Merchant Banker's point of view, the market making role entails commitment of additionalcapital, requiring additional funds arrangement at their end. Though Merchant Banker can enter intoarrangements with nominated investors for market making purpose, the onus nevertheless rests with theissuer and Merchant Banker for finding suitable investors with strong financial muscle and as such doesnot seem to be a feasible way out.Alternatively, if line of credit support is obtained by the Merchant Banker, it effectively would mean usingborrowed capital for an activity for which the required amount for market making by the MerchantBanker may get blocked for a substantially longer tenure than when compared to tenure of the line ofcredit obtained. This would result into an asset liability maturity mismatch and also a funds flowmismatch. The capital base of most of the Merchant Bankers is not strong enough to absorb this risk ontheir own account. The only option left to them is to transfer the risk on a back-to-back arrangement(often through an offline contract) with the promoters of the issuer Company, nullifying the very purposeof approaching SME Exchange. Such transactions will remain hidden and unaccounted pushing theentrepreneur more in risk rather providing risk capital to SME. The above could be considered as one ofthe main reasons for not many SMEs and Merchant Bankers coming forward with public issues on theSME Exchange.B. Limited Awareness on listing on SME ExchangeThe awareness about separate platform for SME listings on SME Exchange is not well spread amongstSMEs. Also the awareness, if existent, is limited to a preliminary awareness that a new option is availablefor SMEs to raise capital. However, the way to go about it in terms of - the procedure involved, parties tobe engaged, eligibility norms etc. is not known to a majority of SMEs.C. Expectations of the SME sector towards disclosure requirements and available alternativesfor raising risk capitalFor SMEs belonging to the services sector or in the technology space, where escalated growth rate andhigh returns on capital are possible, the alternative of raising capital from VCFs and PEs are moreattractive on a private placement basis than opting for the SME Exchange route of listing of IPOs. Themain reasons why SMEs find private placement to VCFs and PEs more attractive are –a) Additional disclosure requirements for the IPO which would have to be made available in publicdomain; the same may not be contemplated in the best interest for the SME unit.3

) Forecasts are more futuristic in nature which may be frowned upon at the timeof due diligence by the Merchant Banker.c) Satisfying the information and disclosure requirements for minimum 50investors post issue may be more cumbersome for an issuer Company thansatisfying a few VCFs and PEs on the Board.d) Also the VCFs and PE investors are likely to bring in more domain expertise intheir association with the issuer Company than the passive investors throughthe IPO route.The above mentioned points may be true for service enterprises or new agetechnology oriented SMEs where VCF and PE options are available to the deservingentities with a good investment and business plans, the same may not be true for theconventional manufacturing industry. The VCFs and PEs may not be interested ininvesting in conventional industry providing modest returns with reasonableconsistency.For SME units belonging to the conventional manufacturing sector, the apprehensionof use of profitability figures if available in public domain by vendors and suppliers forhard negotiations on pricing is real and immediate as SME units would be expected todisclose in greater details and half-yearly periodicity, on their performance. On theother hand, unlisted public limited Companies may have to disclose profitabilityfigures once a year and the information is available through Registrar of Companies.To a certain extent it is not so easily available in public domain. Thus, accessingcapital market through listing on SME exchange and adhering to greater disclosurerequirements would have to be a reasonably balanced decision for an SME.Success of this renewedattempt by theGovernment of India(with necessary supportfrom the regulator) forencouraging setting upof SME exchanges istherefore crucial if thesmaller companies areever able to drawsupport from the capitalmarkets. The SMEexchanges have to notonly take off but alsoremain active andbuoyant for quite sometime. This can happenonly if the institutionalinvestors agree toparticipate in SMEexchanges until the retailinvestors enter the fieldand the exchangeacquires a critical mass.Because