BSE: New rules have been implemented by the Bombay Stock Exchange (BSE) for small and medium-sized businesses (SMEs) that want to transfer from the SME platform to the main board. In order to move to the main board, an applicant business must have a net value of at least ₹15 crore for the two previous financial years, according to the most recent standards. In addition, the requirements state that the applicant company must have a minimum of three years of listing history on the SME platform. Prior to moving to the main board, they need also to have 250 public shareholders.
Under the new rules, SMEs aiming to shift to the main board must meet additional criteria. They need to demonstrate a positive operating profit in at least two out of the three preceding financial years, along with a positive profit after tax (PAT) in the immediate financial year when submitting the migration application to the exchange.
The applicant firm’s market capitalization must be at least ₹25 crore, and its paid-up equity capital must exceed ₹10 crore.
Furthermore, the applicant company should not have experienced any significant regulatory actions in the preceding three years. This includes scenarios like trading suspension by a stock exchange against the SME and its promoters, as well as the absence of any winding-up petition accepted by the National Company Law Tribunal (NCLT).
Such enterprises, their promoters, and their subsidiaries should not be debarred by the capital markets regulator Sebi.
The new standards will take effect on January 1, 2024, according to the BSE.
Currently, 181 of the 464 firms that have been listed on the BSE SME platform have moved to the main board.
In March 2012, BSE and the National Stock Exchange (NSE) jointly introduced specialized platforms designed for SMEs. These platforms facilitate the listing of such firms, providing them with a cost-effective means to raise equity capital for their growth and expansion.
