Indian capital market watchdog SEBI (Securities and Exchange Board of India) on Thursday said all the stock and commodity exchanges can facilitate trading in stocks and commodities derivatives from October 2018. SEBI has taken a series of reforms at its board meeting held on Thursday. SEBI decided to put a 10% cap cross-shareholding on all the mutual funds and moreover will now up to 10% and all the mutual funds will now have a year to conform to new cross holding terms. With the latest reform of SEBI converge the bourses from October 18, BSE and NSE will be able to provide commodity derivatives trading on their respective platforms. In addition to this, SEBI said the promoters of the companies will now be allowed to sell up to 2% of their equity through secondary markets.
SEBI Chief Ajay Tyagi said that the regulator is trying to simplify, rationalise norms for REITs (Real Estate Investment Trusts) and all the firms to face action for WhatsApp leak of financial details investigating more companies in information leak case. The new measure may have an impact on the shareholding pattern of UTI Asset Management Company (AMC), requiring its promoters to lower their stake to 10% or below in next one year. As State Bank of India, Punjab National Bank, Bank of Baroda and Life Insurance Corporation are having their own mutual funds and at the same time, each of them holds an 18.24% stake in UTI AMC will now be required to limit their shareholding to 10%.
SEBI said that all the credit rating agencies can’t hold more than 10% of their rival firms and has allowed QIPs (qualified institutional placement) as one of the routes to achieving minimum 25% public shareholding. Amid the booming domestic equities, SEBI Chairman Ajay Tyagi said the regulator has decided to relax entry norms for FPIs (foreign portfolio investors) who are willing to invest in the Indian markets. Besides this, SEBI would allow listing of security receipts issued by an asset reconstruction company (ARC) on stock exchange platform. In a serious warning to companies for leakage of key financial details, all those responsible, including auditors, would face action and the rules would be strengthened if required, Ajay Tyagi said further.