the size willgrow only gradually evena miniscule share of theirinvestible funds cansustain the exchanges.Success of this renewed attempt by the Government of India (with necessary supportfrom the regulator) for encouraging setting up of SME exchanges is therefore crucial ifthe smaller companies are ever able to draw support from the capital markets. TheSME exchanges have to not only take off but also remain active and buoyant for quitesome time. This can happen only if the institutional investors agree to participate inSME exchanges until the retail investors enter the field and the exchange acquires acritical mass. Because the size will grow only gradually even a miniscule share of theirinvestible funds can sustain the exchanges.4. Suggestions:[FISME carried out a series of discussions with MSMEs, Banks and FIs, SME Exchanges,Merchant Bankers, VCs, PEs, economists, financials experts and senior governmentofficials at New Delhi, Bangalore and Mumbai and the concerns of stakeholderswere finally discussed during a Stakeholders' Roundtable on SME Exchange' organizedon 28th March 2012 in New Delhi. The suggestions emerged during the roundtableare summarized thus. ]41. The unanimous conclusion of the intensive consultative process has been: Theonly way SMEs can access capital market is through intervention byGovernment of India by way of directions to the FIs and the Banks to earmark asmall proportion of funds for investing into the issues on SME exchanges.There are regulatory and process issues which can be sorted out without muchdifficulty once the BIG decision is taken by the Government.[Ministry of Finance may take required steps]2. To reduce this cost, it is proposed that it should be sufficient for the issuer torelease information through the website of SEBI, Merchant Banker, SMEExchange and its own website and also as part of important recordannouncements (as for announcement of Board Meeting, Book closure datesand record dates) in leading financial and national dailies. The same would in

any case be noticed by the targeted subscribers for the SME issues viz., institutions and HNIs. Theissuance of detailed advertisement by SMEs may be made optional in place of mandatory as ofnow.[SEBI may suitably amend SEBI (ICDR) Regulations, 2009].3. To address the issue of market making, a few structural changes suggested are:a) Onus on market making should not rest with Merchant Bankers. They should continue undertakingthe other fee based activity where they have a normal specialization.[SEBI may suitably amend SEBI (ICDR) Regulations, 2009].b) Onus of market making should be on banks, insurance companies and financial institutions,having large capital and assets base. A small portion of their portfolio cold be earmarked forinvestment in equity shares or specified securities issued and traded on SME Exchanges, say:1- For banks - 5% of the total investment portfolio in capital market or 1% - 3% of the net-worth(increasing annually by 1% point), whichever is lower. Investments made by banks in issueslisted on SME Exchange should be excluded rom the capital market exposure norms, providedthey are undertaken as part of market making exercise.[RBI may issue suitable guidelines including amendment tothe guidelines on the Capital Market Exposure Norms].- For insurance companies – 1% of Assets under management.[Ministry of Finance, GOI to advise insurance companies / IRDA suitably].c) Additionally, investment in SME equity as part of initial subscription or underwriting commitmentsor for market making purpose as a market maker or as a nominated investor should qualify aspriority sector lending. Banks may be asked to provide for market making in respect of at least 10SMEs per bank in a year. To begin with this target could be achieved over 2 – 3 years given thenascent nature of SME Exchange. However, if accepted, the banks could be asked to at least makea beginning in the current financial year. It may be mentioned here that banks are ideally suited forproviding market making and for taking an equity position in SMEs. By the very nature of workingcapital provided in the form of cash credit, the exposure is normally of a very long duration even ifreviewed and renewed on an annual basis. As such, during growing stage and upside swing for anSMEs, the performance of SMEs are normally better, commanding better lending terms frombanks. Conversely, during declining stage in the industry, when the performance of the SMEs is ona decline, the SMEs find it difficult to service high cost of borrowings.More often than not, banks are required to agree for reduction in interest rates in case anyrestructuring exercise is undertaken. Thus, though the assistance is given in the form of loans, it haspeculiar characteristics of risk capital except that banks cannot command higher returns in theevent of upside in the business of an SME.Given this backdrop, it would be beneficial for a Bank to grant assistance to SMEs as acombination of debt and equity, especially where they have had a good track record for pastassistance granted. The limits hereinabove suggested would enable banks identify good SMEs intheir portfolio and encourage them towards accessing capital market.