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A stock exchange is a highly technology-driven organized market. The SME and large business can apply for listing with BSE or NSE in India. The principal objective of the stock market is maintaining transparency where securities are bought and sold in a regulated environment. The stock market mobilizes small saving for productive purposes.
Listing means getting securities of a Company Listed in the stock market to raise investment and for further trading. It can be also said as the process of making the securities officially quoted on the notified stock exchange for the trade.
The main objectives of listing are to provide ready marketability and Liquidity to shares and stocks. To keep proper control and supervision in dealing therein. It also protects the interest of shareholders and also the general public.
Listing is beneficial to the company, to the investor, and to the public at large. The important advantages are listed below:
Also, Read: How to List on BSE SME Exchange.
Investor Education: Stock exchange is responsible for creating awareness among the investor by publishing periodically the quotations of listed securities. Disclosing financials of the listed company. An investor can make the right decision and can get the maximum benefit from their investments.
Liquidity of investment: The stock market provides a high level of liquidity on investment. Investment in the stock market is easily convertible to cash as the need of the investor.
Investment is safe: the company listed on the stock exchange is strictly regulated in terms of the end-use of fundraised from an investor. The amount invested in stock is safe and the only investor has to assume the market risk in lieu of return on investment.
Efficient use of Capital – the stock exchange helps the investor in taking the right decision by providing them a market trend, financials of the company listed on a stock exchange. The share price of a listed company fairly calculated based on the profitability and operational efficiency of the company.
Protection from bad deliveries: the company listing process with the stock market is regulated and hence trading of their securities is too regulated. It prevents the trading of false and duplicate securities. So there are almost no possibilities of bad deliveries.
High collateral value – the Listed securities on a stock exchange is backed by high collateral value. The securities of such a level of the company can be sold easily.
Also, Read: BSE Listing Process and Requirement.