Description

NSE places HUBTOWN, LANCORHOL, and ZUARI under Long-Term Additional Surveillance Measure with 100% margin requirements effective September 1, 2025.

Summary

NSE has applied Additional Surveillance Measure (ASM) to three securities under the Long-Term ASM Framework Stage-I, effective August 28, 2025. The securities are Hubtown Limited (HUBTOWN), Lancor Holdings Limited (LANCORHOL), and Zuari Agro Chemicals Limited (ZUARI). This surveillance measure introduces stricter trading conditions including 100% margin requirements.

Key Points

  • Three securities placed under Long-Term Additional Surveillance Measure (ASM) Stage-I
  • 100% margin requirement applicable on all positions from September 1, 2025
  • LANCORHOL and ZUARI moved from Short-Term ASM to Long-Term ASM framework
  • No securities currently placed in Stage-IV (Trade-for-Trade segment)
  • ASM is a market surveillance tool and not an adverse action against companies

Regulatory Changes

  • Implementation of Long-Term ASM Framework for identified securities
  • Margin requirements increased to 100% for affected securities
  • Securities meeting Stage-IV criteria would be shifted from Rolling Settlement (EQ) to Trade-for-Trade segment (BE)

Compliance Requirements

  • Market participants must ensure 100% margin coverage for positions in affected securities
  • Compliance with all existing surveillance measures remains mandatory
  • Members should monitor positions in ASM securities closely

Important Dates

  • August 28, 2025: ASM framework becomes applicable
  • August 29, 2025: Cut-off date for existing open positions
  • September 1, 2025: 100% margin requirement becomes effective for all positions

Impact Assessment

The surveillance measure will increase trading costs for the three affected securities due to higher margin requirements. While this may reduce speculative activity in these stocks, it primarily serves as a risk management tool. The measure is limited in scope, affecting only three securities, so broader market impact is expected to be minimal. Investors holding positions in these securities should prepare for increased margin obligations.

Impact Justification

Affects trading conditions for three specific securities with increased margin requirements but limited market-wide impact