Graded Surveillance Measure (GSM) - Securities Moving to Different GSM Stages

Description

BSE announces movement of 8 securities across GSM stages, with securities moving to stages 0, I, II, and III under the Graded Surveillance Measure framework.

Summary

BSE has announced changes to the Graded Surveillance Measure (GSM) classification for 8 securities, effective October 27, 2025. The GSM framework is designed to alert investors about securities that have witnessed abnormal price movements or unusual trading patterns. Securities are being moved to different stages (0, I, II, and III), with each stage indicating varying levels of surveillance intensity. Notably, Nivaka Fashions Ltd is moving to a lower GSM stage (Stage 0) due to its inclusion in the Enhanced Surveillance Measure (ESM) Framework.

Key Points

• 8 securities are being reclassified under different GSM stages
• 1 security (Nivaka Fashions Ltd) moving to Stage 0 due to ESM Framework inclusion
• 4 securities moving to GSM Stage I: Amit International Ltd, Devine Impex Ltd, Mega Fin India Ltd, and SSPN Finance Ltd
• 2 securities moving to GSM Stage II: Gujarat Lease Financing Ltd and RKD Agri & Retail Ltd
• 1 security moving to GSM Stage III: Relic Technologies Ltd
• Securities marked with # are moving to lower GSM stages due to ESM Framework inclusion
• Securities marked with $ move to lower GSM stages due to IBC Framework inclusion
• Higher GSM stages indicate more stringent surveillance measures

Regulatory Changes

The GSM framework operates on a staged approach where securities exhibiting concerning trading patterns are subject to progressively stricter surveillance:

• Stage 0: Indicates exit from regular GSM due to inclusion in other frameworks (ESM/IBC)
• Stage I: Initial surveillance stage with basic monitoring
• Stage II: Enhanced surveillance with stricter requirements
• Stage III: Highest level of surveillance with most stringent trading conditions

Securities can move between stages based on their trading behavior and compliance with regulatory norms.

Compliance Requirements

• Investors should be aware that securities in higher GSM stages may have additional trading restrictions
• Market participants must conduct enhanced due diligence before trading in GSM securities
• Trading members should ensure clients are informed about the GSM status of securities
• Securities in GSM stages may be subject to additional margin requirements and position limits
• Clients may need to provide additional disclosures or confirmations for trading in GSM securities

Important Dates

• Effective Date: October 27, 2025 - GSM stage changes become applicable

Impact Assessment

Market Impact: The reclassification affects liquidity and trading activity in these 8 securities. Higher GSM stages typically result in reduced trading volumes due to additional surveillance measures and investor caution.

Investor Impact: Investors holding or trading these securities should be aware of the increased surveillance and potential restrictions. Securities in higher GSM stages carry elevated risk profiles and may face trading limitations such as reduced price bands, additional margin requirements, or mandatory physical settlement.

Operational Impact: Brokers and trading members must update their systems to reflect the new GSM classifications and ensure appropriate risk management measures are in place. The movement of Nivaka Fashions Ltd to Stage 0 (due to ESM inclusion) indicates that this security will be subject to ESM framework rules rather than regular GSM provisions.

Detailed Security List

Impact Justification

Affects trading conditions for 8 securities with varying GSM stages, indicating increased surveillance requirements and potential trading restrictions for these stocks