20 per cent scrips on NSE illiquid

“Trading members are advised to exercise additional due diligence while trading in these securities either on own account or on behalf of their clients,” the NSE said in a circular. NSE’s move follows direction from the market regulator Sebi to draw up a list of illiquid scrips. Analysts said Sebi is keen on ensuring the interests of minority shareholders.

“Sebi wants to caution the stock exchanges to be more vigilant about reviewing the trading pattern and other related details of the shares of the companies. There might be less trading and so it can be restricted to few hands and may cause harm to minority shareholders,” NexGen Capitals equity head Jagannadham Thunuguntla said. Some of the other stocks in this category include Godfrey Philips India,Khaitan Electricals,Siyaram Silk Mills,Atlas Cycles and State Bank of Bikaner and Jaipur.

It also contains some funds,Franklin Templeton Capital Protection Oriented Fund,Franklin Templeton Mutual Fund-Capital Safety Fund 3Y (Growth Option) and Franklin Templeton Mutual Fund-Capital Safety Fund 5Y (Growth Option).

The illiquid shares are those shares in which the trading frequency is less than 80 per cent of the total trading days in the previous six months,Thunuguntla added. “The list will be reviewed on a monthly basis,” the circular added.