Latest news with #SecuritiesandExchangeBoardofIndia
Economic Times
9 hours ago
- Business
- Economic Times
Sebi proposes 5-point AI rulebook for securities market. Check details
Securities and Exchange Board of India (Sebi) is considering preparing guidelines for the responsible usage of Artificial Intelligence or Machine Learning in securities markets. The market regulator on Friday released a consultation paper seeking public feedback on five broad-based guiding principles that could be part of the regulatory framework. ADVERTISEMENT With AI/ML use growing across exchanges, brokers, and mutual funds, Sebi aims to strike a balance between innovation and regulation. The proposed framework covers governance, data security, bias prevention, investor protection, and risk controls. The last date to send comments/suggestions is July 11. Earlier, Sebi constituted a working group to study Indian, global best practices in AI/ML, mandating it to prepare guidelines for the usage of AI/ML applications. The working group was also tasked with providing recommendations to address concerns and issues related to the use of AI/ML applications. Also Read: Sebi eases delisting norms for PSUs with over 90% government holding Market participants must set up internal teams with the technical expertise to monitor AI/ML models, document model development, and handle exceptions. Senior management will be held accountable for the entire AI lifecycle, including oversight of third-party vendors. ADVERTISEMENT If AI/ML tools directly impact investors—like in algo trading or advisory services—firms must clearly disclose their use, including model purpose, risks, accuracy, and limitations. Language must be simple and proposes rigorous model testing in simulated environments before live deployment, and ongoing monitoring thereafter. Firms must retain data logs and documentation for a minimum of five years to ensure explainability and traceability. ADVERTISEMENT To prevent discrimination, Sebi suggests using diverse, high-quality datasets and training staff to identify bias. Companies must follow strong data governance, privacy, and cybersecurity protocols. ADVERTISEMENT Also Read: Sebi board meeting: Regulator approves PSU delisting, IPO reforms, dematerialisation of Securities. 10 key takeawaysSebi has suggested a lighter regulatory approach for internal-use models (e.g., surveillance), while models affecting clients would face stricter controls. (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times) ADVERTISEMENT (You can now subscribe to our ETMarkets WhatsApp channel)
Time of India
9 hours ago
- Business
- Time of India
Sebi proposes 5-point AI rulebook for securities market. Check details
Sebi has released a consultation paper proposing a 5-point regulatory framework for the responsible use of AI and ML in India's securities markets. The guidelines focus on governance, transparency, fairness, data security, and risk controls, aiming to balance innovation with investor protection. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Here are 5 guiding principles: 1) Model governance 2) Mandatory disclosure 3) Robust testing & monitoring norms 4) Fairness and bias 5) Data security Securities and Exchange Board of India (Sebi) is considering preparing guidelines for the responsible usage of Artificial Intelligence or Machine Learning in securities markets. The market regulator on Friday released a consultation paper seeking public feedback on five broad-based guiding principles that could be part of the regulatory AI/ML use growing across exchanges, brokers, and mutual funds, Sebi aims to strike a balance between innovation and regulation. The proposed framework covers governance, data security, bias prevention, investor protection, and risk last date to send comments/suggestions is July Sebi constituted a working group to study Indian, global best practices in AI/ML, mandating it to prepare guidelines for the usage of AI/ML applications. The working group was also tasked with providing recommendations to address concerns and issues related to the use of AI/ML Read: Sebi eases delisting norms for PSUs with over 90% government holding Market participants must set up internal teams with the technical expertise to monitor AI/ML models, document model development, and handle exceptions. Senior management will be held accountable for the entire AI lifecycle, including oversight of third-party AI/ML tools directly impact investors—like in algo trading or advisory services—firms must clearly disclose their use, including model purpose, risks, accuracy, and limitations. Language must be simple and proposes rigorous model testing in simulated environments before live deployment, and ongoing monitoring thereafter. Firms must retain data logs and documentation for a minimum of five years to ensure explainability and prevent discrimination, Sebi suggests using diverse, high-quality datasets and training staff to identify must follow strong data governance, privacy, and cybersecurity Read: Sebi board meeting: Regulator approves PSU delisting, IPO reforms, dematerialisation of Securities. 10 key takeaways Sebi has suggested a lighter regulatory approach for internal-use models (e.g., surveillance), while models affecting clients would face stricter controls.
