SEBI Outlines Plans for Simpler Fundraising and Lower Compliance Costs

The Securities and Exchange Board of India (SEBI) is working to make India’s capital markets more accessible, efficient, and resilient. Speaking at an event organized by the Bharat Chamber of Commerce to mark its 125th anniversary and launch the Bharat Chamber Investors’ Forum, SEBI Chairman Tuhin Kanta Pandey stated that the regulator's focus is on simplifying fundraising processes, reducing compliance burdens, and strengthening investor protection.

Pandey noted that building world-class capital markets requires going beyond higher market capitalization and trading volumes, emphasizing the fundamental need to connect household savings with productive investments. He stated that good businesses should be able to access suitable forms of capital through efficient and transparent processes, highlighting steps taken by the regulator to facilitate capital formation and improve the ease of doing business.

Detailing the regulatory adjustments, Pandey shared that SEBI has streamlined initial public offering (IPO) processes, shortened timelines for rights issues, and rationalized listing requirements for large issuers. Additionally, the regulator has allowed founders, subject to prescribed conditions, to retain certain employee stock options after listing.

In the debt market segment, SEBI has reduced listing timelines for public issues, enabled debt securities with lower face values, and relaxed mandatory merchant banking requirements for certain eligible issuers undertaking private placements. Pandey explained that these measures are intended to reduce issuance costs while maintaining appropriate safeguards, adding that SEBI is reviewing regulatory processes to ensure compliance remains proportionate and risk-based without compromising governance or market integrity.

Providing an overview of market growth, Pandey reported that market capitalization has grown at an annual rate of about 17 percent over the past decade, while mutual fund assets have expanded by approximately 20 percent annually. Furthermore, the number of unique investors in the securities market has increased fourfold since fiscal year 2019, crossing 15 crore.

Data shared during the address showed that companies raised over Rs 98,000 crore through 189 initial public offerings in the first half of the current financial year. Meanwhile, outstanding corporate bonds stood at approximately Rs 61 lakh crore. Highlighting regional participation, Pandey pointed out that the number of securities market investors from West Bengal has risen to over 90 lakh from around 12 lakh in fiscal year 2015, with about 36 percent of these investors below 30 years of age.

Concluding his remarks, Pandey emphasized that increasing reliance on technology makes cybersecurity, operational resilience, surveillance, and risk management critical areas of focus, asserting that world-class markets must remain resilient during periods of stress.

"SEBI's ongoing initiatives to streamline fundraising, lower compliance costs, and rationalise listing requirements are positive steps for the broader business ecosystem. For growing enterprises and upcoming ventures looking to access public capital, reduced compliance burdens and faster timelines will significantly lower entry barriers. At the same time, maintaining robust risk management and cybersecurity standards ensures that market integrity is preserved as retail participation and digital adoption continue to expand." — Dr. Shishir Gupta, Founder & CEO, StartupLanes