New rules are released by the BSE for moving SMEs to the main board

In order to move from its SME platform to the main board, small and medium-sized businesses must meet new requirements set by the BSE. Specifically, the applicant must have a net value of at least Rs 15 crore for the two previous fiscal years.

The application company must have been listed on the SME platform for a minimum of three years, per the requirements. In addition, they must obtain 250 shares from the general public before moving to the main board.

Furthermore, the SME must have a positive profit after tax (PAT) in the fiscal year in which it files the migration application with the exchange, as well as a positive operational profit for at least two of the three fiscal years.

In a circular, BSE said that the candidate “should have a net worth of at least Rs 15 crore for two preceding full financial years.”

Additionally, the applicant’s market capitalization must be at least Rs 25 crore and its paid-up equity capital must exceed Rs 10 crore.

In addition to other requirements, the applicant company should not have had any winding-up petitions accepted by the National Company Law Tribunal (NCLT) or significant regulatory actions against it in the previous three years, such as any stock exchange suspending trading against the SME and its promoters.

Also, the capital markets regulator Sebi shouldn’t restrict the application firm, its founders, or its subsidiary.

The exchange also modified the requirements for listing on the SME platform in a different way.

According to BSE, the new regulations will take effect on January 1, 2024.

According to statistics on the platform, out of the 464 firms that have been listed on the BSE SME platform so far, 181 have moved to the main board.

Leading exchanges, the BSE and the NSE, introduced specialized platforms for SMEs in March 2012 to facilitate their listing and provide cost-effective equity capital raising for development and growth.