In 1997, the exchange went on-line. The belief that screen-based trading would shore up the volumes was shortlived. After the initial enthusiasm, the volumes began to decline and currently, it is even lower than what it was during the outcry system. The year 1998 saw the exchange put in place broker insurance, a settlement guarantee fund and a clearing house. Trading indematerialised shares is set to commence on January 7 while plans to introduce badla trading are in an advanced stage.

In order to increase the arbitrage opportunity, MSE has aligned with the Federation of Indian Stock Exchanges (Fise). It has also tied up with the Bombay Stock Exchange (BSE) for setting up BOLT terminals in Chennai.The exchange management is now hoping that more members will start trading in the new year. Currently, only a fraction of the 174 members are actively trading on the bourse. Drawing back the members and along with them their clients is the strategy that is being adopted by the exchange management to improve business.

But not all members are upbeat on the revival of MSE's fortunes. According to a senior member, the client profile of the exchange comprised predominantly of investors outside Chennai. Setting up of NSE terminals all around Chennai and in neighbouring states sucked volumes out of MSE. By simply putting up systems which the competition already has, investors cannotbe drawn back -- especially when there is an acute lack of liquidity on the exchange. MSE, he added, has to offer niche products to attract volumes.

The year also saw MSE auctioning membership cards which fetched Rs 7 lakh. The mere fact that there were takers for the card is interpreted by optimists as a sure sign of revival and for the superstitious lot -- the shifting of the trading system back to MSE's second line beach building, from where the exchange had attained its erstwhile premier status, is the beginning of a turnaround.