NSE revises criteria for SME stocks to shift to mainboard; check new rules

Business Standard

24-04-2025

NSE guidelines on SME stocks: The revised eligibility criteria for stocks looking to shift from the NSE SME platform to the NSE Main Board indices will be effective from May 1, 2025
NSE on SME stocks: The National Stock Exchange (NSE), on Thursday, April 24, 2025, revised the eligibility criteria for stocks looking to shift from the NSE SME platform to the NSE Main Board indices.
In a circular issued today, NSE said that securities listed on NSE SME Platform shall be eligible to list on NSE main board, subject to such companies, fulfilling the revised eligibility criteria, effective May 1, 2025.
What is the new criteria for SME stocks to migrate to the NSE Main board?
According to the exchange's latest circular on SME stocks, SME securities should adhere to five major eligibility criterion in a bid to shift to the main board indices on the NSE.
NSE's revised eligibility criteria for migration from NSE SME Platform to NSE Main Board -
1) Paid-up capital: The SME company's paid-up equity capital should not be less than ₹10 crore and the average capitalisation should not be less than ₹100 crore.
NSE clarified that capitalisation will be the product of the price (average of the weekly high and low of the closing prices of the related shares quoted on the stock exchange for 3 months preceding the application date) and the post issue number of equity shares.
2) Revenue, Ebitda: The NSE circular stated that the SME company should have earned revenue from operations more than ₹100 crore in the last financial year. This rule has been added for the first time. Also, the company should have had positive operating profit from operations in at least two out of three financial years.
3) Listing period: NSE said the SME stock should have been listed on SME platform of the Exchange for at least three years.
4) Public shareholders: The total number of public shareholders in the SME company should be at least 500, down from the previous requirement of 1,000, as on the date of filing the application.
5) Promoter and Promoter Group: The revised eligibility criteria states that the Promoter and Promoter Group should hold at least 20 per cent stake in the SME company at the time of filing the application. Besides, the shareholding of the Promoters should not be less than 50 per cent of shares held by them, as on date of application for migration, on the date of listing. Also Read:
Other eligibility criterions listed by NSE
Apart from the above mentioned five eligibility criteria, allowing SME stocks to migrate to main board platform on the NSE, the stock exchange said that -
1) There should be no proceedings admitted under the Insolvency and Bankruptcy Code against the applicant SME company and promoting company. Moreover, the company should not have received any winding up petition admitted by NCLT/IBC.
2) In addition to this, the net worth of the SME company should be at least ₹75 crore.
3) The c ompany should not have faced any 'material' regulatory action in the past three years, including suspension of trading against the applicant company and Promoter by any Exchange.
4) The SME company, the Promoter, and/or any subsidiary company should not have received any debarment notice by market regulator Sebi.
5) The SME company should not have faced disqualification/debarment of the director of the company by any regulatory authority.
6) The applicant company should not have any pending investor complaints in SCORES.
7) There should be a cooling period of two months from the date the security has come out of the trade-to-trade category or any other surveillance action, by other exchanges where the security has been actively listed.
8) There should have been no Default in respect of payment of interest and/or principal to the debenture/bond/fixed deposit holders by the applicant, promoter/subsidiary company.
NSE SME Market: All you need to know
At present, there are at least 365 SME stocks trading on the NSE. Some of the notable names include Purple United Sales, Sahaj Solar, Ganesh Infraworld, EMA Partners, Aimtron Electronics, Royal Arc Electrodes, Precision Metaliks, and Transwind Infrastructures.
So far in calendar year 2025, around 57 SME IPOs have been launched in the primary markets, including Spinaroo Commercial, Retaggio Industries, Identixweb, Active Infrastructures, Grand Continent Hotels, Paradeep Parivahan, and Shreenath Paper.