Sebi cuts face worth of debt securities to spice up retail participation | Capital Market Information

Markets regulator Sebi on Wednesday drastically lower the face worth of debt securities to Rs 10,000 from Rs 100,000 at current to spice up participation of retail buyers within the company bond market.

Market contributors are of the view that decrease ticket dimension of debt securities might encourage extra non-institutional buyers to take part within the company bond market which in flip might also improve liquidity.

In a round, Sebi mentioned, “The issuer might subject debt safety or non-convertible redeemable desire shares on non-public placement foundation at a face worth of Rs 10,000”.

This, nonetheless, can be topic to sure situations just like the issuer ought to appoint at the least one service provider banker, and non-convertible debentures and non-convertible redeemable desire shares be plain vanilla, curiosity or dividend-bearing devices.

Sebi mentioned that credit score enhancements can be permitted in such devices.

 

With respect to Normal Data Doc (GID), which is legitimate as on the ‘efficient date of the round’, Sebi mentioned the issuer might increase funds by way of tranche placement memorandum or Key Data Doc at a face worth at Rs 10,000 offered at the least one service provider banker is appointed to hold out due diligence in respect of such issuances.

“Needed addendum shall be issued by such issuer to the shelf placement memorandum or Normal Data Doc, as relevant,” it added.

In October 2022, the Securities and Alternate Board of India (Sebi) decreased the face worth of company bonds to Rs 100,000 from Rs 1,000,000.

First Revealed: Jul 03 2024 | 7:22 PM IST