Business Standard

Curbs laid down by Sebi could spell trouble for cash-strapped promoters

MFs' exposures to such entities can face refinancing risks

Sebi
Premium

Jash Kriplani Mumbai
Curbs laid down by the Securities and Exchange Board of India (Sebi) on promoter funding can spell trouble for cash-strapped promoters who have availed funding from mutual fund (MF). The minimum security cover prescribed by the regulator for “loan against shares” and exposure limits could lead to near-term risks for MFs when existing loans come for refinancing.

“Some of the regulatory changes will make it difficult for promoters seeking funding against pledged shares to roll over their debt. The non-banking financial companies (NBFCs), which are an alternative avenue, are already constrained because of their own liquidity challenges,” said Akhil Mittal,

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Jun 28 2019 | 8:45 PM IST

Explore News

To read the full story, subscribe to BS Premium now, at just Rs 249/ month.

Key stories on business-standard.com are available only to BS Premium subscribers.

Register to read more on Business-Standard.com