GSM vs ASM: How the Two Frameworks Differ (2026)

The GSM vs ASM question comes down to what each framework is looking at. GSM, the Graded Surveillance Measure, is triggered by a company's fundamentals, specifically a price that is not commensurate with its financial health. ASM, the Additional Surveillance Measure, is triggered by how the stock is trading, meaning price variation, volatility and how concentrated the buying is. Both are run jointly by SEBI and the exchanges, both tighten trading conditions, and a security can sit under both at once.

GSM vs ASM at a glance

Source: NSE Graded Surveillance Measure FAQ and Additional Surveillance Measure FAQ.

What does GSM actually measure?

GSM shortlisting is a balance-sheet test, not a chart test. NSE's FAQ sets out two criteria for mainboard securities. Criteria I requires latest available net worth of 10 crore rupees or less, and net fixed assets of 25 crore rupees or less, and a PE greater than twice the PE of the Nifty 500 or a negative PE. Criteria II requires full market capitalisation under 25 crore rupees together with a PE or price-to-book test against the same benchmark.

Several categories are excluded from GSM shortlisting outright, including securities with derivatives available, index constituents, companies listed in the last year through an IPO, and companies that paid a dividend in each of the last three years.

Most secondary write-ups still describe GSM as a six-stage framework. It has been four stages since the November 2019 review, and newly shortlisted securities are placed at Stage 0 first.

What does ASM actually measure?

ASM shortlisting is a trading test. The parameters NSE lists are high-low variation, client concentration, close-to-close price variation, market capitalisation, volume variation, delivery percentage, number of unique PANs, and PE. The criteria combine these, so a large move alone does not qualify a stock; a large move plus concentrated participation usually does.

The concentration test is the one worth internalising. Several long-term criteria require the top 25 clients to account for 25 percent or more of combined NSE and BSE volume in the stock over the last 30 days. Short-term Stage I raises that to 30 percent over five trading days. See what is the ASM list for the stage-by-stage detail.

What changes for trading under each?

Under GSM the actions escalate sharply. Stage I is a 100 percent margin with a price band of 5 percent or lower. Stage II moves the security to trade-for-trade with an Additional Surveillance Deposit of 50 percent of trade value payable by buyers. Stages III and IV restrict trading to once a week, on Monday or the first trading day of the week, with a 100 percent ASD, and Stage IV adds no upward price movement.

Under ASM the actions are lighter at entry. Long-term Stage I applies a 100 percent margin from the T+3 day. Stage II cuts the price band to the next lower level and keeps the margin.

Both frameworks operate in addition to existing measures. If a security is already in trade-for-trade settlement and then qualifies for GSM Stage II, the ASD applies on top rather than instead.

Neither list is a verdict on the company

NSE's ASM FAQ says shortlisting "is purely on account of market surveillance and it should not be construed as an adverse action against the concerned company / entity." The stated purpose of both frameworks is the same: to alert investors to be extra cautious and to advise market participants to carry out due diligence.

That framing matters when you read a surveillance tag next to a company's disclosures. The tag tells you the exchange applied an objective test. What the underlying filings say is a separate record, and it is the one Flock reports: the quarterly shareholding pattern, the bulk and block deal tape, and promoter pledge disclosures. Reading GSM vs ASM correctly means knowing which question each one answers, and then going to the filings for the rest.