Summary
India’s market regulator, the Securities and Exchange Board of India (SEBI), announced a review of its delisting rules and other market measures intended to make capital markets easier to use for a range of participants. The regulator highlighted recent reforms it has implemented and outlined areas of further review, including delisting mechanisms, KYC for non-resident Indians and startup access to long-term capital via the Innovators Growth Platform.
At a summit, SEBI chairman Tuhin Kanta Pandey said a mature capital market must allow both fair entry and fair exit for participants. Pandey described the forthcoming review of the delisting framework as part of a broader effort to reduce friction in capital markets.
The regulator has undertaken a series of reforms in recent years aimed at improving market efficiency and investor appeal. Among these are faster trade settlement cycles and simplified registration procedures for foreign investors, moves SEBI characterizes as steps to attract and accommodate broader participation in India’s financial markets.
In 2024, SEBI introduced a fixed-price delisting route that lets companies offer shareholders a predetermined exit price. That fixed-price option serves as an alternative to the reverse book-building method, where the exit price is discovered through investor bids. In addition, SEBI approved a voluntary delisting framework last year targeting public sector companies with controlling shareholders owning more than 90%, enabling a structured exit path for such entities.
Pandey also said SEBI will coordinate with other authorities to simplify know-your-customer (KYC) requirements for non-resident Indians, indicating regulatory collaboration to remove administrative barriers for a specific investor group.
Separately, SEBI is reviewing the rules governing the Innovators Growth Platform, a venue intended to help startups access markets and raise long-term capital. The review aims to refine how startups can use that platform to tap public-market resources over an extended time horizon.
The statements reflect SEBI’s stated focus on streamlining capital-market processes across participant types - retail and institutional investors, foreign registrants, public-sector firms and startups - while keeping the emphasis on clear entry and exit mechanisms.
Context limitations
The regulator described these intentions at the summit but did not provide detailed timelines or specific amendments in its public remarks. Where SEBI indicated coordination with other authorities, the precise scope and sequencing of those efforts were not specified.