Key Points
- SEBI’s board gave the thumbs up to new rules for primary and secondary markets.
- No news on chairperson Madhabi Puri Buch’s alleged conflicts of interest.
- No updates on the F&O framework, disappointing traders and analysts.
- New rules include ASBA-like systems and faster T+0 settlement cycles.
- Introducing a ‘New Asset Class’ and quicker rights issue processes.
Looma News
In the latest board meeting, SEBI announced a bunch of changes aimed at making capital markets better, but they left some big questions unanswered. Everyone was waiting for some clarity on chairperson Madhabi Puri Buch’s alleged conflicts of interest, especially since she’s been in hot water lately. This was their first meeting after the controversies, so many were hoping for some answers.
On top of that, they didn’t say a peep about the highly anticipated F&O framework, which left traders and analysts pretty bummed. There was a lot of buzz about what SEBI might do after they shared a consultation paper earlier this summer suggesting major changes, like weekly expiries for derivatives contracts and higher minimum contract values. Everyone was eager to see what SEBI would come up with, especially since finance minister Nirmala Sitharaman had stressed the need for action here.
What Did Get Approved?
Even though they missed some chances, SEBI did roll out a few new measures that could be good news for traders. They introduced an ASBA-like mechanism for secondary markets, which should make trading a lot smoother. This new method lets investors block funds in their bank accounts instead of transferring cash up front, which could help reduce some financial risks.
Plus, they’re expanding T+0 settlement cycles from just 25 stocks to potentially the top 500 by market cap. This could change the game on how quickly trades settle, making everything more efficient.
New Asset Class and Rights Issues
SEBI also brought in a ‘New Asset Class’ to give investors more options. You’ll need to put in a minimum of Rs 10 lakh, making it different from regular mutual funds. This is a big step toward diversifying the investment scene in India.
And there’s more! The rights issue process is getting a serious makeover. The time to complete it will shrink from 317 days to just 23, making it a much more attractive route for companies wanting to raise funds compared to the usual preferential allotments.
While the meeting left some questions in the air, these new measures are a move toward a stronger and more efficient capital market. It’ll be interesting to see how these changes unfold and if SEBI will eventually tackle the ongoing controversies about its leadership.
