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CSE bids farewell to badla

The Calcutta Stock Exchange on Friday bid farewell to the carry forward system, popularly known as 'badla', amidst fears of a sharp decline in trading volume in the immediate short term under the rolling settlement.

The last day of trading under the existing system, however, reflected an optimistic note with leading scrips meeting fresh buying support giving an indication that the market was prepared to accept the new form of trading.

The exchange would shift to the rolling settlement of trading from July two following the Securities and Exchange Board of India's decision on May 14, which has blamed the carry-forward system for the recent scam involving 'big bull' Ketan Parekh.

"There is always some apprehension among members when a new system is on the verge of introduction, but ultimately things will cool down and an indication to this effect was visible during today's trading," a senior broker said.

Citing a similar example, another broker said, "When the settlement period was brought down from 15 days to seven days, as per Sebi orders a few years back, apprehensions were expressed about the survival of the market, but the situation improved gradually."

This time also there might be a temporary decline in trading volume, but a majority of brokers said the situation would improve and would ultimately benefit brokers as the rolling settlement platform would provide a 'realistic' option to investors.

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