Description
BSE imposes minimum 75% margin requirement on securities with high promoter and non-promoter encumbrance under SEBI SAST Regulation 28(3), effective May 11, 2026, while certain securities exit the framework from May 7, 2026.
Summary
BSE has issued a surveillance measure under SEBI (SAST) Regulation 28(3) targeting companies with high promoter as well as non-promoter encumbrance. Securities meeting the inclusion criteria will attract a minimum 75% margin requirement in the Equity and Equity Derivatives segments from May 11, 2026. Separately, certain securities become eligible to exit the framework from May 7, 2026. This circular is a continuation of Exchange Notice No. 20220131-43 dated January 31, 2022.
Key Points
- Securities in Annexure I meet the inclusion criteria and will attract a minimum 75% margin in Equity and Equity Derivatives segments
- The 75% margin applies to all open positions as on May 08, 2026 and all new positions created from May 11, 2026
- Securities in Annexure II are eligible to exit the encumbrance framework effective May 07, 2026
- Annexure III provides a consolidated list of all securities currently under the framework
- This measure operates in conjunction with all other prevailing surveillance measures imposed by exchanges
- The measure is subject to periodic review
- Inclusion in this measure should not be construed as an adverse action against the concerned company
Regulatory Changes
No new regulatory framework is introduced. This circular continues the existing encumbrance-based surveillance mechanism established under SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 2011, Regulation 28(3), first operationalized via BSE Notice No. 20220131-43 dated January 31, 2022. The update reflects a periodic revision to the list of securities under the framework.
Compliance Requirements
- Trading Members must ensure compliance with the 75% minimum margin requirement for securities listed in Annexure I
- Members must apply the margin to all open positions held as of May 08, 2026
- Members must apply the margin to all new positions created on or after May 11, 2026
- For clarifications, members may contact BSE Surveillance at bse.surv@bseindia.com
Important Dates
| Date | Event |
|---|---|
| May 06, 2026 | Notice issued |
| May 07, 2026 | Securities in Annexure II exit the framework |
| May 08, 2026 | Reference date for existing open positions subject to 75% margin |
| May 11, 2026 | 75% margin requirement becomes effective for Annexure I securities |
Impact Assessment
This measure significantly increases the cost of trading in affected securities by requiring 75% margin — well above standard margin levels — in both cash equity and derivatives segments. Traders and investors holding positions in Annexure I securities face substantially higher capital lock-in. The dual application to both open and new positions ensures immediate impact across existing portfolios. Market participants should review the annexures to identify affected holdings. The measure is designed to deter speculative activity in stocks where promoter or non-promoter pledging/encumbrance is elevated, aligning with SEBI’s broader investor protection objectives under the SAST framework.
Impact Justification
Mandates 75% minimum margin on affected securities in both equity and equity derivatives segments, significantly increasing trading costs and capital requirements for positions in listed companies with high encumbrance.