Look What BSE Chief Has To Say About GST After-Effects

India’s introduction of a single nationwide goods and services tax may have an unexpected consequence: prompting more companies to sell shares to the public.

That’s the view of Ashishkumar Chauhan, chief executive officer of BSE Ltd, the operator of the Bombay Stock Exchange. He says smaller firms that become tax-compliant due to the levy, scheduled for implementation on July 1, will be more inclined to go public because they’ll no longer have anything to hide. Some 1,000 companies will list on his bourse over the next four years, he estimates.

“We have only scratched the surface,” the head of the Deutsche Boerse AG-backed BSE said in an interview in the old business district of Mumbai. Some 74 companies raised 276 billion rupees ($4.3 billion) through first-time share sales on the BSE in the year ended March, the highest since 2010, according to the exchange.

Investors and analysts have been debating how the country’s biggest tax overhaul since independence in 1947 will impact the country’s markets, with some predicting that the GST will face teething problems.

While the levy is widely projected to boost government revenue and increase the ease of doing business in the world’s largest democracy, attention is also focusing on less obvious outcomes of Prime Minister Narendra Modi’s policy.

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