Description

NSE places securities under Long Term ASM with 100% margin requirements effective October 13, 2025. BHARATSE enters Stage-I, MCLEODRUSS moves to Stage-II, and KIOCL shifts to Stage-IV with Trade-for-Trade segment.

Summary

NSE has issued surveillance measures under the Long Term Additional Surveillance Measure (ASM) framework effective October 13, 2025. The circular mandates 100% margin on all open positions as on October 10, 2025 and new positions from October 13, 2025 onwards for shortlisted securities. Three securities are affected: Bharat Seats Limited (BHARATSE) enters Stage-I, Mcleod Russel India Limited (MCLEODRUSS) moves from Stage-I to Stage-II, and KIOCL Limited (KIOCL) moves from Stage-I to Stage-IV with mandatory shift to Trade-for-Trade segment.

Key Points

  • 100% margin applicable on all positions (existing and new) from October 13, 2025
  • BHARATSE (Bharat Seats Limited, ISIN: INE415D01024) shortlisted in Long-Term ASM Stage-I
  • MCLEODRUSS (Mcleod Russel India Limited, ISIN: INE942G01012) moves from Stage-I to Stage-II
  • KIOCL (KIOCL Limited, ISIN: INE880L01014) moves from Stage-I to Stage-IV
  • KIOCL will shift from Rolling Settlement (Series: EQ) to Trade-for-Trade segment (Series: BE) from October 13, 2025
  • ASM framework operates in conjunction with other prevailing surveillance measures
  • Shortlisting is purely surveillance-based and not an adverse action against the company

Regulatory Changes

The circular implements Long Term ASM provisions under the framework established through multiple previous circulars (NSE/SURV/39265 dated October 27, 2018, NSE/SURV/45111 dated July 22, 2020, NSE/SURV/46557 dated December 04, 2020, NSE/SURV/48506 dated June 04, 2021, NSE/SURV/52090 dated April 22, 2022, NSE/SURV/63362 dated August 09, 2024, and NSE/SURV/64066 dated September 20, 2024).

Securities qualifying under Criteria VII (Scrips shifted to Stage IV) are mandatorily shifted to Trade-for-Trade segment, eliminating intraday trading and requiring delivery-based settlement.

Compliance Requirements

  • All NSE members must ensure 100% margin coverage for open positions in affected securities as on October 10, 2025
  • 100% margin must be collected on all new positions in these securities from October 13, 2025 onwards
  • Trading members must adjust systems for KIOCL’s shift to Trade-for-Trade (Series: BE) segment from October 13, 2025
  • Members should inform clients about the enhanced surveillance measures and margin requirements
  • Queries may be directed to surveillance@nse.co.in

Important Dates

  • October 08, 2025: Circular issued
  • October 09, 2025: Securities officially shortlisted in respective ASM stages
  • October 10, 2025: Cut-off date for existing open positions subject to 100% margin
  • October 13, 2025: Effective date for 100% margin on all positions and KIOCL’s shift to Trade-for-Trade segment

Impact Assessment

Market Impact: High - The 100% margin requirement significantly increases capital requirements for traders holding positions in affected securities, potentially reducing liquidity and trading volumes.

KIOCL Specific Impact: Very High - The shift to Trade-for-Trade segment eliminates intraday trading opportunities, requires full upfront payment/delivery, and increases settlement risk. This typically results in reduced liquidity and wider bid-ask spreads.

Trading Impact: Traders with existing positions in these securities as of October 10, 2025 must arrange for 100% margin by October 13, 2025, or face position squaring. New position-taking becomes capital intensive.

Investor Impact: Long-term investors face no direct impact beyond margin requirements if holding in demat form. Short-term traders and arbitrageurs will find these securities less attractive due to higher capital costs and reduced flexibility.

Operational Impact: Brokers and trading members must update risk management systems, inform clients, and ensure compliance with enhanced margin collection from October 13, 2025.

Impact Justification

High ranking due to 100% margin requirement on affected securities and shift of KIOCL to Trade-for-Trade segment, significantly impacting trading flexibility and capital requirements for market participants