Description

BSE revises eligibility criteria for SME companies migrating to Main Board and companies from other exchanges seeking direct listing, with unified requirements for market cap, liquidity, profitability and compliance.

Summary

BSE has revised the eligibility criteria for SME companies seeking migration to Main Board and for companies listed on other recognized stock exchanges seeking direct listing on Main Board. The circular establishes unified eligibility criteria covering capital requirements, market performance metrics, profitability standards, and compliance parameters.

Key Points

  • Minimum paid-up capital requirement of Rs. 10 crores
  • Market capitalisation requirements: Rs. 100 crores for migration, Rs. 1000 crores for direct listing (6-month average)
  • Mandatory 5% of weighted average equity shares traded during 6-month period
  • Trading required on at least 80% of days during 6-month assessment period
  • Minimum average daily turnover of Rs. 10 lacs and minimum daily turnover of Rs. 5 lacs
  • Minimum 50 average daily trades and 25 minimum daily trades during assessment period
  • Operating profit (EBITDA) average of Rs. 15 crores over preceding 3 years with minimum Rs. 10 crores each year
  • Net worth requirement of Rs. 1 crore in each of preceding three years
  • Net tangible assets of at least Rs. 3 crores in each of preceding three years

Regulatory Changes

  • Unified eligibility criteria now apply to both SME migration and direct listing from other exchanges
  • Enhanced market liquidity requirements with specific trading frequency and volume thresholds
  • Strengthened profitability requirements with consistent operating profit over 3-year period
  • Clear distinction in market capitalisation requirements between migration (Rs. 100 cr) and direct listing (Rs. 1000 cr)

Compliance Requirements

  • Promoter holding of at least 20% at application time
  • 6-month lock-in period for promoter shares from BSE listing date (not applicable to SME migrations)
  • No SEBI debarment orders against company, promoters, or directors
  • Company and promoters must not be wilful defaulters or fraudulent borrowers
  • Promoters/directors must not be fugitive economic offenders
  • Company not under NCLT winding up or insolvency proceedings
  • No trading suspension for non-compliance in last 12 months
  • 100% shareholding in demat form
  • 3-year track record with no pending non-compliance
  • Minimum 3-year listing history required

Important Dates

  • Effective immediately upon circular issuance (August 20, 2025)
  • 6-month assessment period for market performance metrics
  • 3-year historical data required for profitability and compliance assessment

Impact Assessment

  • Creates clearer pathway for SME companies to graduate to Main Board with defined quantitative criteria
  • May reduce number of eligible companies due to enhanced liquidity and profitability requirements
  • Provides regulatory clarity for companies from other exchanges considering BSE listing
  • Strengthens quality of Main Board listings through rigorous eligibility standards
  • May impact SME ecosystem by setting higher barriers for Main Board migration

Impact Justification

Affects SME companies and those seeking cross-listing, establishing new unified criteria for board migration and direct listing