Cochin Shipyard Ltd, Rail Vikas Nigam Ltd (RVNL), Indian Renewable Energy Development Agency Ltd (IREDA), NBCC (India) Ltd and IFCI Ltd are among 7 PSU stocks that have been added to the long-term ASM framework today. The other two are Oil India Ltd and HUDCO. PSUs were exempted from the surveillance earlier, but the market regulator SEBI in a bid to enhance market integrity and safeguard investor interest, announced the extention of the list.
In a circular earlier, NSE said: "As per Joint Surveillance Meeting of Exchanges and SEBI held on September 20, 2024, the surveillance measures/frameworks were reviewed, and it was decided to extend them to Public Sector Undertaking (PSU) companies. Further, all other provisions of the above-mentioned exchange circulars shall remain unchanged. The amended framework shall be applicable from September 23, 2024 and the list of PSU/other scrips shortlisted (if any) as per the amended framework shall be published separately," it said.
RVNL shares declined 1.61 per cent to Rs 535.50. IREDA fell 1.10 per cent to Rs 229.80. IFCI slipped 0.53 per cent to Rs 70.73. HUDCO edged 0.9 per cent lower at Rs 248.70. Despite being added to the ASM framework, shares of Cochin Shipyard climbed 4.32 per cent to Rs 1,926.35 on BSE. Oil India added 0.68 per cent to Rs 566.25. NBCC India edged 0.55 per cent higher at Rs 175.05.
Stock exchanges put stocks under ASM based on several parameters including high-low price variation, volume variation, delivery percentage, client concentration in stocks, close-to-close basis price variation and market capitalisation, among others.
In short, stocks with unusually high volatility are put under ASM framework. The main objectives of these measures are to alert investors to be extra-cautious and advice them to carry out due diligence while dealing in such stocks. The framework came into force in March 2018.
There are two types of ASM framework: Short term and long term. In the short term ASM, there are two stages. Stocks are retained in each stage as applicable for a minimum period of 5/15 trading sessions and are eligible for review from 6th/16th trading day onwards.
Accordingly if the stock does not meet the criteria on the review date, it is moved out of short-term ASM framework. If the stock continues to meet the criteria for short-term ASM without attracting the criteria for Long-term ASM, it is subjected to the Stage II ASM framework. If it is moved to long-term ASM, short-term provisions do not apply to stocks.