Description

BSE notifies trading members that certain securities will be moved to higher GSM stages effective April 29, 2026, attracting enhanced surveillance actions including trade-to-trade settlement, price bands, and Additional Surveillance Deposits.

Summary

BSE has issued a notice (No. 20260428-43) informing trading members that certain securities listed in the attached Annexure will be moved to their respective higher stages of the Graded Surveillance Measure (GSM) framework, effective April 29, 2026. This action is taken under the GSM Framework published on February 23, 2017, and subsequent amendments. The specific list of affected securities is provided in the Annexure (Annexure_GSM) accompanying the notice.

Key Points

  • Securities in the Annexure will be moved to higher GSM stages effective April 29, 2026
  • All affected securities will be subject to trade-to-trade settlement with no netting off allowed
  • Four GSM stages apply, each with progressively stricter surveillance actions
  • Stage I: 100% margin rate and price band of 5% or lower
  • Stage II: Trade-to-trade, 5% price band, and Additional Surveillance Deposit (ASD) of 50% of trade value payable by buyers
  • Stage III: Trade-to-trade, 5% price band, trading permitted once a week (every Monday/1st trading day), ASD of 100% of trade value by buyers
  • Stage IV: Same as Stage III with an additional restriction of no upward price movement
  • Trading members are advised to take adequate precautions while trading in affected securities

Regulatory Changes

This notice is issued with reference to the following prior exchange notices establishing and amending the GSM framework:

  • Exchange notice no. 20170223-44 dated February 23, 2017
  • Exchange notice no. 20170303-29 dated March 03, 2017
  • Exchange notice no. 20180720-55 dated July 20, 2018
  • Exchange notice no. 20191129-23 dated November 29, 2019
  • Exchange notice no. 20231117-63 dated November 17, 2023

No new regulatory framework is introduced; this is an application of the existing GSM framework to a new set of securities.

Compliance Requirements

  • Trading Members: Must note the securities moving into GSM stages and apply appropriate surveillance measures
  • Buyers: Must deposit Additional Surveillance Deposits (ASD) as applicable — 50% of trade value for Stage II, 100% of trade value for Stages III and IV
  • Settlement: All trades in affected securities must be settled on a trade-to-trade basis; no netting off is permitted
  • Clarifications: Members may refer to the GSM FAQ at http://www.bseindia.com/markets/equity/EQReports/graded_surveil_measure.aspx?expandable=6 or write to bse.surv@bseindia.com

Important Dates

  • April 28, 2026: Notice issued
  • April 29, 2026: Effective date — securities moved into their respective higher GSM stages

Impact Assessment

Securities moved into higher GSM stages face significantly reduced liquidity and heightened trading friction. Stage III and IV securities are restricted to once-a-week trading (Mondays), which can cause sharp price movements on trading days and make it difficult for investors to exit positions. The mandatory ASD requirements (up to 100% of trade value) substantially increase the cost of buying affected securities. Stage IV securities additionally face a no-upward-movement restriction, effectively capping any price recovery. Retail and institutional investors holding these securities may face mark-to-market losses and difficulty liquidating positions. Trading members should proactively inform clients holding these securities about the new restrictions.

Impact Justification

Securities moved into GSM stages face significant trading restrictions including trade-to-trade settlement, 5% price bands, 100% margins, and mandatory Additional Surveillance Deposits up to 100% of trade value, severely impacting liquidity and trading activity in affected stocks.