Can suspended companies be allowed to get listed on SME Exchange?

Finding it difficult to get listed on the mainboard? SME Exchange is the key to all your problems. Consult our SME IPO Listing Consultants for details or log on to www.muds.co.in

SME Exchange is allocated for SMEs who otherwise find it difficult to trade their securities and shares. Initially, the SMEs found it difficult to involve themselves in satisfactory trading volumes while they were listed along with other stocks. Thus, SME Exchange became the well-known stock exchange approved by SEBI for the listing of securities. 

For any organisation to be listed on the SME Exchange, its post-issue paid-up capital should not exceed ₹25 crores. The SME Exchange does not limit itself to the various SMEs as described by The Micro, Small and Medium Enterprise Development Act 2006 or the organisations where the finances allotted for plant and machinery does not exceed ₹10 crores.

Thus, the various organisations with paid-up capital between ₹10 to 25 crores have this option to migrate from Main Board (i.e. The National Stock Exchange) to the SME Exchange and vice versa.  

Process for migrating to BSE SME Platform             

The various organisations that are listed with identified stock exchanges and are looking for listing themselves on BSE SME Platform are required to satisfy the following norms:

PARTICULARS NORMS
Paid-up capital

 

 

Minimum of Rs.1 crore and maximum up to Rs. 25 crores, as on the date of making an application for the direct listing.

As per the latest audited financial results, 

Net worth must be positive & Net tangible assets of Rs. 3 Crores.

Networth
Track record The company or the partnership/ proprietorship/LLP firm or the firm which have been converted into the company should have a combined track record of at least 3 years.

In case a Company/Partnership/ Proprietorship/LLP has not completed its operation for three years then should have been funded by way of loan/equity by Banks or Financial Institutions or Central or State Government or its undertaking, or its Group Company should have been listed for at least two years either on the Main Board or SME Board of the Nationwide Exchange.

Public Shareholding It is a mandate to comply with the requirements of SCRA, SCRR as well as the Listing Agreement.
No. of public shareholders Minimum 50
Migration The organisations have an option to make a fresh application in order to migrate to the main board only after a period of two years from the date of listing on SME Platform, but it has to fulfil the norms of Direct Listing on the Main Board
Appointment of Market Maker
  • For a minimum period of 3 years from the date of listing on SME platform at least one Market Maker shall be appointed.
  • At least 5% of the issued capital of the company is to be held by the Market Maker on the date of listing of the company on SME platform

Along with the above-mentioned norms, an organisation at the time of taking shareholders permission before migrating to SME Exchange has to follow the below-mentioned pointers:

  • Clearly indicate to the shareholders’ that once the migration procedure is complete, the equity shares held by them might multiply and thus, they would be able to offload the same during the market making period. 

  • The shareholders’ permission is a mandate that needs to be fulfilled and their approval for delisting the securities from the recognized exchanges is required.  

    Conclusion

Any suspended company is not at all permitted for listing on BSE SME Exchange until the suspension is quashed and the company is again granted permission to trade on the Main Board of BSE.    

For further details about SME IPO India and SME, IPO Eligibility contact our SME IPO Consultant at www.muds.co.in

“The withdrawal of Jaiprakash Power Ventures insolvency application is a positive outcome which should be applauded as standing up to the established purpose of IBC. Even more, it shall be beneficial for all stakeholders in the long run.”

-Shweta Gupta, Founder and CEO, MUDS

By | 2020-07-15T10:29:55+05:30 February 15th, 2020|SME IPO|0 Comments

Leave A Comment

*

code

G E T A Q U O T E
get a quote
captcha

Enter the code above here *

SUBSCRIBE To OUR NEWSLETTER
Subscribe our Newsletter

X
SCHEDULE YOUR CONSALUTATION TODAY
captcha
Enter the code above here *