Description
BSE notifies trading members that select securities will be moved to higher Graded Surveillance Measure (GSM) stages effective April 9, 2026, attracting enhanced margin requirements, trade-to-trade settlement, and trading frequency restrictions.
Summary
BSE has issued Notice No. 20260408-34 informing trading members that certain securities (listed in the attached Annexure) will be moved to higher stages of the Graded Surveillance Measure (GSM) framework effective April 9, 2026. The GSM framework, originally published on February 23, 2017, imposes progressively stricter surveillance actions on securities at each stage.
Key Points
- Securities listed in the attached Annexure will be escalated to higher GSM stages from April 9, 2026
- Four GSM stages apply, each with increasingly restrictive trading conditions
- Settlement for all affected securities will be on a trade-to-trade basis (no netting off allowed)
- Trading members are urged to take adequate precautions while trading in the affected securities
- Queries can be directed to bse.surv@bseindia.com or the GSM FAQ page
Regulatory Changes
This notice references the GSM framework established under the following prior notices:
- Exchange Notice 20170223-44 (February 23, 2017) — original GSM framework
- Exchange Notice 20170303-29 (March 03, 2017)
- Exchange Notice 20180720-55 (July 20, 2018)
- Exchange Notice 20191129-23 (November 29, 2019)
- Exchange Notice 20231117-63 (November 17, 2023)
No new regulatory framework is introduced; this is an application of the existing GSM framework to newly identified securities.
Compliance Requirements
Trading members must comply with the following surveillance actions based on the GSM stage assigned to each security:
| Stage | Surveillance Actions |
|---|---|
| I | 100% applicable margin rate; price band of 5% or lower |
| II | Trade-to-trade; price band of 5% or lower; Additional Surveillance Deposit (ASD) of 50% of trade value to be deposited by buyers |
| III | Trade-to-trade; price band of 5% or lower; trading permitted once a week (every Monday/1st trading day); ASD of 100% of trade value by buyers |
| IV | Trade-to-trade; price band of 5% or lower; trading permitted once a week (every Monday/1st trading day); ASD of 100% of trade value by buyers; no upward price movement allowed |
- No netting off is permitted; all settlements must be done on a trade-to-trade basis
- Buyers in Stage II–IV securities must deposit the required ASD before trading
Important Dates
- April 9, 2026: Effective date for securities moving into their respective higher GSM stages
Impact Assessment
The escalation of securities to higher GSM stages significantly restricts their tradability and liquidity. Stage III and IV securities are especially impacted, as trading is limited to once per week and buyers must deposit 100% of trade value as ASD. Stage IV securities face an additional prohibition on upward price movement, effectively capping gains. Investors holding these securities may face challenges in exiting positions due to weekly trading windows and high margin requirements. Trading members should review the Annexure carefully and update their systems and client communications accordingly.
Impact Justification
GSM stage escalations impose significant trading restrictions including 100% margins, trade-to-trade settlement, ASD requirements up to 100%, and weekly trading limits, directly impacting liquidity and tradability of affected securities.