“That (LODR) is a big ordinance, and the process has begun,” Pandey said. “We will have a lot of consultation and put out a consultation paper, and that will take some time.”The Sebi chief said the intention of the revamp is not to increase the size of the rulebook but to make it more effective.
“Our agenda is not about adding more rules. It’s about shaping a smarter rulebook. One that is easier to understand, proportionate to the risks it seeks to address, and that supports innovation,” he said.
Besides the LODR renewal, Sebi is also preparing a revision of the settlement rules and a consultation paper is expected soon. According to Pandey, a broader effort is underway to review multiple regulations, including norms for stockbrokers, MFs and settlements. “A comprehensive review of Sebi’s regulations is underway after due public consultations, an exercise aimed at removing redundancy, removing ambiguity and updating outdated structures,” Pandey said. Sebi is also working on a closing mechanism for the equity markets and is close to enabling this framework after extensive discussions with stakeholders. This mechanism is expected to improve price discovery in the final minutes of trading and reduce the sharp swings often seen at market close. Stock exchanges have backed the move, arguing that India needs to align its market structure with global standards, where such auctions are the norm.
On the much-awaited approval for the NSE IPO, Pandey maintained that no final confirmation can be given until the no-objection certificate is formally issued.
He emphasized the need for a broad IPO ecosystem that allows for both investor exits and capital raising.
“An IPO allows for both exit and fundraising. It depends on the specific IPO. Many companies are already well established by the time they enter the market. As they mature, it is natural that some investors will choose to exit as a premium has already been created,” Pandey said on the sidelines of the event.
At the same time, Sebi is working on simplifying fundraising processes. Last week it published a consultation paper proposing a framework to facilitate fundraising for IPO-bound companies whose pre-IPO shares have been pledged. The aim is to ensure that the lock-in rules are automatically enforced even if the pledge is invoked or released, thus avoiding listing delays.
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