Description

NSE imposes 75% minimum margin requirement on securities with high promoter and non-promoter encumbrance under SEBI SAST Regulation 28(3), adding Future Market Networks Limited to the surveillance framework.

Summary

NSE has issued a surveillance measure targeting companies with high promoter and non-promoter encumbrance as per Regulation 28(3) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulation 2011. Future Market Networks Limited (FMNL) has been added to this framework effective December 5, 2025, requiring a minimum 75% margin in Equity and Equity Derivatives segments. The consolidated list now includes three securities: Bedmutha Industries Limited, B. L. Kashyap and Sons Limited, and Future Market Networks Limited.

Key Points

  • Future Market Networks Limited (FMNL, ISIN: INE360L01017) added to high encumbrance surveillance measure
  • Minimum 75% margin requirement applicable in Equity and Equity Derivatives segments
  • Margin applies to both existing open positions as on December 4, 2025 and new positions from December 5, 2025
  • No securities are being excluded from the framework in this update
  • Consolidated list maintains three securities under surveillance
  • This measure operates in conjunction with all other prevailing exchange measures
  • Framework subject to periodic review

Regulatory Changes

This circular continues the surveillance framework established by NSE circular NSE/SURV/51189 dated January 31, 2022. The measure targets companies where both promoter and non-promoter shareholdings have high encumbrance levels as defined under SEBI (SAST) Regulation 2011, Regulation 28(3). The framework aims to manage risks associated with heavily encumbered shareholdings by imposing stringent margin requirements.

Compliance Requirements

For Trading Members:

  • Ensure 75% minimum margin is collected on all open positions in FMNL as on December 4, 2025
  • Apply 75% minimum margin on all new positions created from December 5, 2025 onwards
  • Monitor consolidated list of affected securities (Annexure III)
  • Comply with this measure alongside all other prevailing exchange requirements

Affected Securities:

  • Future Market Networks Limited (Symbol: FMNL, ISIN: INE360L01017) - newly added
  • Bedmutha Industries Limited (Symbol: BEDMUTHA, ISIN: INE844K01012) - continuing
  • B. L. Kashyap and Sons Limited (Symbol: BLKASHYAP, ISIN: INE350H01032) - continuing

Important Dates

  • December 2, 2025: Circular issued (Circular Ref. No. 932/2025)
  • December 4, 2025: Cut-off date for existing open positions subject to 75% margin
  • December 5, 2025: Enhanced margin requirement becomes effective for FMNL
  • December 3, 2025: Exclusion effective date (no securities being excluded in this update)

Impact Assessment

Trading Impact: The 75% margin requirement significantly increases capital requirements for traders holding positions in affected securities, potentially reducing trading volumes and liquidity in these stocks. Traders with existing positions in FMNL must ensure adequate margin coverage by December 4, 2025, or face potential position squaring.

Market Implications: The inclusion of FMNL indicates heightened regulatory concern about encumbrance levels in the company’s shareholding structure. This surveillance measure serves as a risk management tool but may also signal underlying financial stress or governance concerns. Market participants should exercise increased caution when trading these securities.

Operational Requirements: Brokers and trading members must update their risk management systems to enforce the 75% margin requirement automatically. This may require system changes and client communication regarding increased margin obligations.

Note: The exchange explicitly states that shortlisting under this measure should not be construed as adverse action against the company, though the practical impact on trading remains substantial.

Impact Justification

High margin requirement of 75% significantly impacts trading in affected securities, restricting liquidity and increasing capital requirements for positions in these stocks.