Sebi likely to allow non-convertible debentures with lower face value

The Securities and Exchange Board of India (Sebi) has proposed the issuance of non-convertible debentures (NCDs) or non-convertible redeemable preference shares (NCRPS) with a face value of Rs 10,000, down from the current minimum issuance value of Rs 1 lakh.

The market regulator has also proposed fast-tracking public issuances and listing debt securities.
 

In a consultation paper floated on Saturday, Sebi said the issuer must appoint a merchant banker to carry out these privately placed NCDs or NCRPS due diligence.
 

Further, these issuances will only be interest or dividend-bearing instruments with a simple structure. The proposals come in the backdrop of recent regulatory changes for the online bond platforms and as a move to promote participation from non-institutional investors in the corporate bond market.

Reit/InvIT may issue subordinate units, ESOPs 
 

The Sebi has proposed a framework for the issuance of subordinate units in Real Estate Investment Trusts (Reits) and Infrastructure Investment Trusts (InvITs) to sponsors, sponsor groups, and associates. These units have inferior voting rights and are issued only on a private placement basis. Under the proposed framework, any issuance of smaller units after the initial offer will require approval from 75 per cent of the unit holders by value.