At a time when markets face significant pressure and FII selling dampens sentiments, the head of India’s largest stock exchange expects the SEBI chief to bring required positive regulatory push.

“The new SEBI chief is a brilliant man. He has a great understanding of how the market functions, so hopefully we will have a much sanguine regulator going forward. He will bring a breath of fresh air to the regulatory structure,” Ashish Chauhan, MD and CEO, National Stock Exchange, told businessline.

Chauhan was speaking to businessline on the sidelines of Sanghamitra 2025, a Rotary International District Conference 3234 held in Chennai.

Speaking about SEBI’s recent steps to tighten regulations in areas like F&O trading, Chauhan said that tough regulations protect smaller investors better in the long run despite the short term slowing down of trades. “NSE started operations in 1994. In the 31 years of operation, each time the regulators have tightened regulations, it has brought in more comfort to the retail investors as the market becomes more safe…It’s a good thing,” he said.

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As for the current free fall of the stock markets, the exchange head said that the current geopolitical complexities seem to have made markets more reactive. “India as such is doing exceedingly well but the rest of the world is going through some changes. US being a unipolar world is trying to recede from world activities. Whether right or wrong depends on which side you are on. When such a country starts receding from world events you will have many more new polarities coming up. In some ways it will be everyone to themselves and in that framework, India is well poised to hold its own,” he said.

Will such market conditions impact the much-anticipated initial public offering of NSE? The technocrat said there is no “understanding on when SEBI approval will come” but they are set to prepare for the listing as and when it does.

Staying invested

He also stressed on the Indian stock market’s status as a bulwark of future wealth creation in India and explained how Covid and resulting digital push has expanded the market base. The change in KYC norms to accommodate video-based KYC has been a big factor for growth of retail investors, he said. “Today there are only 30 pin codes in India that do not have NSE-registered investors . This is out of 19300+ total pin codes in India,” he said. “In 2014 we had 1.67 crore investors and now we have 11 crore investors,” he added.

With the median age of investors getting lesser, he also had a word of advice for the new crop of investors who are new to market cycles. “Market will have its own ups and downs. People should invest only a small portion of their savings and continue to stay invested. Even during Covid, markets fell by 40 per cent but came about substantially. But, in the long-term India still has a good chance to become rich before it becomes old in the next 20-30 years,” he said.