Mumbai, Aug 11 The Bombay Stock Exchange (BSE) on Monday said that it has strengthened the eligibility norms for SME companies seeking migration to the mainboard by enhancing the requirement of operating profitability to Rs 15 crore for last 3 financial years, with a minimum operating profit of Rs 10 crore in each of these financial years.
According to the exchange, the same criteria will be applicable for companies listed on other recognised stock exchanges seeking direct listing on India's oldest stock exchange, the BSE.
"The move is aimed at promoting transparency, disclosure, and thereby improving the quality of listings," the BSE said.
Previously, the companies needed to have positive operating profit for at least 2 out of 3 financial years, and similarly, the minimum number of public shareholders has increased from 250 to 1,000.
The exchange has also set market liquidity criteria for both entities seeking to be migrated to the mainboard and companies intended for direct listing on the exchange.
The companies should have, during the past six months, witnessed trading of at least 5 per cent of the weighted average number of equity shares listed and have been trading on at least 80 per cent of days during such 6 six-month period.
Furthermore, companies are also required to have net tangible assets of at least Rs 3 crore in each of the last 3 financial years and should have a compliance track record for 3 years, according to the BSE.
Small and midsize enterprises, or SMEs, are businesses that typically lie in the middle of the small and large business spectrum. SMEs typically have a threshold for their earnings, assets, and/or workforce.
With more than 150 years of existence, the BSE is the oldest recognised exchange in Asia. The exchange has played a significant role in the growth of the Indian capital market and has provided numerous Indian businesses with an effective platform for raising capital.
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