SEBI introduces pre-open call auction

Share |

The Securities and Exchange Board of India (SEBI) said on Thursday it has decided to introduce the call auction mechanism in the pre-open session.

The pre-open session shall be introduced on a pilot basis by BSE and NSE for the components of benchmark indexes BSE-30 and NSE-50.

BSE updates - Change in listing norms by SEBI

(Under BSE updates) - The Securities Exchange Board of India popularly known as SEBI, which controls and governs the working of Indian share markets by making amendements in the trading and listing rules in all the stock markets of india whether regional or Bombay Stock Exchange(BSE), National Stock Exchange (NIFTY) has come up with another amendement in the listing norms of the companies on indian share markets.

The change in listing norms would protect the minority share holders in any listed company on all the authorised stock markets across india. SEBI's step will prevent situations wherein companies come out with follow-on issues, rights issues or preferential allotments with higher voting rights per share, helping promoters get greater control in the company. According to Sebi amendements in norms, firms can come up with fresh issues that offer inferior voting rights or dividend, thereby helping raise equity without resorting to debt and giving up control.

However it's still not clear how the indian share markets would react to this change in coming trading days

SEBI scraps no delivery period during Corporate announcements Events

To avoid volatility in markets, watchdog SEBI has done away with the practice of keeping shares under no-delivery during the record date for corporate announcements like bonus or dividend.

No-delivery period means that trading during the record date would not result in any delivery of shares.

However, this system was useful when trading used to take place in the physical form as certificates had to be delivered before record date starts to the registrars of companies.

However, the practice lost importance during the present days of demat or electronic trading.

"...it is decided to do away with 'no-delivery period' for all types of corporate actions in respect of the scrips which are traded in the compulsory dematerilaised mode," market regulator SEBI said in a circular.

Market analysts said the move will prevent market volatility.

"The announcement would prevent fluctuation in prices and it is good for the market," brokerage firm SMC Global Vice- President Rajesh Jain.

SEBI added the circular is issued to protect the interests of investors in securities and to promote and regulate the securities market and it would come into effect from August 1, 2009.

courtesy - economictimes

SEBI removes entry load on MF schemes

SEBI's new guidelines stipulates that investors directly make payments to distributors instead of MF companies deducting it from the investment made in any scheme.

"There shall be no entry load for the schemes, existing or new, of a Mutual Fund. The upfront commission to distributors shall be paid by the investor to the distributor directly," SEBI said in a statement after its board meeting.

Also read -
-World's top 10 most valuable brands list
-TATA'S are more reputed then Google, MSoft
-BSE aims at internationalization of listing businessNEW !!
-Effect of Recession on Indian Economy
-Economies hit by recession
-World's Strongest economies list

Further, the upfront commission to distributors shall be paid by the investor to the distributor directly, the statement said.

The equity schemes of MFs are likely to be hurt the most as they attract the most entry load among schemes.

Share rule changes - approved by SEBI

The Securities and Exchange Board of India (SEBI) approved the "anchor investor" concept under which an investor can subscribe to up to 30 percent of the quota for institutional investors in an initial public offering, said Chairman C.B.Bhave.

Also read -
-World's top 10 most valuable brands list
-TATA'S are more reputed then Google, MSoft
-BSE aims at internationalization of listing businessNEW !!
-Effect of Recession on Indian Economy
-Economies hit by recession
-World's Strongest economies list

"This is in response to (the) requests of issuers that there was a need for investors with prior commitment who will enhance their ability to sell the issue and bring more confidence," Bhave told reporters after a board meeting.

Under the new rules, an anchor investor would pay 25 percent of the total investment at the time of applying for the initial public offering, and the balance within two days of the closure of the issue.

Such anchor investors would have to adhere to a lock-in period of one month from the date of the share allotment.

Earlier this year, the regulator amended rules for declaring the price band of initial public issues and changed its rules on mandatory open offers in a drive to make the capital markets more investor friendly.

Bhave said SEBI had also decided to rationalise disclosure in the rights issues offer documents as information relating to the listed company offering such an issue was already available in public domain for investors.

In a rights issue, a company issues new shares to existing shareholders. Analysts say the upturn in the stock market is expected to see many firms rushing to tap this route to raise finances for either cutting debt or to fund expansion plans.

Also read -
-World's top 10 most valuable brands list
-TATA'S are more reputed then Google, MSoft
-BSE aims at internationalization of listing businessNEW !!
-Effect of Recession on Indian Economy
-Economies hit by recession
-World's Strongest economies list

"The revised disclosure would make the process of rights issue faster for companies and also reduce overall costs for such issues," said a SEBI statement.

