Research report of analysts not an ad unless related to promotion: Sebi

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Markets regulator Sebi on Thursday clarified that research reports and recommendations of research analysts (RAs) are not considered advertisements unless anything contained in such reports is in the nature of promotion of products or services offered by them.

This came after the Securities and Exchange Board of India (Sebi) received certain queries concerning the applicability of provisions of advertisement code on a research report issued by an RA.

In its circular, Sebi said that the forms of communications, to which the advertisement code shall be applicable include pamphlets, circulars, brochures, notices or any other literature, document, information or material published, or designed for use in any publication or displays (such as newspaper, magazine, sign boards/hoardings at any location), in any electronic, wired or wireless communication or over any other audio-visual form of communication (such as television, tape recordings, motion pictures) or in any other manner whatsoever.

Further, a research report, irrespective of the mode of its dissemination to any investor or prospective investor, will be construed as an advertisement if anything contained in the said research report is either expressly or impliedly in the nature of the promotion of products or services offered by an RA, it added.