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Business Standard
a day ago
- Business
- Business Standard
'Much-needed relief': Startups on Sebi reforms relaxing ESOP norms
The ease in norms from the Securities and Exchange Board of India (Sebi) comes at a time when multiple Indian startups such as PhonePe, Zepto, Pine Labs Udisha Srivastav Peerzada Abrar Ajinkya Kawale New Delhi/Bengaluru/Mumbai Startups are hailing SEBI's latest reforms as a much-needed relief, calling them a timely move that removes key hurdles in the IPO journey. The easing of stock holding norms for founders and simplification of rules for existing investors to participate in offer-for-sale (OFS) components are expected to boost listing plans for new-age companies. The ease in norms from the Securities and Exchange Board of India (Sebi) comes at a time when multiple Indian startups such as PhonePe, Zepto, Pine Labs, among others are targeting to go public soon. Over 30 startups, with a cumulative value of $100 billion may go public in the next two years, a report by The Rainmaker Group shows. Harshil Mathur, CEO and co-founder of fintech giant Razorpay, said 'SEBI's move marks a defining moment for India's startup ecosystem. By empowering founders to stay invested and easing the road back home, this step fuels a future where the best Indian companies are built, scaled, and celebrated right here. It's not just a policy tweak, it's a signal that India is ready to be the world's innovation hub,' said Mathur. The markets regulator's proposal allows founders to retain share-based benefits such as employee stock ownership plan (ESOP) at the time of filing their draft red herring prospectus (DRHP), on the condition that these benefits are granted one year prior to filing the document. "This move brings more flexibility and fairness to how founders stay invested. It also reduces the friction for good companies to go public," said Vikram Chopra, founder and chief executive officer (CEO) of auto-tech platform CARS24. 'It's also a change many in the ecosystem, including us at CARS24 have been requesting for a while. The capital markets benefit when the people building businesses remain motivated to stay the course. This is a step in the right direction,' said Chopra. Bankers explained that the market regulator usually insists on categorising founders as promoters as they have a controlling say in the management. Earlier, traditional promoters and founders of startups, were barred from holding share-based benefits since there was no distinction between the two. However, startup cap-tables go through rounds of dilution during fundraise with founders dependent on ESOPs. Startup founders explained that the new norms may enable healthier exits for early teams and founders. "SEBI's ESOP reforms are a much-needed recognition of the long-term skin in the game that founders bring to the table. By allowing founders to retain ESOPs granted before the IPO, the move removes a structural bias that discouraged listings and limited wealth creation," said Abhiroop Medhekar, co-founder and CEO, of Velocity, an e-commerce enablement platform. 'This positive reform comes as a big relief to founders of new-age companies as it will enable them to avail skin-in-the-game benefits and align their interests with other shareholders,' said industry body Startup Policy Forum (SPF) It streamlines how accredited investors, already participants in AIFs, can co-invest in high-conviction opportunities alongside fund managers, aligns India with global norms, and removes longstanding friction around such structures. "This will further increase the flow of private, especially domestic capital, to entrepreneurial and growth businesses. By limiting CIVs to accredited investors, SEBI has also signaled a shift toward more principle-based, lighter-touch regulation for qualified participants," said Gopal Srinivasan, Chairman and Managing Director of TVS Capital Funds and Senior Board Member, Indian Venture and Alternate Capital Association (IVCA). Executives added that the move will enable investors to participate in funds with ease. "We often have sophisticated investors who want the option of co-investing but struggle for lack of appropriate structures to do so; especially global institutional investors and family offices. With this change, within the same scheme one is able to offer co-investments to such investors and therefore makes the proposition far more attractive and tenable. This will certainly help us bring on some marquee investors into the fund," Abhishek Prasad, managing partner at Cornerstone Ventures said.
