The Long-term Additional Surveillance Measure (LT ASM) is a regulatory framework introduced by SEBI and Indian stock exchanges to monitor and manage risks in stocks that exhibit continuous abnormal trading patterns. This framework is designed to protect investors and enhance market integrity by imposing stricter trading conditions on selected securities for an extended period.
Criteria for Inclusion in LT ASM
Stocks are selected for the Long-term Additional Surveillance Measure (LT ASM) list based on objective criteria jointly defined by SEBI and the exchanges. These criteria include significant price swings (high-low and close-to-close variations over defined periods), abnormal trading volume fluctuations, high client concentration (such as the top 25 clients accounting for a large share of volume), differentiated market capitalization thresholds, low diversity among traders (few unique PANs), low delivery percentage, and extremely high or volatile price-earnings (PE) ratios.
Stages of LT ASM
LT ASM (Long-Term Additional Surveillance Measure) is applied in steps. As a stock moves through each step, trading restrictions become stricter to help control unusual price movements or speculation.
- Stage I: 100% margin requirement from T+3 days; price band may be reduced.
- Stage II: Further reduction in price band; continued 100% margin.
- Stage III: Additional price band reduction; continued 100% margin.
- Stage IV: Settlement on a gross basis (trade-to-trade), 100% margin, and a restrictive price band (e.g., 5%). For derivative stocks, new contracts are not issued, and existing contracts are settled as per expiry.
Here is the list of stocks that have been shortlisted in the Long-Term ASM Framework:
KIOCL Ltd
KIOCL Ltd (formerly Kudremukh Iron Ore Company Ltd) is a government-owned enterprise under the Ministry of Steel, primarily engaged in the production of iron ore pellets. Headquartered in Bengaluru, it operates a pellet plant in Mangaluru and sources ore from Karnataka. KIOCL also provides turnkey projects and operation & maintenance services in the mining and mineral sector. On October 08th, KIOCL Ltd was included in the LT-ASM stage IV Framework by the stock exchanges.
Bharat Seats Ltd
Bharat Seats Ltd is an automotive component manufacturer, primarily engaged in the production of seating systems and interior components for cars and two-wheelers. It is a joint venture between the Relan Group, Suzuki Motor Corporation, and Maruti Suzuki India. The company supplies to major automobile OEMs in India, including Maruti Suzuki and Suzuki Motorcycles. On October 08th, Bharat Seats Ltd was included in the LT-ASM stage I Framework by the stock exchanges.
SunRakshakk Industries India Ltd
SunRakshakk Industries India Limited is a publicly listed Indian company, formerly known as A.K. Spintex Ltd, that is diversifying from its textile roots into Fast-Moving Consumer Goods (FMCG) and related intermediate chemicals. The company provides textile processing services and manufactures FMCG products, including soaps, noodles, toothpaste, and detergents. On October 08th, SunRakshakk Industries India Ltd was included in the LT-ASM stage II Framework by the stock exchanges.
Ambo Agritec Ltd
Ambo Agritec Ltd. is an Indian company that manufactures and trades food products, including biscuits, edible oils, vanaspati, and specialty Bengali food items under brands like Happy Bite, Happy Heart, and Max Health. The company also trades commodities such as crude linseed oil and soybean meal. On October 08th, Ambo Agritec Ltd was included in the LT-ASM stage III Framework by the stock exchanges.
Earthstahl & Alloys Ltd
Earthstahl & Alloys Ltd. is an Indian company that manufactures Cast Iron Lumps and Ductile Iron Pipe Fittings using waste from the steel industry. The company’s primary business involves recycling steel waste into cast iron, which serves as a raw material for other foundries. On October 08th, Earthstahl & Alloys Ltd was included in the LT-ASM stage I Framework by the stock exchanges.
Written by Sridhar J
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