BSE shares were put under the Additional Surveillance Measure (ASM) framework by the National Stock Exchange.

What Happened: The stock was placed under the short-term ASM stage 1 on Monday. ASM is a regulatory framework implemented by Indian stock exchanges to closely monitor stocks that exhibit unusual price movements or heightened volatility.

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Stocks placed under ASM are subject to increased scrutiny to protect investors and maintain market stability. BSE’s share price has climbed up over 25% in the past five days. When a stock enters Stage 1 of ASM, specific restrictions are applied. One key requirement is that investors must maintain a 100% margin for any trades involving that stock, meaning they need to provide the entire trade value upfront.

Another impact is that pledging of stocks that fall under the ASM framework is not allowed. If an already pledged stock is moved into the ASM category, the collateral margins provided against that stock will be removed. This means that the value of the collateral will be reduced by the amount of collateral previously received for the stock.

The parameters for shortlisting securities under ASM include high-low variation, client concentration, number of price band hits, close-to-close price variation and price-earnings ratio.

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