The Ministry of Defence (MoD) and the National Stock Exchange of India Limited (NSE) on Monday signed a Memorandum of Understanding (MoU) to facilitate capital market access for micro, small, and medium enterprises (MSMEs) for fund raising.
The move comes after the stocks of major defence companies, whether government-owned or private, have been trading well on the bourses in the last couple of years since the government’s aatmanirbharta push in the military sector.
“The MoU intends to facilitate MSMEs in the defence sector to raise productive capital for their growth plan in an efficient and transparent manner through NSE platform ‘NSE Emerge’. The platform offers new and viable options for raising equity capital from diversified set of investors,” the MoD said in a statement.
It was signed by Anurag Bajpai, Additional Secretary, Department of Defence Production (DDP), and Ashishkumar Chauhan, Managing Director, NSE, in the presence of Defence Secretary Giridhar Aramane.
The MoU will be in force for five years, during which time DDP and NSE will conduct an extensive awareness drive through seminars, MSME camps, knowledge sessions, road shows, and workshops to guide corporates engaged with the MoD in fund-raising on the NSE Emerge platform.
The Ministry said the NSE will also assist MSMEs in connecting with intermediaries like merchant bankers, registrars, transfer agents, depositories, etc., and guide them regarding capital markets, capital raising mechanisms, and regulatory compliance and requirements.
The Ministry remarked that this MoU will help MSMEs and emerging companies in the defence sector scale up their business operations, explore new markets, and fund their R&D activities.