Why is Calcutta Stock Exchange closing down after 117 years? Explained
Once considered a contender to the Bombay Stock Exchange (BSE), the 117-year-old Calcutta Stock Exchange is reportedly nearing the end of its voluntary departure as a bourse. After years of legal and regulatory obstacles, it is going to celebrate its last Kali Puja and Diwali as a functioning stock market before permanently closing on 20th October.
The Securities and Exchange Board of India (SEBI), the market regulator, had already suspended trading at the CSE in 2013 due to non-compliance with regulatory standards. The exchange decided to completely shut down despite attempts over the last ten years to revive trading and even challenge SEBI’s ruling.
Although the exchange had previously intended to challenge SEBI orders in court, a favourable ruling was not possible until last year. The board of CSE made the decision to drop its pending cases in the Supreme Court and the Calcutta High Court in December 2024. The former then requested a voluntary departure.
CSE Chairman Deepankar Bose stated, “Approval has also been obtained from the shareholders vide EGM (Extraordinary General Meeting) dated 25th April 2025 relating to the exit of the stock exchange business. Accordingly, CSE submitted the exit application to SEBI, which has, in turn, appointed a valuation agency for undertaking the valuation of stock exchange which is in progress.”
CSE would remain a holding company if SEBI authorises the withdrawal but its subsidiary CSE Capital Markets Pvt Ltd (CCMPL) will continue to operate on the NSE (National Stock Exchange) and BSE. The sale of CSE’s three-acre EM Bypass property to the Srijan Group for Rs 253 crore has also been approved by the regulator and this will happen after SEBI grants his approval.
The regulator has also approved CSE’s plan to sell its three-acre EM Bypass property to Srijan Group for ₹253 crore, a transaction that will be completed after the exit is finalised.
End of an era of trading
CSE which was founded in 1908 was formerly a competitor of the Bombay Stock Exchange and a representation of Kolkata’s financial history as well as the hub of the Lyons Range.
The largest setback for CSE occurred in 2013, when SEBI chose to halt trading on the platform. The exchange violated important regulations which led to the outcome. It approched courts multiple times to counter the suspension. However, this resulted in financial strain and a decline in trade activity did not help either, particularly in the midst of the NSE and BSE trading boom.
One of the main causes of CSE’s downfall along with other factors including an actual loss of relevance, is the dominance of BSE and NSE. CSE started to lag behind especially following the Dot Com boom in the early 2000s, when the stock exchange found it difficult to adapt to a finance industry dominated by technology.
The revelation of the Ketan Parekh scam in 2001 dealt the last blow. Parekh who was a stockbroker by profession inflated the prices of a few stocks, referred to as K-10 stocks, by taking advantage of the exchange’s loopholes. It triggered stricter regulations and a sharp decline in investor confidence. CSE’s collapse was ultimately caused by the stock exchange’s incapacity to adhere to the rules over time.
“We began each day with a prayer to Goddess Lakshmi before trading till April 2013 when trading was suspended by the regulator. This Diwali feels like a farewell to that legacy,” veteran stockbroker Siddharth Thirani, reported The Times of India.
On 25th April, the formal proposal was approved by shareholders after being submitted to SEBI earlier on 18th February. Rajvanshi & Associate has been hired by SEBI to complete the same which is the last stage before exit approval is granted.
With 1,749 listed businesses and 650 registered members, the exchange “has played an important role in India’s capital markets,” according to chairman Bose’s FY25 report. During 2024-2025, he was paid Rs 5.9 lakh in director’s sitting fees.
With a one-time payment of Rs 20.95 crore and yearly savings of roughly Rs 10 crore, the exchange provided all employees with a Voluntary Retirement Scheme (VRS) in advance of the departure. While some staff were kept on contract for compliance tasks, all of them accepted the offer.
An era for India’s regional stock exchanges which used to be abuzz with activity until electronic platforms moved market concentration to Mumbai, is coming to an end with the exit of the CSE. Legacy organisations like CSE remain as symbols of financial history, reflecting the evolution of India’s capital markets through technology modernisation and regulatory strengthening.
“CSE has played an important role in India’s capital markets,” Chairman Deepankar Bose rightly summarised in the FY25 annual report.
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