According to sources, a senior Bhel official will be meeting SEBI executive director in-charge of depositories, Pratip Kar, on Monday to thrash out the issue. Bhel sources said the company was in favour of certain modifications in the agreement that is entered into between the company and the depository.

SEBI is, however, unlikely to play ball with Bhel's contention and is expected to inform the company that since more than 235 companies have signed up without a problem, there does not appear to be any flaw in the agreement to the extent that could keep Bhel away from signing up with the depository.

Bhel is the only stock among both, the 30-share BSE Sensex and the S&P CNX Nifty which is yet to sign up with the depository.

SEBI sources said that they wouldseek to convince Bhel officials of the importance of joining the depository. Sources said that regulator is upset with the company on its failure to sign up despite SEBI putting it on the list of those scrips where institutions will be allowed to trade only in demat shares.

Bhel and six other companies, which formed part of the list, had failed to sign up with the depository in time for institutions to trade in demat shares of the companies by October 15. For this reason, the deadline for these scrips was pushed back by two months to December 15.

The reluctance on the part of the companies had raised the heckles of SEBI and the regulator had taken up the issue with each of these six companies. While most of the seven companies had either signed up or had expressed a willingness to sign up in the very near future, Bhel was of the opinion that certain modifications need to be made in the listing agreement.

Interestingly, some institutions like Unit Trust of India (UTI) have already written to SEBI askingit to direct the company to provide them with the demat option. As per the Depositories Act, an investor has the right to seek the demat option from the company.