BackEasier debt rules for large cos
As a part of the framework for large corporates, a higher monetary threshold has been specified for defining such large corporates, thereby reducing the number of entities qualifying as LCs.
PremiumMUMBAI : The board of the Securities and Exchange Board of India has made it easier for large companies to raise debt financing .
Under the capital markets regulator’s so-called large corporate (LC) framework, companies had to raise at least 25% of their incremental borrowings for a year through issuance of debt securities.
Now, Sebi has decided to increase the threshold for classifying companies as large corporates. In a consultation paper released in August, the regulator had proposed to increase the threshold of long-term outstanding borrowing to at least ₹500 crore from the current ₹100 crore.
It has also done away with the penalty which is levied if large companies are not able to raise a certain percentage of incremental borrowing from the debt market.
Further, the regulator has retained the provision which gives large companies the flexibility to comply with these rules over a contiguous block of three years.
Separately, the regulator has also approved a proposal to change several regulations that will make it easier to transfer unclaimed amounts of investors in listed entities (other than companies, REITS and InvITs) to its Investor Protection and Education Fund (IPEF). It has also prescribed a uniform process for investors to claim for such amounts in a streamlined manner.
Sebi also extended the timeline for Investment Advisers and their key personnel to comply with its enhanced qualification and experience requirements by two years to 30 September 2025.
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