Applicability of Additional Surveillance Measure (ASM) under Insolvency and Bankruptcy Code (IBC)

Description

NSE circular announcing changes to the ASM framework for companies under IBC, effective April 01, 2026. Five securities are being added to the 'Receipt of corporate announcement/disclosure' category while no securities are being excluded.

Summary

NSE has issued updates to the Additional Surveillance Measure (ASM) framework applicable to companies under the Insolvency and Bankruptcy Code (IBC), effective April 01, 2026. Five securities — ARSHIYA, CLCIND, EASTSILK, GENSOL, and HDIL — are being moved into the ‘Receipt of corporate announcement/disclosure from the company’ category under ASM IBC. No securities are being added to Stage I or Stage II, no inter-stage movements are occurring, and no securities are being removed from the ASM IBC list.

Key Points

• Five securities added to ASM IBC ‘Receipt of corporate announcement/disclosure’ category effective April 01, 2026: Arshiya Limited (ARSHIYA), CLC Industries Limited (CLCIND), Eastern Silk Industries Limited (EASTSILK), Gensol Engineering Limited (GENSOL), and Housing Development and Infrastructure Limited (HDIL)
• No securities are being newly added to ASM IBC Stage I or Stage II
• No securities are moving between Stage I and Stage II (in either direction)
• No securities are being excluded from the ASM IBC list
• The consolidated ASM IBC list contains securities across Stage I and the ‘Receipt of corporate announcement/disclosure’ category
• Stage I securities (continuing): ABAN (Aban Offshore Limited), NEUEON (Neueon Corporation Limited), RHFL (Reliance Home Finance Limited), SANWARIA (Sanwaria Consumer Limited)

Regulatory Changes

Under SEBI’s ASM framework, securities of companies subject to IBC proceedings are placed under enhanced surveillance to protect investors. The ‘Receipt of corporate announcement/disclosure’ sub-category applies when a company has made disclosures relating to IBC proceedings. Stage I and Stage II represent escalating levels of surveillance with progressively stricter trading conditions (e.g., trade-for-trade settlement, reduced price bands).

Compliance Requirements

• Trading Members / Brokers: Must update their systems to reflect the revised ASM IBC list effective April 01, 2026. Applicable margin, settlement, and price band requirements for each ASM stage must be enforced for the listed securities.
• Investors: Should be aware that trading in ASM IBC-listed securities is subject to additional restrictions including trade-for-trade settlement and enhanced margin requirements depending on the stage.
• Clearing Members: Must ensure proper margin collection and settlement obligations as per the ASM stage assigned to each security.

Important Dates

• Effective Date: April 01, 2026 — all additions and changes to ASM IBC categorisation come into force
• Circular Date: March 30, 2026

Impact Assessment

Newly Added Securities (effective April 01, 2026):

Market Impact: The inclusion of GENSOL is particularly notable given it is a recently high-profile IBC case. HDIL has been a long-standing IBC case. Traders and investors in these securities should expect trade-for-trade settlement and enhanced margin requirements, reducing liquidity and increasing transaction costs. Institutional investors may face restrictions on accumulation. The ASM IBC designation signals regulatory concern over corporate governance and financial distress at these companies.

Impact Justification

This circular imposes ASM trading restrictions on multiple securities under IBC proceedings, directly affecting tradability and investor access. The addition of GENSOL (a high-profile recent IBC case) and four other securities significantly impacts market participants holding or trading these stocks.