The Print
a day ago
- Business
- The Print
Sebi announces measures for PSU delisting, relaxes ESOP norms for startup founders
With foreign portfolio investors' interest in government securities growing amid India's inclusion in global bond indices, the Securities and Exchange Board of India (Sebi) decided to simplify regulatory compliance for govt bonds-focused FPIs. The board, which met at the capital markets regulator's headquarters here, also decided to allow startup founders to retain employee stock options (ESOPs) granted at least one year prior to the filing of preliminary IPO papers. Mumbai, Jun 18 (PTI) The Sebi board on Wednesday approved a slew of proposals on the ease of doing business for market participants and measures for voluntary delisting for select state-owned companies. The Sebi board also decided to come out with a settlement scheme for certain stock brokers who traded on the National Spot Exchange (NSEL) platform against whom enforcement actions have been started, which includes clarity on both monetary and non-monetary terms of settlement. This was the second board meeting chaired by Tuhin Kanta Pandey since assuming charge as the head of the capital markets regulator earlier this year. In comments that come amid the largest equity bourse NSE's initial public offering (IPO) plans, Pandey also said that the regulator does not have any problem with the current structure of a clearing corporation being a subsidiary of an exchange. However, he said that the charges levied to an investor for executing trades cannot be a 'black box' and made it clear that the Sebi favours unbundling on this front. The issue of majority ownership in its clearing arm being a hindrance for the NSE IPO is a 'speculation' and not a proposal or an ask from the regulator, Pandey said. At its board meeting, the Sebi also decided to allow category I and II alternate investment funds to offer co-investment opportunities within the AIF structures and a proposal to make angel investors into 'Accredited Investors', which will allow them greater flexibility, as the measures to protect smaller investors will not be applicable for them. A majority of the 19 proposals cleared in the board meeting are related to ease of doing business for the market ecosystem, including in the social stock exchange front, for merchant bankers, and the real estate investment trusts and infrastructure investment trusts. Pandey said entities have raised Rs 20 crore from 20 issuances till now, and the measures announced on Wednesday, including broadening the number of entities, which can do a not-for-profit organisation will help them raise more funds. On the PSU delisting front, the measures adopted by the Sebi board include relaxations from the requirement of the two-third threshold for approving delisting by public shareholders and in the mode of computation of floor price. Under current rules, delisting is successful if promoter shareholding reaches 90 per cent. Moreover, the floor price for delisting is calculated using several pricing metrics such as the 60-day average price and the highest price in the last 26 weeks. Pandey said excluding banking, financial services and insurance sectors, there are five entities, where the state owns 90 per cent or more stake, which stand to benefit from the decisions of the board, and explained that challenges have been faced since the past because of financial performance of entities. Sebi's announcement on the ESOP front is being considered as a major relief to startup founders looking to go public, as they will be able to retain employee stock options (ESOPs) granted at least one year prior to the filing of preliminary IPO papers. Under the existing regulations, promoters are ineligible to hold or be granted share-based benefits, including ESOPs. If they hold such share-based benefits at the time of filing of draft red herring prospectus (DRHP), they have been required to liquidate such benefits prior to the IPO. This provision has been found to be impacting founders classified as promoters at the time of filing of DRHP, Sebi noted. Pandey said the board approved a proposal to 'facilitate founders who received such benefits at least one year prior to the filing of DRHP with the board, to continue holding, and/or exercising such benefits even after being specified as the promoter/s and the company becoming a listed entity'. These proposals are expected to assist public companies who intend to list after undertaking reverse flipping — shifting the country of incorporation from a foreign jurisdiction to India. On the FPI's G-Sec ownership front, Pandey said Sebi has decided to simplify rules and ease regulatory compliance for Foreign Portfolio Investors (FPIs) that invest exclusively in Indian government securities (G-Secs) with the aim to attract more long-term bond investors to India. Currently, foreign investors invest in Indian debt through three routes — General, Voluntary Retention Route (VRR) and the Fully Accessible Route (FAR). VRR and FAR allow investments without many restrictions, such as security or concentration limits. 