[RBI to suitably modify the priority sector lending norms].d) RBI may frame guidelines to address the Banks' concern making investment in the unlisted sharesof SMEs to avoid such investments being construed as 'ever-greening' especially if the SMEs arerated in the top 3 on the internal rating scale of the Bank concerned or in the top 3 of the scale of theexternal credit rating agency.[RBI to suitably advise].1The prudential norms for banks limit capital market exposures to 20% of the Bank's Networth on a solo basis and 40% of the consolidatedNetworth on a consolidated basis (consolidated Bank would include licensed banks along with its subsidiaries).5

e) Market makers could issue advertisements to popularize the SMEs in which theyhave invested by providing information on financial performance and therebycreate a market for prospective investors. Market making can be provided tillsuch period where the shares continue to remain frequently traded for aminimum period of 1 year and till such time where banks investment doesn'tfall below 10% or for 3 years, which is earlier.[Market makers to take initiative].f) The requirement of minimum 50 investors at the time of issue should be doneaway with, as it is expected that only institutional investors would be interestedin investing in SMEs in the initial stages.[SEBI may suitably amend SEBI (ICDR) Regulations, 2009].g) After listing, more investors can find the SME scrip attractive if the lot size can bereduced from the existing lot size which is of a minimum value of Rs. 1 lakh atthe time of listing.[SEBI may suitably amend SEBI (ICDR) Regulations, 2009].h) Grading for SME IPOs should be made mandatory. However, a separate gradescale should be adopted for the SME issues so that well performing SMEs orventures with great business ideas get a chance of getting the best gradingfrom the Credit Rating Agencies.[SEBI may suitably amend SEBI (ICDR) Regulations, 2009].i) Income tax exemption is presently available to Venture Capital Funds andAlternative Investment (SME) Funds having corpus invested in SMEs in excess of75%. It is suggested that income accruing to any registered fund or investorwith SEBI including non-SME Alternative Investment Funds investing in SMEs,out of such investments should be exempted from the provisions of income tax.The suggestion is made to enlarge the avenues of equity capital availability toSMEs, from whatever source that may be available.[Ministry of Finance, GOI may carry-out the required amendment].4. It is expedient to popularize the same by convening seminars and workshops onthe subject involving all the major participants. The Investor Protection &Education Fund set up under SEBI Regulations for the Fund in 2009 may be usedfor such investor and issuer workshops. If need be, MoMSME could also berequested for making allocations for investor and SME education. SMEassociations could be associated in popularizing the events and educating SMEson the procedural requirements and economical advantage from raising capitalresources through public issue on SME Exchange. Programs and workshops couldbe organized in all the major clusters with the top 50 clusters getting covered in thefirst year. The feedback from the SME stakeholders and prospective retail /institutional investors could also be used in making amendments to theregulations, where necessary.[SEBI, Ministry of MSME, Stock Exchanges, Merchant Bankers,FISME and other associations and professional bodies].5. The disclosure requirements can be restricted for providing only limitedinformation about the issuer Company's performance could be considered, ifsome of the earlier suggestions are accepted, viz.:a) Mandatory grading of IPOs with annual or semi-annual surveillance exerciseby Credit Rating Agenciesb) Institutional investors and banks market making in the initial period wouldprovide greater confidence to the retail investors.[SEBI may suitably amend SEBI (ICDR) Regulations, 2009]6

