What are the compliance requirements for listing on NSE/BSE?

For a company to get listed on NSE (National Stock Exchange) or BSE (Bombay Stock Exchange), it must meet various compliance requirements set by regulatory bodies like SEBI (Securities and Exchange Board of India). These requirements ensure transparency, investor protection, and smooth market functioning. Companies need to adhere to financial, governance, and legal criteria before getting listed.

1. Financial Requirements for Listing on NSE/BSE

A company must meet financial eligibility criteria to be listed on NSE or BSE. The key requirements include:

• Minimum Net Worth: The company should have a minimum net worth of ₹3 crore for BSE SME and ₹15 crore for NSE Emerge.
• Profitability Track Record: It should have been profitable in at least 2 out of the last 3 years.
• Minimum Capital: The company must have a paid-up capital of ₹10 crore for NSE and ₹3 crore for BSE SME.
• Minimum Market Capitalization: A company applying for NSE/BSE mainboard listing should have a minimum market cap of ₹25 crore.

2. Governance & Regulatory Compliance

Companies seeking listing on NSE or BSE must comply with various governance and regulatory norms:

• SEBI Regulations: The company must comply with SEBI’s listing regulations and disclosure norms.
• Board of Directors: At least 50% of the board members must be independent directors.
• Corporate Governance Standards: The company must ensure fair disclosure of financial reports and decision-making processes.
• Audit Committee: A qualified audit committee should oversee financial reporting and internal audits.

3. Due Diligence & Documentation

Companies must submit various documents and undergo due diligence before listing:

• Draft Red Herring Prospectus (DRHP): A preliminary IPO document outlining financials and risks.
• Shareholding Structure: The company must disclose shareholding patterns before listing.
• Financial Statements: Audited financial statements for at least the last three years.
• Legal Clearances: No pending litigations or major legal disputes.

4. Post-Listing Compliance Requirements

Even after listing, companies must comply with the following requirements:

• Quarterly & Annual Reports: Companies must publish financial reports regularly.
• Minimum Public Shareholding: At least 25% of shares must be held by the public.
• Insider Trading Regulations: No unfair trading based on insider information.
• Dividend Policy Disclosure: Companies must declare their dividend distribution policies.

5. Conclusion

Listing a company on NSE or BSE is a detailed process requiring financial, regulatory, and governance compliance. From meeting SEBI guidelines to maintaining transparency, companies must follow strict norms to ensure investor trust and smooth market functioning.