Tag: SEBI

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SEBI proposes pay disclosure norms for AMCs

The Securities and Exchange Board of India (SEBI) has proposed changes to remuneration disclosure norms for mutual fund asset management companies (AMCs). Under the proposal, AMCs would no longer need to publicly disclose the names, designations and salaries of top executives and high-earning employees. Instead, compensation details would be reported in a consolidated format.

At present, mutual fund firms are required to disclose the remuneration of key officials, including the chief executive officer (CEO), chief investment officer (CIO), chief operating officer (COO), the top 10 highest-paid employees, and staff earning above specified salary thresholds. SEBI has proposed replacing these disclosures with category-wise compensation figures and the number of employees in each category.

The regulator said the proposal follows industry feedback highlighting concerns around employee privacy, data protection and the limited value of individual salary disclosures for investors. Industry participants also argued that such requirements could put AMCs at a disadvantage in attracting and retaining talent compared with portfolio management services (PMS) firms and alternative investment funds (AIFs), which do not face similar disclosure norms.

According to SEBI, consolidated reporting would continue to provide investors with an overview of senior management compensation while ensuring disclosures remain relevant and proportionate. Its analysis found that employees covered under the current rules account for only a small portion of the workforce at most AMCs.

SEBI has also proposed that scheme-level remuneration details of fund managers should not be publicly disclosed, though they may be shared with investors holding units in the concerned scheme upon request.

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Rajesh Exports under regulatory lens after Sebi order

Rajesh Exports is facing increased scrutiny after a recent Securities and Exchange Board of India (Sebi) order related to alleged financial irregularities. The development could impact the company’s eligibility under the government’s Production Linked Incentive (PLI) scheme for electronics manufacturing.

The company has denied any wrongdoing and said it is cooperating fully with regulators. Rajesh Exports also informed Sebi that nearly 400 GB of documents submitted during the investigation could not be located by the regulator and will be resubmitted within 15 days.

No final decision has been taken on the company’s PLI status, and the review remains ongoing.

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SEBI bars Rajesh Exports promoter

The Securities and Exchange Board of India (SEBI) has barred the promoter of Rajesh Exports from accessing the securities market after alleging large-scale misrepresentation of the company’s revenue figures.

In an interim order, SEBI said the Bengaluru-based gold exporter and jewellery manufacturer overstated its revenue by more than ₹15 lakh crore over multiple financial years. According to the regulator, the company reported sales transactions that lacked genuine economic substance, resulting in an inflated picture of its business operations and financial performance.

SEBI’s investigation found that a significant portion of the reported turnover came from transactions involving related entities and circular trading arrangements. The regulator said these transactions appeared to have been structured mainly to inflate reported revenues rather than reflect actual business activity.

The market watchdog stated that such disclosures may have misled investors, analysts and shareholders by portraying Rajesh Exports as a much larger business than it actually was. SEBI stressed that accurate financial reporting is essential for maintaining investor confidence and ensuring fair functioning of capital markets.

As part of the interim action, the promoter has been restrained from buying, selling or dealing in securities until further orders. SEBI has also launched a detailed investigation to examine the extent of the alleged violations and determine whether other individuals or entities were involved.

Rajesh Exports is one of India’s largest gold refining and jewellery companies and has often reported among the highest revenues in the corporate sector. Its turnover figures had frequently drawn attention because of their scale relative to the company’s profitability.

SEBI clarified that the interim order is based on preliminary findings and does not amount to a final determination of wrongdoing. The company and its promoter will have an opportunity to present their responses during the investigation.

The case has attracted significant attention due to the scale of the alleged revenue overstatement. Investors and market participants will closely monitor further developments as SEBI’s probe progresses and more details emerge about the company’s financial reporting practices.

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OYO parent gets SEBI approval for ₹6,500 cr IPO

Oravel Stays Ltd, the parent company of hospitality and travel platform OYO, has received approval from the Securities and Exchange Board of India (SEBI) to launch its much-awaited initial public offering (IPO).

The company plans to raise around ₹6,500 crore through the public issue, marking a major step in its journey towards becoming a publicly listed company. The approval comes after multiple attempts by OYO to enter the stock market over the past few years.

According to reports, the IPO will include a fresh issue of shares as well as an offer-for-sale component. The funds raised are expected to be used for business expansion, debt reduction, technology investments and other corporate requirements.

