Markets regulator Sebi has simplified the procedural requirements for onboarding of Foreign Portfolio Investors (FPIs) in a bid to facilitate ease of doing business and to reduce the time taken for their registration. The regulator allowed designated depository participants (DDPs) to grant FPI registration on the basis of scanned copies of application forms and supporting documents, according to a circular issued on Monday. Granting of registration on the basis of scanned copies has been allowed but trading can only be activated following the verification of the physical documents, it said.
This may mean easier access, simplified KYC and documentation requirements, and fewer investment restrictions for a majority of FPIs, especially broad-based funds and pooled vehicles that were earlier part of Category-II.
To get same tax treatment as FIIs; rules on search & seizure and consent settlement cleared
The Securities and Exchange Board of India (Sebi) has proposed stricter disclosure norms for certain foreign portfolio investors (FPIs) to bring in more transparency and trust against the backdrop of the Adani-Hindenburg Research saga. Under the new norms, FPIs with an exposure of more than 50 per cent to a single group or with assets of over Rs 25,000 crore will be tagged as 'high risk' and will be required to provide additional information such as full identification of their ownership, economic interests, and control rights. A failure to provide these disclosures will lead to invalidation of the FPI registration.
Revenue dept says changes in I-T Act require Parliament nod; new regime to wait till Budget in June-July 2014.
The Securities and Exchange Board of India (Sebi) may allow non-resident Indians (NRIs) and Overseas Citizens of India (OCIs) greater exposure to domestic equities if their investments are sent through foreign portfolio investors (FPIs) registered at the GIFT City International Financial Services Centre (IFSC). The proposal will be taken during Sebi's board meeting on Saturday along with other key agenda items such as easing of voluntary delisting mechanism and introduction of a regulatory framework for real estate fractional ownership platforms, said people in the know. At present, the combined holdings of NRIs and OCIs in a global fund have to be less than 50 per cent, while that of a single NRI or OCI is capped at 25 per cent.
Amid intense scrutiny from short-sellers and regulators, Adani group stocks have seen a significant shift in their shareholder base: Relatively opaque foreign portfolio investors (FPIs) have given way to more recognisable investors and broad-based funds. The list of large public shareholders - those directly holding at least 1 per cent - is now dominated by entities, such as the state-owned Life Insurance Corporation (LIC), US-based GQG Partners, Abu Dhabi-based International Holding Company, and Qatar Investment Authority's INQ Holding.
Market regulator Sebi does not expect a large number of foreign portfolio investors to be impacted by the new beneficial ownership disclosure norms, according to sources. The norms are set to come into effect from February 1 and against this backdrop, the equity market has witnessed significant volatility, with the benchmark Sensex crashing over 1,000 points on Tuesday after shedding early intraday gains. The sources in the know said FPIs which may be required to provide enhanced disclosures are expected to be significantly less than estimated in the consultation paper and the Sebi board note of October 2023.
Foreign portfolio investors (FPIs) are likely to get a reprieve from the Securities and Exchange Board of India (Sebi) in case of a passive or unintended breach of the thresholds that trigger additional disclosure norms. According to sources, FPIs whose single group exposure exceeds 50 per cent of their corpus will get 10 trading days to bring down their exposure below the prescribed level, without triggering the stricter disclosure norms. If total equity exposure of an overseas fund exceeds Rs 25,000 crore and it doesn't wish to provide additional disclosures, it will have three months to pare its exposure.
The Indian market regulator had revamped the FPI regulations in 2014 giving custodians the mandate to collect and verify the KYC documentation of offshore investors
Foreign portfolio investors (FPIs) are likely to seek from the finance ministry a six-month extension of the date for complying with the amendments to the Prevention of Money-Laundering Act (PMLA), citing implementation challenges. Sources said FPIs, through their custodians, were planning to approach the ministry, highlighting key concerns and seeking more clarification. The ministry, through a notification on March 7, lowered the threshold for reporting ultimate beneficial ownership (UBO) for non-profit organisations and politically exposed persons to 10 per cent from 25 per cent.
Madhabi Puri Buch, the first female chairperson of Sebi, doesn't plan to rest on her laurels in her third and final year in office and has set out an ambitious goal, such as moving towards a same-day and instantaneous settlement cycle for the secondary market.
