In the world of the stock market, a company's journey is a bit like a student’s journey in a big university. First, the company must enroll by meeting strict entry rules called Listing. Once listed, it can trade its shares with the public and raise money. However, sometimes a company decides to graduate or leave the school, or in some unfortunate cases, it gets expelled for breaking rules; this is called Delisting.

For a regular investor in 2026, understanding these two processes is vital. When a company lists, it creates a new opportunity for you to buy shares. But when it delists, it means the shares will stop trading on the NSE or BSE, and you need to know how to get your money back. In 2026, SEBI (the market regulator) has made these rules much more transparent to ensure that small investors like us are never left stranded without a fair exit.

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Part 1: Joining the Market (Listing Requirements)

Listing is the process of getting a company’s shares officially registered on a stock exchange like the NSE or BSE. To ensure that only healthy companies enter the market, SEBI has set high bars for the Mainboard (for big companies).

The 7 Core Listing Requirements (2026)

Company Age: The company must have a track record of at least 3 years of operation. You cannot start a business today and list it tomorrow.
Profitability: For the Mainboard, the company should generally have an average pre-tax operating profit of at least ₹15 Crore in 3 out of the last 5 years.
Net Tangible Assets: The company must have at least ₹3 Crore in net tangible assets (like buildings, machinery, etc.) in each of the preceding three years.
Net Worth: It must have a minimum net worth of ₹1 Crore in each of the last three years to show it is financially stable.
Paid-up Capital: In 2026, the post-issue paid-up equity capital (the total value of shares issued) must be at least ₹10 Crore.
Public Float (The 25% Rule): At least 25% of the company’s shares must be held by the public. The owners (promoters) cannot keep everything for themselves.
Corporate Governance: The company must have an Audit Committee and a Remuneration Committee, and at least one-third of the board must be Independent Directors (people not related to the owners).

Part 2: Leaving the Market (Delisting)

Delisting is the permanent removal of a company’s shares from the stock exchange. Once delisted, you can no longer buy or sell its shares on your broker app. There are two ways this happens:

1. Voluntary Delisting (The Choice Route)

This happens when the company owners (promoters) decide they want to take the company private again. Maybe they don't want to follow the strict stock market rules anymore, or they want full control.

The Exit Price: The owners must offer to buy back shares from you at a fair price.
Reverse Book Building (RBB): This is a 2026 bidding process where you (the shareholder) tell the owners at what price you are willing to sell.
Fixed Price Option: In 2026, SEBI also allows a Fixed Price delisting where the owners offer a price that is at least 15% higher than the market average to make it simple.

2. Compulsory Delisting (The Expulsion Route)

This is a punishment by the Stock Exchange. It happens if the company breaks serious rules, fails to pay fees, or doesn't show its financial reports for a long time.

Investor Protection: Even in this case, the promoters are forced to buy back shares from public investors at a price determined by an independent valuer.

Quick Comparison: Voluntary vs. Compulsory Delisting

Feature

Voluntary Delisting

Compulsory Delisting

Reason

Business Strategy / Merger.

Non-compliance / Breaking Rules.

Who initiates?

The Promoters (Owners).

The Stock Exchange (NSE/BSE).

Impact on Owners

They get full control of the firm.

They are banned from the market for 10 years.

Exit Opportunity

Guaranteed through bidding or fixed price.

Mandatory but often at a fair value set by auditors.

How to Calculate the Exit Price in a Buyback/Delisting?

In 2026, the Floor Price (minimum price) for a delisting is usually the highest of:

The 52-week average price.
The highest price paid by the promoter in the last 26 weeks.
The 60-day average market price.

The Formula:

Exit Price = Floor Price + Premium

Frequently Asked Questions (FAQs)

What happens to my shares if a company delists?

You are still a shareholder, but your shares are now unlisted. You cannot sell them on the NSE/BSE. You must either sell them to the promoter during the Exit Window or find a private buyer later.

Can I refuse to sell my shares during delisting?

Yes. You can choose to hold them. However, it will be very difficult to sell them later because there is no public market for them.

Is there a time limit to sell shares after delisting?

Yes. Usually, the Exit Window stays open for one year after the company officially delists to give small investors enough time to sell.

Why do companies delist?

Common reasons include mergers with other companies, wanting to reduce regulatory costs, or the owners feeling that the market is not valuing their company correctly.

What is the 90% Rule in delisting?

A voluntary delisting is only successful if the promoters' total shareholding reaches at least 90% after buying back shares from the public.

Can a delisted company come back (Relisting)?

Yes! You can hold your Pre-IPO shares (which will be locked for 6 months) and also apply for fresh shares during the official IPO window.

How do I know if a company is going to delist?

The company must send a notice to all shareholders and publish advertisements in newspapers. You will also see a notification in your broker app.

What is In-principle Approval?

Before a company can ask you for your shares, it must get a green signal or in-principle approval from the Stock Exchange.

Are SME IPO listing rules different?

Yes. SME (Small and Medium Enterprise) listing rules are much easier. For example, the post-issue capital can be as low as ₹3 Crore to ₹25 Crore.

What if I missed the delisting exit offer?

You can still sell your shares to the promoter at the same exit price for up to one year after the delisting date. After that, you are stuck with private shares.

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