Description
BSE notifies inclusion of securities under Enhanced Surveillance Measure (ESM) attracting 100% margin from May 18, 2026, along with stage downgrades and exits from the ESM framework effective May 15, 2026.
Summary
BSE’s Surveillance Department has issued an update to the Enhanced Surveillance Measure (ESM) framework. New securities (listed in Annexure I) are being added to ESM and will attract a minimum 100% margin on all open positions as of May 15, 2026, and on new positions from May 18, 2026. Certain securities already under ESM are being moved to a lower stage (Stage I), while others are exiting the framework entirely effective May 15, 2026.
Key Points
- Securities in Annexure I newly included under ESM will attract minimum 100% margin w.e.f. May 18, 2026 on all open and new positions.
- Some securities are being downgraded to Stage I of the ESM Framework w.e.f. May 15, 2026 (also listed in Annexure I).
- All securities qualifying under ESM will be shifted from Rolling Settlement to Trade-for-Trade (T2T) segment w.e.f. May 18, 2026.
- Securities moving to Stage II will trade under Trade-for-Trade with a 2% price band and Periodic Call Auction w.e.f. May 15, 2026.
- Securities exiting the ESM framework w.e.f. May 15, 2026 are listed in Annexure II.
- A consolidated list of all securities currently under ESM is provided in Annexure III.
- ESM operates in conjunction with all other prevailing surveillance measures imposed by the exchanges.
- Shortlisting under ESM is purely for market surveillance purposes and should not be construed as an adverse action against the concerned company.
Regulatory Changes
This notice updates the ESM framework established through a series of prior notices (20230602-44, 20230718-46, 20240809-42, 20240920-63, 20241004-65, and 20250725-61). The changes include periodic review-driven additions, stage transitions, and removals of securities within the ESM framework. Price bands for securities exiting the framework are reinstated to their pre-ESM levels, subject to any other applicable surveillance measures.
Compliance Requirements
- Trading Members must ensure that the minimum 100% margin is collected on all open positions in newly included ESM securities as on May 15, 2026, and on all new positions from May 18, 2026.
- Members must comply with Trade-for-Trade settlement rules for all ESM-listed securities from the applicable effective dates.
- Members should refer to Annexure I, II, and III (attached to the circular) to identify the specific securities affected.
- For clarifications, members may contact BSE Surveillance at bse.surv@bseindia.com.
Important Dates
| Date | Event |
|---|---|
| May 14, 2026 | Notice issued |
| May 15, 2026 | Stage I downgrade effective; Stage II price band (2%) & Periodic Call Auction effective; ESM exits effective |
| May 18, 2026 | 100% margin requirement effective on open positions (as of May 15) and new positions; shift to Trade-for-Trade segment effective |
Impact Assessment
This circular has high market impact for holders and traders of the affected securities. The 100% margin requirement effectively doubles the capital required to maintain or open positions, significantly increasing the cost of trading and likely reducing liquidity. The mandatory shift to Trade-for-Trade settlement eliminates netting benefits and increases settlement risk exposure for members. Stage II securities face an additional 2% price band restriction and periodic call auction mechanism, further constraining intraday price movement and trading flexibility. Market participants should immediately review their portfolios against the Annexures to assess exposure and ensure margin adequacy before the effective dates.
Impact Justification
Imposition of 100% margin and shift to Trade-for-Trade segment significantly restricts trading in affected securities; Stage II securities face 2% price band and periodic call auction, materially limiting liquidity and price discovery for market participants holding these scrips.