Description

BSE circular detailing 16 securities moving into higher GSM stages (Stage II, III, and IV) under the Graded Surveillance Measure framework effective October 14, 2025.

Summary

BSE has announced the movement of 16 securities into higher stages of the Graded Surveillance Measure (GSM) framework. Six securities are moving to Stage II, one security to Stage III, and nine securities to Stage IV. This action is part of BSE’s ongoing surveillance measures to monitor securities exhibiting abnormal price movements or other concerns requiring enhanced oversight.

Key Points

  • 16 securities are being moved to higher GSM stages effective this circular
  • 6 securities moving to GSM Stage II: Digjam Ltd, Ecoboard Industries Ltd, Revati Media Ltd, Shakti Press Ltd, Ace Engitech Ltd, and Aayush Wellness Ltd
  • 1 security moving to GSM Stage III: Aar Shyam India Investment Company Ltd
  • 9 securities moving to GSM Stage IV: Mipco Seamless Rings Gujarat Ltd, Premier Capital Services Ltd, Soma Papers & Industries Ltd, Bijoy Hans Ltd, Ashoka Refineries Ltd, Harmony Capital Service Ltd, ACE Edutrend Ltd, Oscar Global Ltd, and G-Tech Info-Training Ltd
  • Securities marked with (*) indicate alignment with NSE’s GSM classification
  • Securities may move to lower GSM stages if included in ESM (#) or IBC ($) frameworks

Regulatory Changes

Movement to higher GSM stages brings progressively stringent surveillance measures:

Stage II Implications:

  • Price band restrictions
  • Additional surveillance deposit (ASD) from buyers
  • 100% upfront margin requirement
  • Trade-for-trade settlement

Stage III Implications:

  • All Stage II restrictions plus higher ASD percentage
  • Enhanced disclosure requirements

Stage IV Implications:

  • Most stringent surveillance measures
  • Maximum ASD requirements
  • Strictest trading restrictions
  • Highest level of regulatory scrutiny

Compliance Requirements

For Brokers:

  • Collect additional surveillance deposits from clients for purchase transactions
  • Ensure 100% upfront margin collection
  • Implement trade-for-trade settlement procedures
  • Provide enhanced disclosures to clients about GSM securities

For Investors:

  • Pay additional surveillance deposit on buy transactions
  • Understand that these securities are under enhanced surveillance due to concerns
  • Accept delivery-based settlement only (no intraday trading)
  • Exercise increased caution when trading these securities

For Listed Companies:

  • Provide timely disclosures and clarifications
  • Address concerns that led to GSM classification
  • Work towards meeting exit criteria to move to lower stages

Important Dates

  • Effective Date: October 14, 2025 (date of circular issuance)
  • Securities will remain in assigned GSM stages until they meet exit criteria or are subject to further surveillance action

Impact Assessment

Market Impact:

  • Trading volumes in these securities likely to decline due to higher entry barriers
  • Liquidity constraints due to trade-for-trade settlement and additional deposit requirements
  • Potential price volatility as market adjusts to new trading conditions
  • Investor interest may diminish due to enhanced restrictions

Operational Impact:

  • Brokers must update systems to enforce ASD collection and trading restrictions
  • Increased monitoring and compliance burden on trading members
  • Risk management systems require updates to handle GSM securities appropriately

Investor Impact:

  • Higher cost of entry due to surveillance deposits
  • Reduced trading flexibility (no intraday positions)
  • Increased holding risk due to lower liquidity
  • Enhanced due diligence required before investing

Company Impact:

  • Reputational concerns due to GSM classification
  • Potential difficulty in raising capital
  • Pressure to improve compliance and address surveillance concerns
  • Need for proactive engagement with regulators to exit GSM framework

Impact Justification

Movement to higher GSM stages significantly impacts trading conditions with increased restrictions, additional surveillance deposit requirements, and enhanced reporting obligations for affected securities.