The Securities and Exchange Board of India’s (Sebi) board is set to meet later today, September 12 to consider a host of regulatory reforms. According to reports, the agenda is likely to include easing initial public offering (IPO) norms for large companies and extending deadlines for firms to meet minimum public shareholding norms.
The board is also likely to discuss relaxations for foreign portfolio investors (FPI) and accredited investors in alternative investment funds (Aifs), a wider role for rating agencies, and granting equity-like status to real estate investment trusts (REITs) and infrastructure investment trusts (InvITs). This will be the third board meeting chaired by Tuhin Kanta Pandey since he took charge as Sebi Chairman on March 1 this year.
Sebi Board Meeting: Key Agendas
Easing IPO Norms
The market regulator is likely to consider easing IPO norms for companies with very large market capitalisations, which would allow them more flexibility on minimum offer size and longer timelines to meet public shareholding norms. For this, the regulator also floated a consultation paper on July 31, 2025.
As per the consultation paper, for companies with post-issue capital between Rs 50,000 crore and Rs 1 lakh crore, the minimum public offer would be Rs 5,000 crore or at least 8 per cent of securities. Firms with post-issue capital between Rs 1 lakh crore and Rs 5 lakh crore would need to offer Rs 6,250 crore or 2.75 per cent of securities.
For the largest companies, with post-issue capital above Rs 5 lakh crore, the minimum offer would be Rs 15,000 crore or 1 per cent of securities, subject to a floor ensuring at least 2.5 per cent of shares are sold to the public.
Anchor Quota For Domestic Institutions
Sebi’s board is also expected to deliberate upon a proposal to create a dedicated quota in IPO anchor books for domestic insurers and pension funds, similar to the existing quota for mutual funds. According to the July 31 consultation paper, the aim is to bring more long-term institutional investors into large public offerings and create a stable ownership base at the time of listing.
Currently, mutual funds get at least one-third of the anchor book. Extending a similar share to insurers and pension funds would broaden the pool of long-term investors. Sebi, in its consultation paper, argued that this move could help reduce volatility in large offerings, encourage wider domestic institutional participation, and strengthen confidence in primary market issuances.
SWAGAT-FI To Facilitate FPI Entry
Sebi is expected to introduce a new framework called “Single Window Automatic and Generalised Access for Trusted Foreign Investors” (SWAGAT-FI). This new framework aims to make it easier for the highly-regulated foreign portfolio investors (FPIs) such as sovereign wealth funds, central banks, and pension funds to gain access to Indian markets. For this, Sebi floated a consultation paper on August 8.
Under the scheme, as discussed in the consultation paper, FPIs would get faster, automated access to equities, debt, and alternative investment funds, by minimising paperwork and registration delays. Sebi expects the framework to boost long-term foreign investment into India while simplifying compliance for large, low-risk institutional investors.
New Method To Determine Closing Prices For Stocks
The board is likely to discuss the introduction of a new system to derive the closing prices of stocks. The new system, called Closing Auction Session (CAS), is globally practised and is considered more “stable” and "less volatile” according to the regulator. Currently, the exchanges in India follow the Volume Weighted Average Price (VWAP) system to arrive at closing price.
“Data and research suggest that CAS provides a more stable and less volatile closing price compared to the volatility often observed under a Volume Weighted Average Price (VWAP) based closing price methodology, even when handling the same level of trading volumes,” Sebi said in its consultation paper dated August 22.
Equity-Like Status For REITs, InvITs
In a consultation paper dated April 17, Sebi sought public feedback whether REITs and InvITs should be classified as equity for mutual fund investment purposes. Currently, these investment vehicles are treated as hybrid instruments.
The consultation paper also highlighted that in some countries, REITs and InvITs are treated as equity and included in global indices. India-based REITs are already featured in indices like MSCI India Small Cap and FTSE India Index.
