Mumbai: The Bombay Stock Exchange (BSE) has decided to permit listing of the shares issued by small cap companies.

Under this, companies having a paid-up capital of Rs 3 crore, after the issue, can list on the exchange. Other conditions for listing on the BSE include a minimum turnover of Rs 3 crore in each of the previous three years and should have a minimum of 500 shareholders.

At present, the BSE allows listing of shares of the companies with a post-issue capital of Rs 10 crore or a post-issue capital Rs 5 crore with a market capitalisation of Rs 50 crore.

Says BSE chief executive officer and executive director Dr Manoj Vaish: "This measure will enable small companies to raise fresh capital, which will help growth in economy and overall development of the country. This will also enable the companies that are currently listed only on regional stock exchange to have a national presence through BSE's trading platform."

To avoid unscrupulous companies to raise money from investors, the BSE has laid down some strict norms that include a due-diligence to be done by an exchange-appointed independent team of chartered accountants or a merchant banker.