While Sinha's ultimate goal is to broaden and deepen the Indian financial system, his immediate priority is rebuild confidence in the markets and bring investors back. Sebi is studying a slew of proposals that will do just that.
Market regulator Sebi wants to broaden the participation in the equity markets and work on this will begin with gusto once the furore around the elections dies. CNBC-TV18's Sajeet Manghat and Aastha Maheshwari report that the proposals Sebi is looking at could change the face of the Indian financial market beyond recognition.
Sebi chief UK Sinha has a full plate as his team works on his pet project - making the Indian capital markets the go-to destination for companies and investors. While Sinha's ultimate goal is to broaden and deepen the Indian financial system, his immediate priority is rebuild confidence in the markets and bring investors back. Sebi is studying a slew of proposals that will do just that.
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UK Sinha, Chairman, SEBI: "We are looking at a number of suggestions, e-IPO is one of them, increasing certain quota for anchor investors, increasing tax benefit for retail investors to invest in the IPO market although only the government can take a call on taxation, whose resolution looks very tough, sharing research report with investors and also asking corporates to raise money through convertibles. Even the corporate bond market needs to be developed more."
But Sebi may be finding that some proposals are easier to consider than others. Case in point: the government's recent proposal to allow unlisted companies to list in overseas markets. This has set alarm bells ringing along Sebi's corridors. Sinha says this avenue should be open only to smaller companies who do not get the right valuation domestically.
Sinha says: "This shouldn't be used by all companies, else what will be the fate of the Indian market. If every company starts listing abroad... this is not a permanent trend. It is only a temporary change."
By all accounts, the regulator's key focus area is clear: get investors to choose India over other financial markets. But quite a few of the proposals will require some heavy tweaking of existing regulations and in some cases, a whole new set of regulations, which will take some time.
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