Description

NSE updates Enhanced Surveillance Measure framework with securities moving between stages, including 2 securities moving to Stage II and consolidated list of 4+ securities under ESM.

Summary

NSE has issued updates to the Enhanced Surveillance Measure (ESM) framework effective August 19-20, 2025. Two securities (MANUGRAPH and UMAEXPORTS) are moving from Stage I to Stage II, while no new securities are being added to Stage I or excluded from the framework. Securities under ESM attract minimum 100% margin and are shifted to Trade-for-Trade segment.

Key Points

  • No new securities added to ESM Stage I
  • 2 securities moving from Stage I to Stage II: MANUGRAPH and UMAEXPORTS
  • No securities moving from Stage II to Stage I
  • No securities being excluded from ESM framework
  • Consolidated list shows at least 4 securities under ESM including ABMINTLLTD, ASLIND, and ASPIRE
  • All ESM securities attract minimum 100% margin requirement
  • Securities shift from Rolling Settlement (EQ/SM) to Trade-for-Trade (BE/ST) segment

Regulatory Changes

  • Stage II securities will be under Trade for Trade with 2% price band under Periodic Call Auction
  • Enhanced surveillance framework operates in conjunction with other prevailing surveillance measures
  • Shortlisting is purely for market surveillance and not an adverse action against companies

Compliance Requirements

  • Market participants must comply with 100% margin requirements on all open positions as of August 19, 2025
  • New positions created from August 20, 2025 will attract minimum 100% margin
  • Trading in affected securities will be restricted to Trade-for-Trade segment

Important Dates

  • August 19, 2025: Stage changes become effective; 100% margin applies to existing open positions
  • August 20, 2025: Securities shift to Trade-for-Trade segment; 100% margin applies to new positions

Impact Assessment

Medium impact on affected securities and their traders. The 100% margin requirement significantly increases capital requirements for trading these securities. Movement to Trade-for-Trade segment reduces liquidity and increases settlement obligations. Stage II securities face additional restrictions with 2% price band under Periodic Call Auction, further limiting price movement and trading flexibility.

Impact Justification

Affects multiple securities with increased margin requirements and trading restrictions