Founded by entrepreneur Ritesh Agarwal in 2013, OYO has grown from a budget hotel aggregation platform into one of the world’s largest hospitality technology companies. The company operates hotels, homes and vacation rentals across several countries and has built a significant presence in India and international markets.

In recent years, OYO has focused on improving profitability, streamlining operations and strengthening its balance sheet. The company has reported better financial performance, supported by higher occupancy rates, stronger demand for travel and cost-control measures. These improvements are believed to have helped the company secure regulatory approval for its IPO plans.

The proposed public offering comes at a time when India’s primary market remains active, with investors showing interest in companies that have demonstrated a clear path to profitability. Market participants will closely watch OYO’s valuation, growth strategy and financial performance as details of the IPO emerge.

With SEBI’s approval now in hand, OYO is expected to move ahead with the next stages of the IPO process, including finalising issue details and launch timelines. The offering is likely to be among the most closely watched public issues in India’s startup ecosystem this year.

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Sebi imposes ₹28.95 cr fine on Suzlon Energy

India’s market regulator has imposed a penalty of ₹28.95 crore on Suzlon Energy and several of its former executives over alleged misrepresentation of financial information and failure to make accurate disclosures to investors.

The action was taken by Securities and Exchange Board of India (Sebi) following an investigation into transactions involving the company and related entities. According to the regulator, certain disclosures made to investors did not fully reflect the nature of the transactions, resulting in misleading information being presented to the market.

Sebi found that the company had failed to provide complete and transparent details regarding financial arrangements linked to related parties. The regulator said these omissions affected the quality of information available to shareholders and could have influenced investment decisions.

As part of the order, penalties were imposed on Suzlon as well as several individuals associated with the company during the period under review. Among those named was Girish Tanti, who was fined for his role in the matter.

The regulator stated that listed companies have a responsibility to maintain high standards of corporate governance and ensure timely, accurate and complete disclosures. Transparency, Sebi noted, is essential for protecting investor interests and maintaining confidence in capital markets.

Suzlon, one of India’s leading renewable energy companies, has not publicly commented in detail on the order. The company retains the option to challenge the regulator’s findings through the appropriate legal channels.

The case relates to historical transactions and disclosures examined by the regulator. Sebi concluded that the company and certain executives violated provisions of securities regulations governing disclosure requirements and fair treatment of investors.

The penalty comes as regulators continue to increase scrutiny of corporate governance practices and disclosure standards among listed companies.

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SEBI plans new rules for Options Trading

Securities and Exchange Board of India (SEBI) has proposed a new system for option strike prices to make trading more flexible and easier during sharp market movements.

The market regulator wants to introduce a dynamic framework that would allow option strike prices to adjust according to changing market conditions. The move is aimed at ensuring traders have access to more suitable price levels when markets move quickly.

Currently, option strike prices are introduced based on existing exchange rules. However, during periods of high volatility, traders can sometimes face difficulties if available strike prices do not match rapidly changing market conditions.

SEBI believes a more flexible system could help maintain smooth trading and improve the overall experience for market participants. The proposal is also expected to support better risk management and provide traders with more choices.

Options are widely used by traders and investors to manage risk and make market bets. The strike price is an important part of these contracts because it determines the level at which buying or selling can take place.

Market experts say the proposed changes could make options trading more efficient, especially during periods of sudden market movement. A wider range of relevant strike prices could help traders react more effectively to changing situations.

SEBI has invited comments and suggestions from stakeholders before taking a final decision on the proposal.

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BofA pays ₹58.5 lakh to close SEBI case

Bank of America’s (BofA) securities arm in India has settled an insider trading-related case with the Securities and Exchange Board of India (SEBI) by paying a settlement amount of ₹58.5 lakh.

The case was linked to alleged lapses in complying with insider trading regulations, particularly the failure to properly maintain a Structured Digital Database (SDD), which is required to track access to unpublished price-sensitive information.

SEBI had issued a show-cause notice to the firm last year, alleging violations of insider trading and merchant banking rules. The regulator said the database is a key compliance tool designed to prevent misuse of confidential market information.

During the proceedings, the company filed a settlement application without admitting or denying the allegations. The matter was reviewed by SEBI’s internal committees and later approved for settlement.

