Description
BSE announces surveillance measures for companies with high promoter and non-promoter encumbrance under SEBI SAST Regulation 2011, effective January 30, 2026.
Summary
BSE has updated the list of securities subject to surveillance measures for companies with high promoter and non-promoter encumbrance as per Regulation 28(3) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulation 2011. The measures are effective from January 30, 2026. One security (Forbes & Company Ltd) has been newly added to the framework, while no securities are moving out. The consolidated list now contains 14 securities under this surveillance measure.
Key Points
- Forbes & Company Ltd (Scrip Code: 502865, ISIN: INE518A01013) newly added to high encumbrance surveillance framework
- No securities are moving out of the framework in this update
- Total of 14 securities currently under this surveillance measure
- Framework targets companies with high levels of pledged/encumbered shares by both promoters and non-promoters
- Measures designed to protect investor interests where significant shareholding is encumbered
Regulatory Changes
This circular implements surveillance measures under Regulation 28(3) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulation 2011. The regulation requires disclosure and monitoring of encumbrance of shares and voting rights. High encumbrance levels indicate elevated risk as promoter shares are pledged as collateral, potentially leading to forced selling in adverse situations.
Compliance Requirements
- Trading members and investors must be aware of securities under this framework
- Securities under this measure may face trading restrictions or additional margin requirements
- Companies must continue to comply with SEBI disclosure requirements regarding encumbrance of promoter and non-promoter holdings
- Market participants should exercise enhanced due diligence when trading these securities
Important Dates
- Effective Date: January 30, 2026 - New surveillance measures become applicable
- Circular Date: January 29, 2026
Impact Assessment
Market Impact: High encumbrance levels indicate financial stress and potential instability in the affected companies. The surveillance framework restricts liquidity and may increase volatility in these securities.
Investor Impact: Investors holding these securities face increased risk due to high promoter encumbrance. The framework provides transparency but may result in reduced trading activity and wider bid-ask spreads.
Operational Impact: Trading members must update their risk management systems to account for securities under this framework. Additional margin requirements and trading restrictions may apply.
Securities Currently Under Framework:
- Brahmaputra Infrastructure Ltd
- Forbes & Company Ltd (newly added)
- Forbes Precision Tools and Machine Parts Ltd
- Future Market Networks Ltd
- Gayatri Highways Ltd
- India Finsec Ltd
- India Nivesh Ltd
- Indo Tech Transformers Ltd
- NR Agarwal Industries Ltd
- Setco Automotive Ltd
- Shalimar Paints Ltd
- Sudal Industries Ltd
- Tulsyan NEC Ltd
- Visa Steel Ltd
Impact Justification
High encumbrance levels pose significant risk to investors and market stability. Surveillance measures restrict trading to protect market integrity under SEBI regulations.