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Jet Airways, Reliance Power: 34 stocks will exit F&O segment from June 28

(Photo: Kamlesh Pednekar)
National Stock Exchange (NSE) had announced expulsion of 34 stocks from the derivatives or futures and options (F&O) segment in April. Some of the notable counters that have been expelled include Jet Airways, Reliance Power, BEML, CEAT, Syndicate Bank, IDFC, Allahabad Bank and Ajanta Pharma. 

The move follows tightening of section criteria for stocks in the derivatives segment by market regulator Securities and Exchange Board of India (Sebi) in 2018.

The stock exchange said the existing unexpired contracts for the securities for the month of April, May and June will be available for trading. However, no contracts will be available for trading in these scrips from June 28.

From an investor's perspective, once the stock enters the derivative segment, it is seen as positive move. Mostly, such stocks exhibit a positive trend as more trades enter the system and only a margin payment is made. 

Here's a full list of the companies that have been banned from the F&O market, effective June 28

Ajanta Pharmaceuticals Ltd.
Allahabad Bank
BEML Ltd.
Can Fin Homes Ltd.
Ceat Ltd.
CG Power and Industrial Solutions Ltd.
Chennai Petroleum Corporation Ltd.
DCB Bank Ltd.
Godfrey Phillips India Ltd.
Godrej Industries Ltd.
Gujarat State Fertilizers & Chemicals Ltd.
IDFC Ltd.
IFCI Ltd.
India Cements Ltd.
Indian Bank
Infibeam Avenues Ltd.
IRB Infrastructure Developers Ltd.
Jet Airways (India) Ltd.
Jain Irrigation Systems Ltd.
Kaveri Seed Company Ltd.
Karnataka Bank Ltd.
Mangalore Refinery & Petrochemicals Ltd.
NHPC Ltd.
Oriental Bank of Commerce
PC Jeweller Ltd.
Repco Home Finance Ltd.
Reliance Power Ltd.
South Indian Bank Ltd.
Suzlon Energy Ltd.
Syndicate Bank
Tata Communications Ltd.
TV18 Broadcast Ltd.
V-Guard Industries Ltd.
Wockhardt Ltd.

On the flip side, when a stock moves out of derivative segment, it is sentimentally negative. Around the F&O expiry, there can be a recovery in such stocks as derivative positions start to square off. Out of the 34 stocks that will exit this segment on June 28, 11 stocks have gained ground since Tuesday as we got closer the expiry of June F&O contracts due Thursday.

Stocks Current Price 1-day change (%)
Allahabad Bank 44.5 9.07
BEML Ltd. 895 8.66
Ceat Ltd. 945 4.74
DCB Bank Ltd. 240 4.51
IFCI Ltd. 10.5 32.08
India Cements Ltd. 108 13.21
Oriental Bank of Commerce 96.1 4.68
Suzlon Energy Ltd. 5.85 18.18
Syndicate Bank 40.2 10.14
V-Guard Industries Ltd. 249 4.97
Wockhardt Ltd. 390 5.41
Data source: Spider Software