Calcutta Stock Exchange

Calcutta Stock Exchange
Name	Calcutta Stock Exchange
Native name	কলকাতা স্টক এক্সচেঞ্জ
Type	Stock exchange
Location	Kolkata, West Bengal, India
Founded	0 1908
Currency	Indian rupee

Calcutta Stock Exchange. Established in 1908, it is the second-oldest stock exchange in India after the Bombay Stock Exchange. Located in Kolkata, the exchange played a pivotal role in the development of the capital market in eastern India, facilitating trade in securities for prominent regional companies. While its national prominence has been eclipsed by larger exchanges like the National Stock Exchange of India, it remains a significant institution for regional corporations and investors.

History

The exchange was founded during the colonial era, with its formation driven by the need to organize trading in shares of companies operating in eastern India, particularly those in the jute, tea, and coal industries. Its early growth was intertwined with the economic fortunes of Kolkata, then Calcutta, which served as the capital of British India until 1911. Key milestones include its formal recognition under the Securities Contracts (Regulation) Act, 1956 and its automation in the late 1990s. The exchange faced significant challenges following the economic liberalization of the 1990s, which saw the rise of electronic national exchanges, leading to a decline in trading volumes and relevance on the national stage.

Operations and trading

The exchange operates as a platform for trading equity shares, debentures, and government securities. Trading originally occurred through an open outcry system on its physical trading floor but transitioned to a fully automated screen-based trading system. It follows a T+2 rolling settlement cycle, in line with standards set by the Securities and Exchange Board of India. The trading session is conducted on all weekdays except for holidays declared by the exchange, with pre-market and normal market sessions.

Governance and regulation

The exchange is governed by a Board of directors elected from its membership. As a recognized stock exchange, its primary regulator is the Securities and Exchange Board of India, which oversees its compliance with market regulations. It must adhere to the rules framed under the Securities Contracts (Regulation) Act, 1956 and other guidelines issued by the regulatory body. Internal governance is managed through its Memorandum of Association and Articles of Association.

Membership and listings

Membership is composed of registered stockbrokers who are authorized to trade on the exchange floor, now electronically. The number of active members has decreased over time due to market consolidation. Listings primarily include small and medium-sized companies based in eastern and northeastern India, spanning sectors such as agro-based industry, textiles, and infrastructure. While it once listed major companies, many have migrated to the Bombay Stock Exchange or the National Stock Exchange of India for greater visibility and liquidity.

Technology and infrastructure

The exchange migrated from manual trading to a computerized system, implementing the C-STAR (CSE Screen Based Trading And Reporting) platform. Its infrastructure includes a data center for trade matching and a robust telecommunication network for member connectivity. While functional, its technological framework is less advanced compared to the systems employed by the National Stock Exchange of India, which utilizes the NEAT platform. The exchange also provides an Investor grievance redressal system as part of its technological interface.

Significance and impact

Historically, the exchange was crucial in mobilizing capital for the industrialization of eastern India, funding ventures in plantations, manufacturing, and mining. It served as a key barometer for the regional economy, particularly in West Bengal. Its establishment contributed to the formalization of securities trading in India. Today, its significance is largely regional, providing a listing avenue for smaller companies and contributing to the depth of India's multi-exchange market structure, as recognized by the Ministry of Finance.

Category:Stock exchanges in India Category:Companies based in Kolkata Category:1908 establishments in India