India’s capital markets regulator proposed easier disclosure obligations for issuers of listed non-convertible securities, including debentures and hybrid instruments, as it seeks to reduce compliance costs and align domestic norms with global standards.
The amendments proposed on Friday would eliminate the requirement for listed entities to dispatch hard copies of annual report summaries to debenture holders who have not registered their email addresses—a legacy obligation that has persisted even as equity market rules have moved decisively online.
In its place, the Securities and Exchange Board of India (Sebi) suggests that issuers send only a letter containing a web link and a quick-response (QR) code, allowing bondholders to access the full annual report digitally. The regulator said this would “minimize the usage of paper and facilitate ‘Go green’ and sustainability initiatives of a listed entity.”
The draft also clarifies timelines: for firms under the Companies Act, 2013, existing statutory deadlines will continue to apply, while for all other issuers—including statutory bodies and trusts—a minimum 21-day notice period is proposed, “in line with the provisions of the Companies Act, 2013, for the sake of parity”.
The consultation paper invites public comments until 15 August.
Experts back modernization efforts
Sebi’s latest move is part of a broader push to bring Indian markets into the 21st century, said Akshaya Bhansali, managing partner at Mindspright Legal. “Sebi’s July 2025 consultation paper is an important regulatory milestone aimed at modernizing India’s disclosure system and easing corporate compliance.”
“The proposal to require dematerialization of securities for corporate actions like splits, consolidations, and schemes of arrangement is a progressive step that aligns with global best practices and improves investor protection. By eliminating outdated provisions such as physical share transfers and proof-of-delivery requirements, Sebi is signalling a shift toward digital-first governance,” Bhansali said.
Bhansali added that these changes not only improve operational efficiency for listed entities but also reduce the risk of fraud and error. “The emphasis on electronic payments and streamlined disclosures reflects Sebi’s commitment to ease of doing business while maintaining robust market integrity.”
She suggested that by requiring digital delivery and standardizing disclosure timelines, Sebi is making it easier for both domestic and international investors to assess and compare Indian debt securities.
Boost to India’s bond markets
Ketan Mukhija, senior partner at Burgeon Law, noted the acute compliance burden faced by leveraged entities and large debt issuers.
“If this paper is adopted, governance norms for debt and hybrid securities will be reduced, which is positive as it could stimulate more activity in India’s debt market,” he said. “Because debt market activity is not that active in India. There is a lot of equity. So, I think it will definitely induce that business-friendly environment in terms of greater activity in the debt market.”
Mukhija pointed to the significance of harmonizing disclosure and materiality event rules across asset classes. “The disclosure requirements, materiality event—they have come at par with the equity kind of listed companies,” he said. “For equity, you have to give disclosures in XBRL, you have this timeline, this format, this way. It has become the same for debt. That’s a very good point of uniformity. The more clarity and simplicity there is, the more investor confidence there is.”
“The activity of the debt market will definitely increase,” Mukhija said, adding the proposals would resonate with both domestic and foreign institutional investors, who have long sought clarity and simplicity in Indian debt market regulations.
Sebi’s paper highlights that issuer financials are already available in the public domain—on company and stock exchange websites—and that further digitalization will only enhance transparency. “It is also pertinent to note that the financials of the issuer are already in public domain viz. website of the issuer and the stock exchanges where the securities are listed.”
The regulator also points to previous public feedback, which cited “relaxation from sending a physical copy of financials will lead to saving of cost and prevent wastage of paper,” and that this “would lead to regulatory consistency and ease of doing business.”
The current proposals build on temporary relaxations introduced during the Covid-19 pandemic, when Sebi and the ministry of corporate affairs allowed virtual meetings and digital dispatch of financial documents. Those measures were extended repeatedly, most recently through September 2025.
Sebi’s expert committee has now recommended making them permanent, arguing that digital communication should be the default for all listed entities.
