BSE share price plummets 5% after inclusion in ASM framework, snaps 9-day winning run

BSE share price in focus today: Shares of BSE Ltd, one of Asia's oldest stock exchanges, plunged 5% in intraday trade on Wednesday, June 11, hitting a low of ₹2,855 after being placed under the Additional Surveillance Measure (ASM) framework.

The move aims to caution investors and curb speculative activity following a sharp rally in the bourse’s stock price. Today’s decline also snapped the stock’s nine-day winning streak.

ASM is an initiative by the capital markets regulator, the Securities and Exchange Board of India (SEBI), and stock exchanges, under which securities are placed under either a short-term or long-term framework to protect investors' interests.

When a stock is placed under the ASM framework, traders are restricted from using intraday leverage, and 100% of the traded value is required as margin. This helps curb risky and speculative trades, thereby minimizing potential losses.

Currently, BSE has been placed under Stage 1 of the Additional Surveillance Measures (ASM) framework by the NSE, following a sharp surge in trading activity in recent months. The stock has gained over 130% since its March lows, driven by BSE’s expanding presence in India’s equity derivatives market and anticipation surrounding NSE’s pending initial public offering.

Stocks placed under the ASM framework serve as a cautionary signal, alerting investors to exercise extra vigilance. It will also advice market participants to conduct thorough due diligence while dealing in these securities. 

SEBI and exchanges use the ASM framework to shortlist securities. The parameters for shortlisting securities include high-low variation, client concentration, number of price band hits, close-to-close price variation, and price earnings ratio. The stocks usually remain in ASM for more than five trading sessions before further review by exchanges.

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