Come September end and hundreds of stocks may have to shift to trade-to-trade segment if they don't comply with Sebi norms for 100% promoter holding to be in dematerialised form. And as many stocks remain non-complaint as of now, a serious impact on the overall liquidity cannot be ruled out, reports CNBC-TV18's Tanvi Shukla.
The Sebi circular issued on June 17, 2011 stated that all of the promoter holding in a stock will have to be converted into dematerialized form by September end. With the deadline soon approaching, Sebi is concerned about the companies that have not done so, as yet. If companies do not comply with these norms, the trading will have to shift from normal segment to trade-to-trade segment.
As of June 30, 27 of the Nifty 50 stocks are non-compliant. Around 1,090 stocks listed in the National Stock Exchange are non-compliant as of June 30 and these include PSUs like GAIL, BPCL, and BHEL who have not converted their entire promoter holding into a dematerialized form, as of now.
If these stocks have to convert to a trade-to-trade segment trading then it could include intraday trading would not be allowed to square off. Netting would not be possible. And, these could impact the stock, in terms of getting out of the index itself.
The derivative trading of such stocks may be discontinued. There can be an impact on the overall liquidity of the scrip in itself. With all such possibilities on cards, Sebi has laid out in a public notice today asking companies to comply with the norms by September 30.
Source: www.moneycontrol.com
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DENIP Consultants Pvt Ltd
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