BSE comes out with new guidelines for shifting of SMEs to main board

BSE has put in place fresh guidelines for small and medium enterprises looking to migrate from its SME platform to the main board, whereby the applicant will be required to have a net worth of at least Rs 15 crore for the preceding two financial years. Under the guidelines, the applicant firm needs to be listed on the SME platform for at least three years. Besides, they need to have 250 public shareholders before shifting to the main board.

In addition, the SME should have a positive operating profit for at least any two out of three financial years and have a positive profit after tax (PAT) in the immediate financial year of making the migration application to the bourse.

“The applicant should have a net worth of at least Rs 15 crore for two preceding full financial years, ” BSE said in a circular.

Further, the paid-up equity capital of the applicant should be more than Rs 10 crore and the market capitalization should be at least Rs 25 crore.

Among other parameters, the applicant company should not have received any winding-up petition admitted by the National Company Law Tribunal (NCLT) and no material regulatory action should have been taken against the firm in the past three years like suspension of trading against the SME and its promoters by any stock exchange.

Also, the applicant company, its promoters as well as its subsidiary should not be debarred by capital markets regulator Sebi.

Separately, the exchange also tweaked the eligibility criteria for listing on the SME platform. The new guidelines will become effective from January 1, 2024, BSE said.

Till date, 464 companies have been listed on the BSE SME platform, of which 181 have migrated to the main board, data with the platform showed.

Top bourses- BSE and the National Stock Exchange (NSE) – launched dedicated platforms for SMEs in March 2012 to enable the listing of these firms and help them raise equity capital for growth and expansion in a cost-effective manner.