Description

NSE implements Long Term Additional Surveillance Measure for 2 securities with 100% margin requirement effective August 5, 2025.

Summary

NSE has imposed Long Term Additional Surveillance Measure (ASM) on 2 securities - Garuda Construction and Engineering Limited and Hind Rectifiers Limited. Both securities will be subject to 100% margin requirement on all positions effective August 5, 2025. These securities were moved from Short Term ASM to Long Term ASM framework.

Key Points

  • 2 securities included in Long Term ASM Framework Stage-I effective August 1, 2025
  • 100% margin requirement applicable from August 5, 2025
  • Both securities previously under ST-ASM, now moved to LT-ASM
  • No securities listed for Stage-IV (Trade-for-Trade segment shift)
  • ASM framework operates in conjunction with other surveillance measures

Regulatory Changes

  • Implementation of Long Term Additional Surveillance Measure framework
  • Margin requirement increased to 100% for specified securities
  • Securities meeting criteria VII would be shifted from Rolling Settlement (EQ) to Trade-for-Trade (BE) segment

Compliance Requirements

  • Market participants must maintain 100% margin on all open positions as of August 4, 2025
  • 100% margin required on new positions created from August 5, 2025 onwards
  • Members must comply with enhanced surveillance measures
  • Queries to be directed to surveillance@nse.co.in

Important Dates

  • August 1, 2025: Securities shortlisted under Long Term ASM Framework Stage-I
  • August 4, 2025: Last day with existing margin requirements
  • August 5, 2025: 100% margin requirement becomes effective

Impact Assessment

High Impact: The 100% margin requirement significantly increases the cost of trading and holding positions in GARUDA and HIRECT securities. This measure will likely reduce trading volumes and liquidity in these stocks. The surveillance action is purely market-based and should not be construed as adverse action against the companies. Market participants should reassess their positions and margin requirements before the effective date.

Impact Justification

100% margin requirement significantly impacts trading liquidity and cost for affected securities