The market regulator also said entry load for investments in mutual funds would be removed, which is expected to result in increased participation. It would also cut registration fees for market intermediaries by about 50 percent.

courtesy - economictimes

SEBI tightens investment norms

(22/4/2009 - SEBI news ) - Market regulator SEBI imposed a ceiling of 30 per cent on resources a mutual fund can invest in the debt instruments of a single entity, a move that will help asset managers to diversify risks.

"The Board decided to amend the Seventh Schedule of SEBI (Mutual Fund) Regulations to provide that no mutual fund scheme shall invest more than 30 per cent of its net assets in money market instruments of an issuer," SEBI said in a statement after the Board meeting.

-Effect of Recession on Indian Economy
-Economies hit by recession
-Plan for World Economy Revival
-Indian Economic Summit Updates
-World's Strongest economies list
-Trouble in Indian Forex
-US Economic recession-how it started

The schemes may, however, continue to invest up to 15 per cent or 20 per cent of its net assets, in other investment grade debt instruments of an issuer as already provided in the regulations, it added.

Welcoming the decision, AMFI Chairman A P Kurien said " the move was suggested by us as it will help in reducing risk by cutting down overexposure in a single entity."

Valueresearch CEO Dhirendra Kumar said it is a modest initiative by the regulator and will lead to reducing systemic risks. It will ensure safety of investors' money although it will be bit tough for fund houses to comply with.

-Effect of Recession on Indian Economy
-Economies hit by recession
-Plan for World Economy Revival
-Indian Economic Summit Updates
-World's Strongest economies list
-Trouble in Indian Forex
-US Economic recession-how it started

However, it said, these limits will not cover investments in government securities, T-Bills and Collateralized Borrowing and Lending Obligations (CBLO).

posted under - SEBI, SEBI updates, indian markets updates, Securities exchange board, Indian stocks, BSE, BSE stocks, NSE stocks

Sebi asks 11 cos to resolve investor issues within 30 days

Market regulator Securities and Exchange Board of India on Monday asked 11 companies to resolve investor issues in a month or face penalty.

"If any of these companies fails to redress the grievances and submit the status report ... within 30 days from the date of this advertisement, SEBI shall be constrained to take actions against these companies and their directors," it said in a statement.

Also Read :
-Effect of Recession on Indian Economy
-Economies hit by recession
-Plan for World Economy Revival
-Indian Economic Summit Updates
-World's Strongest economies list
-Trouble in Indian Forex
-US Economic recession-how it started

The companies include Aashi Industries, Beta Naphthol, Indo American Optics, Jayant Vitamins, Motorol Enterprise, Ojas Technochem Products, Indo American Credit Corp, Hindustan Industrial Chemicals, Topline Shoes, Panjwani Packaging and Pankaj Agro Protinex.

SEBI said it has received a large number of complaints against these companies from investors and that these firms have not responded to the regulator's letter sent along with the list if complaints to them for resolution.

The regulator said, as per the SEBI Act, "such companies shall be liable to a penalty of one lakh rupees for each day during which such failure continues or one crore rupees, whichever is less."

posted in - SEBI updates, indian markets updates, SEBI latest news, BSE updates, NSE updates, SEBI

SEBI to simplify share inheritance rules

The Securities and Exchange Board of India (Sebi) will shortly modify some rules pertaining to inheritance of shares, based on the recommendations of the committee on ‘Transmission of Shares’, a person involved with the development told ET.

The move is likely to benefit the legal heirs awaiting inheritance of shares belonging to deceased relatives who neither made a will nor filed the mandatory nomination with depositories.

Also Read :
-Effect of Recession on Indian Economy
-Economies hit by recession
-Plan for World Economy Revival
-Indian Economic Summit Updates
-World's Strongest economies list
-Trouble in Indian Forex
-US Economic recession-how it started

The new guidelines will pave the way for quick transmission of shares, especially physical shares. Brokers said investors residing away from urban centres have been facing maximum difficulties with respect to share inheritances.

Transmission means devolution of title to shares otherwise than by transfer, for example, devolution by death, succession, inheritance, bankruptcy, marriage, etc. Transmission is different from ‘transfer’; in transmission a person acquires an interest in the property by operation of law such as right of inheritance or succession, whereas transfer is effected by an act of the parties.

According to some people tracking the committee’s work, Sebi took about 16 months to move ahead on the report despite unanimity among committee members on addressing the difficulties in transmission of physical and dematerialised securities.

