Description

NSE adds Axita Cotton Limited and Rockingdeals Circular Economy Limited to ESM Stage I with 100% margin requirement and trade-for-trade settlement effective January 1, 2026.

Summary

NSE has included two securities under Enhanced Surveillance Measure (ESM) Stage I effective January 1, 2026. The affected securities are Axita Cotton Limited (AXITA) and Rockingdeals Circular Economy Limited (ROCKINGDCE). These securities will attract a minimum 100% margin on all open positions as of December 31, 2025, and new positions from January 1, 2026. Additionally, they will be shifted from Rolling Settlement segment (EQ/SM series) to Trade-for-Trade segment (BE/ST series).

Key Points

  • Two securities added to ESM Stage I: AXITA (INE02EZ01022) and ROCKINGDCE (INE0PTR01012)
  • 100% minimum margin requirement applicable on all positions
  • Securities shifted from Rolling Settlement (EQ/SM) to Trade-for-Trade (BE/ST) segment
  • No securities moving between Stage I and Stage II
  • No securities being excluded from ESM framework
  • ESM framework operates in conjunction with other surveillance measures
  • Action is purely for market surveillance and not adverse against companies

Regulatory Changes

Securities qualifying under ESM will be shifted from Rolling Settlement segment (Series: EQ/SM) to Trade-for-Trade segment (Series: BE/ST) effective January 1, 2026. Securities moving to Stage II will be under Trade-for-Trade with a 2% price band under Periodic Call Auction effective December 31, 2025.

Compliance Requirements

  • Members must ensure 100% margin collection on all open positions in affected securities as on December 31, 2025
  • 100% margin must be collected on all new positions created from January 1, 2026
  • Trading in affected securities will be restricted to Trade-for-Trade settlement only
  • Market participants must comply with ESM framework alongside all other prevailing surveillance measures

Important Dates

  • December 31, 2025: Securities moving to Stage II come under Trade-for-Trade with 2% price band under Periodic Call Auction
  • December 31, 2025: 100% margin applicable on all open positions in newly added ESM securities
  • January 1, 2026: Effective date for 100% margin on new positions
  • January 1, 2026: Securities shift from EQ/SM to BE/ST segment

Impact Assessment

Market Impact: High - The 100% margin requirement will significantly reduce leverage and liquidity in the two affected securities. The shift to Trade-for-Trade settlement eliminates intraday trading and may substantially reduce trading volumes.

Operational Impact: High - Brokers and traders with existing positions in AXITA and ROCKINGDCE must arrange for 100% margin by December 31, 2025. The segment change requires system adjustments and may impact existing trading strategies.

Investor Impact: High - Investors holding these securities will face increased capital requirements and reduced liquidity. The trade-for-trade mechanism means mandatory delivery, eliminating speculative trading opportunities.

Impact Justification

High severity and impact due to mandatory 100% margin requirement and shift to trade-for-trade segment for affected securities, significantly restricting trading activity