Description

BSE announces changes to Enhanced Surveillance Measure framework with securities entering, exiting, and moving between ESM stages effective January 19, 2026.

Summary

BSE has announced comprehensive changes to the Enhanced Surveillance Measure (ESM) Framework effective January 19, 2026. The circular identifies securities newly entering ESM, those moving between ESM stages (both higher and lower), and securities exiting the framework. ESM is a surveillance mechanism applied to securities exhibiting abnormal price movements or other concerns, imposing additional restrictions to protect investors.

Key Points

  • 3 securities newly shortlisted for ESM Framework (Krishna Ventures, Manaksia Aluminium, Tirth Plastic)
  • 4 securities moving to higher ESM stages (Kinetic Trust, Nagpur Power & Industries, Trade Wings, Vipul)
  • 11 securities moving to lower ESM stages (Arunjyoti Bio Ventures, Bluegod Entertainment, CHPL Industries, Continental Controls, Fynx Capital, Prima Industries, Rotographics India, SER Industries, Swadeshi Industries & Leasing, Systematix Securities, Wardwizard Foods and Beverages)
  • 19 securities moving out of ESM Framework entirely
  • Some securities exiting ESM are moving to other surveillance frameworks (SMP or IBC)
  • Changes affect both mainboard and SME segment securities

Regulatory Changes

The ESM Framework is a stage-based surveillance mechanism where securities are placed in different stages based on market behavior. Movement to higher stages typically results in more stringent trading restrictions (such as trade-for-trade settlement, reduced price bands, or additional margin requirements). Movement to lower stages or exit from ESM indicates improved compliance or normalized trading patterns.

Securities marked with special notations include:

  • “#” - SME Scrip
  • “*” - As per NSE classification
  • “$” - Moving to SMP Framework
  • “@” - Moving to IBC Framework
  • “^” - As per Parent Company
  • “~” - Will continue in Trade for Trade as per circular dated January 05, 2026

Compliance Requirements

  • Market participants must note the revised ESM status of affected securities
  • Trading members should update their systems to reflect new surveillance categories
  • Investors should be aware that securities in ESM may have restricted trading conditions including:
    • Trade-for-trade settlement (no intraday trading)
    • 100% upfront margin requirements
    • Price bands or other restrictions depending on ESM stage
  • Listed companies should ensure compliance with disclosure norms to avoid ESM placement

Important Dates

  • Effective Date: January 19, 2026 - All changes to ESM classification take effect
  • Circular Date: January 16, 2026

Impact Assessment

Market Impact: Medium - The circular affects 37 securities across mainboard and SME segments. Securities entering or moving to higher ESM stages will face increased trading restrictions, potentially reducing liquidity and investor participation. Conversely, securities exiting or moving to lower stages will experience relaxed conditions.

Investor Impact: Investors holding or trading these securities should note that ESM placement typically indicates heightened risk or abnormal market behavior. Enhanced surveillance measures may limit trading flexibility and require additional margins.

Operational Impact: Trading members and brokers must update their risk management systems to reflect new ESM classifications and associated trading restrictions from January 19, 2026.

Impact Justification

Affects 37 securities with changes in surveillance measures, impacting trading conditions for listed companies and investor accessibility