Key decisions taken in SEBI Board Meeting
Brief Overview:
Securities and Exchange Board of India (“SEBI”) in its board meeting has approved amendments to the issue of non-convertible securities in order to promote ease of business and boost investor participation in the Indian bond market.
Technical Details:
SEBI has taken the following measures to strengthen investor participation in the Indian bond markets and provide relaxation to listed entities:
1) Issuers may now have an option to issue privately placed non-convertible debentures (“NCDs”) at a face value of INR 10,000/- (Indian Rupees Ten Thousand Only) instead of the current requirement of INR 1,00,000/- (Indian Rupees One Lakh Only) subject to the appointment of a merchant banker;
2) Existing debt listed entities may disclose their audited financials in the form of a web-link and QR code for subsequent issuances of NCDs;
3) In order to standardise market practice pertaining to record dates, the record date has now been fixed at 15 (fifteen) days prior to the respective due dates; and
4) SEBI has revised the format of due diligence certificates for issue of NCDs across SEBI norms to ensure consistency.
JC takeaway:
The Board Meeting approved the proposals that were previously open to public comments. We can expect amendments to the SEBI regulations in the near future. This is a step forward towards the induction of more retail investors in the Indian bond market.
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