Bourses to shift firms to restricted segment for violating rules

Leading stock exchanges BSE and the National Stock Exchange (NSE) would shift stocks of 35 firms (including Arvind Remedies and Plethico Pharmaceuticals) to the restricted trading category for not complying with listing agreement rules, from September 28.

The action follows non- compliance with a Listing Agreement clause relating to timely preparation and disclosure of financial results by a listed company for consecutive quarters.

The results are required to be disclosed by listed companies on the stock exchange platforms for the benefit of investors. BSE would shift 26 scrips to the ‘Z’ group, wherein their scrips would be “settled on trade-for-trade basis” NSE has decided to move nine stocks to this category, the bourses said in separate circulars.

Under the trade-for-trade segment, no speculative trading is allowed and delivery of shares and payment of consideration amount are mandatory. The stocks to be moved to the ‘Z’ group on both  bourses include Arvind Remedies, Classic Diamonds (India), Helios And Matheson Information Technology, Timbor Home, Innoventive Industries, Kesoram Indu-stries and Plethico Pharmaceuticals.

These scrips will be transferred to the ‘Z’ group with effect from September 28, 2015, “due to non compliances for two consecutive quarters i.e. March 2015 and June 2015 for the Clause 41 of the Listing Agreement”, exchanges noted.

As per the provisions of Clause 41 of the listing agreement, companies listed on the BSE and NSE are required to file their quarterly results with the exchange in a requisite format, within 45 days of the end of each quarter.

The exchanges said CORE Education & Technologies and C Mahendra Exports have submitted their respective financial results as per the Listing Agreement for March and June quarter. However, they have not paid the levied fine for the delayed submission.

Meanwhile, BSE also said that four other firms --Terruzzi Fercalx India, Meuse Kara & Sungrace Mafatlal, Tecpro Systems, Eastern Sugar & Industries and RCL Foods, which are currently in the 'Z' group were also non-compliant for two consecutive quarters - December 2013 and March 2014 - of the Clause-41 of the listing agreement.

The 'Z' group includes companies which have failed to comply with the listing requirements and/or have failed to resolve investor complaints and/or have not made the required arrangements with the depositories - CDSL and NSDL - for dematerialisation of their securities.