The Securities and Exchange Board of India (SEBI) is currently examining the Calcutta Stock Exchange’s (CSE) application for a voluntary exit from the stock exchange business, Minister of State for Finance Pankaj Chaudhary informed the Lok Sabha on Monday. SEBI has set up a Working Group and engaged a valuation agency to assess the exchange’s assets and liabilities, a crucial step before granting approval for exit.

Trading on the CSE platform has been inactive since April 2013, and the exchange has struggled to meet key regulatory requirements. These included compliance with clearing corporation arrangements and maintaining the minimum net worth mandated under the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018. The Calcutta High Court had previously granted extensions on February 19, 2024, and August 19, 2024, but the exchange failed to fulfil the conditions within the allotted time.

In its application dated February 18, 2025, CSE formally requested voluntary exit under SEBI’s Exit Policy for stock exchanges, citing these compliance challenges. According to Chaudhary, SEBI is awaiting certain additional information from the exchange to complete its assessment before finalising the exit procedure.

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Once the review is complete, SEBI will issue a “speaking order” that will formally approve CSE’s exit. The order will consider the status of exclusively listed companies on the exchange, the verification of CSE’s assets and liabilities, and any necessary relaxations of regulatory requirements to facilitate a smooth exit.

CSE, established in 1908, is one of India’s oldest stock exchanges, but its relevance declined significantly with the emergence of national exchanges like the NSE and BSE. The voluntary exit would mark the end of formal operations for an exchange that has been largely dormant for more than a decade.

SEBI’s scrutiny ensures that all stakeholders, including companies exclusively listed on CSE, are considered, and that regulatory obligations are properly addressed before the exchange is formally dissolved. This process underscores SEBI’s approach to orderly exits in India’s evolving capital markets.

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