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The average daily turnover of 'S' group stocks on the Bombay Stock Exchange has increased by 80 per cent, after the introduction of the IndoNext platform on the BSE early last month.
The BSE IndoNext platform was introduced on January 7, 2005, to trade exclusively in the 'S' group stocks.
The idea was to provide depth to these small-cap stocks, which includes the companies listed with regional stock exchanges and have a paid up capital over Rs 3 crore and Rs 20 crore.
The S group also includes stocks from the BSE's B1 and B2 groups, meeting certain eligibility criteria.
The average daily turnover of S group stocks has increased from Rs 40 crore (Rs 400 million) in December, 2004 to Rs 71 crore (Rs 710 million) in February, while the daily average traded volumes of these stocks has increased by 93 per cent from 7 lakh equity shares traded daily in December to 14 lakh shares in the current month.
The government's primary intention behind the introduction of the BSE IndoNext was to set up a trading platform for these companies to raise capital both in bond and capital as well as provide liquidity to these securities.
If the daily turnover is anything to go by, IndoNext has caught the imagination of the market.
The aggregate turnover of Suryajyoti Spinning Mills has increased from just Rs 7 lakh in December 2004, to Rs 2.09 crore (Rs 20.9 million) in February.
Sumeet Industries, which posted a turnover of around Rs 1,000 per day in December is now posting an average daily turnover of over Rs 3 lakh on the Bombay Stock Exchange.
The aggregate turnover of Helios and Matheson, Micro Technologies, Amtek Auto, Noble Explochem, Suryajyoti Spinning, Man Industries, Ondeo Nalco India, Bharat Bijlee and Pitti Laminations has increased by more than 100 per cent in last two months.
Steel Exchange of India, which got listed on the BSE after the introduction of IndoNext, reported trading of over 4 lakh equity shares in the current month against just 40,000 shares last month.
Kalptaru Papers, Kaveri Telecom Products, Sharon Bio Medicine and Visu International are the newly listed companies to have reported aggregate volumes of over 10,000 equity shares on the Bombay Stock Exchange.
Dynamatic Technologies (Rs 409.50) , Haldyn Glass (Rs 36.10), Rasand Engineering (Rs 75.15), Dolphin Offshore (Rs 104.50), Syncom Formulations (Rs 106), Kallam Spinning (Rs 24.25), Ugar Sugar Mills (Rs 245.10), Raj Rayon (Rs 37.85), Madhucon Projects (Rs 480), Encore Software (Rs 27.60), IT People (Rs 37) and BF Utilities (Rs 78.45) are the few companies to have reported heavy volumes and are now currently trading at their lifetime highs on the Bombay Stock Exchange.