Description

NSE implements surveillance measures with 35% margin requirements for companies with high encumbrance, adding 2 securities and removing 6 securities from the framework.

Summary

NSE has updated its surveillance framework for companies with high encumbrance as per SEBI (SAST) Regulation 28(3). Two securities (MSPL and RTNPOWER) will be added to the surveillance measure effective August 7, 2025, while six securities will be removed effective August 5, 2025. The consolidated list now contains 8 securities subject to minimum 35% margin requirements.

Key Points

  • 2 securities added to surveillance framework: MSP STEEL & POWER LIMITED and RATTANINDIA POWER LIMITED
  • 6 securities removed from framework including HINDUSTAN ZINC LIMITED and APOLLO MICRO SYSTEMS LIMITED
  • Minimum 35% margin requirement applies to both Equity and Equity Derivatives segments
  • Consolidated list maintains 8 securities under the surveillance measure
  • Companies can submit representations by 5:00 PM on August 5, 2025

Regulatory Changes

The surveillance measure is implemented under SEBI (SAST) Regulation 2011, specifically Regulation 28(3) addressing high encumbrance levels. This continues the framework established in previous circulars from October 2019 and April 2020.

Compliance Requirements

  • Trading members must ensure 35% minimum margin on all open positions as of August 6, 2025
  • 35% margin applies to new positions created from August 7, 2025 onwards
  • Margin requirements apply to both Equity and Equity Derivatives segments
  • Companies may submit representations for reconsideration before the deadline

Important Dates

  • August 5, 2025: Securities exclusion effective date
  • August 5, 2025, 5:00 PM: Deadline for company representations
  • August 6, 2025: Last day for existing margin calculations
  • August 7, 2025: New surveillance measure implementation date

Impact Assessment

The measure affects trading liquidity and cost for the specified securities through increased margin requirements. Six securities gain relief from restrictions while two face new constraints. The framework undergoes periodic review and operates alongside other surveillance measures, indicating ongoing regulatory monitoring of market risks related to high encumbrance levels.

Impact Justification

Affects specific securities with increased margin requirements and trading restrictions based on regulatory compliance