The regulator last week reached out to custodians for beneficial ownership information of investors coming from China, Hong Kong, and 11 other countries.
BSE (formerly Bombay Stock Exchange) has seen its market share go past the critical 20 per cent mark in the derivatives segment, intensifying its battle with bigger rival - the National Stock Exchange (NSE) - which, less than a year ago, had a monopoly in this space. In April, the average daily trading volume (ADTV) for BSE stood at Rs 89 trillion, accounting for 20.6 per cent of the overall ADTV of Rs 432 trillion (based on notional volumes for options).
Market players attribute the rally in small and midcaps to flows from retail investors and domestic institutions.
Markets watchdog Sebi on Tuesday decided to tighten norms for utilisation of IPO proceeds by companies, introduce special situation funds to invest only in stressed assets and amend various regulations, including those on mutual funds and settlement proceedings. The board of Sebi, which met on Tuesday, also gave its nod for amending Foreign Portfolio Investor (FPI) regulations and introducing a provision for appointment or re-appointment of any person, including as a managing director or a whole time director or a manager, who was earlier rejected by the shareholders at a general meeting. Once the amended norms are in place, such appointments or re-appointments can only be done with the prior approval of the shareholders.
An expert committee appointed by the Supreme Court said it cannot conclude any regulatory failure around Adani Group's stock rallies, and that Securities and Exchange Board of India (SEBI) has 'drawn a blank' in its probe into alleged violations in money flows from offshore entities into the conglomerate.
An expert committee appointed by the Supreme Court said it cannot conclude any regulatory failure around Adani Group's stock rallies, and that Sebi has "drawn a blank" in its probe into alleged violations in money flows from offshore entities into the conglomerate. But the six-member panel said there was an evidence of a build-up in short positions on Adani Group stocks ahead of the report of US-based short seller Hindenburg Research, and profiting from squaring off positions after prices crashed post-publication of the damning allegations. "At this stage, taking into account the explanations provided by Sebi, supported by empirical data, prima facie, it would not be possible for the committee to conclude that there has been a regulatory failure around the allegation of price manipulation," the panel said in the report submitted to the Supreme Court.
Diwali fireworks are expected to continue on Dalal Street next week, with four companies collectively seeking to mobilise over Rs 6,600 crore through initial public offerings (IPOs). In terms of the amount raised, this is poised to be the busiest week of calendar year 2023. Tata Technologies (Tata Tech), a subsidiary of Tata Motors, could lead the charge with an IPO projected to be over Rs 2,900 crore. This will mark the first maiden share sale by a Tata Group firm in nearly two decades.
Mutual funds (MFs) turned net sellers of equities in April amid a run up in stock prices on sustained inflows from foreign portfolio investors (FPI). The benchmark indices, Sensex and Nifty50, logged their biggest monthly advance since November last year, gaining 3.6 per cent and 4.1 per cent last month. Data from the Securities and Exchange Board of India (Sebi) shows that MFs sold equities worth over Rs 5,100 crore in April, the highest since February 2021.
A global association for regulated funds that is leading efforts to shorten the settlement cycle for US equities has reached out to the Securities and Exchange Board of India (Sebi) with a plea to extend the T+1 implementation timeline by 18 months. The short transition period of four months does not provide foreign portfolio investors (FPIs), their services providers, and broker dealers sufficient time to make the necessary operational and compliance changes to accommodate a shorter settlement cycle, ICI Global said in its letter addressed to Sebi chairman Ajay Tyagi written a few days back. ICI Global carries out the international work of the Investment Company Institute (ICI), a global association for regulated funds, whose members manage assets of more than $42 trillion.
'Sebi has to make sure that investor interests are protected and at the same time, there isn't over-regulation so that companies don't get discouraged to list here.'
The government is likely to file draft papers for the mega initial public offering of LIC with market regulator Sebi by next week, while a portion of the issue would be reserved for anchor investors, a top official said on Wednesday.
