BSE, NSE put in place measures to enhance monitoring of firms

NEW DELHI: Leading stock exchanges BSE and NSE have put in place a detailed framework for shortlisting and reviewing of securities under graded surveillance measures (GSM), wherein investors need to be extra cautious while dealing in such stocks.

These additional guidelines have been made after a joint surveillance meeting of markets regulator Sebi with exchanges last week, the bourses said in separate circulars.

Under the new criteria, securities having a networth of less than or equal to Rs 10 crore and net fixed assets of less than or equal to Rs 25 crore are eligible for inclusion under the GSM framework.

Also, securities with a negative price earning (PE); or having a greater than two times PE of benchmark index -- Nifty 500 or S&P BSE 500 --can be included.

Further, the exchanges said securities with full market capitalisation of less than Rs 25 crore can be directly included under GSM stage I.

GSM framework has been made to check any abnormal rise in stock price not commensurate with the company's financial health. The framework has six stages with surveillance action defined for each stage.

According to the exchanges, securities placed under GSM framework would be reviewed on quarterly basis and securities not meeting the inclusion criteria would be moved out of the GSM framework.

The bourses said public sector enterprises; securities already under suspension; securities on which derivative products are available; firms listed during last one year through initial public offer and those which have paid dividend for each of last three preceding years, will not be included under the framework.

In addition, securities listed through scheme of arrangement involving merger or demerger in last one year will not be included.

"In case of merger of companies, if any of the securities at time of merger is under the purview of GSM, then the same shall be continued on the resultant entity.

" If the parent company is under purview of GSM, the resultant demerged companies shall also attract GSM. If the parent firm is not under purview of GSM, the resultant demerged companies shall not be part of GSM at the time of demerger and shall be considered during the subsequent quarterly review," the exchanges said.

Last month too, the exchanges came out with some guidelines in this regard. KOLKATA: Indian Oil Corporation Ltd would invest a total of around Rs 12,000 crore in the Haldia refinery and pipeline infrastructure in West Bengal, a company official said on Monday.

The Haldia refinery's capacity would be increased from 7.5 mmtpa to 8 mmtpa, and will undertake transition to BS-VI compliant fuel by April 2020, Executive Director and head of West Bengal State Office (WBSO), Dipankar Ray said.

The state-owned company would invest Rs 7,600 crore in the refinery, he told reporters here.

Ray said the LPG bottling plants at Durgapur and Kalyani would be connected by pipeline, which would be brought from Paradeep via Haldia. The Budge Budge plant would be connected later.

This would entail an investment of Rs 4,325 crore, he said.

Around 10,000 petrol pumps in the country are now powered by solar energy and another 5,300 would be added to the list by this fiscal, Executive Director, Corporate Communications, Subodh Dakwale said.

All petrol pumps would eventually be powered by solar energy, he added. NEW DELHI: The bigwigs Indian industrilists including Mukesh Ambani and Bharti Airtel's Sunil Mittal might lose a job. From the first day of financial year 2020, 291 firms including Reliance Industries, Infosys, TCS and Bharti Airtel will have to appoint a nonexecutive chairperson on their boards to comply with regulator Sebi's directive and most of these firms will need to split the roles of chairman and managing director for compliance.

Under the new Sebi norms, the top 500 listed entities will have to ensure that the chairperson is a non-executive director from April 1, 2020. It will eventually lead to a split in the post of chairman and managing director.

These norms are part of the series of recommendations given by the Sebi-appointed Kotak committee on corporate governance.

Sunil Bharti Mittal is currently the executive chairman of Bharti Airtel, while Gopal Vittal holds the position of CEO and Md.interestingly, Reliance Industries, earlier this month, extended the tenure of Mukesh Ambani, who also holds the position of chairman on its board, as the managing director of the company for another five years.

RIL, Bharti Airtel and TCS will also need to appoint a woman independent director on their respective boards by April 1, 2019.