Highlights from SEBI board meeting held on April 30, 2024.
Companies can now issue bonds with a face value of Rs.10,000.
To enhance the participation of non-institutional investors in the bond market while safeguarding the interest of such investors, the Board approved the proposal to provide an option to the Issuers to issue NCDs or NCRPS through private placement mode at a reduced face value of Rs. 10000/- along with the requirement to appoint a Merchant Banker.
You can check the below post to understand the rationale by SEBI in bringing this change:
Standardization of the record date for identifying eligible holders
To address the inconsistencies relating to the fixation of record dates and to bring uniformity and standardization in terms of market practice followed by various issuers, the Board approved the proposal that record date for the payment of interest (or dividend)/ repayment of principal of debt securities/ non-convertible redeemable preference shares shall be 15 days before the due dates of such payment obligations.
Reducing the size of the offer document
Facilitating listed entities to disclose audited financials for the last three years in the offer document through the insertion of a web link and QR code of the stock exchange website, where such financials are hosted to reduce the size of the offer document.
Ease of Doing Business for Market Infrastructure Institutions (MIIs):
The board approved various proposals including the proposal that the MIIs may continue to disclose their shareholding pattern in the format applicable to listed companies and are no longer required to disclose it in a separate format.
Other decisions related to ease of doing business like issuing Consolidated Account Statement in electronic form by default, rationalizing the inspection period of commodity warehouses, etc. will be issued by way of circular(s).
AMCs to have an institutional mechanism for deterrence of potential market abuse including front-running
Considering the recent front-running instances, SEBI will specify the broad framework of the institutional mechanism, the industry body i.e. Association of Mutual Funds in India (AMFI), in consultation with SEBI, shall specify detailed standards for such an institutional mechanism.
Streamlining of prudential norms for passive schemes concerning exposure to securities of group companies of the sponsor
Currently, Mutual Fund schemes are not allowed to invest more than 25% of their net asset value (NAV) in group companies of the sponsor. This restricts the passive funds from effectively replicating the underlying index, in cases where group companies of sponsor comprise more than 25% of the index. This also puts such AMCs at a relative disadvantage as compared to other AMCs who may not have a sponsor group company(ies) comprising more than 25% in the underlying index.
To streamline the aforesaid norm and create a level playing field for all AMCs, the Board approved an amendment to SEBI (Mutual Funds) Regulations, 1996 to allow equity passive schemes, on indices to be specified by SEBI, to take exposure up to the weightage of the constituents in the underlying index with a cap of 35% investment in the group companies of Sponsor.
Amendments to SEBI (Infrastructure Investment Trusts) Regulations, 2014 and SEBI (Real Estate Investment Trusts) Regulations, 2014
The Board approved the proposal to provide a framework for Unit Based Employee Benefit schemes (UBEB) for the employees of investment manager/manager of InvIT/REIT.
Link to the full circular from SEBI: