NALCO (National Aluminium Company Limited), a Central Public Sector Enterprise, has seen its shares rise by 0.93% to ₹238.30 amidst regulatory challenges. The company is contesting penalties imposed by the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) for non-compliance with Securities and Exchange Board of India (SEBI) regulations regarding board composition.

Penalty Details and Stock Performance

NALCO faces penalties from both major Indian stock exchanges:

The penalties relate to violations of SEBI's Listing Obligations and Disclosure Requirements (LODR) concerning the adequate number of independent directors on the company's board.

On the trading front, NALCO's stock showed the following performance:

NALCO's Response and Actions

NALCO argues that as a Central Public Sector Enterprise, the appointment of directors is controlled by the President of India, not the company itself. In response to the penalties, NALCO has taken the following steps:

1. The board has resolved to seek waivers for the imposed penalties.
2. A waiver application has been submitted to the stock exchanges.
3. The company is pursuing the matter with the Ministry of Mines to expedite the appointment of required independent directors.

Upcoming Board Meeting

According to the LODR data, NALCO has scheduled a board meeting. The meeting agenda includes:

• Consideration of unaudited standalone and consolidated financial results for the quarter and half-year.
• Discussion of other business matters.

The trading window for NALCO securities is closed in compliance with insider trading regulations.

The company's proactive approach in addressing the regulatory issues and its commitment to transparency through timely disclosures demonstrate its efforts to maintain good corporate governance practices. However, the outcome of the penalty waiver requests and the timeline for appointing new independent directors remain to be seen.

NALCO , a Government of India Enterprise, has been fined Rs 15.03 lakh by the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) for non-compliance with SEBI regulations regarding board and committee composition. The company is actively seeking a waiver of these penalties, citing its unique status as a Central Public Sector Enterprise (CPSE).

Fine Details and Non-Compliance

NALCO received identical fines from both BSE and NSE, each amounting to Rs 7,51,660 (including GST). The penalties were imposed for non-compliance with Regulations 17(1) and 18(1) of SEBI LODR Regulations 2015 for the quarter ended June 30, 2025. These regulations pertain to the composition of the board of directors and audit committee, respectively.

NALCO's Response and Actions Taken

In response to the fines, NALCO has taken several steps:

1. Communication with Government: The company informed the Ministry of Mines, its administrative ministry, about the fines on September 8, 2025, requesting expedited appointment of the required number of Independent Directors.

2. Clarification to Stock Exchanges: NALCO clarified to both BSE and NSE that as a CPSE, the authority for appointing directors rests with the President of India, and the company has no control over these appointments.

3. Board Meeting: The matter was discussed in NALCO's 359th Board meeting on September 25, 2025. The Board advised the company to communicate with the exchanges, explaining its position as a CPSE.

4. Waiver Application: A waiver application was submitted to BSE on September 18, 2025, for the committee composition non-compliance. The company plans to apply for a waiver of the board composition penalty once compliance is achieved.

Key Points from NALCO's Statement

NALCO's Stance

NALCO emphasizes that the appointment of Independent Directors is beyond its control, as all directors are appointed by the President of India. The company has been continuously engaging with the Administrative Ministry to expedite the appointment of the required number of Independent Directors to ensure compliance with both the Companies Act, 2013, and SEBI LODR Regulations, 2015.

The company has requested that the non-compliance be condoned and the imposed fines be waived, considering its status as a government enterprise and the ongoing efforts to rectify the situation.

As NALCO works towards resolving this regulatory issue, investors and market watchers will be keenly observing how this situation unfolds, particularly given the company's unique position as a government-controlled entity navigating stock market regulations.