ASE to sell off iconic Manekchowk building

Ahmedabad Stock Exchange (ASE), India’s second oldest, is about to sell off its historic building at Manekchowk and a piece of land in Ellisbridge to ensure its survival. A proposal to sell off the properties was approved at an extraordinary meeting (EGM) of the exchange held on Tuesday.

The ASE has been forced to make this  move because the capital market regulator, Securities and Exchange Board of India (Sebi), has set the condition that regional exchanges must have net worth of at least Rs100 crore to be started and stay operational. As the exchange is facing a shortfall of Rs43 crore to stay in business, it wants to sell off the structure to meet Sebi’s condition.

At the extraordinary general meeting (EGM), the board of the stock exchange decided to sell off its real estate properties and meet the first eligibility for starting an exchange. Around 60 members of the board and shareholders, who were present at the meeting, decided to sell off two properties — one at Manekchowk and the other at Ellisbridge.

According to realty experts, the value of the Manekchowk building is estimated to be around Rs8 crore. With the sale of the 6,000 square yard plot in Ellisbridge, the exchange can expect to get around Rs43 crore. Apart from this, the ASE is also ready to sell off its two shops in Panjrapole office, if required. The exchange will continue to operate from the office in Panjrapole.

“Board members passed all the resolutions at the EGM called on Tuesday. The resolutions were about selling the properties to raise Rs43 crore to start the exchange. For us, it is a matter of survival. We are left with no option but to sell the real estate properties that we have,” said chairman of Ahmedabad Stock Exchange, Hemantsinh Jhala.  Last week, Sebi issued a circular putting the condition that if a regional exchange does not have an annual turnover of Rs1,000 crore, the regulator will compulsory shut it down. “Before this, Sebi had also made it mandatory for an exchange to have net worth of at least Rs100 crore to function. We have only Rs57 crore. We are facing a shortfall of Rs43 crore,” he said.

Talking about the second condition — that of achieving an annual turnover of Rs1,000 crore — Jhala said that once the exchange begins its operations, the target is achievable.

Now, ASE has only two years in hand to raise the capital of Rs43 crore, restart the exchange and achieve the annual turnover of Rs1,000 crore. “It is a question of do or die. We will make every effort to revive the exchange. We are confident of doing so,” said Jhala.