The Securities and Exchange Board of India (SEBI) is set to review and potentially clear a wide range of proposals at its upcoming board meeting on September 12, aimed at improving the ease of doing business in capital markets, according to a report by Moneycontrol.
Key proposals on the table
1. Less stake dilution in mega IPOs
For very large companies, SEBI may ease minimum public shareholding (MPS) rules by allowing smaller initial offerings with extended timelines. Depending on post-issue market cap, dilution norms could range from Rs 1,000 crore + 8% for companies up to Rs 1 lakh crore, to Rs 15,000 crore + 1% for those above Rs 5 lakh crore. Deadlines to meet the 25% MPS could extend up to 10 years.
2. Anchor investor allocation in IPOs
The number of anchor allottees for IPOs sized Rs 250–500 crore may increase from 25 to 30. Insurance and pension funds could also get allocations alongside mutual funds, diversifying the investor base.
3. Related Party Transactions (RPTs)
A new turnover-linked materiality threshold is likely to be introduced, easing compliance for smaller firms while safeguarding minority shareholders.
4. Expanded scope for Credit Rating Agencies (CRAs)
SEBI may allow CRAs to rate instruments regulated by RBI, IRDAI, PFRDA and others, provided activities are ring-fenced under separate business units.
5. Equity classification for REITs and InvITs
Reclassifying REITs and InvITs as equity instruments could allow mutual funds to include them in equity schemes, boosting investor participation.
6. Review of stock broker and RTA regulations
Revamped governance standards for brokers and activity-based rules for Registrar & Transfer Agents (RTAs) are also under discussion.
7. Strengthening governance in exchanges
Proposals include appointing at least two executive directors alongside the managing director at Market Infrastructure Institutions.
8. Accredited investor AIF schemes
A new class of AI-only Alternative Investment Funds with a lighter compliance framework may be approved, alongside lower investment thresholds for Large Value Funds.
9. Easier norms for Investment Advisers (IAs) and Research Analysts (RAs)
The board could clear changes to allow sharing of past performance data with disclaimers, simplified registration, and relaxed qualifications.
10. FPIs and Indian participation
SEBI may enable resident Indian entities to act as sponsors of retail schemes based in IFSCs, expanding FPI participation opportunities.
Outlook
If cleared, these reforms will align with SEBI’s broader objective of simplifying compliance, expanding investor access, and deepening India’s capital markets.
