Adani-Hindenburg impact: Sebi releases consultation paper for FPI

Adani-Hindenburg impact:

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Sebi on Wednesday released consultation paper, seeking enhanced transparency measures for foreign portfolio investors (FPIs).

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Here are the key highlights from the paper

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FPIs with a Rs 25,000 crore equity holding in India must make additional disclosures.

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FPIs with more than 50% of equity AUM in a single group will have to make additional disclosures.

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FPIs with group exposure below 25% of AUM won't need to make additional disclosures.

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FPIs breaching additional disclosure norms will be required to wind down within 6 months.

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FPIs with Indian equity holding of over ₹25,000 Cr need to make additional disclosures.

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Additional disclosure needs data of ownership, economic interest, or control rights

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Some FPIs been observed to have a major portion of holdings in a single company/group

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In some cases, concentrated holdings been near static and maintained for a long time.

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Possibility of promoters of such groups using FPI route to circumvent regulatory norms.

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Concentrated FPI holding may increase the risk of price manipulation.

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