SME market like a casino? Sebi should talk it down & regulate only in case of fraud: Sunil Subramaniam
Sunil Subramaniam, Market Expert, says that speculation is part of a healthy capital market. It is only when you have these speculative entities like these people come in, that there is liquidity in the market. But if you regulate them and take them out, overall as a market, the liquidity is going to shrink. Should the regulator step in on the valuations? Subramaniam thinks that is right because there is no golden rule on what should be the right valuation. The market is the best determinant. So, unless there is clear evidence of fraud, some price fixing, rigging, or some false news put across which makes the share price go up, Sebi shouldn’t put in any regulation.
The SME market is almost like a casino now. It does not feel like a stock market.
Sunil Subramaniam: I fully agree with you. The reason for this is also related to the rampant futures and options situation. Demat accounts are going up. Post-COVID, youth with a lot of time on their hands, armed with internet and technology hands, are treating the stock market like a gambling den. There are no two ways about it. We do not have other options for gambling. We can see similar kinds of success when it comes to Dream11 and those kinds of sports-related apps. Despite all Sebi restrictions, financial influencers (fin fluencers) play a big part. It is like a get-rich-quick scheme. Booking gains from these IPOs show their intent. They are not investors. They are speculators.
The regulator will give approvals as long as the process is clean. The regulator will
