Calcutta Stock Exchange to Shut Down After 117 Years: What Does This Mean for Indian Investors?

Kolkata’s iconic Calcutta Stock Exchange (CSE), one of India’s oldest bourses, may be celebrating its last Kali Puja and Diwali as a functioning exchange in 2025, as per a report by PTI. If this transpires, this will mark the end of a 117-year-old journey. The exchange is now moving toward a voluntary exit following years of legal struggles and regulatory woes.

Background of the Calcutta Stock Exchange

Founded in 1908, the Calcutta Stock Exchange was once a formidable rival to the Bombay Stock Exchange (BSE), dominating trade volumes and serving as the financial nerve centre of Kolkata’s Lyons Range. The exchange’s decline began after the Rs 120-crore Ketan Parekh scam, which led to broker defaults and dealt a severe blow to investor confidence. Trading activity steadily declined over the years during the 2000s, leading to SEBI suspending the operations in 2013 following repeated non-compliance.

Reasons Behind the Closure

Trading at the CSE was suspended by SEBI in April 2013 due to non-compliance with regulatory requirements. Over the past decade, the exchange made many attempts to resume operations and contest SEBI’s decisions in court. However, the exchange has now decided to move towards a voluntary exit, citing years of regulatory hurdles and legal challenges.

Current Status and Future Plans

The CSE on its part has denied the report about its closure, calling them incorrect. Exchange officials told NDTV that the CSE remains operational and has not received any regulatory approval to wind down its business. The exchange has also said that it will issue an official statement after Diwali.

“Approval has been obtained from shareholders vide EGM dated April 25, 2025, relating to the exit of the stock exchange business. Accordingly, CSE submitted the exit application to SEBI, which has appointed a valuation agency to undertake valuation of the stock exchange,” said CSE chairman Deepankar Bose, according to PTI. If SEBI gives its nod, CSE will remain a holding company with its subsidiary, CSE Capital Markets Pvt. Ltd. (CCMPL), carrying on broking business on the NSE and BSE.

Impact on Indian Investors

The CSE’s closure marks the end of an era for India’s regional stock exchanges, which once thrived before trading activity consolidated around Mumbai’s electronic platforms. This move is expected to have a significant impact on Indian investors, particularly those who have been trading on the CSE platform.

Restructuring and Voluntary Retirement Scheme

As part of its restructuring, the CSE launched a Voluntary Retirement Scheme (VRS) for all employees, offering a one-time payout of Rs 20.95 crore. The move is expected to save around Rs 10 crore annually. All staff accepted the offer, with a few retained on a contractual basis for compliance functions.

Conclusion

The closure of the Calcutta Stock Exchange is a significant event in the Indian stock market landscape. While it marks the end of an era for regional stock exchanges, it also highlights the need for regulatory compliance and the importance of adapting to changing market conditions. As the Indian stock market continues to evolve, it is essential for investors to stay informed and adapt to the changing landscape.

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