39 stocks will move out of the additional surveillance measures framework on Monday, according to the S&P BSE Sensex.
With this, the bourse said in a notification on its website, there are only 61 stocks which are currently under the framework.
The Securities and Exchange Board of India and exchanges had in March last year decided to place shares of select companies under additional surveillance—or ASM. This was aimed at checking any abnormal rise in stock prices not commensurate with the financial health of companies.
BSE Ltd. added 109 companies, including Reliance Naval and Engineering, Amtek Auto, GVK Power & Infrastructure, to the ASM framework in June last year, while stating that the move shouldn't be construed as an adverse action against the companies.
Among the criteria used to identify companies to be placed under the mechanism are:
- Volatility in stock price.
- Concentration of shareholding.
- Number of times the scrip hits the circuits or daily limits.
For companies placed under ASM:
- The circuit breaker kicks in at a 5 percent change in price.
- Buyers need to pay brokers upfront the full amount to acquire shares
- 100 percent margin will be levied.
Securities under the ASM framework are reviewed every month on a daily rolling basis.
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