AnnexureTax benefits to VCF / VCC and Alternative Investment (SME) Funds – Category-I arising out of Sec. 10(23FB) of Income TaxAct, 1961 read with SEBI (Alternative Investment Funds) Regulations, 2012Any income of a Venture Capital Company (VCC) or Venture Capital Fund (VCF) from investment in a Venture Capital Undertaking(VCU) is exempt from income tax. Eligible VCC, VCF and VCU are defined in SEBI (Venture Capital Fund) Regulations, 1996, whichhave since been rescinded after notification of SEBI (Alternative Investment Funds) Regulations, 2012. VCU are entities which are notlisted and which do not fall in the negative list of SEBI and GOI. With SEBI (Alternative Investment Funds) Regulations, 2012, the scopeof income tax benefits have been enlarged to include Alternative Investment Funds registered as Category I SME funds (i.e. whereinvestments made in SMEs as defined under MSME Development Act, 2006, exceeds 75% of the fund size) by including such fundswithin the meaning of VCF or VCC eligible for exemption under Sec. 10(23FB) of the IT Act, 1961.Excerpts of law relating to Securities Transaction Tax - Even income arising out of divestment on initial public offer made by anyinvestor (including offers made by VCC or VCF) is exempt from tax if the income is in the nature of long term capital gains providedSecurities Transaction Tax (STT) has been paid at 0.2%. If the gain is in the nature of short term, on payment of STT @ 0.2%, theapplicable tax on the short term capital gain would be flat 10%. The income has to arise of investment transactions. In other words,income in nature of dividend on equity of preference shares, short term or long term capital gains, are exempt from payment ofincome tax under Sec. 10(23FB) of IT Act, 1961. Any other income or gain in the nature of fees, royalties, etc. would be exempt from ITAct, 1961, provided the same is arising of the investment covenants of the VCC or VCF in the VCU.SEBI (Venture Capital Funds) Regulations, 1996 (since rescinded but existing VCF would continue to be governed under theregulation ill the closure of the VCF; no additional funds can be raised or scheme launched under except under SEBI (AlternativeInvestment Funds) Regulations, 2012)Sec 2(n) define “venture capital undertaking” as a domestic company—(i) whose shares are not listed on a recognized stock exchange in India;(ii) which is engaged in the business for providing services, production or manufacture of article or things or does not includesuch activities or sectors which are specified in the negative list by the Board with the approval of the Central Government bynotification in the Official Gazette in this behalf.SEBI (Alternative Investment Funds) Regulations, 2012 - DefinitionsSec. 2(1)(o) defines “investee company” as any company, special purpose vehicle or limited liability partnership or body corporatein which an Alternative Investment Fund makes an investment;Sec. 2(1)(s) defines “SME” as Small and Medium Enterprise and shall have the same meaning as assigned to it under the Micro,Small and Medium Enterprises Development Act 2006 as amended from time to time;Sec. 2(1)(t) defines “SME fund” means an Alternative Investment Fund which invests primarily in unlisted securities of investeecompanies which are SMEs or securities of those SMEs which are listed or proposed to be listed on a SME exchange or SME segment ofan exchange;Sec. 2(1)(z) defines “venture capital fund” means an Alternative Investment Fund which invests primarily in unlisted securities ofstart-ups, emerging or early-stage venture capital undertakings mainly involved in new products, new services, technology orintellectual property right based activities or a new business model;Sec. 2(1)(aa) defines “venture capital undertaking” means a domestic company:(i) which is not listed on a recognised stock exchange in India at the time of making investment; and(ii) which is engaged in the business for providing services, production or manufacture of article or things and does not includefollowing activities or sectors:(1) non-banking financial companies;(2) gold financing;(3) activities not permitted under industrial policy of Government of India;(4) any other activity which may be specified by the Board in consultation with Government of India from time to time;Sec. 3(4) Alternative Investment Funds shall seek registration in one of the categories mentioned hereunder and in case ofCategory I Alternative Investment Fund, in one of the subcategories thereof:(a) “Category I Alternative Investment Fund” which invests in start-up or early stage ventures or social ventures or SMEs orinfrastructure or other sectors or areas which the government or regulators consider as socially or economically desirable andshall include venture capital funds, SME Funds, social