The regulator confirmed that after payment of the ₹58.5 lakh fee, the case has been disposed of.

The settlement brings closure to the proceedings, though SEBI retains the right to take action in future if any misrepresentation or non-compliance is found.

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RBI, IRDAI cautious on banks in commodity derivatives

India’s financial regulators have taken a cautious stance on allowing banks and insurance companies to participate in commodity derivatives trading, according to remarks made by SEBI chief Tuhin Kanta Pandey.

Pandey said that both the Reserve Bank of India (RBI) and the Insurance Regulatory and Development Authority of India (IRDAI) are currently not inclined to permit such participation due to risk and structural concerns. As a result, banks and insurers are expected to remain out of the commodity derivatives segment for now.

The clarification comes even as the Securities and Exchange Board of India (SEBI) had earlier explored expanding participation in the commodities market to deepen liquidity and improve price discovery. SEBI had also discussed allowing banks and pension funds to enter the segment as part of efforts to strengthen the ecosystem.

However, the latest stance from the RBI and IRDAI indicates that the proposal has hit a regulatory roadblock. Officials believe commodity-linked instruments may not align with the long-term investment mandates of banks and insurance companies, and could expose them to additional volatility risks.

Following the remarks, market sentiment turned negative for commodity exchanges. Shares of Multi Commodity Exchange of India (MCX) fell by around 3–3.5%, reflecting concerns that reduced institutional participation could limit liquidity and trading volumes.

MCX, which dominates India’s commodity derivatives market, is particularly sensitive to regulatory changes affecting institutional access. Investors worry that without banks and insurers, the growth potential of the segment could be constrained in the near term.

At the same time, SEBI’s broader agenda to develop the commodity market remains in focus, including earlier proposals to involve pension funds and other long-term investors. But regulatory alignment between the three major bodies, SEBI, RBI, and IRDAI, appears to be the key hurdle.

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SEBI proposes overhaul of stockbrokers’ net worth norms

The Securities and Exchange Board of India (SEBI) has proposed a major revision in how stockbrokers calculate their “variable net worth”, shifting from a fixed formula to a more risk-based system that reflects their actual business size and exposure.

Under the current rule, brokers are required to maintain net worth linked to 10% of the average daily client cash balance they hold. However, SEBI says this method has become outdated after changes in how client funds are handled in the market. With the introduction of the upstreaming mechanism, client money is now transferred to clearing corporations, leaving brokers with very little cash on their books.

Because of this shift, SEBI believes the old calculation no longer accurately reflects the risks brokers face. The regulator has now proposed a new framework that ties capital requirements more closely to both client exposure and business scale.

In the new model, one key component of net worth will be based on 10% of the average credit balance of clients over the past six months. This replaces the earlier focus on funds retained by brokers.

The second component is linked to the number of active clients. Brokers will need to maintain additional capital in slabs depending on their client base. For example, firms with more clients will be required to hold higher minimum net worth, with incremental increases as their customer base grows. Separate requirements are also proposed for clients brought in through authorised persons.

SEBI has said the net worth requirement acts as a “second line of defence” after margin obligations and must be strong enough to absorb risks not covered elsewhere.

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SEBI eases IPO rules, plans checks on trading errors

Securities and Exchange Board of India (SEBI) has taken steps to make life easier for companies planning to go public, while also trying to make stock market trading safer.

In a recent move, SEBI has allowed companies to reduce the size of their IPOs by up to 50% without going through a long and complex approval process. Earlier, companies could only make smaller changes without restarting paperwork.

This change comes at a time when global uncertainties, including tensions involving Iran, have made markets unpredictable. Because of this, many companies have been cautious about raising funds, as investor sentiment has weakened.

With the new rule, companies can now adjust their IPO plans more easily if market conditions are not favourable. However, they still need SEBI’s approval, and the purpose of the IPO must remain the same. The relaxation is temporary and applies to companies planning to launch IPOs in the coming months.

At the same time, SEBI is also focusing on making trading more secure. It is looking to reduce “fat finger” errors, mistakes made when traders accidentally enter the wrong price or quantity.

To address this, SEBI may ask stock exchanges to introduce tighter and more flexible price limits in the options trading segment. These limits would help prevent sudden spikes or crashes caused by such errors.

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