“In case of physical shares, companies would have to fix a threshold limit of 200 shares or Rs 1 lakh, whichever is higher, for transmission of shares after submitting the standardised documents,” said a person on the committee. “The limit will be the basic minimum limit to be adhered to by all listed companies.

Companies would require a deed of indemnity, an affidavit and a NoC in case there are other legal heirs. Those companies that have a higher threshold can continue with that,” he said. When the title to shares is passed by an operation of law, the beneficiary need not perform additional formalities.

Companies have different documentary compliances for the legal heirs of the deceased security holder. In many cases, this is tedious and discourages investors from following up on small amounts.

Also Read :
-Effect of Recession on Indian Economy
-Economies hit by recession
-Plan for World Economy Revival
-Indian Economic Summit Updates
-World's Strongest economies list
-Trouble in Indian Forex
-US Economic recession-how it started

For instance, in case of a leading bank, a local manager submits a verification report on whether the legal heir possesses a succession certificate or the probated will. Market participants familiar with the development point to the need for updating the nomination of lakhs of investors.

posted under - SEBI, SEBI updates, indices, indian markets updates, indian share markets, indian stocks, bse updates, nse updates

SEBI increases upfront margin on warrants to 25%

The Securities and Exchange Board of India has decided to increase the upfront margin to be paid by allottees of warrants to 25 per cent from 10 per cent earlier.

The markets regulator also decided to relax the pricing norms regarding Satyam Computer, after its board examined a request for exemption of certain provisions of takeover regulation. This was done within the general context.

Also Read :
-Effect of Recession on Indian Economy
-Economies hit by recession
-Plan for World Economy Revival
-Indian Economic Summit Updates
-World's Strongest economies list
-Trouble in Indian Forex
-US Economic recession-how it started

SEBI has also shortened the timeframe for announcing the price band for an initial public offering to just two days against the present requirement of two weeks.

The timeline for announcement of bonus share issue has also been reduced to 15 days from 30 days earlier. Further, a company declaring the bonus issue would not require approval from the shareholders.

On dividend, SEBI said, listed companies will have to announce dividend on per share basis and not on percentage of face value of the share, as the face value may differ and mislead investors.

posted under - SEBI updates, BSE updates, BSE stocks, SEBI, SEBI news
source - www.economictimes.com

SEBI orders probe into Satyam market operations

Startled by the disclosure of fudging of accounts by Satyam founder B Ramalinga Raju, market regulator SEBI on Wednesday ordered probe B R Raju into share market operations and inspection of the IT company.

"SEBI has ordered an investigation into the affairs relating to buying, selling or dealing in the shares of Satyam Computers," it said in a release.

The probe follows a letter written by Raju in which he disclosed that "accounts provided to the stock exchanges were not true".

The investigation, SEBI said, will ascertain whether any provision of the Act or regulation has been violated.

As a first step, SEBI today ordered an investigation into affairs relating to buying, selling or dealing in shares of Satyam to ascertain if any regulatory provision was violated. Besides, it ordered inspection of Satyam Computer (books).

Giving details of the irregularities, Raju said the company's balance sheet as of September 30 carries "inflated (non-existent) cash and bank balances of Rs 5,040 crore (as against Rs 5,361 crore reflected in the books)."

Also Read :
-Market response after Satyam Fraud
-SEBI to probe Satyam market Operations
-Effect of Recession on Indian Economy
-Economies hit by recession
-Plan for World Economy Revival
-Indian Economic Summit Updates
-Rs v/s US$ latest updates
-World's Strongest economies list
-Trouble in Indian Forex
-Indian Agricultural Updates
-US Economic recession-how it started


It also carries "an accrued interest of Rs 376 crore which is non-existent, understated liability of Rs 1230 crore on account of funds arranged by me, overstated debtors position of Rs 490 crore (as against Rs 2651 crore in the books."

The USD 2-billion Satyam also reported a revenue of Rs 2700 crore for the September quarter and an operating margin of Rs 649 crore (24 per cent of revenue) as against the actual revenue of Rs 2112 crore and an actual operating margin of Rs 61 crore (3 per cent of revenue).

"This has resulted in artificial cash and bank balances going up Rs 588 crore in Q2 alone," Raju said, adding that the gap in the Balance Sheet has arisen purely on account of inflated profits over a period of last several years.

Satyam, meanwhile, said Board member Ram Mynampati has been appointed interim CEO. "We are obviously shocked.. immediate priorities are to protect interest of shareholders, protect the careers and security of its approximately 53,000 associates..," Satyam said in a statement.

A shocked industry called for deeper regulation. "This fraud on the investors and employees... shows a systemic breakdown in audit and board oversight... questions will need to be asked," FICCI President Rajeev Chandrasekhar said.

