BSE Tightens SME Mainboard Criteria: Rs 15 Crore Operating Profit, 1,000 Public Shareholders Now Mandatory

To further strengthen market liquidity, the exchange has introduced rigorous trading benchmarks for eligible companies.

Companies are also required to maintain net tangible assets of no less than Rs 3 crore in each of the last three financial years. (Source: reuters)

In a strategic move to bolster market integrity, transparency, and investor confidence, the Bombay Stock Exchange (BSE) has significantly enhanced its eligibility criteria for small and medium enterprises (SMEs) seeking migration to the Mainboard, as well as for companies listed on other recognised exchanges pursuing direct listing on BSE’s Mainboard.

For migration of SMEs or direct listing, the revised norms announced by BSE now require a minimum operating profit of Rs 15 crore cumulatively over the last three financial years, with at least Rs 10 crore in each individual year. This is a marked tightening from the earlier requirement, which mandated only a positive operating profit in two out of the last three years.

In addition to profitability requirements, the minimum number of public shareholders has been raised sharply from 250 to 1,000, reflecting BSE’s focus on deepening the shareholder base and enhancing liquidity.

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To further strengthen market liquidity, the exchange has introduced rigorous trading benchmarks for eligible companies. Entities must have recorded trading volumes of at least 5% of the weighted average number of equity shares listed over the preceding six months and must have traded on a minimum of 80 per cent of trading days in the same period. These provisions ensure that only actively traded and liquid stocks qualify for mainboard listing.

Moreover, companies are required to maintain net tangible assets of no less than Rs 3 crore in each of the last three financial years and must have demonstrated a consistent compliance track record over the same period.

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This regulatory tightening aligns with BSE’s broader mission to safeguard investor interests, enhance market transparency, and promote sustainable economic growth. By raising the bar for migration and direct listing, BSE seeks to filter in financially robust and well-governed companies, thereby increasing overall market quality.