Description

BSE updates the list of securities under Enhanced Surveillance Measure framework, adding 5 new securities and moving 2 securities to higher ESM stages effective October 31, 2025.

Summary

BSE has updated the Enhanced Surveillance Measure (ESM) framework list effective October 31, 2025. Five new securities are being added to ESM Stage I, while two existing securities are being moved to higher ESM stages. No securities are moving to lower stages or exiting the framework. The consolidated list now includes at least 25 securities under various ESM stages.

Key Points

  • 5 new securities shortlisted for ESM Stage I: Adcon Capital Services Ltd, Aztec Fluids & Machinery Ltd, Essar Shipping Ltd, Groarc Industries India Ltd, and Riddhi Steel and Tube Ltd
  • 2 securities moved to higher ESM stages: Explicit Finance Ltd and Natura Hue Chem Ltd
  • No securities moved to lower ESM stages
  • No securities moving out of ESM framework
  • Changes effective from October 31, 2025
  • ESM framework applies graded surveillance with multiple stages (I, II, etc.)

Regulatory Changes

The ESM framework continues to operate under existing regulations with periodic updates to the securities list. Securities under ESM are subject to additional surveillance measures including Trade-for-Trade (T2T) settlement, reduced price bands, and increased margin requirements depending on the ESM stage.

Compliance Requirements

  • Trading members must apply ESM stage-specific trading restrictions from October 31, 2025
  • All trades in listed securities must be settled on T2T basis
  • Investors should be aware of enhanced margin requirements for ESM securities
  • No intraday trading or square-off allowed for ESM securities
  • Additional disclosures may be required from listed companies under ESM

Important Dates

  • Effective Date: October 31, 2025 - New ESM classifications become applicable
  • Circular Date: October 30, 2025

Impact Assessment

Market Impact: Medium - The addition of 5 new securities to ESM Stage I will restrict trading activity in these stocks with mandatory delivery-based trading. Liquidity in these securities is expected to decrease due to T2T settlement requirements.

Investor Impact: Investors holding or trading these securities will face stricter margin requirements and cannot engage in intraday trading. Two securities moving to higher ESM stages will face progressively stringent surveillance measures.

Operational Impact: Brokers and trading platforms must update their risk management systems to implement ESM stage-specific controls for the affected securities.

Impact Justification

Affects trading in 7 securities with enhanced surveillance measures; existing framework update rather than new regulation