venture funds, infrastructure funds and such other AlternativeInvestment Funds as may be specified;Explanation ─ For the purpose of this clause, Alternative Investment Funds which are generally perceived to have positive spillovereffects on economy and for which the Board or Government of India or other regulators in India might consider providingincentives or concessions shall be included and such funds which are formed as trusts or companies shall be construed as “venturecapital company” or “venture capitalfund” as specified under sub-section (23FB) of Section 10 of the Income Tax Act, 1961.Securities transaction Tax (STT) is a tax being levied on all transactions done on the stock exchanges. Securities Transaction Tax isapplicable on purchase or sale of equity shares, derivatives, equity oriented funds and equity oriented Mutual Funds. In other words,the same is not applicable on preference shares or debentures or any other securities other than equity. Current STT on purchase orsell of an equity share is 0.075%. If STT has been paid at the time of selling securities (shares), the law relating to Income Tax is:FOR INVESTORS -(1) Shares are sold after 12 months, it comes under long term capital gains no tax ispayable on that gain.(2) Shares are sold before 12 months, it is a short term capital gains and Income Tax @10% flat is payable on the gain.FOR TRADERS –All gains are treated as trading (Business) and tax is payable as per appropriate tax slabs. However, STT paid on transactions can beclaimed as a deductible expense.STT on IPO and benefits in payment of Income Tax :Benefit of capital gains tax exemption has been extended to sale of unlisted securities in an initial public offering. However, a securitiestransaction tax at the rate of 0.2 % will be payable on such a transaction.7

Stakeholders’ Roundtable on SME Exchangeth(28 March 2012, India Habitat Center, New Delhi)ParticipantsMr. Lakshman Gugulothu, IPS, CEO - SME Exchange, Bombay Stock Exchange (BSE), MumbaiMr. Ananta Padmanabhan Sarma, CEO, SIDBI Venture Capital Ltd, MumbaiMr. Ravi Tyagi, SME Exchange Project, NSE, MumbaiMr. Anurag Goyal, Vice President, Microsec Capital Ltd, New DelhiProf. Sanjay Sehgal, Dean - Faculty of Commerce and Business, Delhi UniversityProf. Muneesh Kumar, Head - International Relations, Delhi UniversityMr. Kulbhushan Parashar, Director RSJ Capital Ventures Pvt. Ltd, New DelhiMr. S P Gupta Director TSP Management & Financial Advisors (P) Ltd.Mr. Munindra Sehgal, Associate - Mergers, Acquisition & Restructuring Div, JM Financial ConsultantsMr. Rajesh Dubey, Former ED-SME, ICRA, Advisor (Finance), FISMEMr. V.K. Agarwal, President FISME & MD, Shashi Cables Ltd, LucknowMr. D. Gandhikumar, Gandhikumar Foundry, CoimbatoreMr. Arjun Navada, MD, Eastern Switchgear & Electrical Company Pvt. Ltd., KolkataMr. R. Sada Siva Reddy, President, Jeedimetla Industries Association, HyderbadMr. Deepak Jain, Managing Director, Bhansali Cables & Conductors Private Ltd, New DelhiMr. C.S. Goel, Managing Director, Goel Engineers (India), New DelhiMr. Naveen Jain, MD, Dayachand Engg. Industries Pvt. Ltd., MuzaffarnagarMr. Dinesh Singhal, MD, Kanohar Electricals Ltd, MeerutMr. Neeraj Kedia, MD, Chakradhar Chemicals Pvt. Ltd., MuzaffarnagarMr. Pankaj Aggarwal, Managing Director, Bindlas Duplux Ltd., MuzaffarnagarMr. Anil Bhardwaj, Secretary General, FISME, New DelhiFederation of Indian Micro Small & Medium Enterprises (FISME)FISME came into being in 1995 as a federation of geographical and sectoral associations of Micro, Smalland Medium Enterprises (MSMEs) spread across districts and states in India. Born during period ofliberalization and at the time of India’s accession to WTO, its mindset, mission and activities have beenshaped by these national and global developments. It is a multi-sector, politically neutral and not-forprofitorganization. It aims to facilitate development of an entrepreneurial and competitive environmentat home and greater market access for Indian MSMEs in India and abroad. Working with a strongorientation for reforms in regulatory environment and public promotional policies to enhancecompetitiveness of MSMEs vis-à-vis their larger domestic counterparts and foreign firms, FISME organizesa wide range of MSME support programmes and undertakes implementation of developmental projects.It is widely regarded as the progressive face of Indian MSMEs.[For more details: http://www.fisme.org.in]Federation of Indian Micro and Small & Medium Enterprises (FISME)B - 4 / 161, Safdarjung Enclave, New Delhi-110029 INDIATelephone : +91-11- 26187948, 26712064, 46023157, 46018592 Fax : +91-11- 26109470 Email : info@fisme.org.in