Also Read :
-Market response after Satyam Fraud
-SEBI to probe Satyam market Operations
-Effect of Recession on Indian Economy
-Economies hit by recession
-Plan for World Economy Revival
-Indian Economic Summit Updates
-Rs v/s US$ latest updates
-World's Strongest economies list
-Trouble in Indian Forex
-Indian Agricultural Updates
-US Economic recession-how it started


FICCI and CII, however, said the Satyam episode should not be seen as a blot on all the Indian firms.

Corporate Affairs Minister Prem Chand Gupta said stern action would be taken under the law.

posted under - Satyam Computer services, satyam updates, SEBI updates, SEBI on Satyam, Satyam india, Satyam Fraud

SEBI restricts early exit from close-ended mutual funds

The Securities and Exchange Board of India (SEBI) on Thursday said investors won't be allowed to exit from close-ended mutual fund schemes before maturity and asked fund houses to list them on stock exchanges.

The market regulator also said all such funds must invest in instruments in line with their maturity profile.

"For all close-ended schemes, no early exits will be provided by the funds," SEBI Chairman C B Bhave told a media briefing following a board meeting earlier in the day. "All schemes will have to be listed on the stock exchange," he added.

Visitor's who read this post also read:
-Speak out about Mumbai terror attacks - now
-Why US Economy crashed
-BSE,DJIA, NSE, NASDAQ Closing rates
-Best of Christmas celebrations ideas for season
-Fortune 500 Companies List

The decision comes in wake of a liquidity crisis faced by the industry two months ago as investors pulled out from fixed income funds fearing their credit quality.

More than Rs 90,000 crore flowed out of debt funds during the period, creating a liquidity crunch for the Rs 4 trillion industry and forcing the central bank to offer money through a special money market operation to ease the pressure.

The regulator also extended the validity period of initial public offers to one year from three months now.

source - www.economictimes.com

SEBI may limit FMP's realty sector investments

In an effort to discourage mutual funds high exposure to the real estate sector, capital market regulator SEBI may impose limits on fund allocation to certain sectors in fixed maturity plans (FMP). SEBI, which is undertaking a structural review of FMPs, will also address the issue of asset-liability mismatch at some of the fund houses, according to sources close to the development.

Also read:
BSE, NSE October rates
Insulate your investment from Stock turmoils- stepwise guide
Biggest and largest world economies list


An assessment of MF portfolios by SEBI shows that some funds have 15-16 % exposure to the real estate sector and nearly 5% to non-banking finance companies (NBFCs), the sources said. MFs’ exposure in realty firms and NBFCs is through pass-through certificates.

Both big and small funds have invested in these two sectors. Some fund houses, especially a few smaller ones, were hit badly when large corporate investors exited in the wake of concerns relating to the quality of paper issued by some real estate companies.

The MFs had invested in such paper on hopes of a higher yield. An early exit by large institutional investors can put fund managers in trouble as meeting redemption requirements at short notice is tough. Their only option then will be to sell part of the investment portfolio.

SEBI now wants to close this early exit option, so that FMPs can operate mainly as closed-ended schemes. So far, the regulator has not imposed any limit on the exposure mutual funds can take in a particular sector, although there are limits in terms of investment in various instruments. Fund houses invest the FMP corpus in corporate and securitised paper, certificates of deposit and commercial paper. “We are undertaking a thorough review of the FMP structure,” a top SEBI official said.


Also read:
BSE, NSE October rates
Insulate your investment from Stock turmoils- stepwise guide
Biggest and largest world economies list


The sources said SEBI has noticed a mismatch in asset-liability management (ALM) at some fund houses . Although FMPs are short-term funds, fund managers have taken long-term positions in securities (maturity of one year or more), as they get a higher interest. As FMPs are short-term funds, they are ought to be invested in short-term instruments like Tbills.

The most common FMPs vary in maturities between 3 and 13 months. There is also the likelihood of SEBI introducing a lock-in period for FMPs. As a short-term measure, trustees of some fund houses recently instructed distributors to make payment for redemptions of all fixed-income schemes only after the redemption date, but within 10 days of it.

Over the past one year, FMPs have emerged as one of the most popular products as they have scored over fixed deposits in terms of higher yields and post-tax returns. As of end-September , the corpus of FMPs stood at Rs 1,32,000 crore, accounting for nearly 25% of the Rs 5,32,000-crore assets under management of mutual funds.


Also read:
BSE, NSE October rates
Insulate your investment from Stock turmoils- stepwise guide
Biggest and largest world economies list


from Economictimes