'With an objective to enhance ease of doing business through a risk-based approach and optimum regulation, the board approved the proposal to relax certain regulatory requirements for all existing and prospective FPIs that exclusively invest in G-Secs. These measures are expected to further help in facilitating investments by FPIs in G-Secs,' Sebi said in a statement after the conclusion of the board meeting. Under the approved relaxations for FPIs investing in G-Secs, the periodicity of mandatory KYC review for such FPIs will be harmonised with the RBI's requirements. Accordingly, such foreign investors will have less frequent mandatory KYC reviews. It also approved a proposal for the use of liquid mutual funds and overnight funds for compliance with deposit requirement mandates for investment advisors and research analysts, in addition to bank fixed deposits for the purpose of compliance. PTI AA BAL BAL This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.
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Business Standard
a day ago
- Business
- Business Standard
Capillary Technologies India files DRHP with Sebi, aims to raise ₹430 crore
Upcoming IPO: Capillary Technologies India, an AI-based cloud-native Software-as-a-Service (SaaS) products and solutions company, has filed its Draft Red Herring Prospectus (DRHP) with the markets regulator, the Securities and Exchange Board of India (SEBI) for its maiden public issue. The Bengaluru-based tech company' IPO, with a face value of ₹2 per equity share consists of a fresh issue of equity shares aggregating to ₹430 crore, and an offer for sale (OFS) of 18.33 million equity shares by existing shareholders. Capillary Technologies India IPO details Capillary Technologies International, the promoter of the company, will offload up to 1.4 million equity shares in the offer for sale. Investors selling shares include Ronal Holdings, Trudy Holdings, Filter Capital India Fund I, Sripathi Venkata Ramana Reddy, Harminder Sahni, Adarsh Reddy B, Sudhakar Reddy Katanguri, Sripathi Damodar Reddy, and Manjunath Nanjaiah. According to the DRHP, the company intends to use the net fresh issue proceeds worth ₹120 crore for funding its cloud infrastructure cost, ₹151.54 crore for investment in research, designing and development of its products and platform, ₹10.32 crore for investment in purchase of computer systems for its business, funding inorganic growth through unidentified acquisitions and general corporate purposes. MUFG Intime India, formerly Link Intime is the registrar of the issue. JM Financial, IIFL Capital Services, and Nomura Financial Advisory and Securities (India) are the book-running lead managers. About Capillary Technologies India Capillary Technologies India is a software product company. It offers artificial intelligence (AI) based cloud-native Software-as-a-Service (SaaS) products and solutions to enterprise customers. The Bengaluru-based company is among one of the few players in the loyalty management space that offer end-to-end loyalty solutions, including an advanced loyalty management platform (Loyalty+), connected engagement platform (Engage+), predictive analytics platform (Insights+), rewards management platform (Rewards+) and customer data platform (CDP) for its customers. As of March 31, 2025, Capillary had 13 offices including in key markets of India, United States, United Kingdom, United Arab Emirates, Singapore, Indonesia, Vietnam and Malaysia, and provided services in 46 countries. In the financial year 2024-25 (FY25), Capillary Technologies India reported a total income of ₹481.1 crore, up 19.6 per cent from ₹402.1 crore in the previous fiscal. Its profit after tax (PAT) stood at ₹13.2 crore in FY25 against a loss of ₹59.8 crore in FY24. Its earnings before interest, tax, depreciation and exceptional items (Ebitda) came in at ₹78.5 crore FY25.
