SEBI chairman Tuhin Kanta Pandey, while speaking at a FICCI event, discussed plans to improve the tenure and maturity of equity derivatives products. He also said that SEBI may introduce a regulated platform where pre-IPO companies can trade shares. Here are the key highlights from his speech.
SEBI looking to extend tenure of equity derivatives
Pandey highlighted SEBI’s plans to improve the tenure and maturity of equity derivatives products. “We will consult with stakeholders on ways to improve in a calibrated manner and the maturity profile of derivative products so that they better serve hedging and long-term investing,” he said at the FICCI Capital Market Conference 2025.
He noted that volumes in the cash market have doubled over the past three years. SEBI aims to deepen cash equities markets while enhancing the quality of derivatives through longer-tenure products.
According to PTI, Last month, SEBI’s whole-time member Ananth Narayan warned about the growing dominance of ultra-short-term derivatives trading, which could hurt the health of India’s capital markets. Research by SEBI shows that 91 per cent of individual futures and options (F&O) traders suffered net losses in FY25, collectively losing over Rs 1 lakh crore that could have contributed to responsible investing and capital formation.
SEBI hints at pilot trading platform for pre-IPO companies
Tuhin Kanta Pandey says that market regulator may introduce a regulated platform where pre-IPO companies can trade shares after making certain disclosures. The initiative, he added, will be launched on a pilot basis.
Pandey said that pre-listing information is often insufficient for investors to make informed decisions. He hinted at a pilot platform where pre-IPO companies can trade subject to specific disclosures.
“This initiative is expected to eliminate unnecessary processes and pain points that cause avoidable friction in fundraising, disclosures, and investor onboarding,” Pandey said.
The platform may allow investors to trade shares in a regulated manner during the three-day period between IPO allotment and listing. It could replace the existing unregulated grey market that currently operates in this period. When asked about discussions with depositories, he clarified, “This is only in principle with what I’m stating.”
AI adoption and capital market innovation
On artificial intelligence (AI), Pandey said it can improve customer engagement, risk assessment, monitoring, fraud detection, and financial inclusion.
“We have to think of AI as an assist, not a substitute for judgment. Sebi’s proposed guiding principles for AI ML emphasise a tiered approach, data and cyber controls, and clear accountability. RBI‘s free AI committee report also complements this,” he said.