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The Bombay Stock Exchange (BSE) has brought in new guidelines for small and medium enterprises (SMEs) seeking to transition from the SME platform to the main board. As per the new guidelines, applicants will be required to have a net worth of at least Rs 15 crore for the preceding two financial years.
Furthermore, the applicant firm needs to be listed on the SME platform for at least three years and possess 250 public shareholders before shifting to the main board, news agency PTI reported.
Additionally, the SME must 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 circular from the BSE points out that the applicant should have a net worth of at least Rs 15 crore for two preceding full financial years. The paid-up equity capital of the applicant must exceed Rs 10 crore and the market capitalization should be a minimum of Rs 25 crore.
Besides these, another requirement is that the applicant company should not have received any winding-up petition admitted by the National Company Law Tribunal (NCLT). No significant regulatory action should have been taken against the firm in the past three years such as suspension of trading against the SME and its promoters by any stock exchange.
Moreover, the applicant company, its promoters as well as its subsidiary should not be debarred by the capital markets regulator Securities and Exchange Board of India (Sebi).
Meanwhile, the exchange also adjusted the eligibility criteria for listing on the SME platform.
BSE has said that the new guidelines will come into effect from January 1, 2024. As per the platform data, 464 companies have been listed on the BSE SME platform till date. Of these 181 have migrated to the main board.
In March 2012, the BSE and the National Stock Exchange (NSE) launched dedicated platforms for SMEs to facilitate the listing of these firms and help them raise equity capital for growth and expansion in a cost-effective manner.