The filing of offer documents with the capital markets regulator - Securities and Exchange Board of India - has more than halved this financial year (2022-23, or FY23) as the outlook for new share sales has worsened, following correction in the secondary market. So far in FY23, 66 companies filed their draft red herring prospectus (DRHP), as opposed to 144 in the preceding financial year (2021-22, or FY22).
Have the markets already played out their dynamics before the economy has even properly taken off? Are we now destined for a period of mediocre returns despite a strong economy? asks Akash Prakash.
The Securities and Exchange Board of India's (Sebi's) board on Wednesday allowed foreign portfolio investors (FPIs) to trade in exchange-traded commodity derivatives. The move, it said, "will enhance liquidity and market depth, as well as promote efficient price discovery." Overseas investors will only be allowed to deal in non-agricultural commodity derivatives and only cash-settled contracts.
Industry players credit Sebi's first woman chairperson with putting special emphasis on cyber security, use of tech and data, areas where Sebi is trying to 'stay ahead of the curve'.
The Rs 38-trillion mutual fund (MF) industry is going through a new fund offer (NFO) rush. Since July 1, the industry has launched close to 70 NFOs. This follows the completion of a near three-month embargo period when the industry had vowed to not launch any new offerings till the time it implemented norms around pooling of investor accounts. As a result, between April and June 2022, the industry was able to launch just three NFOs.
The clarification by the National Securities Depository (NSDL) - which is tasked with monitoring foreign portfolio investor (FPI) investment in domestic stocks - that the accounts of top investors in Adani group stocks remain 'active' has helped prevent a $500-million selloff of shares. Analysts said a freeze of the FPI accounts, as reported by some media outlets, could have prompted global index providers to cut weighting of four Adani group companies from their global indices. Brian Freitas, an analyst at independent research provider Smartkarma, said if the FPI accounts were indeed frozen, FTSE and MSCI would have reduced weighting of Adani group companies at the next rebalance, since it would have meant that the large part of the free float was not tradeable.
HDFC and HDFC Bank's merger - touted as India's biggest-ever corporate merger - pumped up shares of the two entities on the bourses. Shares of Housing Finance Development Corporation (HDFC) skyrocketed 9 per cent while those of HDFC Bank zoomed 10 per cent. In comparison, the benchmark S&P BSESensex and the Nifty50 indices settled 2.2 per cent higher on Monday.
Bear operators are said to have created huge short positions in the stock market over the past few days, which means they were betting on a fall in the market values
The government will launch the mega public offer of LIC by March and file draft papers with market regulator Sebi by the end of this month, an official said. Finance Minister Nirmala Sitharaman had last week reviewed the progress of the initial public offering (IPO) of Life Insurance Corporation (LIC) in a meeting with top officials of the ministry. The official said the September 2021 quarter financials of LIC are getting finalised as well as fund bifurcation is in progress.
Sun Pharma was the top loser in the Sensex pack, shedding 2.37 per cent, followed by HCL Tech, Reliance Industries, IndusInd Bank and L&T.
Market regulator Securities and Exchange Board of India has said one FPI can hold a maximum of 10 per cent of a company's equity shares, while existing overseas investor classes such as foreign institutional investors, sub-accounts and qualified foreign investors need to convert to the new FPI regime eventually.
In this round, the market has won. But it is still for Gautam Adani to decide whether he has lost or not, argues Shekhar Gupta.
New regime places more limits on unregulated foreign entities
Swiss brokerage UBS joins European banking peer HSBC in shutting down its offshore derivative business
The second-longest serving chairman introduced quite a few measures for the primary market and implemented a new corporate governance framework.
Highlights of Economic Survey 2020-21, tabled in Parliament by Finance Minister Nirmala Sitharaman on Friday.
The Securities and Exchange Board of India (Sebi) has deferred the diktat requiring foreign investors to disclose their mobile number, email addresses and income details to depositories, a move believed to be aimed at curbing practices such as round tripping and money laundering. "Based on the representations received from MIIs (market infrastructure institutions), Sebi has decided to extend the deadline for making 6-KYC attributes mandatory for new accounts opened by 1 month to July 1, 2021. "Participants are accordingly requested to take note of the above and ensure compliance," NSDL said in a note on Tuesday. The regulator is also meeting custodians this week to thrash out a solution and address investors' concerns.
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