Rule 21: Stock exchanges can delist companies for losses, trading issues, or legal troubles; fair buyout required.
Rule 21 of the Securities Contracts (Regulation) Rules, 1957, allows a recognized stock exchange to delist securities on several grounds, such as a company incurring losses for three consecutive years, prolonged suspension of trading, infrequent trading, legal convictions of the company or its directors, unknown or false addresses, or insufficient public shareholding. Before delisting, the company must be given a chance to be heard. If delisted, the company, promoters, and directors are liable to buy outstanding securities at a fair price. Delisting can also occur upon the company's request if certain conditions, including shareholder approval, are met.
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