HO/47/15/11(1)2025-MRD-TPD1/ I/63/2025 — THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992

CIRCULAR HO/47/15/11(1)2025-MRD-TPD1/ I/63/2025 October 30, 2025 To All Stock Exchanges All Clearing Corporations (Except Commodity Derivatives Exchanges and Clearing Corporations) Sir/Madam, Sub: -Implementation of eligibility criteria for derivatives on existing NonBenchmark Indices Clause 5.7 of SEBI circular no. SEBI/HO/MRD/TPD -1/P/CIR/2025/79 dated May 29, 2025, stipulates the following prudential norms with respect to eligibility criteria for derivatives on Non-Benchmark Indices (NBIs): 5.7.1 In addition to the existing eligibility criteria for derivatives on indices, specified in Clause 1.1.2 of Chapter 5 of SEBI Master Circular for Stock Exchanges and Clearing Corporations dated December 30, 2024, Stock Exchanges shall follow the following prudential norms before introducing derivatives on non-benchmark indices: 5.7.1.1 Minimum of 14 constituents; 5.7.1.2 Top constituent's weight ≤ 20% 5.7.1.3 Combined weight of the top three constituents ≤ 45% 5.7.1.4 All other constituents' individual weights must be lower than those of the higher-weighted constituents (i.e. a descending weight structure). The Stock Exchanges were directed to submit their proposal for NBIs having derivatives contracts on them to SEBI, within 30 days from the issuance of the aforesaid circular. As the process of adjustment of constituents and their weights in the existing NBIs can impact passive funds tracking the indices as well as derivatives contracts on these indices, a public consultation was carried out on August 18, 2025 , to seek views on whether compliance with prudential norms be achieved through creation of separate index or weight/constituent adjustment in existing index. Based on the feedback received on public consultation and recommendations of Secondary Market Advisory Committe