Moreover, in case the company wants to get its equity shares listed on the main board, it can do so according to the regulation of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.<\/p>\n\n\n\n
SEBI (LODR) Regulations 2015<\/h2>\n\n\n\n
Company that has post issue face value of equity shares of more than 10 crore and up to 25 crore can voluntarily migrate to the main board provided that approval has been obtained of the shareholders by passing a special resolution through postal ballot.<\/p>\n\n\n\n
It may be noted that special resolution will be considered valid only if the total votes cast by non-promoters in favour of the resolution amounts to two times the votes cast against the resolution.<\/p>\n\n\n\n
Criteria for migration from SME to the main board<\/h2>\n\n\n\n
The stock exchanges have issued the migration policy and have specified certain Criteria for migration from SME to the main board. Any company on the SME platform having paid up capital of more than 10 crore can apply to migrate to the main board provided:<\/p>\n\n\n\n
- Market<\/a> capitalization is minimum 25 crore rupees;<\/li>
- A special resolution is passed in the annual general meeting where at least two-third of the shareholders (apart from promoter shareholders) favour the migration;<\/li>
- On migrating to the Main board the company should comply with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015;<\/li>
- The company\/Directors\/Promoters are not debarred by SEBI;<\/li>
- The applicant should have been listed on the SME Platform for minimum 2 years;<\/li>
- There should be no disciplinary action by other stock exchanges and regulatory authorities in the last three years. There should be no material, regulatory or disciplinary action taken by a stock exchange or regulatory authority in the last three years against the applicant company. There should be no material, regulatory or disciplinary action taken by a stock exchange or regulatory authority in the last one year in respect of promoters\/promoting company\/ies, group companies, companies promoted by promoters\/promoting company\/ies of the applicant company.<\/li>
- Certificate in respect of:
- The company has not been referred to the board for Industrial and Financial Reconstruction;<\/li>
- The net worth of the company hasn’t been wiped out by the accumulated losses causing a negative net worth;<\/li>
- The company hasn’t received winding up petition admitted by the court.<\/li><\/ol><\/li><\/ul>\n\n\n\n
What is the procedure for Migration from SME?<\/h2>\n\n\n\n
The procedure for migration is as follows:<\/p>\n\n\n\n
![\"What](\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2021\/04\/image001-27.png\")
<\/figure><\/div>\n\n\n\n- Obtain prior consent of the scrutinizer;<\/li>
- Appoint an agency for the purpose of e-voting;<\/li>
- Decide a cut off date for dispatching notice to shareholders;<\/li>
- Finalize calendar of event;<\/li>
- Intimate to the concerned stock exchange beforehand regarding the board meeting;<\/li>
- Conduct the board meeting and approve the appointment of the scrutinizer and also approve the notice for postal ballot;<\/li>
- Print the notice for postal ballot;<\/li>
- Send the notice of postal ballot with the ballot paper and explanatory statement;<\/li>
- Publish an advertisement in one vernacular and one English newspaper and include the following details-
- Date of sending the notice of EGM;<\/li>
- Date of commencement of voting (if voting is conducted through electronic mode, then provisions of Rule 20 of Companies (Management and Administration) Rules shall apply mutatis mutandis);<\/li>
- Last date of voting;<\/li>
- Statement that any postal ballot which is received after 30 days from the date of sending EGM notice would be treated as invalid;<\/li>
- Statement that members not having received the postal ballot can apply to the company to get a duplicate copy of the same;<\/li>
- Details of person for the redressal of grievances.<\/li><\/ol><\/li>
- Commencement of the postal ballot or the e-voting;<\/li>
- Scrutinizer should declare the result as soon as possible after the last date of receipt of the ballot paper, but it should not be later than 7 days thereof;<\/li>
- File form MGT-14 to the concerned registrar of companies in 30 days time from the date of declaration of the results by the scrutinizer;<\/li>
- Upload the results on the company’s website;<\/li>
- Submit the results along with the applications for in-principle approval to the concerned stock exchange.<\/li><\/ul>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
The due process must be followed in order to ensure smooth migration from SME to the main board. After migration from the SME platform to the main board, retail participation in the companies has increased, which has helped the performance of SME companies’ stocks.<\/p>\n\n\n\n
Read our article<\/b>:All about SEBI (ICDR) (Amendment<\/a>), Regulations, 2021<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"
SMEs can migrate to main board of exchange on fulfilling some of the conditions. SMEs have seen its stocks perform way better and offering returns to investors after migrating to the main board of SME platform. In this article, we shall discuss the relevant provisions of SEBI (LODR) Regulations 2015, SEBI (ICDR) Regulations, 2018, and […]<\/p>\n","protected":false},"author":35,"featured_media":49451,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[2828],"tags":[3917],"acf":{"service_id":"227"},"yoast_head":"\n
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