A circular to the exchange members has the request - "To kindly select atleast those companies out of this list with whom you can arrange to get theagreement signed with CDS.''

The members have been asked to send a list of companies "which you can helpto sign the agreement with CDS at your earliest". A deadline of January 31,2000 has been fixed for the members to bring the companies within CDSL.

Markets regulator Securities and Exchange Board of India has prescribedcompulsory demat trading in 200 securities for all investors and in 500securities for institutional investors and foreign institutionalinvestors.

So far, out of the 200 companies, 192 companies have signed an agreementwith CDSL while the rest have not and out of the other 300 companies, 104companies have signed while 196 have yet to sign up with the depository,making a total of 204 companies which have not opened account with CDSL.

Exchange officials said that the request to its members had been made on apurely voluntary basis and in the interest of investors who will have awider choice. "Some of the members by virtue of their trading largely in thescrips of certain companies have close relations with them, and we hope theycan influence them to sign up with CDSL.''

CDSL, promoted by BSE has only around 13,000 client accounts as compared tothe only other depository in the country, National Securities Depository Ltd(NSDL), which has more than 16.5 lakh client accounts. According to CBBhave, managing director of NSDL, they are targeting a client base of 25lakh to 30 lakh accounts by the end of 2000.

One of the reasons that NSDL has more accounts is due to the historical factthat CDSL had not attained connectivity with National Stock Exchange and theexchanges at Calcutta and Delhi, though that is expected to be remedied whenthe bourses adopt a rolling settlement format from January 10. In fact,rolling settlement would have been introduced last year itself, but for ahitch.

Those which had already tied up with NSDL did not feel it necessary to openanother account with CDSL - "when people can trade in any exchange andsettle with NSDL, why should they incur additional fees throughinter-depository transfers as a result of CDSL's non-connectivity" sourceswondered. Even after CDSL gets connectivity with other exchanges, it willhave to do some hard-sell in order to get people to open accounts with it,depository participants felt.

BSE as its main promoter has been frequently coming to CDSL's rescue.Recently, the exchange had the occasion to come down heavily on those of itsmembers who refused to accept or deliver shares of their clients andinvestors, which have been dematerialised with CDSL.