At the time of listing, the market regulator stipulates a minimum market cap of Rs. 25 crore, however unlike international practice there is no continued listing criteria in India. But in order to weed out high number of penny stocks from the Indian bourses which see infrequent trading with few investors, SEBI is said to consider a proposal of minimum market cap of Rs. 10 crore for continued listing on exchanges in India.
Read about what are Penny stocks?
It has been found that out of the 5000 listed companies, some 1000 companies fall in the category of penny stocks. And to move them out of the exchanges in India, besides the market-cap limit, the committee is suggesting some other measures such as maintenance of minimum trading turnover in proportion to m-cap, profitability and net worth norms for companies.
Additionally, SEBI and exchanges are weighing a continued minimum asset base or net worth of Rs. 25 crore to remain listed on the bourses.