7.1 As noted earlier (see para 6.1), delisting may be either voluntary or compulsory.

Some of the common causes for compulsory delisting of securities are:

1. Non-payment of listing fees.
2. Non-compliance with listing requirements.
3. Non-compliance with provisions of the Listing Agreement.
4. Absence of trading or negligible trading.
5. Non-redressal of investors’ complaints despite repeated reminders.
6. Unfair trading practices at the behest of the promoters / management.
7. Other malpractices such as fake original or duplicate or share certificates deliberately issued by the management.
8. Whereabouts of the company and / or its promoters / directors not known.
9. Reduction in the number of public holders of securities.

7.2 Some of the common causes for voluntary delisting of securities are :

1. A listed company finds the listing fees payable to the Stock Exchange burdensome and disproportionate to the benefits accruing to the company and/or its security holders.
2. The number of public holders of the listed securities is reduced to so low a level (due to private placement issue or otherwise) that it does not justify the securities to continue to be listed.
3. Regional imbalance of the holders of the securities either due to shifting of the companies registered office and / or location of manufacturing unit, or for any other reason.
5. Negligible trading or total absence of trading for a considerably long period of time.
6. The company has either suspended its business or is under closure or has become a sick industrial company.
7. Small capital base or failure to comply with the requirement of increasing the capital, not justifying listing to be continued.
8. Mergers, demergers, amalgamations, takeovers, etc.

7.3 It is significant to note here that a study of the cases of delisting during the past two years on the basis of the data which was placed before the Committee, in particular by the BSE, shows that non-payment of the listing fees is the most predominant reason for the compulsory delisting of securities.