How does a company transition from SME Exchange to Main Board of NSE/BSE?

By PriyaSahu

Many small and medium enterprises (SMEs) initially list on the SME Exchange to raise capital and expand their market presence. As they grow, they may seek to transition to the Main Board of NSE or BSE for higher visibility, better liquidity, and access to a broader investor base. This transition follows specific eligibility criteria and regulatory approvals.



1. What is SME to Main Board migration on NSE/BSE?

SME-listed companies on NSE Emerge or BSE SME can upgrade to the Main Board if they meet specific financial and regulatory criteria. This move enhances their credibility, improves stock liquidity, and provides access to institutional investors.



2. Eligibility criteria for migration from SME to Main Board

To move from the SME Exchange to the Main Board of NSE or BSE, a company must fulfill the following conditions:

  • Minimum Market Capitalization: The company should have a market capitalization of at least ₹25 crores.
  • Profitability Track Record: It must have a net profit in at least two of the last three financial years.
  • Shareholder Base: The company should have at least 200 shareholders.
  • Paid-up Capital: The post-issue paid-up equity capital should be a minimum of ₹10 crores.
  • Corporate Governance Compliance: It must comply with SEBI (LODR) regulations, including independent directors and financial disclosures.
  • Approval from Shareholders: A special resolution must be passed by shareholders for migration.


3. Steps to migrate from SME Exchange to the Main Board

The migration process involves regulatory approvals and compliance with SEBI and stock exchange norms. Below are the key steps:

  1. Appoint a Merchant Banker: A SEBI-registered merchant banker is required to assist with documentation and regulatory approvals.
  2. Meet Financial and Governance Criteria: Ensure compliance with market capitalization, net worth, and governance norms.
  3. Obtain Shareholders’ Approval: Pass a special resolution in a general meeting.
  4. Apply to NSE/BSE: Submit the migration application with required financial and legal documents.
  5. Regulatory Review and Approval: SEBI and the stock exchange review the application and grant approval.
  6. Trading on the Main Board: Once approved, the company’s shares are migrated to the Main Board, offering greater visibility and investor confidence.


4. Benefits of moving to the Main Board

Upgrading from the SME Exchange to the Main Board offers several advantages:

  • Increased Liquidity: More investors lead to better price discovery and trading volume.
  • Higher Market Credibility: Listing on the Main Board enhances a company’s reputation.
  • Access to Institutional Investors: Mutual funds, FIIs, and large investors prefer Main Board-listed stocks.
  • Better Valuation: Companies on the Main Board often enjoy higher valuations due to better market perception.
  • Expansion Opportunities: A broader investor base supports further fundraising and business growth.


Need help with SME to Main Board migration? Contact us at 7748000080 or 7771000860 for expert guidance!

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