Company urges SEBI, NSE and BSE to revisit surveillance framework linked to insolvency proceedings
Reliance Infrastructure Ltd. has submitted a representation to the Securities and Exchange Board of India (SEBI), National Stock Exchange (NSE) and Bombay Stock Exchange (BSE), seeking a review of the Additional Surveillance Measure (ASM) framework and trading restrictions imposed on its shares.
The company said the restrictions, introduced following insolvency-related proceedings, were adversely affecting more than seven lakh public shareholders and hindering efficient market price discovery.
Price discovery concerns
In its representation, Reliance Infrastructure said the current framework permits trading only once a week within a narrow ±5% price band, resulting in largely mechanical and predictable price movements.
According to the company, such restrictions do not adequately reflect prevailing business fundamentals, operational performance or long-term value creation potential. It added that its shares continue to witness active investor participation and liquidity in the market.
Impact on shareholders
The company argued that the continuation of the trading restrictions was counterproductive to the interests of retail and small shareholders and undermined efficient market functioning.
It said the impact was disproportionately borne by public shareholders, who were often unable to exit their investments at reasonable prices during lower-circuit phases, leading to a steady erosion in the value of their holdings.
Suggested alternatives
Reliance Infrastructure said the once-a-week trading mechanism constrained effective price discovery and may inadvertently contribute to shareholder value erosion.
The company urged regulators to review the restrictions and adopt safeguards that balance market surveillance objectives with investor protection. It proposed retaining measures such as gross settlement, 100% margin requirements, Additional Surveillance Deposit (ASD) and price-band safeguards, while enabling more effective trading.
The company suggested alternatives including a periodic call-auction mechanism or a wider and graded price band to facilitate genuine two-sided trading.
IBC proceedings
Reliance Infrastructure also pointed out that the ASM framework had been triggered despite the National Company Law Appellate Tribunal (NCLAT) staying both the insolvency admission order and the Corporate Insolvency Resolution Process (CIRP) against the company.
The company said no Resolution Professional had assumed control and that its affairs continued to be managed by its duly constituted Board of Directors in the normal course of business.
Reliance Infrastructure said it would continue to engage constructively with regulators and market institutions while remaining focused on long-term value creation for shareholders.